The Guardian | Published April 2, 2026 By Tim Banks
As a builder and developer, I often explain to clients that a smaller house can cost more per square foot than a larger one. Even the most modest home still needs a kitchen, a bathroom, plumbing, electrical systems and a foundation. Some costs are simply structural.
Prince Edward Island faces a similar reality. We are a small province, but we still need hospitals, roads, schools and public services. With a population of just over 170,000 people, we carry all of the same governance responsibilities as much larger provinces, but with a far smaller tax base to support them. This helps explain why debt pressures feel more painful here than elsewhere, and why it’s more urgent than ever that we listen to PEI’s Auditor General, Darren Noonan, as our debt continues to climb.
But when it comes to the debt problem, scale and spending alone do not tell the whole story.
Another important factor is the role the government chooses to play in the economy. This is particularly true when it comes to real estate development and commercial projects. In my view, this is an area where well-intentioned public investment has too often led to disappointing long-term outcomes and huge financial losses.
A telling example is the Atlantic Technology Centre (ATC) in downtown Charlottetown. Conceived during the optimism of the late-1990s technology boom, the project aimed to position Prince Edward Island as a hub for innovation and digital growth. The vision was understandable. Many provinces were pursuing similar strategies at the time, but mostly through private investment.
However, by the time the ATC opened in 2002, the global tech bubble had already burst. Market conditions had shifted dramatically. The building ultimately cost about $20 million (about $4 million more than originally budgeted) and included design features that were quickly overtaken by technological change. Over time, the tenant mix evolved away from private-sector technology firms toward government offices, a radio station, non-profit organizations like the Black Cultural Society and others that don’t fit the original business plan.
Today, the facility continues to operate, but it loses more than $2 million a year. This loss is covered by taxpayers. Spread across the population, an ongoing expense like this may appear modest on a per-person basis, or compared to the $3 billion of accumulated debt that Auditor General Noonan is warning us about. Yet in a province of our size, millions of dollars tied up in underperforming assets represents real opportunity costs. Those are funds that could otherwise support critical infrastructure, modern equipment or strategic investments with clearer long-term returns. As a point of comparison, $2 million is about the cost of two MRI machines.
I’m not bringing this up to shame former politicians and their past decisions, nor to blame individuals who acted with the best intentions. I’m focusing on the ATC because it is just one building, and one example that can and should be learned from as we look ahead.
Governments play an essential role in setting policy direction, investing in public goods and creating the conditions for economic growth. But they are not good at managing the risks inherent in speculative commercial development. Political timelines are short, and accountability is lacking because it is spread across the faceless bureaucracy. Market discipline is difficult to maintain when success is measured in electoral cycles rather than financial performance.
The private sector, by contrast, lives or dies by its ability to assess demand, control costs and adapt quickly to changing conditions. Projects that do not make economic sense are re-designed, repurposed or abandoned. That discipline is not a guarantee of success, but it is a powerful safeguard against long-term financial drag.
As Prince Edward Island confronts growing debt pressures, the conversation should not focus solely on how much we spend. It should also examine what the government is investing in, and whether those activities align with demand and their core strengths. In short, I believe that the government needs to set the tone and objectives to grow our economy and then leave the implementation of such to experienced individuals who understand market conditions and return on investment.
The ATC is a prime example of this kind of problem, but it is not the only one. My next column will focus on the Charlottetown Area Development Corporation, an organization that started with a great mission and strong leadership, but that evolved into a dumping ground of political projects and patronage. The current renovation of the former Irving gas bar on Euston Street (which has no business plan) is evidence that the CADC lacks appropriate leadership. No business-focused board would have let this project pass the smell test. It stinks, as do most of their recent investments.
Today, my message is simple: Disposing of non-preforming assets and getting the government out of the business of commercial development will not solve our fiscal challenges overnight. But it would be a meaningful step toward a more disciplined, sustainable approach to growth. Engaging and enabling the private sector to support the vision and intentions of the government would help to clarify what is possible and keep things focused on getting the fundamentals right.
The debt problem scares me. It should scare all of us. What will solve it is clearer government leadership about where public effort belongs, and where it does not.