Public Report To: From: Report Number: Development Services Committee Paul D. Ralph, BES, RPP, MCIP, Commissioner, Development Services Department DS-17-47 Date of Report: February 23, 2017 Date of Meeting: February 27, 2017 Subject: File: Request to Remove Requirement for a Full Service Restaurant, Abdul Rehman on behalf of Chayell Hospitality Group Inc., 67 Simcoe Street North B-1200-0032 1.0 Purpose The purpose of this report is to provide a recommendation on a request by Chayell Hospitality Group Inc. to amend an agreement with the City by removing the requirement that the Holiday Inn Express hotel and conference centre development at 67 Simcoe Street North include a full service restaurant within the hotel building. On January 16, 2017 the Development Services Committee referred the request from Mr. Abdul Rehman on behalf of Chayell Hospitality Group Inc. to staff for a report. Attachment 1 is a map showing the location of 67 Simcoe Street North and the zoning for the area. Attachment 2 is a letter from Abdul Rehman on behalf of Chayell Hospitality Group Inc. dated January 3, 2017. Attachment 3 is a list of restaurants that were contacted by Mr. Rehman and the real estate agent for Mr. Abdul Rehman. 2.0 Recommendation That the Development Services Committee recommend to City Council: 1. That, pursuant to Report DS-17-47 dated February 23, 2017, Chayell Hospitality Group Inc. s request to amend the agreement with the City by removing the requirement that the site at 67 Simcoe Street North include a full service restaurant as part of the hotel development be approved. 57
Report to Development Services Committee Meeting Date: February 27, 2017 Page 2 2. That the Mayor and Clerk be authorized to execute any documentation and agreement to give effect to the foregoing in a form and content satisfactory to the Commissioner of Development Services and the City Solicitor. 3.0 Executive Summary Not applicable. 4.0 Input From Other Sources The following have been consulted in the preparation of this report: City Solicitor 5.0 Analysis In November 2012 the City entered into a Purchase and Sale Agreement (P.S.A.) with Mr. Abdul Rehman to sell City-owned lands for the development of a hotel and conference centre at 67 Simcoe Street North. The P.S.A. requires Mr. Rehman to construct and operate a Hotel Development. The P.S.A. defines a Hotel Development as a hotel containing a minimum of 120 guest rooms, a conference facility of 8,000 to 10,000 square feet, a full service restaurant, a swimming pool and exercise facility, and a minimum of 150 parking spaces on the subject site. On February 27, 2013 City Council approved an Increased Assessment Grant for this development. This grant program reimburses Mr. Rehman a portion of the City taxes attributable to the redevelopment of the property. The Increased Assessment Grant only commences upon completion of the Hotel Development which, as defined, includes a full service restaurant. A full service restaurant is a restaurant that includes waiters/waitresses, sit-down service and a full menu, where food is prepared for customers for immediate consumption in nondisposable containers. In the Spring of 2016 the hotel opened as a Holiday Inn Express with 125 guest rooms, a swimming pool and exercise facility and 150 parking spaces. The hotel building includes a 517 square metre (5,565 sq. ft.) vacant space on the ground floor for a future full service restaurant. The conference centre building has been constructed with the interior improvements yet to be completed. Mr. Rehman has advised that he has been marketing the restaurant space to potential full service restaurant tenants with the help of Coldwell Banker Commercial, a real estate brokerage, for a considerable period of time. According to Mr. Rehman and Coldwell Banker, they have pursued a list of potential tenants without success (see Attachment 3). According to Coldwell Banker, the restaurant companies either had no interest in expansion in Oshawa or Durham Region at this time, were not interested in a central location, or the location is too close to another existing franchisee location. 58
Report to Development Services Committee Meeting Date: February 27, 2017 Page 3 The restaurant space has remained vacant since the completion of construction of the building in Spring 2016. The restaurant space occupies a prominent section of the building at the ground level at the corner of Simcoe Street North and Richmond Street East. It is important that this space be filled and not remain vacant. On January 3, 2017, Mr. Rehman submitted a letter to the City requesting that the City no longer require a full service restaurant as part of the development, and instead allow the vacant space to be used for any use permitted by Zoning By-law 60-94 (Attachment 2). On January 16, 2017 the Development Services Committee referred this request to staff for a report. The subject site is zoned CBD-A(3) (Central Business District) in Zoning By-law 60-94. The CBD-A(3) Zone permits a range of commercial uses. If Mr. Rehman s request is approved, Mr. Rehman may continue to pursue a full service restaurant for the vacant space. However, he would like the flexibility to lease the space to other potential tenants with a use permitted in the CBD-A(3) Zone. If Mr. Rehman s request is approved, the Purchase and Sale Agreement with the City will need to be amended accordingly. The Council approval for other projects for Increased Assessment Grants do not include a requirement for a full service restaurant or other specific commercial use (i.e. Genosha Hotel at 68-72 King Street East and Atria Developments at 100 Bond Street East). This Department has no objection to the request to remove the requirement for a full service restaurant. 6.0 Financial Implications There are no financial implications associated with the recommendation in this report. 7.0 Relationship to the Oshawa Strategic Plan The Recommendation in this report advances the Economic Prosperity Goal of the Oshawa Strategic Plan. Warren Munro, HBA, Director, Planning Services Paul D. Ralph, BES, RPP, MCIP, Commissioner, Development Services Department 59
SIMCOE ST N RITSON RD N Attachment 1 Development Services Department ADELAIDE AVE W PARK RD S CENTRE ST S BOND ST E KING ST E OLIVE AVE Subject: Request to Remove Requirement for a Full Service Restaurant, Abdul Rehman on behalf of Chayell Hospitality Group Inc. Address: 67 Simcoe Street North File: B-1200-0032 Subject Site ONTARIO ST CBD-A(3) OSP/CIN WILLIAM ST E. T25 K:\Attachments\2017\02Feb\Attachments\67SimcoeStN_Att1.mxd\02/16/2017 RICHMOND ST W CBD-A. T25 CBD-A SIMCOE ST N CBD-A 60.T25 CBD-A.T25 BOND ST E
Chayell Hospitality Group Inc. Chayell Hotels Ltd. 7815 Kent Blvd Brockville, Ontario K6V6N7 Attachment 2 January 3, 2017 Mr. Paul Ralph Commissioner of Development Services I City of Oshawa For consideration of City of Oshawa Committee and Council: We would like to request that the City of Oshawa allow a change of use for the lower level of 67 Simcoe Street, North; Holiday Inn Express and Suites; facing Richmond Street, East; which was originally planned to be a full service restaurant. All of the restaurants that have been approached already have a location in Oshawa or are not interested in expanding into the market at this time.. We intend to use the space as permitted by the Zoning By-law. Thank you for your consideration. Abdul Rehman ~ J ( l- President Chayell Hospitality Group 61
DS-17-47 Attachment 3 List of Restaurants contacted by Mr. Rehman and his real estate agent Moxy s Earl s Steak House Oliver and Bonnacini Mike s Steakhouse Fran s Restaurants Boston Pizza Shoeless Joe s St Louis Ribs FAB Concepts SIR Corporation (Jack Astor s) International House of Pancakes (IHOP) Applebee s Denny s Cara Foods (Swiss Chalet, Bier Market, Casey s East Side Mario s, Kelsey s, Prime Pubs, Milestones, Montana s, St Hubert, etc.) Cora s Ricky s All Day Grill Smitty s Family Restaurants Pickle Barrel Spaghetti Factory 62