Vacant for 13 years, the old Sault Area Hospital buildings on the waterfront will be purchased by the city for $4.75 million.
City council voted unanimously Oct. 1 to buy the property from Leisure Meadows Community Living Inc. and 1667271 Ontario Inc.
The decision follows five years of frustrated efforts by the city's building standards and legal staff to get the property safely secured and maintained.
"We are at a point where every year we don't do something about this property, is a year that we are leaving significant money on the table in terms of potential tax revenue, and a year that our community is not benefiting from the redevelopment of a beautiful and pristine piece of our waterfront," said Mayor Matthew Shoemaker.
"The only way we can impose conditions on this property is if we sell it to someone after owning it and impose those conditions on them," the mayor said.
"This has been a source of contention in our community in terms of the state of disrepair it's been left in.
"We have tightened up our property standards bylaw three to four times in the 10 years I've been on council, every time with this property in mind, frankly.
"How is it that they are getting around our property standards bylaw?"
"The reality is, every time we've tightened it up, the ownership has only met the bare minimum of the new property standards bylaw.
"And that is all that I believe this property owner is ever going to do. There is never going to be a redevelopment, unless we are the impetus for change on this property," Shoemaker said.
The game plan now is for the city to buy 995 and 941 Queen Street East, quickly issue a request for proposals and sell the properties to a developer, generating $2.3 million to $2.5 million.
The developer would then pay the estimated $4.5 million cost of demolishing the old General Hospital building.
The renal building would be refurbished.
The site has potential to host between 140 and 422 residential units, creating as little as $1.2 million or as much as $20.9 million in additional annual tax revenues over 20 years, depending on density and the number of affordable housing units included.
"Based on current experience, staff believe the scenario with 30 per cent affordable units would likely be the highest number of affordable units for a new development on this property," said Tom Vair, the city's chief administrative officer, in a report prepared for tonight's meeting.
"In the high-density scenario, this translates to $15.3 million over 20 years with a two per cent average annual tax increase," Vair said.
"The medium density scenario would generate $5 million over that same period."
The land is to be sold as three parcels, as shown in the second image in the photo gallery above:
- Area A including the former General Hospital site to the waterfront
- Area B consisting of a parcel of land with waterfront access
- Area C including the former Renal Building and a large portion of waterfront land
Vair said the negotiated $4.75-million sale price for the three properties was arrived at after considerable bargaining.
"We started with a much higher number – probably over $10 million, and we ended with $4.75 million," Vair said.
"We feel that given the analysis of return on investment, we have a price that we can recommend to council and an opportunity for the community to move forward."
