Airport Employment Growth District (AEGD)

[CaptainKirk]

As with the downtown casino issue, I knew little of the pros and cons going into learning about the issue. I have a very basic grasp of AEGD right now, but this part of he article "The city argues that the project represents an opportunity to diversify Hamilton's economic base." had me scratching my head. Isn't Hamilton already the most diverse economy? I've yet to be sold on the need for this and remain open to be convinced. I think that's a lot of civic money that is going to be spent and would like to know if such an investment in something like the LRT could have better benefits for the city in the long run.

...the "diversity index," which the Conference Board of Canada uses to measure how varied a city's economy is. The scale ranges from 1.0 (highly diverse) down to 0.0 (i.e., a one-industry town). Ottawa came in at 0.35; Calgary, the oil and gas capital of Canada, garnered a 0.81 result and Toronto scored 0.88. Hamilton, though, topped them all with a 0.92 rating.

http://www.bizmagazine.ca/sitepages/...0|%20Q2%202012

[realcity]

Let me guess, these same people are anti-casino and pro urban chicken, anti-expressway and pro at-any-cost-to-the-taxpayer LRT. Has Hamilton always had so many left-wing nuts?

[Jon Dalton]

Originally Posted by realcity

Let me guess, these same people are anti-casino and pro urban chicken, anti-expressway and pro at-any-cost-to-the-taxpayer LRT. Has Hamilton always had so many left-wing nuts?

Yes, it's frighteningly clear looking at the landscape of Hamilton that the progressive agenda has dominated policy making over the last several decades.

[thistleclub]

Here's some relevant perspective, via a sidebar in Steven Malanga's Autumn 2012 City Journal feature Airfields of Dreams:

Will the Aerotropolis Fly?

From St. Louis to Detroit to Memphis to Denver, the idea of the “aerotropolis” has become increasingly fashionable. As John Kasarda, a professor at the University of North Carolina’s business school, defines it, the futuristic term describes a city that has grown around an airport, providing residents and businesses with super-quick access to global networks of commerce and travel. Some of these cities, Kasarda imagines, will be built from the ground up. A striking example is South Korea’s New Songdo, currently rising on a man-made island in the Yellow Sea and connected by bridge to one of the world’s busiest airports, Incheon International. But existing cities, Kasarda suggests, could also evolve over time into aerotropolises.

Enamored with Kasarda’s idea, cities that have seen their air traffic vanish are trying to lure it back by promoting themselves as the first American aerotropolises. The concept is a tough sell, though. Trying to make up for the loss of 60 percent of its passenger traffic, Lambert–St. Louis International Airport has tried to turn itself into a cargo hub centered on trade with China, hoping to generate a wave of development. Lambert officials have had numerous meetings with Chinese investors, who are seeking significant government incentives, including $360 million in tax breaks, to build new warehouses around the airport. These demands have helped stall the plan, with budget-crunched legislators hesitating to award fat incentives to businesses at a time when they’re slashing services to residents. Critics note, too, that Lambert already spent $1 billion on a previous expansion intended to secure the airport’s prominence as a passenger hub—a move that failed. And as two University of Missouri professors pointed out in a newspaper op-ed: “If the Aerotropolis won’t fly without public subsidies, that means private venture capitalists think the project is a loser and won’t risk their money.”

If there’s any city whose airport might seem likely to spawn a surrounding aerotropolis, it’s Memphis, home of Federal Express, which has turned the city’s airport into the second-largest cargo hub in the world. Hoping to capitalize on that relationship at a time when Delta has cut some 25 percent of its passenger flights at Memphis International Airport, city leaders have rolled out the slogan “Memphis: America’s Aerotropolis” and are marketing the area to businesses looking for a location that allows them to plug in to global networks.

But Memphis’s experience illustrates a problem with the viability of the aerotropolis idea: many businesses don’t want to locate in industrialized airport settings—which tend to be ugly and lacking urban amenities—just for the sake of easy airport access. Even FedEx, which employs thousands of cargo handlers at the airport, has been moving its front-office employees to suburban office developments, leaving behind hundreds of thousands of square feet of unused space. The office district around Memphis International Airport now has the highest vacancy rate in the city, north of 50 percent. A stark symbol of the area’s struggles is a four-story office building named Aerotropolis Center, which has been vacant for five years.

Denver International Airport may have a better shot at giving rise to an aerotropolis. Opened in 1995, the airport is surrounded by miles of undeveloped land. One 1,287-acre site adjoining the airport has already been slated for retail, hotel, and office space. But the development is possible only because the airport is 30 miles from downtown Denver, in the city of Aurora, where there’s plenty of room to expand, far more than in the congested urban settings of many current major airports. That kind of free space may be the key, at least in the short term, to creating an American airport city.

[CaptainKirk]

Thanks for the article thistleclub.

Interesting stuff for sure. I'm still a little perplexed behind the idea, and still don't really get it. I really don't see the appeal or benefit. A cargo warehouse hub, with cargo warehouse type jobs, is that it?

It sure doesn't sound like a worthwhile investment of $350m in infrastructure to support that.

I wish the proponents could give a clear argument.

So far to me, it sounds like nothing more than developers wanting to cash in on more sprawl, that in the end will cost the city more to support and maintain. Like I said, I want to learn more of the benefits and why this is such a good idea. Can't see it yet.

If any area of the city needs investment attention, I think it's the older part/lower city. Transforming that older area of the city with its existing infrastructure would cost less and should increase the land values/tax base. no?

Right now, I think that LRT in combination with proper land use planning (which is happening), could provide much more benefit at lower cost to the city by taking advantage of funding from upper levels of government.

It seems crazy to me that the city could afford $350m in capital costs for AEGD, and not a fraction of that for LRT.

I need more info. I'm not seeing it.

[thistleclub]

I'm just putting the Malanga piece forward as perspective. I don't vouch for the bonafides of the aerotropolis business case.

My guess is that the notion was given wings, as it were, by the fact that John C. Munro Hamilton International Airport is already Canada’s largest and busiest dedicated inter-modal cargo/courier facility. JCMHIA can accommodate fully loaded wide-body international aircraft, which is the main reason it wears the moniker it does. Since the mid-1980s, air cargo has been a core component of business at the airport, reflected in the presence and investment of partners such as Cargojet, Purolator, UPS and DHL.

Whether that could be leveraged into a footing as one of the world's top air cargo hubs on the back of the AEGD is another matter entirely.

[flar]

I've had mixed feelings about this for years.

Upfront, I'll admit I don't like this kind of development. It's wasteful, a poor use of land and perpetuates a lot things that are wrong with our society.

But just because I don't like it, doesn't change the fact that this is business as usual. Cities are competing for development, so anyone looking to build gets to pick and choose. Unfortunately, taxpayers are on the hook as municiplities roll out the red carpet for development.

Hamilton desperately needs industrial development, too much of the tax burden is on residential and the city is increasingly being crushed by the weight of aging infrastructure. Hamilton got into this situation because so much of its industry moved to greener pastures, abandoning old industrial sites in the lower city.

I really don't know if the long term tax revenue outweighs the initial outlay for services and red carpet treatment for businesses.

Very few businesses are going to go through all the hassles of building on brownfields in Hamilton when they can go to brand new greenfields along the highway in places like Brantford or Milton. It doesn't make it right--I think it's deplorable to keep creating unusable land and discarding it--but that's what's happening. You need only look at the Hamilton area to see this at work. Hamilton's old harbourfront industrial area continues its decline, while the industrial parks along the QEW in Burlington and Stoney Creek are filled up. The industrial parks in Ancaster and Red Hill are attracting industry. Are they enough for the long term? I don't know. Perhaps the Aerotropolis needs to be scaled back.

I would like it if this entire model changed, but I don't really think Hamilton is in a position to lead the charge. It will probably end up hurting the city as businesses choose to locate elsewhere. I know London, Ontario opened a huge industrial park near their airport, just off the 401/Veteren's Memorial Parkway a few years ago. Mississauga has done exceedingly well with their absolutely massive industrial district around Pearson. Hamilton continues to languish, once an industrial hub, now with a net outflow of commuters. A workforce based mostly on retail sales positions, a small class of professionals and everyone else working in the western GTA.

It would be ideal if the brownfields were replaced with shiny new industry and jobs, but I don't think that's realistic in the current scheme of things.

[durandy]

There's no point arguing the business case for the AEGD. This is all a red herring. Tradeport can give you a million versions of a story where the airport is already flourishing and will imminently become our economic heart.

Instead the key fact is that every single party supporting the AEGD except the city and Tradeport are developers who are doing it because they know residential uses will eventually be admitted.

So Realcity how much are you looking forward to living in future Brampton?

[SteelTown]

Originally Posted by flar

I've had mixed feelings about this for years.

Upfront, I'll admit I don't like this kind of development. It's wasteful, a poor use of land and perpetuates a lot things that are wrong with our society.

But just because I don't like it, doesn't change the fact that this is business as usual. Cities are competing for development, so anyone looking to build gets to pick and choose. Unfortunately, taxpayers are on the hook as municiplities roll out the red carpet for development.

Hamilton desperately needs industrial development, too much of the tax burden is on residential and the city is increasingly being crushed by the weight of aging infrastructure. Hamilton got into this situation because so much of its industry moved to greener pastures, abandoning old industrial sites in the lower city.

I really don't know if the long term tax revenue outweighs the initial outlay for services and red carpet treatment for businesses.

Very few businesses are going to go through all the hassles of building on brownfields in Hamilton when they can go to brand new greenfields along the highway in places like Brantford or Milton. It doesn't make it right--I think it's deplorable to keep creating unusable land and discarding it--but that's what's happening. You need only look at the Hamilton area to see this at work. Hamilton's old harbourfront industrial area continues its decline, while the industrial parks along the QEW in Burlington and Stoney Creek are filled up. The industrial parks in Ancaster and Red Hill are attracting industry. Are they enough for the long term? I don't know. Perhaps the Aerotropolis needs to be scaled back.

I would like it if this entire model changed, but I don't really think Hamilton is in a position to lead the charge. It will probably end up hurting the city as businesses choose to locate elsewhere. I know London, Ontario opened a huge industrial park near their airport, just off the 401/Veteren's Memorial Parkway a few years ago. Mississauga has done exceedingly well with their absolutely massive industrial district around Pearson. Hamilton continues to languish, once an industrial hub, now with a net outflow of commuters. A workforce based mostly on retail sales positions, a small class of professionals and everyone else working in the western GTA.

It would be ideal if the brownfields were replaced with shiny new industry and jobs, but I don't think that's realistic in the current scheme of things.

100% agreement!

One thing I would like to see happen ASAP is get the Aeropark completed. It's been dead since 2004 and now it's an abandon park with grass covered roads and vines crawling up along the street lights.

http://maps.google.ca/maps?q=Hamilto...gl=ca&t=h&z=17

Last I heard the city needs to install a stormwater pond or something. Orlick Industries (David Braley) was suppose to build a factory there.

[realcity]

good post Flar. That's exactly how I feel. If the City can somehow prevent it from being residential, I'm for it.

As for good agri land. It's not that great. Mt Hope is the highest elevation between Lake Ontario and Lake Erie, it's also the coldest, better agri land gets the closer it gets to either Lake.

As for houses. who wants to live in the shadow of a 24hr airport?

[Dr Awesomesauce]

Originally Posted by realcity

As for houses. who wants to live in the shadow of a 24hr airport?

I'd rather you just called us all lefties or a**holes than to make a daft comment like that.

[thistleclub]

Aerotropolis opponents gear up for OMB hearing
(Hamilton Spectator, Joan Walters, Jan 8 2013)

Environmentalist Don McLean says an Ontario Municipal Board hearing that begins next week is the first critical “pinch point” in a battle over the largest urban boundary expansion in the city’s history — a project known as the Hamilton aerotropolis.

“It’s important because this is the one (hearing) that will determine whether this goes ahead and if so, how large it is,” the Environment Hamilton director said of the OMB proceeding that begins Jan. 14 and is expected to last three weeks.

“We think the expansion being proposed is unjustified,” said McLean, who is part of a group of opponents led by Environment Hamilton and Hamiltonians for Progressive Development. “It’s clearly much too large. At minimum, it’s premature.”

The groups are collaborating with the Council of Canadians and the Hamilton Civic League in a meeting at City Hall on Wednesday, staged by opponents to bring Hamiltonians up to date on the status of the city’s plan.

[coalminecanary]

I forgot to mention... a few hiccups for would-be businesses looking at development by our airport:

There are multiple and complex federal restrictions on lands near an airport, including building heights, noise attenuation, and use of electronic equipment. These restrictions will force prospective businesses to do pre-consultation with the private operator of the airport and will exclude some businesses from being able to operate there.

The AEGD is at the headwaters of three watersheds. This puts extra restrictions on stormwater management. Businesses operating there will be required to follow special stormwater management procedures at their own cost (building ponds for example), putting a huge premium on the land development costs up there.

Does this make it competitive and attractive to new companies? Or will we never see this development and have to "take what we can get" in the end (sprawl homes)?

[bigguy1231]

The AEGD is being opposed by the same people who oppose anything that might possibly benefit this city. These are the same people who opposed the RHVP saying that it would destroy the valley and was not needed. Well the valley is just fine and the RHVP is at capacity. The Industrial lands at the top of the RHVP are filling up adding to the taxbase of this city and adding many needed jobs.

As for the other lands available for industrial development there are not enough parcels that are big enough to meet the needs of potential tenants. The restrictions mentioned are the same restrictions in place around Pearson in Mississauga and that area seems to be thriving.

The AEGD lands are not going to be developed immediately. They will be developed as needed just like some of the other industrial lands that we now have on the periphery of the city. The city needs to plan long term and this is just part of the process of meeting the future needs of the city. If this city doesn't do this we will lose posssibly billions in future development and thousands of potential jobs.

Only fools would think that the urban boundary is not going to grow and only fools would think that the city can dictate to developers how those developers will spend their money. They will do what they have done to this city what they have done for the last 40 years, they will invest in other cities and not here.

[coalminecanary]

Only fools would think that the kind of sprawling developments we saw during the age of the cheapest and most abundant energy supply in history will continue forever. The provincial policy is to freeze urban boundaries.

150 years ago the city bankrupted itself to build an astoundingly large water pipe and pumping system.

We are poised to do so again.

The difference is, the first time we did it was at the very beginning of the huge industrial revolution boom.

This time we are considering it when we are already well into its decline. We had to PAY canada bread to move here after we already paid to build the RHVP which was supposed to be a development magnet (and was supposed to get the trucks out of the core).

I'm sorry but we simply can't afford it.

[bigguy1231]

Originally Posted by coalminecanary

Only fools would think that the kind of sprawling developments we saw during the age of the cheapest and most abundant energy supply in history will continue forever. The provincial policy is to freeze urban boundaries.

150 years ago the city bankrupted itself to build an astoundingly large water pipe and pumping system.

We are poised to do so again.

The difference is, the first time we did it was at the very beginning of the huge industrial revolution boom.

This time we are considering it when we are already well into its decline.

I'm sorry but we simply can't afford it.

The sprawling development will continue for as long as developers and their customers demand it. Just because this provincial government has dictated an end to it doesn't mean that policy will be in place with future governments.

As for the cost, we heard the same about the RHVP which was originally going to cost $130 million. After all the nonsense from the naysayers it ended up costing this city double that, and will soon need to have lanes added. It has spurred industrial development that has added to the industrial tax base of the city. Monies that will be used to pay for the developments and the infrastructure needed to add more. You have to spend money to make money, it's as simple as that.

[coalminecanary]

How much have we made from development spurred by the RHVP?

Has it paid off yet? And if not, is the payback rate meeting or exceeding the ongoing costs of maintaining and upgrading the highway? What about the costs to taxpayers from the flooding that the RHVP has contributed to?

It's not as simple as "spending money to make money". I understand the concept of capital investment but without future payback it is NOT AN INVESTMENT.

Yes there have been some industrial developments. But the RHVP has also allowed further residential sprawl and big box developments up there. Most of the traffic that is pushing talk of expansion of the highway is residential. The problem with this is the same story as in the rest of Hamilton. This is all new infrastructure that will need to be maintained, and the cost is too high. We are experiencing this RIGHT NOW with our infrastructure debt, and adding more infrastructure with low density development is only going to make it worse. As Flar said, there is too much reliance on residential tax base. Residential taxes simply can not cover the ongoing costs of this infrastructure.

This is not sound financial planning! We can't afford it. The astronomical costs of these projects are not being paid back through industrial development, and when we resort to more residential in order to help justify the infrastructure spending, it'will be an economic disaster.

Look at Mississauga - they are seeing it now. Their unchecked expansion is coming back to haunt them. They have a 1.5 billion dollar infrastructure deficit. Is this the path we want to take?

[durandy]

Originally Posted by bigguy1231

The sprawling development will continue for as long as developers and their customers demand it. Just because this provincial government has dictated an end to it doesn't mean that policy will be in place with future governments.

it's been in place for ten years now and things have changed immensely. You seem to think sprawl is some kind of natural law. Most countries in the world you can't just buy up empty land. It's not just bad for the environment it's silly planning - it doesn't pay for itself. It relies on subsidies from the built up city. If the true cost were charged there would be far less sprawl.

As for flight to other cities, it's done in Mississauga, in process in Milton and Brampton and Halton and Burlington, and we're next. We can either build shitty sprawl and then have to rebuild it again when the inevitable density happens you talk about, or do it right the first time.

I can't understand how anyone except the breed of conservative who hates taxes but demands their entitlements can support these developments.

[Jon Dalton]

Part of the reason the RHVP is at capacity is induced demand. Homes were sold on the basis of highway access and much more big box retail has been added up there, guess what, the highway fills up. Now we need another one. Once we have enough highways, we will have enough and there won't be any more traffic congestion. Other cities have given up and focused more on transit, but not us - we're determined.

[coalminecanary]

The bottom line is we have to start working to attract the kind of taxpaying businesses that crave higher density spaces or are willing to build on brownfields. We simply can't afford to build out forever in order to appease the greenfield businesses. They aren't the only ones out there shopping for space.