WFCU buys stake in Canderel building, provides mortgage to new owner
The Windsor Star/Roseann Danese
A financial institution headed by former mayor Eddie Francis has taken a significant stake in a controversial downtown building that taxpayers have been subsidizing for nearly two decades.
Windsor Family Credit Union holds the mortgage on One Riverside Drive, formerly known as the Canderel building, while also owning 25 per cent of the company that bought the building.
Francis, president of WFCU, said the credit union, through its real estate subsidiary, paid $2.4 million for a 25 per cent share of Europro Riverside, just before the company bought the Canderel building for $32.2 million on March 10. Land registry documents show Europro Riverside was charged on the same day for $32 million to WFCU.
In a series of telephone interviews with the Star Wednesday, Francis explained the $32 million was “security that was registered against the building.”
“I won’t get into detailed information of lending to our members… But what I can share with you is the $32 million is security that’s been registered against the building. The mortgage that’s been advanced is not $32 million.”
Francis described the deal as a “typical commercial deal and typical commercial acquisition.”
He said the deal will help WFCU branch out into “other lines of business” while playing a role in community development.
The credit union is looking at growing its revenue “through non-interest income,” Francis said, and the real estate transaction “will provide a very good return on investment for our members.”
The credit union has 36,496 members and is the sixth largest credit union in Ontario, Francis said.
Francis said WFCU will be working with Europro to lease the 15,000 square feet of empty space in the building’s main floor, possibly to a grocer.
The credit union will not rule out further real estate transactions. It has already acquired four acres in Lakeshore, where it will build a branch, retail space and multi-residential units, Francis said.
The building at One Riverside Drive has been dogged by controversy from its inception in 1998, when then mayor Mike Hurst announced a deal with a company called Canderel that would result in Chrysler Canada moving to the downtown core, spurring a revitalization. The block where the building now sits, at the corner of Riverside Drive and Ouellette Avenue, was expropriated for what was to be a 34-storey office building. But the development was a hard sell, beyond the Chrysler commitment. The building only grew to 14 storeys and the city was forced to lease a significant amount of space in an effort to keep the development afloat.
Francis said the building now is nearly full and people would be surprised to learn it is one of the most modern buildings in the city with affordable rental rates.
Mayor Drew Dilkens said he hopes that Europro Riverside will help ease the city of its obligation to lease some of the office space through to 2022. “If there’s a way for us to extricate ourselves from that lease arrangement, we’d be looking to do that, but we’re not there yet.”
The city also owns the parking garage attached to the building, and Dilkens said most of the spots are used by the building’s tenants, which means there might not be a municipal need for it.
Dilkens said he believes Europro, which has interests in other properties within the city, including the Windsor Star offices at 300 Ouellette Ave., will work with the city. “They’re the real deal. When they say they’re going to do something, they do it. They’re invested in the community. They’re not just looking to flip and make a quick profit.”