Cost of redeveloping former Bay building in Winnipeg now $310M, Southern Chiefs says

The cost of redeveloping the former Bay building in downtown Winnipeg has risen more than 50 per cent and some of the amenities that were planned have been scaled back or removed altogether.

The Southern Chiefs' Organization announced Wednesday it will cost $310 million to transform the Hudson's Bay Company's 99-year-old Winnipeg flagship into a mixed-use development called Wehwehneh Bahgahkinahgohn.

The project was originally slated to cost $130 million in 2022, when the Hudson's Bay Company announced the transfer of the six-storey, 655,000-square-foot building at the corner of Portage Avenue and Memorial Boulevard to the SCO, which represents 34 Anishinaabe and Dakota nations in southern Manitoba.

The projected cost was raised to $200 million in 2023.

SCO Grand Chief Jerry Daniels said the cost increase is due to more accurate budgeting and a more detailed design for a complex, adaptive reuse of a heritage building.

Construction inflation and the cost pressures from the Canada-U.S. trade war also played a role in the higher cost, he said.

"The impact is going to be on the materials that we have to buy. So that's going to change and fluctuate prices," Daniels said following a news conference on the main floor of the former department store, where the walls and ceilings have been stripped down to their basic components.

Three levels of government have pledged a combined $141 million in cash, loans and tax relief to support the $310-million Wehwehneh project.

Daniels said the SCO plans to raise the remainder of the funding for the project.

"We will get there, and I guarantee that our team is well-prepared for that," he said.

Federal cabinet Minister Terry Duguid, the Liberal MP for Winnipeg South, said his government has not been asked to contribute more funding. The federal government has promised $96 million in cash and loans for the project.

The provincial government, which promised $35 million in loans, did not send a representative to the SCO news conference and did not immediately respond to a request for comment on any further funding request.

The City of Winnipeg, which is providing $10 million in property-tax incentives for Wehwehneh, also has not been asked to contribute more to the project, said a spokesperson for Winnipeg Mayor Scott Gillingham.

Some previously announced amenities planned for the project have also been deleted or scaled back because of cost pressures, Daniels said.

The project will no longer include assisted living units for First Nations elders, a governance seat for the SCO nor a museum and gallery, the grand chief said. 

A monument for survivors of residential schools and day schools has been scaled back, while the SCO is "not firm" on whether Wehwehneh will still include a health and healing centre.

Daniels said the SCO has not changed plans for Wehwehneh to include 373 housing units, a child-care centre, two restaurants, rooftop gardens, office space for the SCO and a central atrium.

In order to build that atrium, a crane erected along Memorial Boulevard will soon start removing part of the roof of the building, he said.

The project is now slated to be completed in 2028, two years later than initially planned. Daniels said the SCO still plans to hold some form of ceremony in 2026 to mark the 100th anniversary of the original department store.

Financial trouble at the Hudson's Bay Co., which is under creditor protection, does not jeopardize any aspect of the Wehwehneh project, Daniels said.

With Bay stores elsewhere in Canada facing potential closure, Daniels said the SCO is prepared to advise First Nations interested in acquiring department store real estate of their own.

1st Daniels comments since leave

Daniels' appearance at the Wednesday announcement was his first since he took a month-long leave of absence after he was hospitalized following an early-morning altercation in Ottawa in December.

Daniels described what happened to him in Ottawa as an "unfortunate incident" and said he is grateful to remain grand chief.

"I'm absolutely thankful that I've been able to get the support of the communities and get the support of the chiefs," he said.

He also thanked staff at Aurora Recovery Centre for helping him with what he described as personal issues.

The announcement about Wehwehneh was also the first for SCO since it replaced chief executive officer Joy Cramer with Ryan Bear.

"We're here to make a message that this project is well on its way to completion," Daniels said.

Downtown Winnipeg Bay redevelopment costs more than double original plan

17 hours ago

Duration 1:49

The cost of redeveloping the former Bay building in downtown has increased yet again. In total, it's now expected to cost more than double the original price set out by the Southern Chiefs Organization in 2022.