Alternate Use Study Surplus Lighthouses, Canada Final Report March 2011 Prepared for: Fisheries and Oceans Canada Prepared by: Room 10E262, 10th Floor CRG Consulting 200 Kent Street 325-301 Moodie Drive Ottawa, Ontario Ottawa, ON K2H 9C4 K1A 0E6 Tel: (613) 596-2910 Fax: (613) 820-4718 www.thecrg.com In Association with: Colliers International 1 Table of Contents Alternate Use Study Surplus Lighthouses, Canada ....................................................................... 1 1.0 Executive Summary .......................................................................................................................... 3 1.1 Mandate and Approach ................................................................................................................ 3 1.2 Research Findings ......................................................................................................................... 4 1.2.1 Alternate Uses ............................................................................................................................. 4 1.2.2 Ownership Models ..................................................................................................................... 5 1.2.3 Disposal Processes ...................................................................................................................... 6 1.2.4 Key Success Factors ................................................................................................................... 6 1.2.5 Portfolio Tiering ......................................................................................................................... 8 2.0 Study Scope and Approach ............................................................................................................ 10 2.1 Background ................................................................................................................................. 10 2.2 Study Scope and Approach ........................................................................................................ 11 3.0 Research Findings ........................................................................................................................... 12 3.1 Alternate Uses .............................................................................................................................. 12 3.2 Ownership Models ...................................................................................................................... 14 3.3 Processes ...................................................................................................................................... 14 3.4 Key Success Factors .................................................................................................................... 15 4.0 Portfolio Tiering .............................................................................................................................. 18 Appendix A: Project Examples – Canada .......................................................................................... 22 Appendix B: Project Examples – International ............................................................................... 115 1.0 General Summary of Case Studies and Findings from other Research ............................... 115 2.0 Case Studies from the United Kingdom .................................................................................. 115 3.0 Case Studies from the United States ....................................................................................... 117 4.0 Case Studies from Australia..................................................................................................... 123 5.0 International/ Other Case Studies ........................................................................................... 126 Appendix C: US National Historic Lighthouse Preservation Act – Excerpts ............................... 127 The NHLPA Program at a Glance ................................................................................................ 127 2 1.0 Executive Summary 1.1 Mandate and Approach The recently introduced Heritage Lighthouse Protection Act (HLPA) 2010 allows for the designation of lighthouses as heritage properties. The Act also facilitates the sale or transfer of heritage lighthouses. The Department of Fisheries and Oceans Canada (DFO) has declared a number of custodial lighthouse properties surplus to its operational requirements. In alignment with the HLPA and respecting its custodial obligations in accordance with Departmental and Treasury Board (TB) policies, DFO will consider proposals aimed at divesting its surplus lighthouse facilities. It is expected that the introduction of the HLPA will accelerate the pace of lighthouse divestitures. Accordingly, the Department is seeking to better understand conditions under which surplus lighthouse properties can be redeveloped for viable alternate uses, particularly those alternate uses which afford ongoing public access to the site. This review will assist DFO in assessing proposals it is likely to receive for the transfer of its surplus lighthouses. The review can also be used to identify criteria under which disposals which ensure ongoing public access may be most successful, and similarly conditions under which public use disposals may not be viable. Additionally, this review can be used by those seeking or interested in acquiring surplus lighthouses, by identifying conditions and criteria under which proposed alternate uses are most likely to be viable and by extension identifying the elements that should be considered and addressed within an acquisition proposal. The scope of the study, as per the Client Terms of Reference therefore, has been to: • Research and identify potential alternate uses for surplus lighthouses; • Identify conditions under which alternate uses which promote ongoing public access are most likely to be successful; and similarly, • To identify conditions under which alternate public uses are likely not viable. This mandate has been accomplished primarily through the identification and review of actual examples or case studies where surplus lighthouses have been disposed and subsequently adapted for alternate uses, both in Canada and Internationally. This included examples identified through consultations with DFO officials in the various Regions across Canada, and other examples identified through independent research conducted by the Study Team comprising CRG Consulting and Colliers International. In accordance with the Client Scope of Work (SoW), site visits were not conducted to any lighthouse properties. 3 The research identified approximately 80 lighthouse properties that have been successfully disposed and adapted for alternate uses. This includes properties both within and outside Canada and comprising a wide cross section of lighthouses according to type, size, construction materials, age, location, those which include/exclude ancillary buildings, excess lands, etc. This number of examples and facilities is considered sufficiently large to identify key trends and themes in terms of uses pursued, ownership structures, and common criteria or key success factors. 1.2 Research Findings 1.2.1 Alternate Uses The research identified a wide cross section of successful alternate uses for lighthouse properties which involve and permit ongoing public access to the sites. The most common alternate public uses are tourist or cultural/heritage related. This includes numerous examples of lighthouse facilities that have been converted for uses such as: • Museums; • Inter-active/Interpretive centres; • Eco-Tourist related facilities (locations for whale/bird watching, etc); • Parks; • Tourist accommodations (boutique hotels, bed & breakfast establishments, youth hostels, campgrounds, etc.); • Special event facilities (for meetings, receptions, corporate retreats, fishing lodges, etc.); • Restaurants; • Gift shops; and, • Research/Education facilities with affiliation and management with a Post Secondary Education Institution or School Board. These types of uses are generally to be expected given the waterfront and often tourist locations associated with lighthouses, although some lighthouses in isolated locations have been successfully converted – including those on islands, adding to their appeal for certain uses, boutique hotels and destination getaways for example. Also common as an alternate use for lighthouses is conversion for private residences. There are many examples of this type of conversion, both in Canada and Internationally, although in Canada lighthouse disposals and conversions for private residences occurred mostly prior to 1960. There is evidence and numerous international examples where conversion for use as private residences has retained the heritage character of the lighthouse. Indeed, it is a requirement in most countries that the heritage character of the lighthouses be retained, regardless of the alternate use. In these particular instances, primarily within the United States examples, the structure of the purchase and sale agreement between Government and individual purchaser has specified the retention of heritage features as well as the expressed obligation for the environmental and 4 structural et al. rehabilitation of the facility. Further, the purchaser is obligated to accept the property on an ‘as-is where-is’ basis with no representations, studies, due diligence provided by the Vendor to the Purchaser. This disposition structure