Just when you think all is well, and you are about to move onto making things work and realizing your dream, something comes up that threatens to derail all that we have worked for …. for the time being. We have recently discovered that we don’t have enough power to our space. We thought that 400 amps was going to be enough, but it appears that we will need more than this. What does this mean to our ability to lease this space? What does this mean to my dream?
The process of leasing a space is filled with many potholes and roadblocks. Finding a space in the right location, with the right layout, at the right price, with a landlord that wants a brewery in their space, for the right amount of term, in a city with limited quantity and quality of commercial space is not unlike finding a 4 leaf clover: Tough on the best of days.
We really thought we had found the right space for our project. We found a commercial space that is located exactly where want to be, with the perfect amount of space for our operations, a decent rate, with an amazing landlord, who would like us to be there for up to 20 years. It felt really good to find this space. We negotiated a lease for the better part of 4 months, and finally came to an agreement on terms about 4 months ago. Our agreement allowed us a 3 month period that we could apply for a DP, and carry out some due diligence on how this space would work for us.
Our first hurdle was to apply for a Development Permit, which we have successfully done. Though we haven’t officially heard back from the City of Vancouver on the outcome, we don’t see any reason why we can’t move ahead. Our second hurdle was the floors. Oh yes, the floors. Essentially, the substrate of our floors was subsiding, which means that our floor is dropping and dropping. Like all problems, you can fix anything if you throw enough money at it. We had some contingency in our retrofit budget , so we figured that we could overcome the flooring problem with more money. About $30,000 to be exact.
Well we just came across our third hurdle, and it is a little bigger of a nut than our second. We thought we were free and clear with the electrical in the building. We have 400 amps available, and we always thought it would be enough for our needs. In the past week it has become apparent we need at least 500 amps and preferably 600 amps. It would be simple to say why the hell didn’t you know that 400 amps was insufficient? The problem is until you make choices on your space, you don’t know what your exact load is going to be. Draws on power are HVAC, Refrigeration, Tasting Room, Offices, Kitchen, etc. The problem is that we made assumptions for this power based on a 6,000 sq ft space. Now that we are entertaining a space about 9,000 sq ft, you can basically multiply all your power needs by about 1.5. You can see how we ended up here.
OK, so no problem for a power upgrade but just running more power to the building from the pole out back! Wrong. The power poles that supply our building already have 3 transformers on the pole, which means that this pole is maxed out. Crap. This leaves our option to get additional power either putting in a Pad Mounted Transformer for about $120,000 or putting one on the roof of the building for even more. What the F#$%! This absolutely blows. So now, after all the time and work (never mind money) we have put into this space, it looks like we are about to walk away. While we would like to make this space work, we just can’t afford an extra $120,000 bill. We might be out about $30,000 so far, but it is worth it to lose this money in order to not lose our shirts down the road.
So we now have a huge decision to make! Option A is to drop another $120,000 and push ahead with this space, realizing our dream. Amortizing $120,000 over 20 years is only $6,000 per year, which in the grand scheme of things isn’t that much. Option B is to walk away and find a space without the number and cost of upgrades this space needs. We would go into this process knowing full well that it could be another 6 months before we find another space that works really well for us.
We have another 2 weeks to make our decision, before the subject period on our lease expires. In other words, our landlord will want us to piss or get off the pot with regards to his space in 14 days. Looks like there will be a lot of sleepless nights coming up. If you have any advice for us, please contact me to pass it along. It would be greatly appreciated. Until next time …..
My fingers are crossed for you.
Thanks for the thought. We met with 3 engineers, 2 architects, 1 landlord at the site, and hashed out a plan. We should hear back on Monday if what we think can happen, will actually be feasible. Will update you when I know.
What do you get when you have 5 consultants and one landlord in a room?
Hopefully a brewery with power.
Hoping it all works out.
Thanks for the laugh … I needed that. The other thing you get when you have 5 consultants and 1 landlord is a huge bill. Definitely one of the most expensive meetings I’ve had.
Maybe also a headache. But alas. Lets hope all the money was well spent.