REGINA - City council has passed a motion to give a $6.78 million incentive to Costco for the purchase of land in the City of Regina.
Originally, Costco planned to locate its 2nd store in Regina at 8701 Dewdney Avenue.
This was approved by city council in August 2024.
However, they terminated their agreement to purchase the land back in Dec., finding a different location for "lower development costs" at the Global Transportation Hub (GTH), per a report.
Recognizing the impact of Costco, city administration negotiated an incentive agreement for the corporation.
Business and housing developers threw their support behind the incentive.
Blair Forester of Forster Harvard Development Corp. said Costco will attract many businesses to the surrounding area, hinting at a deal in place with a grocery store pending the Costco deal.
Costco’s other store in eastern Regina averages 2,000,000 visits per year, or 5,500 per day, per the report.
Forester mentioned the limited number of big-box stores left that can truly attract homeowners/businesses to an area with the departure of Lowe's and Target in Canada.
In his mind, Costco is one of the few places left that cannot be affected by the increase in online shopping.
While a majority of councillors supported the motion, there was some frustration with how the deal was handled.
"It’s frustrating when 6.8 million has to be allocated in this matter when so many other city properties have the same type of funding," said Victoria Flores (Ward 6).
Mayor Chad Bachynski said the process was not ideal.
"I expect there will be further conversations with the GTH and our provincial partners to make sure this doesn’t happen again."
Sarah Turnbull (Ward 5) was the lone councillor voting against the motion. She questioned how giving Costco an incentive wouldn’t set a precedent.
"If Costco receives this level of subsidy, how can the city refuse a similar request from a multinational retailer?"
Per the request of Clark Bezo (Ward 10), city council met off-camera for 30 minutes to discuss any legal ramifications of said precedent.
The city will pay Costco $1 million within 30 days of land acquisition, $2.89 million within 30 days after commencement of construction, and $2,89 million within 30 days of issuance of the occupancy certificate and the store opening.
The expected payback period is seven to eight years based on a development velocity similar to the Aurora project that opened in 2019.
City administration used projections from municipal taxes they're set to receive in 2025 from the Aurora Costco, roughly $517,000, and businesses now open adjacent to the store, which will generate around $540,000.
The development is expected to be 157,000 square feet, with a gas station included.
