Yarn business on Barrington Street leaving ‘obstruction’

Mimi Fautley is moving her yarn store after nearly 11 years. She wants to escape the scaffolding that has hidden her from view for almost a year and a half.

“It probably could have, and should have killed my business, but it is pure stubbornness that’s made me refuse, and has got me out from under the scaffolding,” Fautley said.

Fautley owns The Loop located in the Pacific Building on Barrington Street. Scaffolding — not construction — has covered the building since November 2014.

“There is no construction,” she said. “Obstruction, we like to call it.”

The scaffolding prevents bricks from the building’s aging façade from falling onto people. This has also dissuaded people from entering businesses in the Pacific Building, Fautley said.

When Fautley moved into the building in 2005, it was owned by Steve Caryi, a major developer in Halifax. Caryi sold the building in 2007 to New Gen, a South Korean real estate developer. In 2013, Dongdu International took over.

DDI is a Chinese real estate firm. Before making several land purchases in Nova Scotia in 2013, its only business in North America was the purchase of two skyscrapers in Detroit: the Free Press building and the David Stott building.

Originally, DDI promised to fix those buildings. Then after over a year of no work, it sold the Stott building for almost double the original price. It was announced in September that the Free Press building is also for sale, at nearly four times the original price.

Fautley sees parallels between DDI’s activities in Detroit and the state of the Pacific Building. She wonders if the company is doing the same thing here.

“Why would you not do the same thing if it worked out for you in the end last time?” she said.

DDI turned to the city to help it improve the Pacific Building. In 2015, it received $100,000 through the Barrington Street Heritage Incentives Program specifically for façade improvement. The money remains in a fund to be given to the company once the work is complete. As well, it received $160,500 for tax credits, which could be transferred to a new owner if it were to sell the building.

Waye Mason, city councillor for Halifax South Downtown, said the renovations could cost upwards of $2 million due to the unique terra cotta material of the bricks. The Pacific Building itself is worth about $4 million.

Mason said there are dangers of imposing a set timeline for building owners to finish renovations.

“If you push somebody too hard to do something they don’t have the money to do, the default action for that owner is to apply to demolish,” he said.

Fautley said she’s seen her revenue plummet since the scaffolding went up. “Almost every month since has been lower than the previous year.”

In Fautley’s lease there is a clause that would, in theory, help ease some of her losses. It says if her monthly revenue had a 20 per cent loss from the previous year, she would receive half of her rent back for that month.

“They (DDI) chose to interpret that as not applying in this situation because no actual work was being done,” she said.

There is no commercial tenancy act in Nova Scotia that would be able to assist Fautley in a situation like this. Her only option would be to sue her landlord, which would potentially cost more than she would gain.

“I was asking for very little and they still refused to give me that, so it wasn’t really worth my while to pursue (legal action). It would have at least cost me what I would have gotten,” she said.

Another Nova Scotia project

DDI’s Eastern Shore project, called Crystal City, hasn’t seen much progress.

DDI purchased 1,200 hectares of land in Guysborough County in May 2014, saying it would invest $3 billion in residential developments catered to Chinese tourists.

Marvin MacDonald, chief administrative officer of the Municipality of the District of St. Mary’s, said DDI still has not applied for building permits. The district is working to create or amend bylaws to accommodate a larger development, such as DDI’s proposed project.

MacDonald said many details of the project have not been shared, but any employment opportunities for their community would be appreciated.

“We’ve encouraged them to break ground as soon as they possibly can,” he said.

Fautley will miss her building’s location, but sees her move as beneficial since she will only be moving further down Barrington Street.

“I’m not going to lose a single customer by moving there,” she said. “I only stand to gain.”

Multiple calls were made to Stephen Dempsey, the Canadian adviser to DDI. He could not be reached for comment.