Niverville asks court to void agreement for stalled $10M hotel project

A sign advertising a planned 73-room hotel with a waterpark stands on vacant land in Niverville, Man. on Aug. 21, 2026. The town is taking the developer to court to void the agreement after it says the company missed multiple construction deadlines despite extensions. (Scott Andersson/CTV News Winnipeg)

The Town of Niverville is asking a court to void its development agreement for a long-stalled hotel project after it says the developer failed to meet construction deadlines despite two extensions.

According to a notice of application filed on Aug. 13 in Manitoba’s Court of King’s Bench, the town south of Winnipeg is asking a judge to declare the development agreement “of no force and effect.”

The filing names Steel Creek Developers Inc. as a respondent and states the town entered into the development agreement with the company in February 2023.

Under that agreement, a 73-suite hotel with a water park was planned for 200 Drover’s Run, next to Provincial Road 311. The facility was also slated to include an eating and drinking establishment, liquor sales, and patio spaces, according to the agreement filed as an exhibit.

According to an affidavit sworn by Eric King, Niverville’s chief administrative officer, the agreement required construction to begin by March 1, 2023, and be completed by Oct. 31, 2024, unless the parties agreed otherwise in writing.

A development permit issued on March 31, 2023, and filed in court pegged the hotel’s expected valuation at just over $10 million. Under Niverville’s bylaws, that permit was set to expire within 12 months unless work had started.

Court records show the developer never broke ground and twice sought — and received — extensions of the permit. The town subsequently granted an extension to March 31, 2025. A second extension request, made in February 2025, pushed the construction deadline to March 31, 2026.

“The term of the second extension has now expired and the parties have not otherwise agreed to an alternative development timeline or another extension of the development permit,” reads the filing.

“To date, no development or construction of any sort has taken place on the property.”

According to King’s affidavit, Niverville’s council met in March to consider a third extension request but declined it. The council cited the company’s property tax arrears dating back to 2023, the property’s pending tax sale, and “continuing uncertainty” about the development’s plans.

King says he wrote to the developer in June, telling the company its permit had expired and that it was in breach of the agreement for failing to start construction. The letter gave the company 10 days to provide a revised timeline for the development.

“To date, we have not received a revised development timeline or any communication from the respondent in response to the letter,” King said in his affidavit.

A sign still standing on the vacant property Friday advertises the planned Blue Crescent Hotel — a brand launched by Steel Creek Developers, according to the company’s website.

King also says he was advised by the Rural Municipality of Hanover—which handled building permits on the town’s behalf at the time—that it has no record of a building permit application ever being submitted for the property.

The town also wants the court to order that a caveat—a legal notice registered on a property’s title that flags a claim or interest in it—be discharged from the land title.

In his affidavit, King says he was told by the town’s legal counsel that leaving the caveat on title exposes Niverville to potential liability.

Correspondence from the town to the developer, dated March and filed in court, states that the property will be up for tax sale this year.

The stalled project comes as Niverville has grown rapidly in recent years. The town’s population rose 29 per cent between 2016 and 2021 to 5,947, making it the fastest-growing municipality in Manitoba during that period, according to Statistics Canada.

Niverville Mayor Myron Dyck said the original fees tied to the agreement — covering things like water and wastewater hookups based on the planned number of suites — no longer reflect current costs, three years after they were set.

“It’s administrative — just part of the process,” Dyck told CTV News. “So anyone that would now want to do a hotel on that site, and they’re more than welcome to, would just need to deal with a new development agreement with the new fees.”

Dyck added that the town remains open to working with Steel Creek Developers or another developer on the site.

“We’re still interested in seeing that site developed as a hotel,” he said. “But it’s just as per our policies — if there’s no action within a set number of time, things just lapse, and the process to close this is to go through the legal means.”

In a statement to CTV News, Steel Creek Developers CEO Trevor Rempel acknowledged a delay on the ownership group’s side, but did not elaborate on its cause.

“We are working with a local shareholder group to have the project brought back online,” the statement adds. “We hope to start our work in the near future.”

None of the claims have been tested in court.