Kelowna’s Long-Awaited Development Crumbles Again, Frustrating Locals

A Rollercoaster Journey of Promises and Disappointments

Kelowna’s downtown has been a hotbed of development dreams and dashed hopes. The saga of the former Keg building site on Water Street and Lawrence Avenue is the latest chapter in this ongoing story of ideas and battles. The community, eager for revitalization, is left frustrated yet again as another promising project, the 12-storey boutique hotel, falls apart.

New Plans for a Smaller Project

Just when it seemed like progress was finally within reach, the Mark Anthony Group, the property owner, has announced a pivot from their ambitious 12-storey hotel plan to a more modest four-storey commercial building. This change comes after negotiations with a neighboring property owner fell through. A no-build covenant was needed to allow for windows facing the neighboring property line, but the agreement crumbled at the last moment, leaving developers and city planners scrambling for a Plan B.

A History of Setbacks and Changes

This isn’t the first time the development at 1580 Water Street has hit a snag. The original permit, approved in December 2020, included a wine bar, lounge, rooftop deck, interpretive center, tasting room, education center, and lab, along with a wine shop. However, those plans were shelved during demolition when the developers couldn’t secure a liquor license from the province. Now, with the hotel plans scrapped, the new proposal includes possibilities like a restaurant, wine tasting room, wine shop, urban winery, distillery, urban market, events space, and a residential unit.

Community Reaction: Frustration and Discontent

Local residents are vocal about their frustration. Comments from community discussions reflect the collective disappointment. One user exclaimed, “What? Now a four-story commercial building? The hotel was the PERFECT use and size for the site.” Another added, “Would have made that corner of downtown very cool since it already has the Eli rising rapidly basically next door.”

As the community waits for the next steps, the frustration is palpable. The need for development that meets the city's needs and enhances its character is clear. The residents of Kelowna are eager for a resolution that brings vitality and purpose to the long-dormant site. Until then, they remain skeptical and cautious, hoping that the next plan will finally bring the promised revitalization to fruition.

The Need for Hotel Space

The shift from a hotel to a commercial building is particularly vexing for many, given the recent ban on Airbnbs and the high demand for hotel space in downtown Kelowna. Some residents pointed out, that Kelowna has a shortage of hotel rooms, and the new commercial building will not address this need. The city has been actively promoting tourism and attracting visitors, but the lack of accommodation options remains a significant challenge. The loss of a potential hotel is seen as a missed opportunity to address this pressing issue and capitalize on the growing tourism industry in the region.

Looking for a Way Forward

Following the council meeting, it was decided that the best immediate step is to push forward with the new development proposal for a four-storey commercial building. The planning department is working closely with the Mark Anthony Group to expedite the process and ensure that some form of construction can commence promptly. This move aims to finally activate the site and address the long-standing eyesore issue. The developer is expected to submit a revised development permit application soon, with the hope of beginning construction by summer. The city remains open to future discussions with neighboring property owners to explore potential collaborations that might revive elements of the original plan. In the meantime, the focus is on moving forward with a feasible project that will contribute positively to the downtown area.