A social and affordable housing project awaited for years near the Frontenac metro station is not about to see the light of day. The contractor who was originally supposed to complete this project is suing the Société de transport de Montréal (STM) for more than nine million dollars for having canceled his contract “in bad faith”, while the financing of this real estate development – still in cards — knows some failures, has learned The duty.
“This project is a real disaster; it’s appalling,” says bluntly the coordinator of the Ville-Marie Housing Committee, Éric Michaud. The latter notes that many residents of the Sainte-Marie district, in full gentrification, are exasperated by the enormous delays in the realization of this real estate development. “It’s really disappointing. »
In 2018, the City of Montreal, the STM and the Société d’habitation et de développement de Montréal (SHDM) announced with great fanfare the launch of a project awaited since 2010 by residents of the Sainte-Marie district, that of the Complexe real estate Havre-Frontenac. The project was to include 274 housing units, according to its most recent version, including 60 social housing units and 99 affordable condominiums that would be offered for sale below the average market price. The project also provided for 115 private dwellings.
A promoter, Cosoltec, then won the call for tenders launched in March 2017 to carry out this development on a parking lot adjacent to an STM transport center, a stone’s throw from the Frontenac metro station. Construction was scheduled to begin in 2019 and end in 2021 on land owned by the transport company.
‘Unfairly private’
However, in March 2019, the STM terminated the company’s contract because the latter would have liked to make changes “to the conditions of the public call for proposals book in connection with the decontamination of the site”, indicates the company of transportation by email. In response, Cosoltec first put the STM on notice on November 10, 2020, then filed on November 1er last March an originating application to the Superior Court, which the company provided to the To have to as an answer to our questions.
In this lawsuit, Cosoltec is claiming just over $9 million from the STM and its subsidiary Transimmobilier, or about $1 million as “compensation” to compensate for the expenses incurred by the company in this project before it be withdrawn from it and a sum of eight million “representing the loss of profits caused by this unjustified refusal” to be the prime contractor for this real estate development. The company claims to be “unfairly deprived” of these sums because the STM and its subsidiary “unduly refused, in bad faith, to follow up on the real estate project”.
“This refusal is unjustified, because the bid complied with all the conditions set out in the call for proposals, including those related to soil decontamination,” adds the lawsuit, which the STM did not comment on, on the recommendation of its team. legal.
Complex financing
At the same time, the modification of certain financing programs has complicated the realization of this project. The City confirms that units had initially been reserved in the AccèsLogis Québec program in order to build the 60 social housing units planned on this site, east of downtown.
However, the lack of funds reinjected into this program by the Legault government compared to the expectations of the City has forced the latter to sort out the projects that will be able to benefit from the sums remaining in the AccèsLogis kitty, according to our information. Result: the CDH Group, the organization responsible for advancing the social component of this project, is trying by various means to find new sources of funding to make it a reality.
The Sainte-Marie district is also one of the sectors of Montreal where the proportion of tenants who spend “a disproportionate share of their income on housing” is the highest, notes the spokesperson for the Popular Action Front. in urban redevelopment, Véronique Laflamme.
“The explosion in rent costs puts a lot of pressure on tenants, so cooperative and social housing projects become essential in this context”, also notes Élizabeth Martin, who is in charge of development for the CDH Group. She also finds it “a little odious” that this project is taking so long to materialize, especially since in the meantime, the bill continues to climb in a context of rising construction costs on the scale. of the province.
As for the affordable housing units planned in this project, they were initially to benefit from the Accès Condos program managed by the SHDM. However, the latter confirms that this program is currently being redesigned. It is therefore also unclear how this component of the project will be funded.
Many more years
Once the impasse surrounding the financing of this project has been resolved, the STM will have to initiate a call for tenders process to determine the new contractor who will take charge of the construction of this real estate complex. The transport company refuses to advance on the estimated costs of the project so as not to influence the market.
“We estimate that a period of two years will be necessary for the construction of the complex, from the moment the contractor is chosen,” adds Philippe Déry, of the STM. The City, for its part, adopted a resolution last February authorizing the construction of a building complex of no more than 12 floors on this site.
“The project continues,” says SHDM Communications Advisor Julien Serra, while acknowledging that several steps remain to be completed before this real estate development becomes a reality. “We don’t have a deadline that has been determined,” he confirms.