The Société de transport de Montréal (STM) wants to obtain the right to carry out real estate projects with developers around metro stations, in order to generate more revenue. Without this privilege, judges the operator, the schedule for the extension of the blue line planned for 2029 could even be affected.
“For once, I, who am still asking for financing, am bringing a solution that is very concrete to the table,” says bluntly the president of the transport company, Éric Alan Caldwell, in an interview with The Press.
In a report presented Tuesday during the parliamentary committee on Bill 22 aimed at replacing the Expropriation lawthe STM believes that the law “should be clarified to allow transport companies to carry out real estate management and development activities with regard to (their) properties”.
If Quebec followed up on the request, this would mean that a transport company could “join with a real estate developer” for any construction or redevelopment contract near a metro station, for example. This is similar to the model adopted by the Réseau express métropolitain (REM), which allows CDPQ Infra to capture part of the land revenues around light rail.
According to the STM, the inability to join forces with private third parties is a major obstacle. “There are many cases where the STM must negotiate with a specific owner or developer to carry out work. A ministerial exemption was thus recently necessary for the completion of a project for a mechanical ventilation station and a metro station entrance to be built in the city center to be integrated into a new tower construction project. she maintains.
“In France, with the Grand Paris Express, they can expropriate up to 600 meters, which represents around 8,000 homes. And in British Columbia, it’s 800 meters. Here, expropriations are still only carried out for the sole purpose of land use, so it is difficult to plan a coherent whole to achieve maximum development,” reasons Mr. Caldwell.
Benefit from the blue line
In the short term, the STM affirms that it would greatly benefit from this privilege to derive more revenue from the extension of the blue line, this extension of five stations to the east to be delivered in 2029.
According to the company, time is of the essence, as the conclusion of an agreement with a developer will be “required” by the end of fall 2023 to determine the air rights, design and excavation of the Galeries d station. ‘Anjou. The process of expropriating this station is already the subject of a preliminary partnership between the STM and Ivanhoé Cambridge, which owns the commercial establishment.
In its report, the STM clearly states that “if the law is not amended by the fall, it will be impossible to carry out joint development” at the Anjou station “without (modifying) the extension schedule.” of the blue line.
“We need this flexibility, otherwise we risk missing an opportunity or delaying the extension project. It’s the same thing for the Pie-IX/Jean-Talon intersection, where we own the Le Boulevard shopping center. There is the possibility of generating income from the operations that we would carry out on these properties,” illustrates President Caldwell.
He believes that all this would be added to the “transport charges” already planned in the extension project. As early as 2021, a committee mandated by Quebec to reduce the costs of extending the blue line had proposed imposing royalties on real estate developers to recover part of the additional property taxes, representing revenues of around 300 million.
By modifying the Act respecting public transport companiesQuebec would more generally open “the way to generate income through real estate development as part of other STM asset maintenance projects as well as other public transport projects”, it is also argued.
Expropriate faster, for less
In its report, the STM also says it finds it “strange” that transport companies must obtain prior authorization from the government to expropriate, while cities, metropolitan communities and even school service centers are exempt from this obligation.
“It makes sense to remove a layer of complexity from us if we want more effective projects,” says Mr. Caldwell, who says he is hopeful “of having a good listen” from Quebec on this request.
Ultimately, “the need to obtain government authorization adds delays to the expropriation process, which translates into additional costs and can affect the project delivery schedule,” states the company’s management. which recalls that a “large number” of its decisions “must already be authorized by the City, the CMM and the ARTM”, among others.
Incidentally, the STM affirms that it would be necessary to study the possibility of allowing it “to expropriate on behalf of others, such as urban technical network companies (RTU), cities or other entities for which they can carry out work”, in order to save costs and time, again.