Investment firm purchases historic Coach Inn – Owen Sound Sun Times

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A Mississauga-based real estate investment company has purchased the landmark Coach Inn building, which contains emergency accommodations for people experiencing homelessness as well as multiple affordable residential units.

BG Wealth Properties, which says on its website that its investment strategy allows the company to renovate properties and increase rents to create “attractive cash distributions and substantial increases in the after-repair value of our buildings,” made the announcement Monday.

The news ignited concerns in the community that the company would renovate the rooms at the Coach Inn and then increase the rent, as it has done with its other properties in Owen Sound, leaving the units out of reach financially for tenants in need of affordable options and further compounding the lack of rental housing in the city.

But officials with BG Wealth said Tuesday the company views the Coach Inn, which has 44 residential units, differently than the other properties it has acquired, which are long-term rentals and required improvements.

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“When we look at the Coach Inn, the Coach Inn is serving a different purpose – it’s short-term rentals for individuals who need affordable housing and we recognize that as a need in the town,” CEO Craig Dunkerley said in an interview.

Asked if he sees the building remaining as an affordable housing option for people in the long-term, he said that will come down to what the city requires as it goes through its revitalization of the downtown.

“It will come through communication with the city as to what is required in the future,” he said.

Jakob Harvey, director of acquisitions and business growth, said, in the short-term, the company plans to improve the living accommodations for those at the Coach Inn by refurbishing the floors and updating the fixtures.

“In the near future, we do not have plans to substantially increase the rents because we recognize it’s a different group of people in the Coach and it’s really serving the community of Owen Sound. So, no, we have no immediate plans for a rent increase,” he said.

Again, in the long-term, he said any decisions will be made in consultation with city officials and the community.

The property at 1005 2nd Ave. E., historically known as Seldon House, was listed for $2.75 million by Sotheby’s International Realty Canada. The online listing says the “investment property” has an English pub leasing the main level, while the upper floors contain hotel rooms that are leased monthly and are “fully occupied with a waiting list.”

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Joan Chamney, program co-ordinator with YMCA Housing, said for many years, owners of the building have been “very welcoming to a large, diverse group of people” who have been in need of an affordable place to stay in Owen Sound.

The organization uses several main-floor rooms as emergency/transitional accommodations.

“For people that have nothing tonight, we can call them and they reserve a few rooms for us – for our use, for Safe ‘n Sound’s use and for the police to use. So should somebody be found to be homeless at 10 o’clock at night, they can be taken there,” she said.

YMCA Housing also refers people who are struggling to find affordable housing to rent the upstairs rooms at the Coach Inn.

It would be a “huge loss” to lose that kind of rooming, she said.

Toni McGregor Callaghan, executive director of Safe ‘n Sound, said the homelessness prevention organization frequently refers people to the emergency beds in the Coach Inn.

It’s nearly impossible, she said, to find the kind of affordable rooms available at the Coach Inn elsewhere in Owen Sound.

Some of the rooms are occupied by couples, she said, and some people have lived there for many years.

She said she is deeply concerned about what the people who live in the rooms would do if they no longer had that option for accommodations.

Grey County council heard last month that 560 county residents are on waiting list for affordable housing, while vacancy rates in the county are at historical lows and there have been “substantial increases” in rental rates throughout Grey.

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The listing for the building also says the units in the Coach Inn fall under the Innkeepers Act.

Seana Moorhead, executive director/lawyer at the Grey Bruce Community Legal Clinic, said that’s been a subject of dispute, with the clinic taking the position that the Residential Tenancies Act may apply to tenants who reside in the building.

Some tenants have challenged previous owners’ positions that the act doesn’t apply, she said, and, to the best of her knowledge, those claims have been settled out of court.

The RTA provides protection for tenants, including a process that landlords must follow before an eviction can occur, while the Innkeepers Act does not.

The 15,500-square-foot Coach Inn, located at the 10th Street and 2nd Avenue East intersection, was built in 1887 as a hotel with 44 rooms, three parlours, a bar, dining room and sample rooms.

From 1904 to 1937, it operated as a temperance hotel by the daughters of Mary Doyle, founder of the Women’s Christian Temperance Union in Owen Sound, the first organization of its kind in Ontario.

In 1984, the entire exterior facade, lobby and main staircase was designated under the Ontario Heritage Act by Owen Sound. Seldon House is also listed on the city’s register of properties of cultural heritage value or interest.

The building was sold in 2018 by then-owner Jason Queenen, who had the property listed for sale for $1.95 million.

In September 2019, new owner Jeff Mundle applied to city hall for a double facade grant to improve the exterior.

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BG Wealth Properties has a website dedicated to Owen Sound, which says the city “is a hidden gem with immense opportunity for development” and the “opportunity aligns with BG Wealth Group’s vision and value-investing philosophy to develop undervalued properties in areas with high-growth potential.”

A timeline on the website says the company acquired in March 2019 buildings at 261-281 9th St. E., which contain nine residential and six commercial units. It notes the monthly rents upon acquisition ranged from $550 to $750 for one-bedroom units and $950 for two-bedroom units.

“BG Wealth Properties Inc. renovated two one-bedroom units thereby increasing rents for the two units to $1,100 per month each and the one two-bedroom, which the rent was increased to $1,400 per month,” the website says.

The company then acquired in June 2020 buildings in the 900 block of 2nd Avenue East, which contain 13 residential and two commercial units, the website says. Rents averaged $750 a month, which offered “immense opportunity to rehab units and substantially increase rents and buildings value,” it says.

In August 2020, the company “secured a new tenant for another of the one-bedroom units at $1,300 per month. This unit was previously being rented at $650 per month. This increase from the $1,100 we could get last year to $1,300 this year shows there is even stronger demand and more growth possible,” the website says.

Dunkerley said he came across Owen Sound about three years ago while looking for an Ontario community where BG Wealth could invest and be a part of rebuilding the community.

“I saw coming into that there was a lot of effort being made by the Downtown Improvement Association and the business and economic development committee to make improvements. And the province bringing in money to redo the waterfront and the city looking to revitalize and maintain their heritage, it just seemed like an area that we really wanted to be a part of and see how we could help and bring more to the area as well, whether that be helping the residents or bringing in business that are desirable in a downtown core,” he said.