There's been another change of plans for a centrepiece property in downtown Fredericton.
Plans to build a hotel and restaurant on the Centennial Building site, along with a mix of housing and retail, were approved in November.
But the developer now says the pandemic has put a chill on financing for hotel projects.
Instead, Geoff Colter says, Centennial Heritage Properties is proposing a "fully multi-unit residential" development and will add a covered, two-level parking structure at the rear of the building.
'Surprised' that financing was an issue
In an interview with Information Morning Fredericton, Colter said he was surprised to learn that financing would be an issue.
"After we got our approvals, we put together a business plan for the hotel portion of the development" and then sought financing, he said.
"We basically found out that there's no viable financing in the current COVID environment for hotel development."
Financial institutions are "holding their cards close to their chest" and waiting to make sure that a recovery is going to happen, Colter said.
However, he said, the hotel at the Centennial Building site would have come online by September 2023, and hotel industry associations are predicting that by early 2024, the industry will be back to pre-Covid occupancy levels.
"So I kind of thought that the banking world and the financial institutions would have the foresight to sort of buy into that. But unfortunately, that's not the case."
Revised plan addresses 'extremely tight' rental market
Centennial Heritage Properties' revised plan, which keeps the ground-floor restaurant, retail space and indoor parking proposed in its earlier plan, focused on offering residential units to a market that is in dire need of them, Colter said.
"There's a move to have more people living downtown and … by all accounts, the rental market is extremely tight right now," he said.
The revised proposal will now have to go back to the planning advisory committee for approval.
If approved, the new development should be able to meet the same proposed timeline and be underway by September 2023, Colter said.