City to spend $450k on improving Stelco Tower for Hamilton Health Sciences

The city will spend $450,000 on improvements to three floors in the old Stelco Tower for 350 workers from Hamilton Health Sciences who are expected to relocate to the downtown building later this year.

Supporters of the loan – which turns into a grant if HHS stays put for five years – cheered the chance to get 350 well-paid jobs downtown for the sake of its economic ripple in the core.

But the move didn't sit well with a few councillors like Coun. Terry Whitehead representing outlying wards who felt the move was "ripping and raping" jobs from his ward on the Mountain.

If that's a win, then boy, I've lost the definition of a win.- Coun. Terry Whitehead

"One person's benefit should not be another person's loss," Whitehead said.

Whitehead later posted a statement on Twitter that he did not mean for his language to be disrespectful to survivors of sexual assault.

Vacant for 12 years

The money comes from a city program begun four years ago that's meant to incentivize companies moving into the city's vacant business space in the core. It allows the city to spend money to help companies make the improvements to buildings, like carpets, lighting and office partitions.

In the case of the Stelco Tower, the space has been sitting vacant for 12 years. Part of the space will be used for collaborative projects with IBM Canada.

"The reason that we support it is that we get what we want," said the city's director of urban renewal, Glen Norton. "This is a win-win situation... It does assist us in council's direction to reinvest in the downtown."

'We've taken a bit of a hit'

The problem stems back to decades-ago losses of huge companies like Stelco, Proctor and Gamble and Philips Environmental.

The grant program also helps the city provide a buffer to more recent job losses downtown, like consolidation of insurance companies and a potential move or downsizing of big corporate tenants.

"We've taken a bit of a hit in this area," Norton said. "This is the counter-hit."

HHS is expected to spend $5.1 million on improving the decades-old spaces, and had asked the city for $700,000 – a one-time increase to the cap that is usually $450,000. The move involves relocating 350 workers from the hospital system's aging Chedoke Hospital site on the Mountain.

"This is a major spend, a lot more than we ever dreamed of," Norton said. "In our view, the least we could do to help this expensive endeavor along."

Norton said that the lost property taxes on the space, since HHS doesn't pay property tax, will be about $13,600 each year. But he said he expected both the spillover economic impact and the redevelopment of the Chedoke Hospital lands to cover that hit.

'Shifted downtown'

Whitehead framed the discussion about this one particular grant in an existing program in the context of a larger tug-of-war that he sees between Hamilton's core and lower city and the Mountain.  

"These are 350 jobs taken from Ward 8, from another part of the city, and shifted downtown," Whitehead said. "If that's a win, then boy, I've lost the definition of a win." 

Coun. Jason Farr, who represents downtown, pointed out that recent insurance company consolidation recently sent 200 jobs out of downtown, to the Mountain, to Ward 6.

And Coun. Sam Merulla argued that the move to invest in Hamilton's downtown "benefits the city in its entirety."

"This entire city needs to be coming together, not divided," he said.