Friday, September 15, 2006

More proof Hamilton City Council is stupid: City Hall reno costs explode

A few months back, the City of Hamilton decided to pass up on doing the right thing and building a new City Hall to replace the 1950s white marble, Art Deco structure that is way beyond cramped, decades behind code, and leaking. The official reasoning: It was cheaper to renovate the existing bunker for $42 million than build a new structure for $120 million. The real reason, I believe, is that unlike nearly cities like Cambridge and Mississauga, there has been a long standing aversion in Hamilton to private-public partnerships (P3) where they make sense; especially when it comes to the civic square.

Now, we're learning consultants say the renovations will cost at least $55 million, just under half of what it would have cost to just tear down the old place and build it properly, from scratch. Not very good news with a municipal election less than two months away. And it also demonstrates a lost opportunity to coordinate with other long awaited redevelopment projects downtown. Consider, for example, the announcement here the other day that the people redeveloping the bankrupt Royal Connaught (which went into the toilet after Howard Johnson pulled its franchise on the previous owners for not keeping the historic building up to code) signed a new affiliation agreement with Marriott Renaissance and, contrary to previous plans, will now build a brand new condominium next door rather than just have a joint hotel/apartment.

That empty lot, currently used for parking, would be perfect for a city hall and integrating it with office and accomodation space would have made it a magnet. Yet once again, no imagination is coming from the current denizens of the council chamber. 35 years ago, Jackson Square was supposed to be the ultimate shopping centre and civic square. What did we do? We gave a decades long lease to an absentee landlord in Montréal, taxes there are still ridiculous for tenants, and unlike other shopping malls in the city which are open until 9 or even 10, it closes at 5:30 pm most days. What the hell's with that? And the hotel at the mall, long rated 4 diamonds by AAA, has been at three for several years -- which doesn't bode well for convention business which wants premium accomodations.

Compare that to the two cities I mentioned above. Mississauga decided to build its city hall from scratch, and partnered with private business to create new Class One office space as well. Prime and preferred retail space, and who gets the rents? The city, of course. Plus, the hotels in the areas are superb -- were from the very beginning. Cambridge rents space in an office tower, not afraid to admit it's less expensive to do that than have its own physical plant. Few people are complaining there -- and the long time pro business environment in Waterloo Region is another plus.

Hamilton got burned with the water and sewer contract a few years ago, which rotated from one operation to another and at one point was held by ENRON. But P3s do work sometimes, as other cities prove. Hamilton just doesn't know how to do the right thing, or how to stand up to unions while working with them. That's going to affect how I'm going to vote this fall. No incumbents.

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