“The City did not respect the rules of the game”

A developer sues the City of Montreal after it exercised its right of first refusal to force the “stop” of a housing project

Henri Ouellette-Vezina
The Press

A developer from Verdun who is trying to build residential units, including social housing, is suing the City of Montreal to force it to “clarify” the use of its right of first refusal on one of the lots where he wishes to build, which could set a precedent in the municipal world.

“Our intention is not really to block the project or the right of first refusal, but rather to clarify the question of law. Because for us, the City did not respect the rules of the game. In fact, they are even harming the project, because nothing has happened in this area for a year. A year that everyone has lost, without any social housing being able to be built,” sighs Alexandre Forgues.

His company District Atwater, which says it specializes in “responsible development” of housing, launched “very open discussions” with the City more than a year ago on its new project, the Exon Dupuis, located near Duquette Park, in Verdun. He plans to build three contiguous units of hundreds of housing units there that he wants to be “affordable” and “integrated into the community”, like most of his projects, including the most recent, Origine Habitation Durable.

Except that last fall, in the context of the municipal elections, everything changed, says Mr. Forgues. “Suddenly, they arrived with their right of first refusal on one of the lots. Except that as the lots are contiguous, you can’t take one to develop it, it goes together. So, as the City has decided to exercise its right of first refusal on one of the lots only, I can no longer build on any lot. In the end, it’s not even logical and intelligent for the community, ”he condemns.

Ultimately, the land has therefore been inactive for several months, the City “having taken no concrete action”, according to the promoter, who is getting impatient. “The total potential is estimated at around 600 units. With its right of first refusal, if it activates, the City could make 200 at the expense of 400 others for the community. It makes no sense, we absolutely have to agree, ”insists Mr. Forgues.

In everyone’s interest

In his lawsuit, filed Friday at the Montreal courthouse, Mr. Forgues notes that “the public interest can only benefit from such a judgment by allowing all owners […] to be minimally assured of compliance with a transparent and rigorous process for exercising the right of first refusal”.

Moreover, the promoter and his company maintain that “the position chosen by the City varied according to its intentions at the time or, at the very least, are indicative of a great misunderstanding concerning the methods of exercising the right of pre-emption” .

Called to react, the office of Mayor Valérie Plante indicated on Friday that it “intends to use all the tools at its disposal to ensure a mix in the construction of housing as our Regulations for a mixed metropolis “.

“Regarding the legal case, we will let it take its course,” said the press attaché, Alicia Dufour.

If the court agrees to look into the case, it could well be a first legal test for the right of first refusal in Montreal. Since February 2020, the City has had this privilege, which it had acquired by legislation in 2017, giving it the possibility of buying land and buildings “in priority” in order to develop social and community housing.

“The City will have the chance to buy land or buildings put up for sale in priority sectors before anyone else. The real estate market is booming in Montreal and there is not a lot of land available on the market. When there are, they fly away very quickly, ”explained M^me Plant.

As early as 2020, the City had also clarified that there was no question of using the right of first refusal in the context of a residential project by large developers. The mayor had also reminded that in this specific case, there is another “tool”, either the by-law on inclusion, or the “20-20-20”.