Fredericton city councillors have agreed to sell a historically significant building valued at almost half a million dollars to a private developer for $1,000, under the condition the company restore it and put it up for rent.

Councillors were split in their vote on Monday to sell the Lemont House to State Street Properties, with some voicing concerns about the sale price and about how far the terms of the agreement went in requiring the developer to charge affordable rents.

"I do just feel like we are giving a very good deal here to this developer," Coun. Cassandra LeBlanc said.

"I know not everyone agrees with that opinion, but I feel that, you know, this will end up in just a few years as expensive apartments along the water in a historic property … and all we are asking is for $1,000."

Coun. Cassandra LeBlanc voted against selling the Lemont House to State Street Properties, saying the agreement didn't go far enough to ensure affordable rents. (Aidan Cox/CBC)

The Second Empire-style building at 605 Queen St. was constructed in the 1880s and was lived in by the Lemont family, who were furniture dealers and owned a store on Queen Street.

In 2021, the City of Fredericton acquired the property from Aquilini Properties as part of an undisclosed settlement following a lawsuit Aquilini launched against the city in 2019.

Aquilini owns the Crown Plaza and had at one time used the Lemont House to accommodate long-term guests.

But for years leading up to the city's acquisition of it, the building sat vacant, prompting concerns from heritage advocates about its deteriorating condition.

The Lemont House pictured in 1905. (NB Provincial Archives P210-724)

Since acquiring the Lemont House, the city granted it heritage status and made a public request for proposals, which led to the successful submission by State Street Properties.

CBC News requested an interview with State Street Properties on Monday afternoon but did not receive a response.

The company's website shows it owns several residential and commercial buildings, including on Queen, Regent and Dundonald streets.

Limit on rent prices

According to the development agreement between the city and State Street Properties, the average base rent for the 17 apartment units must be below the average new construction rental rates set out by Canada Housing and Mortgage Corporation for a period of five years.

Michael Baldwin, director of corporate services for the city, said in an interview the apartments would be bachelor and one-bedroom units.

According to the CMHC, the average rent for newly constructed one-bedroom apartments was $1,180 in 2023, and $993 for bachelor apartments.

However, the development agreement between the city and State Street Properties says that limit on rent prices is subject to being higher, according to the consumer price index and property tax increases.

During the meeting, LeBlanc tried introducing a motion to amend that agreement so that the cap on rent prices would be in place for 10 years instead of five.

Her motion also proposed eliminating the caveat allowing rent to be higher subject to consumer price index and property tax increases, but no other seconded the motion.

Fairness up for debate

The resolution to sell the Lemont House narrowly passed on Monday, with Deputy Mayor Jocelyn Pike, and councillors Greg Ericson, LeBlanc, Jason Lejeune and Ruth Breen voting against it.

Breen said she had concerns about the potential affordability of the rental units, but even more so about the fairness of the deal for the city.

"My deepest concern is that this property is valued at roughly half a million dollars, and we're selling it to a very successful developer for $1,000," she said, before the vote.

"If that's the best the market can do, I think we need to explore other options in how this can best be repurposed to serve the residents of Fredericton as a whole."

Coun. Ruth Breen said she thought the city wasn't getting a fair deal by selling the Lemont House for $1,000. (Aidan Cox/CBC)

Coun. Eric Megarity said he thinks sale price is fair for the city, considering no other private interests proposed better options, and the fact the Lemont House will likely require "a lot of money" in repairs.

"If we want to save a heritage building we have to throw something in there," Megarity said.

"And I think what we're doing is very fair and reasonable. We will get the taxes. We're bringing the heritage building back for I don't know how many decades."

According to the development agreement, the developer must begin development within 12 months of the sale, "with the aim of bringing the housing stock online as soon as is reasonably possible."

The agreement also requires the development and maintenance of the building to comply in all respects to its heritage designation pursuant to city bylaws.

City councillors voted Monday to remove Waterloo Row from a motion that would add more street parking to some Fredericton roads, after dozens of residents expressed concern about the plan.

During a council meeting in late June, city staff asked council to create about 50 new spaces on the eastern side of Waterloo Row between Lansdowne and Alexandra streets.

Waterloo Row offers a scenic route for motorists heading from the eastern end of Fredericton to its downtown, with views of the water on one side and opulent homes on the other. The road also serves as the face of Fredericton's heritage preservation area.

The proposal was met with criticism from Ward 1 Coun. Margo Sheppard, who said the addition of parking spaces seemed "antithetical" to the picturesque nature of the street and the neighbourhood it borders. 

At a council meeting on Monday, Ward 11 Coun. Jason LeJeune said dozens of residents expressed concern about the proposal.

Ward 11 Coun. Jason LeJeune said dozens of residents were concerned about the proposal. (CBC News)

"Overall, residents are not experiencing the impacts that we are trying to resolve," he said. 

LeJeune said residents he has heard from are worried the council is working to resolve issues that aren't supported by data and creating potential safety hazards in the process. 

He said some residents thought the idea of narrowing the street to make room for parking spaces could create a delay in response times for first responders, and parallel parking could cause congestion and potential collisions. 

"An overall concern was that just adding parking to arterial streets could have a lot of downstream impacts," he said. "Are we going to add parking spaces to other arterial streets like Woodstock Road, Canada Street, these connectors that we rely on to move traffic?"  

Coun. Margo Sheppard, vice-chair of the city's environmental stewardship committee, criticized the motion that would have involved adding parking spaces to Waterloo Row. (Aidan Cox/CBC)

He said residents also expressed worries about heritage preservation. 

Sheppard repeated her concerns about the proposal on Monday, calling the road a "gateway to the city."

After debating the issue, councillors approved an amendment to remove Waterloo Row from a motion to  allow parking changes on a handful of other streets in the city. The revised motion then received third reading. 

The city had proposed the parking changes in an effort to improve safety and accessibility for families who use Morell Park. 

Sheppard said the city should look at alternate options to create more parking in the downtown, including expanding the current parking area in the park. That would require using part of the field in Morell Park, which is currently used for recreational sports, including baseball and soccer.

City of Fredericton Ward 11 Coun. Greg Ericson said the city should look to Morell Park to add more parking. (Jennifer Sweet/CBC)

Ward 8 Coun. Greg Ericson said that location would be worth looking into as a solution. 

"I think we all can recognize that baseball field down there and the two soccer pitches are not regulated professional pitches that can't be altered in their size and orientation," he said. 

"There's a lot of land down there and I'm sure we can find ways to accommodate the overflow parking requirements for venues."