Out of Town Developers

[raisethehammer]

do we even have proper developers in Hamilton's former city?? they all appear to be speculators to me.
Not one of them takes a lead role in trying to change the operations at city hall...in fact, they encourage all the easy approvals for sprawl and stupid taxes that encourage vacant brownfields.
We need guys with vision like Frisina who went before council and had the 6-storey height limit repealed in order to build an 18-storey apartment - wonderfully designed might I add (any developer who cares will get a GOOD architect). Then he went on to build a 43-storey tower that remains our tallest today. From 6 stories to 43! How? By educating the council on the merits of intensification and building 'up' instead of 'out'.
todays losers do the complete opposite....they try to brainwash the local populace of the 'harmful' effects of building up instead of out. Raise the Hammer nailed this issue a couple of years ago:

http://www.raisethehammer.org/blog.asp?id=033

These guys are losers with no vision for the city. How far we've fallen since the days of great vision and smart business practices of guys like Frisina.

[Goldfinger]

Originally Posted by raisethehammer

do we even have proper developers in Hamilton's former city?? they all appear to be speculators to me.
Not one of them takes a lead role in trying to change the operations at city hall...in fact, they encourage all the easy approvals for sprawl and stupid taxes that encourage vacant brownfields.
We need guys with vision like Frisina who went before council and had the 6-storey height limit repealed in order to build an 18-storey apartment - wonderfully designed might I add (any developer who cares will get a GOOD architect). Then he went on to build a 43-storey tower that remains our tallest today. From 6 stories to 43! How? By educating the council on the merits of intensification and building 'up' instead of 'out'.
todays losers do the complete opposite....they try to brainwash the local populace of the 'harmful' effects of building up instead of out. Raise the Hammer nailed this issue a couple of years ago:

http://www.raisethehammer.org/blog.asp?id=033

These guys are losers with no vision for the city. How far we've fallen since the days of great vision and smart business practices of guys like Frisina.

The Century 21 building was a commercial failure. Al Frisina had vision but that project was not viable in Hamilton as it went under power of sale a few years later. He never returned to the core, he instead went out to the burbs and built subdivisions like everyone else.

[Hammer Native]

I have a handful of history books about Hamilton and have watched a few documentaries over the years, some of you may have to. I get the sense that the forefathers and builders of this city of the early twentieth century were big visionaries and believed Hamilton could be anything. I'm talking about the McQuestons, the MacNabs, and the enterprising business people of that era. And I think evidence of that can be seen in the quality and architecture of our old buildings and structures. (Boy if only they were all still standing.) McQueston was responsible for the high level bridge that now has his name on it, and wanted it to be impressive. Look at the beautiful detail of the former Bank of Montreal (Gowlings) building at Main and James, inside and out. Look at the suburban box we have at Main and Bay today.

I have a history documentary on tape, (when I find it I'll pass on the name because I think it still can be purchased.) Anyway I recall someone from then making a statement that they believed Hamilton could one day rival Toronto and "maybe even New York." How's that for big thinking?

Well ladies and gentlemen I would also like to say as one of the new guys on the board I was happy to see a thread I only just started yesterday has generated so much activity and interesting conversation. And to think I was worried it about it being ignored. HA, HA, I'm half kidding but it makes me glad I joined in. I don't know if this will be my last post today but have a good night all.

[thistleclub]

Originally Posted by Hammer Native

I have a handful of history books about Hamilton and have watched a few documentaries over the years, some of you may have to. I get the sense that the forefathers and builders of this city of the early twentieth century were big visionaries and believed Hamilton could be anything. I'm talking about the McQuestons, the MacNabs, and the enterprising business people of that era. And I think evidence of that can be seen in the quality and architecture of our old buildings and structures.

A different era, to be sure. the industrial era excited a lot of big thinking and bold planning, wheras today people seem to be more about contingencies than the plan itself. Broad brush-strokes: The early 20th century was concrete; the early 21st century is abstract. There are obviously vast differences in the kind of building materials favoured by various eras, and the amount of money people are prepared to sink into detail work and craftsmanship. Even expensive modern buildings aren't neccessarily well-built. The Michael Lee Chin-funded addition to the ROM, for example, is not without material flaws even now.

To be a little contrary, MacNab and McQuesten weren't developers. They were connected, high-ranking lawyer-politicians who were able to do what they did in part because they were able to rally backing from banks or higher levels of government. If they lived today and behaved like most of their peers, they might have taken up posts on Bay Street boards after leaving office rather than trying to muddy their hands with urban development. Their legacies are picturesque but ambiguous. MacNab's most impressive legacy is Dundurn Castle, which of course was not the most selfless project. McQuesten left us some beautiful infrastructure but was also an evangelist of highways. He also helped lure McMaster to the city, and in that he pointed the way toward our modern era of institution-building. Since 2000, local business philanthropists have pumped more than a quarter of a billion dollars into the school's coffers, much of it devoted to MUMC and Hamilton Health Sciences. Although these gifts have not fueled a renaissance of Victorian architecture, they have played a role in redefining the city in a positive light and making it world-class in its own way.

[Hammer Native]

^^Yes I guess I lumped in the politicians and business people together in the one statement. We do have some great philanthropists in this city which was a good point to bring up, and we owe them a lot of thanks for helping maintain quality of life in such things as healthcare and education. David Braley, The Juravinskis, Morgan Firestone, Michael Lee-Chin, Michael DeGroote, and I'm sure I've missed others. Although I can't think of anybody in the development business.

[realcity]

This is how land developing happens in Hamilton.

1. A land speculator buys farmland on the fringe of the city. The offer is too good to refuse. Since it is 'unserviced land'. ie no sewers.

2. The new owner leases back the land to the farmer. The farmer continues to work the land. It pays for the low agricultural tax that is levied on the land.

3. The 'land developer' call them Land Speculator, lobbies the local government to extend the boundry, meaning build roads and sewers to the farmland.

4. The land speculator then puts up a cardboard sales office, gives the former farmland a marketable name like Meadowlands, Summit Hill, Forest Acres etc.

5. The sales office then takes money from someone wishing to purchase a new home. Then the house gets built by contract workers.

Where in this scenario is the land developer ever risking or investing any of their own money? Only at the beginning with this process is money really invested. And then at a low risk because the land is leased back to the farmer at basically cost.

This is why they don't invest and build downtown. This business model is all they know how to do.

[LikeHamilton]

Originally Posted by realcity

This is how land developing happens in Hamilton.

1. A land speculator buys farmland on the fringe of the city. The offer is too good to refuse. Since it is 'unserviced land'. ie no sewers.

2. The new owner leases back the land to the farmer. The farmer continues to work the land. It pays for the low agricultural tax that is levied on the land.

3. The 'land developer' call them Land Speculator, lobbies the local government to extend the boundry, meaning build roads and sewers to the farmland.

4. The land speculator then puts up a cardboard sales office, gives the former farmland a marketable name like Meadowlands, Summit Hill, Forest Acres etc.

5. The sales office then takes money from someone wishing to purchase a new home. Then the house gets built by contract workers.

Where in this scenario is the land developer ever risking or investing any of their own money? Only at the beginning with this process is money really invested. And then at a low risk because the land is leased back to the farmer at basically cost.

This is why they don't invest and build downtown. This business model is all they know how to do.

This is not just in Hamilton but everywhere.

[HAMRetrofit]

Originally Posted by realcity

This is how land developing happens in Hamilton.

1. A land speculator buys farmland on the fringe of the city. The offer is too good to refuse. Since it is 'unserviced land'. ie no sewers.

2. The new owner leases back the land to the farmer. The farmer continues to work the land. It pays for the low agricultural tax that is levied on the land.

3. The 'land developer' call them Land Speculator, lobbies the local government to extend the boundry, meaning build roads and sewers to the farmland.

4. The land speculator then puts up a cardboard sales office, gives the former farmland a marketable name like Meadowlands, Summit Hill, Forest Acres etc.

5. The sales office then takes money from someone wishing to purchase a new home. Then the house gets built by contract workers.

Where in this scenario is the land developer ever risking or investing any of their own money? Only at the beginning with this process is money really invested. And then at a low risk because the land is leased back to the farmer at basically cost.

This is why they don't invest and build downtown. This business model is all they know how to do.

The city can court developers that can think outside of this framework. Once downtown development is stimulated others will follow suit. Once Toronto's condo market got going all the typical suburban developers like Great Gulf and CF followed suit. They will not do this unless certainty of profit is proven because they are already making large capital elsewhere.

[Goldfinger]

Originally Posted by realcity

This is how land developing happens in Hamilton.

1. A land speculator buys farmland on the fringe of the city. The offer is too good to refuse. Since it is 'unserviced land'. ie no sewers.

2. The new owner leases back the land to the farmer. The farmer continues to work the land. It pays for the low agricultural tax that is levied on the land.

3. The 'land developer' call them Land Speculator, lobbies the local government to extend the boundry, meaning build roads and sewers to the farmland.

4. The land speculator then puts up a cardboard sales office, gives the former farmland a marketable name like Meadowlands, Summit Hill, Forest Acres etc.

5. The sales office then takes money from someone wishing to purchase a new home. Then the house gets built by contract workers.

Where in this scenario is the land developer ever risking or investing any of their own money? Only at the beginning with this process is money really invested. And then at a low risk because the land is leased back to the farmer at basically cost.

This is why they don't invest and build downtown. This business model is all they know how to do.

Well, there is never a guarantee they will get approval for construction. Your soft costs, i.e. planners, municipal application fees and development charges, engineering expenses, TARION, insurance, lawyers, surveyors, environmental reports, interest, real estate fees, land transfer tax then the purchase price. You will need to spend on all this before you could even think opening up a sales office.

You don't just walk into City hall and ask for the approval in the morning and have it by the afternoon. Everything with you guys on this board is simple, and you all look for simplified answers.

[Civchic]

I agree with Goldfinger here. My company is a sub-consultant on a new development going on (no I won't say which one) and there have been well over 3 million dollars already spent on feasibility studies, consultants, subwatershed studies, etc. It's still growing corn, headed to the OMB, and likely won't start construction for at least another two years. And at least another million dollars.

Yet - it is still easier to do that than to develop in the city. Besides - the profit is there, because a giant portion of the population will still buy into the slice of green idea. People buying $400,000 homes in Waterdown are not going to buy condos in downtown Hamilton, and you have way more of the former just now.

Profit is the driving force.

[raisethehammer]

that's why we need proper legislation protecting land, raising taxes in greenfields and drastically lowering them downtown. the only reaon people can afford their waterdown homes is the massive subsidy used to develop their project.

[RePinion]

Originally Posted by HAMRetrofit

Another note, if a building is ugly it has nothing to do with the developer. It has to do with with what the Architect designed for them. There is something called the Architects Act which requires that they design all buildings greater the 600 sm and taller than 3 stories. If you don't like the design of a building being constructed in your neighborhood then you would need to take it up with the architect and planners involved.

Nothing to do with the developer? Hardly. It is directly contingent on how much money the developer is willing to spend on architecture. The talent of the architect in any given development notwithstanding, the aesthetic quality of the finished building often depends upon how much time the architect was able to spend on the project. The less the developer is willing to spend monetarily, the less time the architect will be able to devote to the project. As far as I know, architects, just like lawyers, generally work on a billable hours model.

[RePinion]

Originally Posted by raisethehammer

that's why we need proper legislation protecting land, raising taxes in greenfields and drastically lowering them downtown. the only reaon people can afford their waterdown homes is the massive subsidy used to develop their project.

Agreed. What it comes down to, in large part, is that while it is not necessarily easy (or effortless) to make money by building huge sprawling developments, it is certainly easier than through downtown development at least at present. That is why we have to take away (or comparitively impoverish) any incentives for continued greenfield development, whether that be through legislation, aggressive downtown development incentives, or any other means.

[I, Sinclair]

Originally Posted by Civchic

Yet - it is still easier to do that than to develop in the city. Besides - the profit is there, because a giant portion of the population will still buy into the slice of green idea. People buying $400,000 homes in Waterdown are not going to buy condos in downtown Hamilton, and you have way more of the former just now.

Profit is the driving force.

People are rational, and they respond to incentives. Make that $400k house a $600k house and there will be more demand for $300 condos. Greenfield land should be shockingly expensive, if it's even allowed to be developed at all. After all, they aren't making any more of it.

It's no great loss to society if middle class families can no longer afford to buy a 3000 sq foot home on a 10 000 sq foot lot an hour from the city center. And the right to suburban living is not guaranteed in law. In fact, there is probably a net benefit to everyone if some of those were traded in for infill townhomes.

[Goldfinger]

Originally Posted by I, Sinclair

People are rational, and they respond to incentives. Make that $400k house a $600k house and there will be more demand for $300 condos. Greenfield land should be shockingly expensive, if it's even allowed to be developed at all. After all, they aren't making any more of it.

It's no great loss to society if middle class families can no longer afford to buy a 3000 sq foot home on a 10 000 sq foot lot an hour from the city center. And the right to suburban living is not guaranteed in law. In fact, there is probably a net benefit to everyone if some of those were traded in for infill townhomes.

I don't agree here. People will still go out to the greenfields, they will just downsize. Instead of 3000 sq ft. they will go with a semi. People don't want to live downtown because they think it's crowded, dirty, unsafe and a poor investment. I have seen study after study that shows consumers want and prefer a yard especially if they have young children.

[Goldfinger]

Originally Posted by Civchic

I agree with Goldfinger here. My company is a sub-consultant on a new development going on (no I won't say which one) and there have been well over 3 million dollars already spent on feasibility studies, consultants, subwatershed studies, etc. It's still growing corn, headed to the OMB, and likely won't start construction for at least another two years. And at least another million dollars.

Yet - it is still easier to do that than to develop in the city. Besides - the profit is there, because a giant portion of the population will still buy into the slice of green idea. People buying $400,000 homes in Waterdown are not going to buy condos in downtown Hamilton, and you have way more of the former just now.

Profit is the driving force.

The consultants have become such a critical piece of the process now. I have to admit I was never sold on their value until I started using firms like PEIL and IBI. I found they are much more efficient at getting approvals done because they have excellent relationships with city staffers due to the fact that many actually worked in the planning and development departments and know how to work the bureaucracy. Now, I wouldn't even think of going for a draft plan approval with them quarterbacking.

[HAMRetrofit]

Originally Posted by RePinion

Nothing to do with the developer? Hardly. It is directly contingent on how much money the developer is willing to spend on architecture. The talent of the architect in any given development notwithstanding, the aesthetic quality of the finished building often depends upon how much time the architect was able to spend on the project. The less the developer is willing to spend monetarily, the less time the architect will be able to devote to the project. As far as I know, architects, just like lawyers, generally work on a billable hours model.

I was being facetious, I agree with you. The architect involved should ask for more billable hours. In many cases the design is flawed from the beginning

[HAMRetrofit]

How many acres are you speculating on now Goldfinger?

[hamiltonguy]

As someone looking to buy a home in a few years to raise a family, I honestly don't like the burbs. A nice small house is the city with a small yard is enough. Heck even a condo is fine as long at the soundproofing is good (I play saxophone, and I don't want to disturb the neighbours) and there is a place for the children to play under supervision.

[realcity]

Originally Posted by Goldfinger

Well, there is never a guarantee they will get approval for construction. Your soft costs, i.e. planners, municipal application fees and development charges, engineering expenses, TARION, insurance, lawyers, surveyors, environmental reports, interest, real estate fees, land transfer tax then the purchase price. You will need to spend on all this before you could even think opening up a sales office.

You don't just walk into City hall and ask for the approval in the morning and have it by the afternoon. Everything with you guys on this board is simple, and you all look for simplified answers.

Obviously this process is distilled down for simplicity and effect. I never mentioned how long a speculator has to sit on the greenspace until it gets serviced. Desantis bought the land in the 53/20 area in 80s. If you were to look at a map of all the surrounding greenspace of who owned it, you'd recognize all the names as the local home builders. Currently the airport lands and along Highway 6 are the next target.

The point was this business model is now dead. The Places to Grow Act and Greenbelt put an end to farmland speculation. It's finally been realized by Queens Park as too valuable. All the PR that comes from the Home Builders is against the GreenBelt. I wonder why? because they're stuck with land that will be farms forever now. I'm sure there is a way to make a profit from farming too, just like there is way to make a profit from urban developing like Stinson. But they're not interested, it's not their business, it might as well be a bakery business, it doesn't fit the model they know.