KLEIN: Winnipeg plan to confiscate land will discourage development

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The City of Winnipeg has introduced a plan that would require developers to hand over 8% of their land when undertaking large-scale residential redevelopment projects.

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The purpose is to create privately owned but publicly accessible green spaces, such as parks, plazas, or community gardens. This is framed as a way to increase green space and reduce city maintenance costs. It appears to be a well-intentioned move to boost the city’s biodiversity and offer more public spaces. But scratch beneath the surface, and it becomes clear this is a deeply flawed plan that will likely harm future development in our city.

Developers are already facing numerous challenges when trying to build in Winnipeg. Housing starts have decreased by more than 20% from last year. Adding the burden of losing 8% of an investment, while taking on the costs of upkeep and maintenance, will undoubtedly discourage more builders from wanting to invest here. It’s not just a matter of giving up land as these green spaces will need to be maintained. This means costs for security, snow removal, and general upkeep will fall on the developers, creating a long-term financial burden.

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Winnipeg is struggling to attract investment and maintain momentum in housing development. Over the last few years, we have seen a steady decline in new builds, which should be a red flag for city leaders. Yet, instead of removing barriers to development, the city is adding new ones.

Mayor Scott Gillingham and his administration must focus on reducing red tape and making it easier for developers to invest in the city, not creating more obstacles. Confiscating land, even under the guise of creating green spaces, is counterproductive to the city’s stated goal of boosting housing development.

Developers are already hesitant to invest in Winnipeg for several reasons. For one, we are the only city still imposing a business tax on companies. This adds financial strain to businesses already operating on tight margins. Second, it can take more than a year to gain all the necessary approvals to begin building. That’s a year of waiting, paying for permits, and dealing with a lengthy bureaucracy while other cities offer much quicker approval processes. On top of those hurdles, the city wants developers to give up 8% of their land. This is simply strike three for many potential investors.

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One developer told me this plan feels like nothing more than land confiscation. When you are building or redeveloping property, every square foot matters. Imagine investing $10,000,000 into a development, only to have the city force you to give up 8% of that land. On top of losing that land, you are responsible for its upkeep, security, and maintenance for the foreseeable future. It is not hard to see why developers would turn away from Winnipeg and look for more business-friendly environments. This isn’t about building a better city, it’s about imposing unnecessary burdens on those trying to help grow the city.

The reality is that our city infrastructure is aging and stretched thin. The city has been struggling to maintain publicly owned parks, with an annual report from April showing that 13% of park assets are in poor to very poor condition. Yes, we need more green spaces, but why should the burden fall on developers? Why is the city shirking its responsibilities and passing them on to the very people who are investing in Winnipeg? If the city can’t maintain the green spaces it already has, what makes us think privately owned public spaces will fare any better? Why not use the new tax dollars that development would generate to maintain the existing spaces?

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Winnipeg’s housing crisis will only worsen if these barriers to development remain in place. Mayor Gillingham has promised to build 8,000 new residences by 2024, but the numbers don’t lie. With a 20% decrease in housing starts, it’s clear that the city’s approach is not working. The city has had years to address these issues, and there has been little progress. We need leadership that is focused on solutions, not more red tape and land confiscation schemes.

Developers and investors are looking for cities that welcome innovation and growth, not places that make it harder to succeed. The current approach contradicts the very goals the city claims to support. If the goal is to build more homes, create more jobs, and revitalize communities, then the focus should be on removing obstacles, not adding more.

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Winnipeg is a city with immense potential, but that potential will not be realized if we continue to impose punitive measures on those who want to invest here. The city needs to reconsider this ill-conceived plan and focus on creating an environment that attracts investment, rather than driving it away.

Reducing red tape, speeding up the approval process, and finding ways to encourage development should be the city’s top priorities. Instead of confiscating land, the city could offer incentives for developers who include green spaces in their projects. That would be a true partnership, where both the city and developers work together to build a better future.

In the end, the question remains: who will pay for these green spaces? The answer is clear — it will be the developers. And as long as that remains the case, fewer developers will be willing to build here and what they build will be less affordable.

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That’s bad for Winnipeg, bad for our housing market, and bad for anyone who wants to see our city grow. Mayor Gillingham and city officials must take a hard look at this plan and ask themselves if this is really the best way forward.

If they are serious about making Winnipeg a better place to live, they need to stop confiscating land and start working on real solutions that benefit everyone.

— Kevin Klein is a former Tory cabinet minister, a former city councillor and President & CEO of Klein Group Ltd.

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