Interviews

Stinson Discusses Hamilton Grand

Condo developer Harry Stinson provides details on the plan, sharing his frustration with the process thus far and his optimism that the project will come to completion.

By Ryan McGreal
Published December 03, 2012

Harry Stinson is taking another swing at the Hamilton Grand, a full service apartment hotel planned for the southeast corner of Main Street East and John Street South.

The property at Main and John where the Hamilton Grand will be located
The property at Main and John where the Hamilton Grand will be located

In a phone interview with RTH, Stinson provided more details on the plan, sharing his frustration with the process thus far and his optimism that the project will come to completion. With a new group of investors, a battle-hardened development plan and a new promotional video, Stinson believes this project will be a success.

About the Hotel

The building will be an apartment hotel with each unit individually owned by an investor. Suites range in price from $99,900 for a south-facing studio through $229,900 for a premium one-bedroom with a park view.

Condo owners won't live in their units; rather, the units will be rented out as apartments, preferably on a long-term basis. "It's designed to operate like a hotel in its ambiance, but the primary target market is extended stay and long-term rental."

The hotel will provide upscale accommodation. "As a tenant, for $1,295 a month you get a furnished studio with housekeeping and breakfast, internet, cable, phone, 24 hour security, a private lounge - basically, living in a hotel."

"The target market are interns working at the hospital, people working on contract, researchers, post-grads - VIP student housing." Stinson added, "It's not for seven engineering students bunking out in Westdale."

Hamilton currently has a shortage of studio apartments. "Before my life was turned upside down by the concept of family, for 30 years I lived in a studio. I was quite happy - all you need living downtown is a nice place to hang your hat."

Business Model

While the concept of an apartment hotel is novel in Hamilton, the concept is well-established elsewhere. "This hotel apartment building is normal in big cities. To have a city flat in a hotel-like building is not a novelty."

"North America has treated condos as if they're smaller houses stacked up, but if you look further back in history, the city apartment was more often than not a hotel-style building." This is true even in Hamilton's past: "f you go back, a hotel wasn't necessarily a tourist building, it was just a convenient way of life for a single person."

Stinson believes this model has more promise today. "You take a city like Hamilton, which is essentially a medical and academic town with entertainment and a tiny bit of steel, and the demographics are quite good for this model."

Stinson points to the low retention rate of people studying at McMaster as an opportunity to provide long-term but non-permanent accommodations, appealing to "people who are non-house oriented and just want a decent place to stay that provides them with clean, full-service, security, and convenience."

Hamilton does not have enough diversity in apartment living. "The multi-unit accommodation in Hamilton today is a bit dated, to put it mildly, so someone coming from a big city and is used to contemporary standards of condo living is somewhat taken aback with the options in Hamilton. They often end up in Burlington or Oakville and have to commute, which is a drag. Or they bite the bullet and rent a house or stay in an apartment - but that wouldn't be the first choice."

Stinson speaks from experience. "I was shocked when I came to Hamilton and looked for a place to live and there was no condo with Toronto standards - even as simple as 24-hour security. I found that astounding. That's what brought me here: this vacuum of contemporary accommodation."

While Hamilton is focused on making it easy to drive, many people don't see that as a convenience. "I've lived all my life in the city, and having to drive everywhere is a drag. Hamilton has a built-in city core, but we're trying to treat it like suburbia - how fast can you whizz through downtown?"

Challenges

Anyone who has been following the Hamilton Grand knows it has had some challenges.

A previous effort to build the hotel fell apart in late 2010 when the City's Public Works Department insisted the building must be set 2.4 metres back from the sidewalk to accommodate a potential future widening of Main Street. Main is already five lanes wide at that location, and most other buildings in the area are already built to the sidewalk.

Stinson said he was "blindsided" when Gary Moore, director of engineering, announced the setback. In a column by Andrew Dreschel at the time, Moore is quoted saying:

The rule is you take the widening; that's the starting point. Whether we need it or not, normally we don't get into that because you don't want to limit yourself or future generations.

The project ground to a halt and the group of investors Stinson had assembled moved on.

This time around, the building is pushed back into an open arcade at street level to accommodate the setback rule. However, the upper floors extend over the arcade to the lot line.

Stinson explained, "If you look at other buildings like the Century 21 tower [Landmark Place, 100 Main Street East] next door, you see the main floor is set back and the building cantilevers over the building. We did the same thing - we put an arcade on Main Street with extra sidewalk under the building so that if the road gets wider the sidewalk will go through the building."

Last time around, "This solution wasn't offered. We said there's got to be another way to deal with this."

Financing

Financing has been a real challenge, but Stinson has a group of investors with enough funding in place to go ahead with a six-storey building. However, he wants to keep the option open to go higher if sales are strong.

"Realistically, this is planned as a six-storey building, but we have a zoning opportunity to go 15 floors. The City is scratching their heads going, 'Why don't you do more?', to which the answer is that banks aren't exactly throwing money around these days, and this is what the current backers can finance on their own."

He added, "If it turns out we're oversubscribed, we'll revisit that. We just want to know we can do this, no sweat. We have the funding in place and could go ahead with no hiccups."

He is hopeful that demand will materialize. "We have the capacity to go another nine floors. If we can generate that momentum, the money will show up. It could be residential on the upper floors, retail at grade, and commercial in the middle."

So far, sales have all been from outside Hamilton. Stinson has held meetings in Vancouver, Calgary, Halifax, Toronto and the United States. "We just started selling units a week ago. It was a small meeting to our primary investment list, but half the people bought right there and then. Over the next 60 days, we will be wrapping it up."

He hopes to start building next year. In the meantime, he is finishing work on Stinson School Lofts, which he says will be ready to move into in the Spring. He has also been working on the Grand Hotel Niagara in Niagara Falls, New York, which he notes is a sister hotel to the Royal Connaught in downtown Hamilton.

Lack of Urgency

Stinson has been working with City planning staff to work out all the construction details for the Hamilton Grand. "We are currently at a site plan with city. We've submitted drawings and going back and forth, but there's nothing in the application that requires a zoning variance. The setback has been resolved, and we're not asking for parking reduction so there's no political issue. It's only going to be a matter of process."

Working with the City has been a challenge. "We're still experiencing the same frustrations of a complete lack of urgency" from staff. "I won't say that's consistent: at the senior planning level, they're pretty good, but it would be nice if it was infectious at the other levels. The mindset seems to be 'here's a problem,' not 'here's an issue and how to resolve it'."

He wishes the city was better at treating infill developments on a fast track. "It's in the City's interest to fast track this. You should be able to get permits as you need them rather than having to get it all resolved first."

The site is a former gas station that requires brownfield remediation. "We need to remediate and we're pushing the City to give us the remediation permit. Give us the excavation permit, let us start cleaning up this ugly site now. This is an as of rights building, a site you want remediated - there's a need for credibility."

He says the various city departments are "having a turf war and we're fodder for the process."

Culture of Failure

Stinson also bewailed what he sees as a culture of failure in Hamilton. "Here, failure is assumed and success is a shock to everybody. People from out of town, it never occurs to them that it might not go ahead. It's incumbent on city to be doing everything they can to create momentum, as opposed to an attitude of, we're worried about this, we're worried about that."

His message for the City: "If we're going to invest millions of dollars, at what point do you take it seriously? Work with us, because that's what it will take for people to buy into it."

A new six-storey building means $30 million in assessment, and $450,000 a year in new property tax. If the building goes a full 15 storeys, "you're looking at over $1 million in new tax assessment at no cost to the city."

He contrasts the city's Airport Employment Growth District, which will cost the City $500 million in new infrastructure costs to prepare the land for industrial development that may not come.

"Downtown is where you should be putting new development. Look at downtown Toronto, which is booming - that business is mostly residential and all the residual business around them. That's what gives a healthy property tax base to the city, not pursuing imaginary businesses with bribes."

Ryan McGreal, the editor of Raise the Hammer, lives in Hamilton with his family and works as a programmer, writer and consultant. Ryan volunteers with Hamilton Light Rail, a citizen group dedicated to bringing light rail transit to Hamilton. Ryan writes a city affairs column in Hamilton Magazine, and several of his articles have been published in the Hamilton Spectator. He also maintains a personal website and has been known to post passing thoughts on Twitter @RyanMcGreal. Recently, he took the plunge and finally joined Facebook.

21 Comments

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By Mal (anonymous) | Posted December 03, 2012 at 10:00:10

"We just started selling units a week ago."

Egad.

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By mrgrande (registered) | Posted December 03, 2012 at 10:05:19

"Downtown is where you should be putting new development. Look at downtown Toronto, which is booming - that business is mostly residential and all the residual business around them. That's what gives a healthy property tax base to the city, not pursuing imaginary businesses with bribes."

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By Another Capitalist (anonymous) | Posted December 03, 2012 at 10:26:36

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By Mary Goore (anonymous) | Posted December 03, 2012 at 11:48:45

"Whether we need it or not, normally we don't get into that because you don't want to limit yourself or future generations." -- Gary Moore

Whether we need it or not... the reason behind Hamilton's long decline in a nutshell. Who cares whether what your doing makes any sense, rules need to be obeyed!

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By hamiltonblog.ca (anonymous) | Posted December 03, 2012 at 11:58:57

Anyone know what is happening with the Royal Connaught?

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By 4 (anonymous) | Posted December 03, 2012 at 13:27:46

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By ScreamingViking (registered) | Posted December 03, 2012 at 20:13:01

I have to give Stinson respect for stepping up.

However, I do have to wonder if he really knows the Hamilton marketplace. Was his plan for the Grand well thought out? Is the concept viable here? Is THAT why he's had a hard time keeping investors? The city's throw from left field was a significant (and backward, I agree) surprise, but a smart developer would have known that risk, as would potential investors. And it's been at least 4 years that this particular development has been in play, which seems like a long time.

Is it more that he's been so vocal about his plans, and when they don't come to fruition it's just more public because of that initial fanfare?

I really hope something good does happen on that site. Something significant.

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By PearlStreet (registered) | Posted December 03, 2012 at 22:15:17 in reply to Comment 83404

He is at the forefront, a visionary that lead the way. He knows it better than it seems I think. When in that position I would expect faltering in a path less travelled.

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By Robert D (anonymous) | Posted December 03, 2012 at 22:10:07 in reply to Comment 83404

I'm not sure I agree with you that a smart developer and potential investors would have known that risk.

It's hard to predict what the city might throw at you, and city hall's bureaucracy seems particularly unaccommodating compared to what developers can get away with in Toronto.

As for investors, why should they stick around and be in there for a long run? One of the partners was an investment firm, they have money to make, and have other opportunities to invest their cash. Why would they sit on their hands for another year and wait for the city to sort things out?

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By ScreamingViking (registered) | Posted December 03, 2012 at 23:22:01 in reply to Comment 83408

Maybe I'm wrong, but something like a road allowance seems like it would be a condition that a property owner should know about (if not explicitly informed, then learn about in researching the bylaws and zoning that affect their property). Yes, shame on the city for not doing their part to help move a development forward, but you'd think this is something major enough that it would be discovered earlier on.

And why didn't Stinson float the "cantilever" option sooner, especially if an example of it exists a block east? And if he had solid investors behind his original plan?

Again, I respect the man's vision and desire to do something good, but there are some plot holes in this story.

Comment edited by ScreamingViking on 2012-12-03 23:23:36

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By -Hammer- (registered) | Posted December 03, 2012 at 23:53:31 in reply to Comment 83412

I'm not going to say you are wrong, but it's bloody Main St. How there has not been a road allowance exemption for Main St. It's five lanes and just about every building on the street is built to the sidewalk and there are zero plans to expand it.

It's something that the city staff should have, in the interests of it being a good development, informed Mr. Stinson of and kept quiet, not screamed it out to the media. It's a new development replacing a vacant lot, not taking a wrecking ball to the Connaught to put up a two floor stucco box.

Comment edited by -Hammer- on 2012-12-03 23:56:00

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By ScreamingViking (registered) | Posted December 04, 2012 at 00:55:17 in reply to Comment 83414

I agree, the road allowance should never have been an issue on Main, not downtown at the very least, and probably not between the 403 and the traffic circle.

If Harry had been redeveloping an existing building, it would not have been an issue. But replacing and remediating an incompatible land-use it is, unfortunately.

The city's fault here is inexcusable.

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By 5 (anonymous) | Posted December 03, 2012 at 21:57:27 in reply to Comment 83404

Like putting in a new Shell station?

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By ScreamingViking (registered) | Posted December 03, 2012 at 23:23:55 in reply to Comment 83406

Booooo :-)

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By -Hammer- (registered) | Posted December 03, 2012 at 22:57:54

I really hope this project takes off, but I firmly believe, the biggest problem Stinson has with this development is the fact he's trying to sell rooms with murphy beds, and almost seems obsessed with them, and his roomsizes appear incredibly small.

I for one, when renting a room for long term, heck even for more then one night, don't want to sleep on a pullout bed. He should lower his unit count, raise the price a bit and make larger full rooms. If you want to expand the unit count, add floors, don't squeeze people into tight spaces.

Comment edited by -Hammer- on 2012-12-03 23:00:04

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By CandyLoftd (anonymous) | Posted December 04, 2012 at 01:10:01

Stinson is right. The city is wrong. This is The Pearl Company again. McGreal can't something be done about Zoning?

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By Gary Santucci (anonymous) | Posted December 04, 2012 at 06:49:31 in reply to Comment 83417

Mr. Moore was incorrectly quoted, here is what he meant to say;

The rule is you take the widening; that's the starting point. Whether we need it or not, normally we don't get into that because you don't want to limit yourself for future generations (of bureaucrats)

Recently Mr.Stinson accompanied Glen Norton on a promotional trip back to Toronto extolling the virtues of investing in Hamilton. What was he thinking? When people ask me about investing in Hamilton and in particular ward 3. I tell them our story and they never ask me again.

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By Mal (anonymous) | Posted December 04, 2012 at 09:00:03

Hamilton does not have enough diversity in apartment living. "The multi-unit accommodation in Hamilton today is a bit dated, to put it mildly, so someone coming from a big city and is used to contemporary standards of condo living is somewhat taken aback with the options in Hamilton. They often end up in Burlington or Oakville and have to commute, which is a drag. Or they bite the bullet and rent a house or stay in an apartment - but that wouldn't be the first choice."

~

Hamilton's downtown is awash in one-bedroom rental apartments. It is far and away the most dominant rental housing stock, unsurprising since single individuals represent the normative household size in downtown (roughly 60% of downtown households are made up of just a single person). I am a little surprised, however, to learn that that downtown's diversity hurdle is a shortage of $1,300/mo studio apartments. (Or that someone with the means to live in Oakville or Burlington and commute would not simply do so -- or simply move to Westdale or Ancaster.)

Before hanging it up somewhere nice, Mr. Stinson inadvertently tips his hat to the true market void, the real vacuum of accommodation: contemporary dwellings geared to young professionals and families. That is the missing piece that would-be visionaries have been overlooking for decades. In the absence of same, downtown has become a market that supports the status quo oasis of conveniences for the childless.

The Grand site is perhaps not the most family friendly -- it's in the heart of a downtown clubland, a veritable Bermuda's Triangle of weekend pisstankery, kitty-corner to a provincial courthouse, and virtually surrounded by asphalt/concrete -- and I certainly don't begrudge Mr. Stinson his idiosyncratic vision, but let's not confuse a sales pitch with the market reality. The Grand may add bodies to downtown and it may be a niche commodity but IMHO, at its most essential level, it is a duplicate piece of puzzle, not a missing one.

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By Renting (anonymous) | Posted December 04, 2012 at 11:35:51 in reply to Comment 83427

People looking for rent all tell us that it's hard to find clean apartment with decent conditions.
They also check the views from the windows, neighbourhood, ask who are the neighboors, security for them and their cars.
You as a landlord do not want to overload the building, so give just what's needed for 1-2 persons in the best form, otherwise there will live a bunch of illegal tenants.
Also, the downtown core is not good for families with kids. That's why they mostly live near schools, parks, rec centres, if they care about their kids.
Mr. Stinson is just right.

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By Realtoring (anonymous) | Posted December 04, 2012 at 11:49:26 in reply to Comment 83434

Parking Spot: $18,000

http://www.hamiltongrand.ca/

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By Simon (registered) - website | Posted December 04, 2012 at 11:34:28

On a positive note - at least the building department treats lowly residential additions the same as multi-million dollar developments...you know, unless you're building giant big box stores and humongous houses on a cornfield.

Had to laugh reading Stinson's comments - his experience is virtually identical to my personal experience with the building department.

"The mindset seems to be 'here's a problem,' not 'here's an issue and how to resolve it'."

Pretty much exactly my impression of the building department.

To be fair, its not entirely staff's fault - when you really get into the City's bizarre by-law and zoning requirements, you really realize how the entire system is designed to output strip malls and new single family houses - defiantly not urban renewal or adaptive re-use.

Comment edited by Simon on 2012-12-04 11:52:22

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