The sale of a prime piece of farmland on the outskirts of Kelowna has firmly closed the door on BC Tree Fruits Co-operative’s plans for a state-of-the-art packing plant in the city.
A deal that closed March 19 saw the 87-acre site at 3330 Old Vernon Road sold above asking to a local grower who intends to plant the property to cherries.
“We had really strong demand – in fact, we had competing offers, and it sold $250,000 over the asking price,” said Jeff Hudson, principal and founder with Unison HM Commercial in Kelowna, which brokered the deal.
The sale price of $9.85 million was not only above the list price of $9.6 million but a significant premium to the $6.48 million for which BC Tree Fruits purchased the property in May 2019.
At the time, the co-op planned to build a state-of-the-art plant on the site that would bring its packing operations under one roof.
But in August 2022, the co-op announced that it was backing off those plans in favour of renovating and expanding its Oliver packing house.
“The sharp rise in construction costs and interest rates along with changes in the industry made the plan for a new build far too risky,” former co-op CEO Warren Sarafinchan said in a statement at the time.
Some elements of the project had seen increases in excess of 30 per cent, he said, and the approval process for the site – which sits in the Agricultural Land Reserve – hadn’t even begun.
Instead, the co-op decided to spend its money consolidating operations at its existing plant in Oliver. It launched a multi-million-dollar expansion of the plant last year as part of that initiative.
Plans for the Old Vernon Road site remained up in the air, but Sarafinchan said the co-op intended to retain ownership despite the focus on its Oliver property.
“The plan is not to sell the Old Vernon Road property,” he told Western Investor in August 2022. “There may be opportunities … to have it as a test orchard, a place that we can show growers some of the new and leading technologies.”
Sarafinchan stepped down as CEO of the co-op last year, and the Old Vernon Road property was deemed surplus to the co-op’s operations.
“It was sitting on their books and it seemed like we just hit the timing right,” Hudson said. “People were asking if they want to sell.”
BC Tree Fruits was not immediately available for comment on the transaction.
