Vetting of GTH project defended
Province failed to consult municipalities on track record of Brightenview
The provincial government threw its support behind Brightenview Development International Inc.’s latest plan to build a wholesale megamall in the province without consulting municipalities where the controversial company’s proposed multimillion-dollar projects have failed to materialize.
Economy Minister Jeremy Harrison last month praised the Saskatoon-based company’s plan to build a $45-million “Global Trade and Exhibition Centre” on 30 acres it bought from the Global Transportation Hub (GTH) west of Regina for $7.6 million, calling the proposed six-building complex “a very positive project for the city of Regina, for the entire province.”
The government insists the GTH’s due diligence process included “research on publicly available sources or industry resources for company performance, supply chain, image and regulation,” but representatives of the Rural Municipality of Dundurn and the municipality of Chatham-Kent, Ont., say they were never asked to weigh in on the company’s past.
“They didn’t contact us,” said Trevor Reid, who was elected reeve of the RM of Dundurn in 2015, three years after Brightenview unveiled plans to build a sprawling “International Exhibition Centre” on land it bought in the municipality south of Saskatoon. The company has not done any work on the project since, leading Reid to say it is “dead in the water.”
Last month, around the time it broke ground at the GTH, Brightenview scrubbed all mention of the Dundurn complex from its website. The company’s CEO, Joe Zhou, told the Saskatoon Star-Phoenix at the time that there was no firm timeline for the project, which had previously had several construction start dates, and a Dundurn-specific website was under development.
Reid, meanwhile, said that while he is ambivalent about whether the project — which Brightenview has said will house 350 shops belonging to Asian investors and create around 1,000 jobs — ever goes ahead, he has no plans to contact the provincial government to express his views about the company.
“(The government) wants to move land down there and, quite frankly, if they have a sale, they’re just looking at the dollars, right?” Reid said. “They’re not looking at the long-term problem that is potentially going to be caused.”
In 2014, Brightenview announced plans to build a $45 million “Global Development Centre” in Chatham-Kent, across Lake St. Clair from Detroit.
Last year, however, Brightenview’s extended deadline to buy a 33-acre industrial park for $804,000 expired and some of the land earmarked for the company was sold to another firm.
At that point, a local councillor told the Saskatoon Star-Phoenix last November, the project was “dead in pretty much everybody’s eyes.”
Mike Burton, Chatham-Kent’s director of investment attraction and government relations, said this week that he does not believe the Saskatchewan government contacted the municipality to inquire about Brightenview, its ambitious proposal to bring millions of dollars of foreign investment to the municipality or its ultimate failure to buy the land.
“I know the mayor hasn’t been (contacted), and I haven’t been,” Burton said, noting that the municipality’s relationship with the company has “cooled quite a bit over time.” He added: “We have no relationship with them now and we’re not pursuing any investment with them.”
The provincial government declined multiple requests for an interview.
In a prepared statement, government spokesman James Parker said the GTH’s due diligence process is the same for all projects and includes research into prospective clients to ensure their businesses meet its permitted uses and that they are in “good corporate standing.”
The process also includes interviews with any potential buyer’s managers, an examination of its financial ability to acquire land and complete development and research into both public and industry-specific sources of information on the company’s performance, Parker said in the statement.
The GTH has been working with Brightenview since 2013, and was “aware of and understood” the “delays” with its projects in the RM of Dundurn and Chatham-Kent, GTH CEO Bryan Richards said in an interview. Asked why the municipalities were not consulted, Richards said the GTH relied on its board of directors and Brightenview to evaluate public information.
“We consulted widely,” he said. Rhonda Ekstrom, the GTH’s vice-president of business development, said there was “no need” to consult with representatives of the RM of Dundurn or Chatham-Kent because “the information that we needed in order to complete our due diligence was available.”
In a statement provided late Thursday, Zhou said Brightenview cooperated fully and provided all of the information requested by the GTH.
The GTH has been mired in controversy over a series of land sales in 2013 and 2014 that left two businessmen with ties to the Sask. Party millions of dollars richer. On Wednesday, one year after provincial auditor Judy Ferguson concluded that taxpayers were charged too much for the land, the Saskatchewan NDP renewed its call for clarity on the issue.
Saskatchewan privacy commissioner recommended last fall, after an appeal was filed following a denied access to information request, that the government release emails related to the GTH land deals. So far, 72 of the 240 emails identified have been released. The privacy commissioner’s report, however, is only a recommendation which can be followed or ignored.
Opposition GTH critic Cathy Sproule said the government’s decision to back Brightenview’s project at the GTH — the first phase of which the company has said will be completed by February — was likely an attempt to make the Crown corporation viable as a business and “get the GTH on the right side of the news.”
“It looks really good on paper,” she said of the project, “but I think due diligence might have been prudent.”