What's next for Hamilton's brownfields?

Hamilton has its work cut out for it when it comes to developing the Bayfront industrial area's mass of brownfield land, a leading industrial broker says.

"It's 100 plus years of heavy industry down there," said Drew Blair, a broker and partner with the Blair Blanchard Stapleton real estate brokerage. "But now you have a more stringent environmental act that most of those sites couldn't meet if they were tested today."

Brownfields are underdeveloped or once-used industrial properties that might be contaminated — and Hamilton has a lot of them. The city estimates that there are hundreds of vacant "under-utilized" buildings and properties in the Bayfront industrial area alone.

'As a city, what do we want to do? Just push it to the side forever? Or do we tackle it now?'—Mathieu Langlier, executive officer, Hamilton-Halton Home Builders' Association

The building stock in that area is older than much of the city, and many of its buildings lie abandoned and derelict. Environmental advocates were pushing for the redevelopment of those lands instead of the city's controversial Airport Employment Growth District, but lost that battle when the Ontario Municipal Board ruled in favour of the proposed expansion.

But that doesn't mean that the city's priority shouldn't still be redevelopment in the Bayfront area, says Don McLean, a founding director of Environment Hamilton. He sees that as the city's first step, as laid out by the province. According to a provincial policy statement, "long-term economic prosperity should be supported by promoting the redevelopment of brownfield sites."

"All of those opportunities are still there. They haven't changed," McLean told CBC Hamilton. "The city can still do the right thing."

Businesses want 'virgin' sites

But that's easier said than done, Blair says. When shopping industrial properties to prospective buyers, many just aren't interested in brownfield development.

"Certain industries just want to be on pristine, virgin sites," Blair said, adding that it's extremely difficult to get a company to purchase brownfield land. "If your industry wants a clean site — that image and that feel — you're not looking at brownfield sites."

Cost is a big factor too. The city estimates that developing a brownfield site is between 14 and 27 per cent more expensive than a comparable greenfield site. And if that brownfield site had, say, a 40,000 square foot building on it that had to be demolished (which isn't uncommon in Hamilton's older industrial area), that price actually rises to between 22 and 34 per cent more expensive.

The city does have its Environmental Remediation and Site Enhancement (ERASE) community improvement plan, a set of programs designed to encourage and promote brownfield redevelopment.

The ERASE plan offers a set of grants and funding to prospective buyers who might purchase a brownfield site — but the city doesn't have a great track record when it comes to making those sites viable for industries, Blair says.

It would likely take a helping hand from the province or the federal government to really get things underway, he says.

"Cleanup is the easy answer, but it's much bigger than that," he said. "As long as the environmental act stays the way it does and the lower city has the perception it does, I don't know where you'd even start."

Meeting demand

Expanding the city's boundaries by the airport was a necessity, even with the brownfield sites in the lower city, says Neil Everson, Hamilton's director of economic development. He says the city has only a 2.4 per cent vacancy rate for industrial properties — a number that is just too low.

"The fact is, we don't have enough buildings that meet the demand of companies looking to move here or expand," Everson said. "It's a real issue."

Blair, for his part, agrees. He says the industrial vacancy rate in the city has been an issue for the last number of years.

"It makes our job very difficult," he said. "You can sometimes answer a client right then and there and say 'no, that doesn't exist' — which isn't a good answer to give them."

Everson says that while yes, there may be a lot of vacant industrial properties in the lower city, most of them don't meet the needs of modern businesses. Most need at least 25-foot ceilings, loading dock doors and immediate access to a major highway, he says.

"Yes, people might see a lot of empty buildings, but do they meet those criteria?" Everson asked.

"They don't have the utility left in them," Blair said. "They're past their time."

Now or never

But Mathieu Langlier, the executive officer at the Hamilton-Halton Home Builders' Association, says that even with the airport lands ruling, the city still needs to push ahead with developing Bayfront brownfield land.

"It's always going to be more work," Langlier admits. "But as a city, what do we want to do? Just push it to the side forever? Or do we tackle it now? It will still be a problem in ten years."

He also questions the city's 2.4 per cent industrial vacancy rate. "What really is vacant?" he asked.

"That's a nice number — but take a drive along the waterfront. It's not possible."

Langlier says the city needs to step in and force absentee landlords that own lands that are "contaminated, under-utilized and under-taxed" to do something with them instead of having them lie empty.