Demolition of one of Sault Ste. Marie's worst eyesores could begin before year's end, as part of a deal to be presented to city council next week.
Councillors will be asked on Monday to approve sale of the old General Hospital building for one dollar to Green Infrastructure Partners Inc. (GIP), who will be expected to pay most of the cost of demolishing the blighted structure.
Based in Markham, Ont., GIP is one of Canada's largest infrastructure development companies.
The company was created in 2022 when it was spun off for $224 million by GFL Environmental Inc., the waste management giant founded by billionaire former Saultite Patrick Dovigi.
GFL, Dovigi and Dovigi-controlled affiliates retain significant equity in Green Infrastructure and a SooToday search of corporate registry records found Dovigi currently listed as GIP's chair.
The sale of the old General Hospital site is part of a larger deal for three former hospital properties to be presented at a city council meeting on Monday.
Three companies responded to a city request for proposals to redevelop the waterfront lands:
- Green Infrastructure Partners Inc. (GIP) and Ruscio Masonry and Construction Ltd. (Ruscio Construction)
- 9720413 Canada Ltd. (Ismarteam)
- Terra Power Systems Inc.
"The selection committee reviewed the applications and recommends the GIP and Ruscio Construction submission for approval," says Tom Vair, the city's chief administrative officer, in a report to Mayor Matthew Shoemaker and councillors.
Ruscio Construction will spend $2 million to buy the old renal building.
GIP or an affiliated company will demolish the former General Hospital building in exchange for full ownership of that property and 10 Lucy Terrace (a waterfront lot).
"The city obtained quotes within the last year for the demolition of the former General Hospital," Vair says.
"These quotes indicate the demolition of the property would cost up to $4.6 million and underscores the significant scale of the demolition project. Selling the properties to GIP for $1 will have them undertake the demolition and incur these costs and deal with any remediation issues required with [the 10 Lucy Terrace waterfront lot.]"
Vair says the General Hospital deal includes requirements that:
- rapid demolition of the former General Hospital will be undertaken commencing 30 to 45 days after the close of property sales with a demolition duration expected at six to eight weeks
- the city will waive tipping fees at the landfill for demolition waste up to 6,800 metric tonnes of construction and demolition waste with materials to be accepted that comply with provincial approvals. Based on a new tipping fee set last week of $92 per tonne, that will constitute a $625,600 city contribution
- the city will provide in-kind services from public works to support the future residential development of the properties including installation of services up to $190,000. The city may seek funding in the future from federal or provincial programs to assist with these in-kind services
- the city will support the demolition of the former General Hospital with a contribution to GIP from the demolition fund of $221,000
- GIP agrees that only waste that is acceptable to the city’s landfill can be deposited there
- exemption from the noise bylaw during demolition to permit work on a modified work schedule of 10 days on, four days off, with site work to be completed Monday to Friday 7 a.m. to 6 p.m., and Saturday and Sunday, 7 a.m. to 5 p.m., which activities may include crushing brick and shredding of materials
- licence of occupation from the city for GIP to mobilize and store heavy equipment on the site in advance of the close of the sale (as of Nov. 19)
GIP and Ruscio Construction are each expected to prepare a master plan for their respective properties within 24 to 36 months to decide future multi-residential and mixed-use development.
The former General Hospital building must be demolished within 18 months of the property closing.
A plan for developing the old General Hospital and applications for building permits for new residential/commercial units must be submitted within five years.
"If these terms are not met, the city will have the ability to take the properties back," says Vair.
As for the renal building, these conditions will apply if the city sells it to Ruscio:
- commencement of construction must occur within 12 months of the close of sale
- Ruscio Construction with pay the $2 million purchase price in instalments of $400,000 a year over five years, interest-free by way of a vendor take back mortgage.
- the city will waive tipping fees at the landfill for demolition waste up to 1,050 mt of construction and demolition waste (estimated value $96,600) with materials to be accepted that comply with Ministry of the Environment, Conservation and Parks (MECP) approvals
- city will provide in-kind services from public works to support future residential development of the property including installation of services up to $190,000. The city may seek funding in the future from federal or provincial programs.
"The purchase and sale of the former Sault Area Hospital site was a strategic community development investment," Vair says in a report prepared for Monday's city council meeting.
"Council and staff were aware the sale price through the request-for-proposals process would be less than the city’s purchase price. The investment was made to redevelop two highly visible, blighted properties on the community’s waterfront with the expectation that the city investment will be recouped and exceeded through future municipal tax revenue. As cited above, a full payback is expected in six to 12 years."
Patrick Dovigi has been in the news recently after shots were fired outside his Toronto home and another owned by his business partner Ted Manziaris, who is a consultant to GIP.
The Globe and Mail has also reported that six vehicles were set on fire on July 1 at an industrial yard used by GIP.
Monday's city council meeting will be livestreamed on SooToday starting at 5 p.m.