Recap: The City Market Decides Against the Mercer Warehouse as a Potential Year-Round Venue

On April 18, 2011, a special meeting was held by the City Market Board, as motioned at the AGM earlier this year. Vendors were to discuss whether or not the Board should continue to consider the Mercer Warehouse as a potential year-round venue for the market.

The Mercer Warehouse (10363 104 Street) is one of the few vacant buildings left in the historic Warehouse District, and is only separated from the burgeoning outdoor City Market by one block. It was built back in 1911 by a liquor and cigar seller named John B. Mercer to be a shipping/receiving hub. More recently, it housed an antique shop, but has been empty for many years now.

Mercer Warehouse

Mercer Warehouse

The conference room at the Sutton Place Hotel was standing room only, as land developer Greg Wilkes presented how the heritage building would be transformed into three levels of market space over 37,000 square feet of space. This area could be divided into 120 stalls, 120 square feet each, with early plans also including provisions for a food court, performance space and children’s play area. The proposal was for the market to be open on Fridays, Saturdays and Sundays.

Interior shot (from Jon Hall, at the City Market Facebook page)

Kelly Pope, a local developer (who, in this 2004 article is credited with “single-handedly doing a huge job of cleaning up and restoring almost two blocks of Jasper Avenue”) recently purchased the building, and has been negotiating with the City Market, through its Board and Wilkes, on terms and the cost of renovations. The deal:

  • Ten year lease plus a five year option;
  • Pope would be responsible for base building upgrades (e.g. washroom refurbishing, roof repair) in the amount of $775,000-$1 million;
  • the City Market would be responsible for market-specific upgrades and demising costs (e.g. installation of public elevator, upgrade of stairs, refurbishment of common areas) for a total cost of $2 million; and
  • Market vendors would be responsible for individual stall improvements (e.g. installation of sinks, freezers, food-safe flooring, lighting and signage), which could run anywhere from $5,000-$50,000.

The Board had calculated that each vendor would be responsible to pay rent of $10,080 a year (an estimate of sorts that they were using for decision purposes), plus utilities, building tax and a proportional cost of operating the common space. That amount did not include the individual stall improvements. Vendors would also have to sign a $16,700 covenant with the owner over 15 years to cover the cost of the $2 million in upgrades.

City Market Meeting

Rough interior plans

Before the voting motion was presented, Wilkes opened the floor to questions. It was apparent that vendors were apprehensive about the Mercer Warehouse for many reasons, including the terms of the lease (some suggesting whether or not it would make more sense to simply purchase a building themselves), the viability of a multi-level market and the lack of dedicated parking, particularly for a year-round venue in a winter city. Also, though Wilkes did his best to assure vendors that the street market would continue from May through to October, he did not have a reassuring answer as to how the indoor market would interact with the outdoor component. Most of all, it became clear that vendors were not satisfied with the exploration of alternatives to the Mercer Warehouse – such as the Kingsland market model of an investors base, continuing in City Hall, or negotiating with the arena for inclusion in the winter garden.

City Market Meeting

The City Market Board

During the discussion, what was most distressing to Mack and I was perhaps the suggestion that locations outside of the core should be explored. The storied history of Edmonton’s original farmers’ market aside, as owners of a 104 Street condo and fervent downtown boosters, it was difficult not to slide into the “it has to be downtown” reasoning made (in)famous by Mayor Mandel on the arena.

After the lengthy discussion period, a motion was presented for members to vote upon. It asked whether or not members wanted the Board to continue pursuing the Mercer Warehouse as a potential year-round venue. A secret ballot was proposed for the voting, and after the votes were counted, there was no doubt the vendors did not like what they heard – 69 nay votes and only 3 yay votes.

It’s important to note that the City Market still has eight years left on the lease on 104 Street to house the summer market, but there is no doubt that there is an appetite for a year-round space in the core. The Board has been directed to go back and consider all other options – we can only hope that those options will be downtown.

9 thoughts on “Recap: The City Market Decides Against the Mercer Warehouse as a Potential Year-Round Venue

  1. Was there anymore information about how that rent number was arrived at?
    At $10k a stall and 120 stalls, that’s $1.2m a year in rent. If all of that’s actually going to rent (which I don’t suggest it is), that’s $37/sqft, which would be some of the most expensive commercial space in the city! West Ed isn’t even that expensive for that kind of size!
    Obviously 1 and a bit years of rental income is going to the renovations, but that leaves 8 years of the term with crazy rent.
    Did they try and justify that number?

  2. It does seem expensive Rob, which is why it was voted against so heavily!

    The number was for discussion purposes mainly, and did include the $2 million in market-specific upgrades which would be spread over the ten-year term (as I understood it).

    There wasn’t much discussion about justifying the number, actually. It was too shocking I think!

  3. It should be noted that people voted against the proposal for other reasons than just the financials. There are many farmer/producers that would be pushed out of the market if it were to expand to three days a week. There was also a lot of concern about the space itself not being appropriate, and not being good enough to abandon or compromise the outdoor summer market.

    For now, the market will be in City Hall. There is no rush to find another space. This opportunity came up and the board explored it. I think the membership was smart enough to take in all factors when making their decision at the SGM.

  4. Sharon – thanks for the update. I feel for those that put their volunteer time into pitching the idea. I too can’t imagine the City Market moving out of the downtown core. Sadly, they’d no longer be my local market either – I can’t imagine.

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