Council chooses Flato to develop 90 acres of Southgate’s Hwy. 10 lands

·4 min read

After hearing from president Shakir Rehmatullah as well as staff, Southgate chose Flato to develop the Hwy. 10 commercial and development lands.

Earlier, council had heard from JLL, an international commercial real estate broker offering to sell parcels on commission.

Instead, Southgate endorsed the drafting of a sales agreement for 90 acres of lands in the Eco Park Phase II to a Flato Green Inc. that will be considered along with a development agreement was approved.

Part of the agreement will be that Flato will share half the cost of building and servicing along a section of the roadway, council heard.

The selling price would be $65,000 per acre, or almost $88,000 per acre if the road and servicing contribution is included.

The draft agreement will have to come before council again to be endorsed.

CAO Dave Milliner said that with the Flato sale there would be no real estate commission to pay, unlike selling through JLL.

He also said the township would co-market with Flato and would be “having a say” in what development would come to Dundalk.

The staff report said Southgate will be “part of discussions and decision process in the types of businesses to be located on Hwy. 10.”

Southgate Economic Development Officer Terri Murphy relayed her conversations with Mr. Rehmatullah about Dundalk’s Main Street not being left behind.

She said that downtown revitalization was important – with more artisan-type businesses – “to be jointly successful.”

While the Flato president was clear about bringing big retail outlets facing Hwy. 10, he also said that Main Street has its own character.

“That needs to be respected and preserved to go with the big box stores as well,” he said.

Residential would also be part of the development. Single-family housing has been the mainstay of Flato’s development in Dundalk so far, but it has now added a seniors apartment and a planned small commercial plaza.

Mr. Rehmatullah described that as something “affordable for the first-time homebuyer, “ giving the example of back-to-back townhouses.

He also told council that less red-tape and fast-tracking the development would help the company keep its costs lower.

“We will look into seeing if we can provide some affordable housing,” he said. He did not mention rental housing for the location.

Southgate would keep 40 acres of land, as well as some property in the Ida Street block.


Both housing and industrial development appear to be in staff’s plans for the retained property.

The CAO mentioned that for some of the township land, he had been talking to Grey County about the possibility of creating some land lease units – where the ownership of the land is maintained and there is a cap on the re-sale of the house so that housing stays affordable.

Ms Murphy said she has been working with smaller local businesses, helping them prepare to expand through developing business plans and finding financing.

By retaining the land, the township will be able to offer the industrial parcels at a lower cost per acre than would be possible if it was marketed through an international firm, she said.

Land prices could potentially be kept close to the Eco-Park I prices, in order to attract local businesses, she suggested.


Shakir Rehmatullah told council that the company had also bought land south of the Eco-Park II lands.

“We’re not done in Dundalk yet. We still have a long way to go,” Mr. Rehmatullah said.

“We are on a mission to come up with a complete community. We came into the community when nobody was there,” he said, referring to the lack of any other housing builders. He also spoke of the difficulty initially of finding lenders to support projects of that scale more than an hour from Toronto.


The staff report compared the revenue from taking the approach of selling parcels through a broker compared with selling the bulk of the acreage to Flato.

JLL Real Estate Proposal– Total income - $10 million after commission is deducted, based on 20 acres of commercial at $175,000 per acre and 110 acres of industrial land at $65,000 per acre.

FLATO - $5 million for 90 acres. Another estimated $2.9 million will be paid to cover 50 percent of the road and servicing construction cost from Hwy. 10 to the west boundary of the Hwy #10 property and north along the rail trail line

The road construction will take about 10 acres. Southgate could then sell the 40 acres of land at $65,000 per acre.

Of that 40 acres, the township has interest for a 25-acre trucking logistic and shipping company to expand their present business in the township. The remaining lands will be easily sold to others on the waiting list, the staff report said. Other industrial lands, as referred to by Ms Murphy, could be developed off the new EcoParkway.

M.T. Fernandes, Local Journalism Initiative Reporter, Dundalk Herald

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