Denciti Development Corp. bought the 106.4-acre Kelowna Springs Golf Course in October after Kelowna city council adopted a new Official Community Plan (OCP) which designated the land for future industrial and employment uses.
Now, a newly elected council is considering reversing the OCP designation, scuttling Denciti’s investment and its intention to redevelop the 480 Penno Rd. property for industrial and commercial uses.
The decision came as a shock to Denciti and its CEO Garry Fawley, who has been involved in developing about 20 projects in the Kelowna area over the past 25 years.
“We were caught off guard when this became an issue,” he said, noting the previous council’s unanimous vote to approve the OCP, the approval from city staff, and its former owner’s work to chart a new path for the property.
Momentum had been building since the election to review the decision, including from councillor Luke Stack, who had voted in favour of the new Official Community Plan but later introduced a motion to rescind the golf course’s industrial designation.
That original effort failed under the former council, but his efforts have continued.
"This is a new council so we could see they were going to vote to review this,” Fawley said, referring to the B.C. municipal elections last fall which resulted in four new faces at the city's council table.
“So we stepped back and said, 'OK, you should be able to review this but the OCP was four years long'. Public consultation, private, staff, council, I’ve never seen an OCP so significantly change so quickly.
“It’s supposed to be a solid policy document.”
Development potential for Kelowna Springs
Denciti’s estimates for the site are that it could produce over 1,000 new job opportunities and more than $1.1 million in annual tax revenue for the city.
Its location in the Gateway district is a few minutes’ drive south of the Kelowna airport, along the Highway 97 corridor adjacent to an existing industrial and commercial sector with most of the required infrastructure already in place for such uses.
It’s an area designated as an employment and transportation hub for the entire region, one of five "Growth Strategy Districts."
The Kelowna area is in need of additional employment lands for its rapidly growing population, Fawley said. Local real estate firm HM Commercial’s most recent statistics reflect a 1.07 per cent industrial vacancy rate in Kelowna.
Forecasts cited by Denciti indicate over 3.5 million square feet of new industrial space and 236 acres of land will be needed to meet the growing demand in coming years.
Fawley said accusations Denciti was being “speculative” in its acquisition are false.
“The landowner, about 2019 went to the city because of the OCP process and said, ‘I don’t see this being a golf course much further into the future, so what can it be?’
"(City) staff was all over it, so it was a staff-led introduction into the OCP,” Fawley said. “It went through council review and hearing.”
Once the property was designated for industrial and employment uses, Fawley said Denciti was approached as a potential buyer.
“I looked at it and across B.C., the whole province, employment lands, industrial lands are so sought-after, we’re looking at this with unanimous approval (from council), it went to staff, staff was all over it, so we did our due diligence, removed all conditions feeling quite comfortable . . . that we’re doing the right thing for Kelowna, the citizens,” Fawley said.
Denciti seeks time to consider options for site
The original concept was to take 18 months to do the necessary engineering work, environmental studies, etc., and create a long-term plan to develop the entire property for various types of industrial and/or warehousing purposes.
Now, Fawley’s asking for six months to reach out to the community and to create a new vision for the site before council moves further to formally reverse the OCP.
The golf course will remain operational at least through 2023.
“We are prepared to reach out into the community, develop creative ideas and see if we can develop a win-win situation,” Fawley said.
“ . . . Allow us to paint a picture, because this has happened so fast we haven’t even been able to build a conceptual idea that we can share with people.”
Options could include retention and possible enhancement of a portion of the property for recreation or a mix of other community objectives including employment.
“I have 25 years experience up there, I’ve always enjoyed developing in Kelowna,” Fawley concluded. “I’ve always got along well with staff, staff has been very good, so has council.
“We’re wanting to continue that kind of constructive dialogue and have that trust between us and I think we deserve it based on our track record.”