Now that upgrades on the building located at Port Harmon in Stephenville have been completed, the mayor has released the cost numbers.
He said in a prepared release this is a follow up to the many media reports since the fall of 2012 and he’s living up to the town’s commitment of a final project report regarding the retrofit of the former Abitibi paper shed into a state of the art industrial fabrication facility.
On Oct. 12, 2013 The Western Star published an article “Work underway on former Stephenville paper-shed building.”
This article highlighted that $3.8 million dollars in contracts were already let to six different contractors; and it was anticipated another $4.5 million dollars in additional contracts would be let.
“To summarize the Oct. 12, 2013 article it said what we (town) were doing, what we were going to do, project costs ($8.3 million in total) and why we were doing it,” O’Brien said.
He said he’s now pleased to say after four and a half years that the retrofit work is complete and that as of March 7, the town received its final financial contribution from the Atlantic Canada Opportunities Agency.
O’Brien said with this final financial contribution payment, the town is now in a position to release, as it committed, an all-inclusive project report which outlines project costs and revenue sources and a building financial performance report.
He said in summary, total construction, operational and maintenance costs for the period of October 2012 to March 16, 2017 was $8,177,213.65 with funding for this amount coming from three sources: Provincial Government $4,255,357.00, Federal Government/ACOA $2,020,011.73 and the Town of Stephenville $1,901,844.92.
O’Brien said additional improvements valued at approximately $1.5 million were completed under leasehold improvements by the leaseholder at the time.
He said of the town’s investment of $1,901,844.92, the town has already recouped $811,274.94 through lease payments, municipal taxes and fees. By the end of the current lease which is in place and runs into 2018, the town will recoup another $386,988.00, further reducing its net investment to $703,581.98.
O’Brien said the retrofit of the building into a state-of-the-art industrial fabrication facility positioned Stephenville to take advantage of ongoing mega projects in the province.
He said it provides residents an opportunity to return or stay in the area to work and be with their families and creates additional spin off employment and economic activity.
O’Brien said conservative estimates value the building at more than $25 million and he’s sure it will continue to generate the desired economic activity and that within a reasonable time frame the town will recoup all of its investment.
At this point revenues generated by the building will produce additional benefits to the residents of Stephenville on an on-going basis.
The numbers:
Stephenville Industrial Facility summary of revenues and expenses as of March 16, 2017
Financial Contributions:
Government of Newfoundland and Labrador - $4,255,357.00
Federal Government/Atlantic Canada Opportunities Agency - $2,020,011
Town of Stephenville - $1,901,844.92
Total financial contributions - $8,177,213.65
Total construction, operation and maintenance - $8,177,213.65
Outstanding construction project expenses/revenue - $0.00
Town of Stephenville: Investment and Return on Investment to date
Town of Stephenville investment (from above) - $1,901,844.92
Tenant lease payments - $767,560.00
Tenant municipal taxes/fee payments - $43,714.94
Outstanding balance of town’s investment to date - $1,090,569.98
Future Projections: Stephenville Industrial Facility
Outstanding Balance of town’s investment to date (from above) - $ 1,090,569.98
Anticipated lease payments on current lease - $357,000.00
Anticipated municipal taxes / fees on current lease - $29,988.00
Anticipated balance of town’s investment if current lease runs full term - $703,581.98
Source: Town of Stephenville
