Revitalization

City Buys Innovation Lands - Updated

By Ryan McGreal
Published December 23, 2009

this blog entry has been updated

The City of Hamilton just announced that it has purchased 16.5 acres of land inside the 53.8 acre West Hamilton Innovation District from Canadian Pacific for $2.1 million. The Chatham Street property will allow the city to extend Frid St and install "development-related infrastructure on the former CP lands" according to the city's press release.

The release quotes Neil Everson, the city's director of economic development and real estate division, stating that the purchase "was approved as the top priority application for funding from the Federal Government's Southern Ontario Development Program.

The total cost of this project is $4.3 million, which includes the former CP property acquisition and a request for a $1.8 million federal grant through the program. The estimated completion of the infrastructure work is set for Spring 2011; further facilitating the development of approximately 15 acres of employment lands resulting in new non-residential assessment and job creation - one of City Council's key focus areas.

Update

Neil Everson helpfully responded to my request for more details on this purchase and the city's plans. Here is his response:

This land will be used for employment purposes only, and specifically high technology, knowledge-based companies that want to be close to McMaster Innovation Park (MIP) and the world class research facilities like CanMet, the McMaster Manufacturing Research Institute, the new Life Sciences Research center, etc.

We will be selling this land to new companies - end users only. Out of the 16.5 acres, we hope to get 15 acres for employment land with the other 1.5 acres being consumed by the road (Frid Street Extension) and the servicing.

The extension will go close to the westerly property line and end up in a cul-de-sac. There is still one parcel of land between our new proeprty and MIP in order to extend the road all the way through to Longwood.

The economic benefit is obviously the assessment and jobs. Unlike a private developer, our price per acre will be more competitive (yet still at or slightly above market value). It is not our practise to sell to speculators; instead we sell to the end user that will build immediately and start paying taxes and hiring Hamiltonians - that's the City's "economic benefit" on the land sale.

We also avoid the potential of any uses (i.e Big Box Retail) locating in the West Hamilton Innovation District that we believe are not in the best interests of the City in terms of growing the economy and maximizing the benefits from the facilities and investment in infrastructure that exist at MIP and McMaster University.

In summary, this will be an excellent example of taking a currently underutilized, strategically located property and transforming it into an assessment generating, job creating parcel of land that helps achieve the City's priority of Growing the Economy. Also, it's a good infill of inner-city employment lands where future employees have great access to housing, the downtown, public transit, etc.

It's really encouraging that the city has remained steadfast in its support for and promotion of this innovation district.

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.

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By highwater (registered) | Posted December 23, 2009 at 17:43:17

More great news! I must be dreaming.

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By GWC (anonymous) | Posted December 23, 2009 at 17:58:56

Ah what the hell we had a spare couple of mill Merry XMAS

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By Meredith (registered) - website | Posted December 23, 2009 at 21:30:04

most important word there: employment.

:)

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By shopsy (anonymous) | Posted December 23, 2009 at 21:33:41

big box stores w00t

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By jason (registered) | Posted December 23, 2009 at 22:15:30

awesome news!! The city nailed it on this one.

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By Balance (anonymous) | Posted December 24, 2009 at 01:01:50

Watch, they'll give the land away for basically nothing and the taxpayers will be left hanging again. They did it with Timmy's in Ancaster. Government shouldn't interfere with the private sector with respect to market values for land.

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By Henry and Joe (anonymous) | Posted December 24, 2009 at 09:33:56

Re: Government shouldn't interfere with the private sector with repect to market value for land.

This is good planning by the city. Protecting the scarce employment land should be a top priority for the city. I went to the meeting when Trinity gave their proposal for their desire to build a box store complex. Contrary to what the papers reported, most people there were against the Trinity proposal. If we don't steer development based on research and evidence, we'll have nothing but retail and we'll all be driving out of town to work (which I currently do). If I need more made-in-China screwdrivers, there are plenty of Cdn Tires and Home Depots around. Thank you City of Hamilton

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By Keith Mann (registered) - website | Posted December 24, 2009 at 09:50:36

The comment by "Balance" (above) seems to be getting moderated down a bit more heavily than I think it deserves, but in this particular case I do disagree with the principle of non-interference.

The particular chunk of Hamilton destined for MIP and related usage is what remains of the decaying corpse of an industrial zone that has been otherwise consumed and transformed by the economically-healthier residential and commercial activity surrounding it. This brownfield reamins untransformed not so much because of its fundamental, locational undesirability but rather because the transportation infrastructure surrounding it is based on rail rather than road.

In this city and this economy, it is unlikely that a desirable private initiative would have arisen to complete such an extensive transformation. The monetary energy-well could not be overcome without the catalyst of public investment. The city stands to profit monetarily from the resale and subsequent tax revenues; its residents -- especially those living in the affected area -- stand to profit from a vast improvement in the quality of the neighborhood. Council has my support on this one.

[Comment edited by Keith Mann on 2009-12-24 08:51:43]

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By hunter (anonymous) | Posted December 24, 2009 at 10:50:11

A little off-topic but anyone notice that the LRT decision has been delayed until mid-Feb?

Metrolinx decision delayed until February

Jill Stephen, the city's director of strategic and environmental planning, says she expects a recommendation from Metrolinx at their Feb. 19 board meeting.

Metrolinx was originally scheduled to recommend LRT or dedicated bus lanes in July. That date has been pushed back three times.

thespec.com/article/695758

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By jason (registered) | Posted December 24, 2009 at 11:14:16

this is great news and is the sort of long-term planning we've been missing for decades in Hamilton. If we had this sort of foresight and planning in place back when the Linc and 403 extensions were built we might see dozens of plants and manufacturing facilities along those roads instead of residential sprawl.

To me the biggest source of 'interference' in Hamilton is from those looking only to their own interests even if it means sacrificing the good of the city (ie - big box on Innovation District land). This is exactly why we have government. Good governing is ensuring that our economy can grow and that job prospects can improve for decades to come. Smart Centres or Trinity Retail don't care about that. It's up to our local government to have a plan and then stick to it. Without a plan, any old use sounds good and the next thing you know, you've got several km of highway lined by shingled peaks and no new employment places. Planning is key. They city appears to finally be doing that.

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By WRCU2 (registered) | Posted December 24, 2009 at 13:39:35

This is a responsible move by city planners but I do take exception to this criteria:

"This land will be used for employment purposes only, and specifically high technology, knowledge-based companies that want to be close to McMaster Innovation Park (MIP) and the world class research facilities like CanMet, the McMaster Manufacturing Research Institute, the new Life Sciences Research center, etc."

High technology is not improving our living conditions. I am not interested in new designer drugs or new time wasting gadgets. I am fed up with genetic modification research and the tinkering with our food. I'm drunk with all the additives within our water follies brewed. I'm sick of the surveillance society and our money manipulators mood. I don't need another TV set, a cell phone pet or virtual vetting twitter texting messengers so lewd.

I want clean wholesome food that protects me from ills. I want a green roof to prevent flooding when rain water spills. I don't need vaccinations from lab swine in a coat or social assistance programs that keep me afloat.

I want a job making old fashioned things, stuff that people need and prosperity brings. How silly folks look with those blue tooth's in ear. Do you have any clue how these make you look queer? Is this what we want from our innovation park? Earplugs and headsets or new wrist chips that spark?

You can have your high tech ridden GPS trap that runs you in circles headlong into crap. I'll be just fine embracing what really matters when your tech falls apart and you're cleft in IT's tatters.

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By grassroots are the way forward (registered) | Posted December 24, 2009 at 14:20:27

WRCU2: I went to a forum at Skydragon a while back, The Politics of Technology. It was an eye opener, in more ways then one.

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By neo-luddite (anonymous) | Posted December 24, 2009 at 15:22:05

You two should stop attending forums and put your money where your mouths are. Buy some land and start building wagon wheels or something. I'm sure customers will come flocking.

I'd do the same but my sparking wrist chip is acting up again.

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By Capitalist (anonymous) | Posted December 24, 2009 at 16:01:29

Great move by the city. Exactly what the city needs more of.

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By grassroots are the way forward (registered) | Posted December 24, 2009 at 17:42:22

Neo-Luddite: Just exactly, what was it that I said that was so wrong? Most reasearch and development is geared toward the Military Industrial complex, what a surprise.

There are many things we, as a society should questioning, as to what ends or what good are some things.

Technology can be a good thing or a bad thing, there is nothing wrong in questioning things.

Even the internet started as a military project!

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By Keith Mann (registered) - website | Posted December 25, 2009 at 10:32:49

Hang on now, Grassroots. There's certainly nothing wrong with questioning things, but technology itself is not good or bad; the people who employ it are, as indicated by uses to which they put it.

Yes, many technologies are developed to meet military needs. This should not be surprising; military needs are often urgent (at least in the eyes of the state), and so receive great resources. Regardless, those needs are often directly analagous to non-military needs; less crucial needs, with less resources, but needs nevertheless which are met by the application of the technology developed to meet the military need. Is the technology then "bad" because the need to which it was first applied was military? Does it become "good" when it meets non-military needs? Or, is the technology neutral?

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By grassroots are the way forward (registered) | Posted December 25, 2009 at 13:21:43

Keith Mann writes: but technology itself is not good or bad; the people who employ it are, as indicated by uses to which they put it.

The end uses, well, this is what we should be questioning. It would depend on which side of fence one was on, to determine if the end uses are good, bad or neutral,right? One person could see it as right, another could see it as wrong.

The point of the lecture, was encompassed in your last words, it was meant to give you something to think about, that is all.

Man is smart but sometimes you got to wonder if man has out smarted themselves, considering the levels of pollution, destruction of habitat and suffering we can cause. Sometimes, the more things change, the more they stay the same.

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By Bob Bratina (anonymous) | Posted December 29, 2009 at 08:49:13

Innovation Park was supposed to be a "premier research park", in which the City invested $5 million dollars. The list of tenants shows a wealth management company, an insurance provider, and a "faculty of family medicine, all taken from Hamilton's Downtown core and in no way related to the innovation park mandate. The loss of Assante Capital and Masters insurance is further evidence that upscale businesses would prefer that their customers and staff not have to mingle with the many discomforting and often menacing individuals who predominate in the core. It also points to the unlikelihood that Innovation Park will live up to its promise. Our purchase of contaminated lands in the so-called innovation district can only lead to more losses as other parts of the City continue to feed on our Downtown, with affordable housing in the Connaught the limit of our vision.

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By Capitalist (anonymous) | Posted December 29, 2009 at 11:04:03

Great post Councillor Bratina.

I am very sceptical that the MIP will be bringing NET NEW PRIVATE SECTOR employment to this city that would have not otherwised occurred. Correct me if I am wrong but are not some of the other MIP tenents just previously moved over from the Mac campus (I am thinking about that UN school or something.)

I have said many times on this website that middle class people and businesses would rather not locate downtown due to the fact that it is dominated by unappealing people and offers nothing for the middle class. Downtown Hamilton (and Hamilton as a whole) will never come back as long as it remains a dumping ground and a butt of jokes (what other city has a halfway house across from an 18,000 seat arena, what other city would even contemplate converting a former best hotel in the city to welfare housing???).

Thank you for standing up for this.

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By Tammany (anonymous) | Posted December 29, 2009 at 12:18:50

Councillor Bratina,

Your concerns are valid. The MIP will be a net harm to the City if it poaches the last remaining "high end" businesses from the downtown ... as I'm sure you know, the downtown does not have any of these to spare.

What a great vote of confidence it would have been if Mac had decided to build an "innovation tower" in the downtown core rather than just building a quasi-suburban business park essentially from scratch. Such a wasted opportunity and another example of the university exhibiting complete apathy towards the needs of the community it calls home. If Mac were a truly responsible institutional citizen it would have followed Yale's example (in New Haven) and worked hand-in-hand with the city to aid in bringing about a resurgence of the core. But alas ...

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By TreyS (registered) | Posted December 29, 2009 at 12:20:22

Wow that's really disheartening to learn that MIP is not following it's mandate and poaching good office tenants from downtown. Why don't they poach from Mississauga?

@ neo-luddite, "wagon wheels" was funny.

Anyone who is now against technology will love it when they need an MRI to help fix their brain aneurysm. Or they can go to Doc Baker in Walnut Grove.

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By Tammany (anonymous) | Posted December 29, 2009 at 12:24:28

"The loss of Assante Capital and Masters insurance is further evidence that upscale businesses would prefer that their customers and staff not have to mingle with the many discomforting and often menacing individuals who predominate in the core."

This is painfully true. It's rare for one to meet a corporate client from out of town without hearing a joke about the motley crew of downtown denizens encountered on the walk over from the parking lot.

For most businesses, the downtown (and by extension, the city) is an utter embarrassment.

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By Tammany (anonymous) | Posted December 29, 2009 at 12:27:18

"Why don't they poach from Mississauga?"

Because the managers who make the decisions on where to locate the offices don't want to work in Stinktown. They know the vast majority of their employees don't want to work or live there either. It's perception which hurts this city more than anything else, perception about the sort of people who live here.

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By jason (registered) | Posted December 29, 2009 at 13:02:01

and so the way we try to change that perception is to build more incinerators, proclaim a welfare apartment building as our number one choice for government money, refuse to enhance quality and safety of downtown life by removing transport trucks.........

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By Tammany (anonymous) | Posted December 29, 2009 at 14:22:25

Yes, it is largely political and bureaucratic ineptitude which is to blame, I agree.

The politicians, bureaucrats and powers-that-be in Hamilton clearly don't understand anything about marketing or "branding" (a term they love throwing around). The fact that there is so much establishment support behind Ecklund's laughable waterfalls rebranding scheme is evidence of this.

Ideally, Hamilton would be selling itself as a liveable big city; the problem is that we currently lack those amenities people associate with big city life, like a quality transit system, pedestrian and cycle friendly streets, high density development, etc.

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By Really? (registered) | Posted December 29, 2009 at 16:23:44

Bob Bratina said: "The loss of Assante Capital and Masters insurance is further evidence that upscale businesses would prefer that their customers and staff not have to mingle with the many discomforting and often menacing individuals who predominate in the core."

So what are you doing to fix it, Mr Bratina? Complain? Walk out of imperative votes that would keep more of these individuals out of our Ward? I have lived in Ward 2 since moving downtown from a Mountain Suburb about 6-7 years ago, and the menacing and discomforting individuals you speak of have grown in numbers and have become even more aggressive/'menacing' since.

If the City could stop dumping the 'working poor', elderly and/or disabled into our Core (and surrounding Neighbourhoods), perhaps then the Downtown could thrive!?

No wonder Banks & Investors will NOT invest in Hamilton. Poor People, the Elderly living on fixed incomes as well as those disabled folks living off assistance DO NOT SPEND MONEY! So why would LuLu Lemon/American Apparel/Gap/H&M/or even Winners want to invest millions in a Retail Outlet when NO ONE IS GOING TO SPEND MONEY THERE!? ...and how are we going to get Middle & Upper Class individuals with DISPOSABLE INCOMES into the Core to shop if they're afraid of all those same people the City keeps dumping in that area?

Maybe then people will WANT to stay living & working in Downtown, instead of bolting to their surface lot-parked cars and bee-lining it out as fast as they can (Thank God for One-Way Expressways)!

I'm starting to think Hamilton will implement Scooter Lanes before we ever get Cycling Lanes on our streets...

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By jason (registered) | Posted December 29, 2009 at 17:55:24

other than the scooter lanes remark, again, you've nailed it with a great post.

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By Capitalist (anonymous) | Posted December 29, 2009 at 18:10:37

"I'm starting to think Hamilton will implement Scooter Lanes before we ever get Cycling Lanes on our streets... "

Although I am not exactly a huge fan of bike lanes, this is just a classic line. Well said!

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By grassroots are the way forward (registered) | Posted December 29, 2009 at 18:41:02

Comments with a score below -5 are hidden by default.

You can change or disable this comment score threshold by registering an RTH user account.

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By A Smith (anonymous) | Posted December 29, 2009 at 18:46:39

Really? >> Poor People, the Elderly living on fixed incomes as well as those disabled folks living off assistance DO NOT SPEND MONEY!

All the more reason to move towards a progressive property tax system. For example, if the first 50k of property value was exempted from property taxes, the effective tax rate of most homes downtown would be cut in half, saving approx $795/year. Not only that, but the effective tax rate on downtown homes would move from 1.59%, above average for the GTA, to around 0.795%, the lowest tax rate in the GTA.

In effect, by introducing a progressive tax rate, the city would reduce the wide variation in home values we see across this city. The goal of progressive tax rates is to smooth out income and wealth disparities and all the evidence suggests it accomplishes this task very well.

Currently, the property tax system we have is not only not progressive, it's actually regressive, where the richest parts of the city pay the lowest tax rate. It's the equivalent of having income tax brackets that move lower as income goes up. In fact, one could make an argument that poverty in Hamilton has increased ever since this regressive tax system was first put in place.

Another positive about a progressive tax system is that while it decreases income disparities, it also evens out tax collections. When tax rates are higher on the top earners and lower on the lower income earners, the percentage of taxes paid by the lowest income group actually goes up, while the highest income group sees their tax burden decrease. Therefore, not only does a progressive tax system make incomes more equitable, it also makes tax burdens more equitable.

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By Ryan (registered) - website | Posted December 29, 2009 at 22:45:33

A Smith, are you aware of any jurisdictions that have implemented a progressive property tax system; and if so, what have been the results? Not trollbaiting - genuinely curious.

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By A Smith (anonymous) | Posted December 30, 2009 at 06:45:36

The Danes already do something similar at the national level...

National Property Tax

A national property tax is levied on the value of properties in Denmark. The taxable value is the lowest of:

1. The assessed value as of 01 January of the current tax year;
2. 105% of the assessed value as of 01 January 2001;
3. The assessed value as of 01 January 2002.


The tax rate is 1% of the taxable value up to DKK 3,040,000 (€407,791) and 3% on the value in excess of the limit. If the property was acquired before 01 July 1988, the applicable rates are generally reduced by 0.5% and 2.8% respectively.
Municipal Real Estate Tax

The municipal real estate tax rate is levied on the land value. The tax rate is between 1.6% and 3.4%, varying depending on the location.

...

According to the OECD, Denmark also has the lowest percentage of people living with less than 40% of the median income.

As for how it might work in Hamilton, if it's anything similar to every other jurisdiction that has used it, the result will be a more balanced distribution of wealth across the whole city. Therefore, rather than everyone ending up in the burbs to shop, more people would actually shop downtown like they used to.

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By TreyS (registered) | Posted December 30, 2009 at 11:51:03

Progressive Tax Rates sounds very interesting. It could be a way for council to sidestep area rated system. We tax income like this now. Those Danes....

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By TreyS (registered) | Posted December 30, 2009 at 11:52:42

BTW "Scooter Lanes" was funny

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By Henry and Joe (anonymous) | Posted December 30, 2009 at 17:12:16

I agree with Bob Bratina and Tammany that the MIP is good as long as it doesn't poach.

The Yale New Haven example brought up by Tammany is interesting as well. Here is my take on that example. The relationship between Yale and the city is different in that the University is centrally located within the downtown core. I think The University and the City are forced to get along because the two institutions developed at the same time within the centre of town. Yale University takes safety seriously, and requires that incoming freshman stay in one of the residential Collenges on campus. It also provides 24 hour shuttle service for students that live off campus in the downtown area. There is a research park there as well - Science Park at Yale. Although there are many private sector new economy companies there, it hasn't been a magic bullet for the town. The same rich-poor divide that you see in town between students and townies is apparent at Science Park. The park is located on the former Winchester Factory site that borders too very poor communities - Dixwell and Newhallville. I worked for a Biotech company there that employed 250 people at its peak. The areas surrounding the Park is economically depressed and seen as a deterrant to some for locating there. The residents feel irritated as they get the negatives that come with development (construction noise) but none of the benefits ( jobs and prosperity). Interestingly, the recent move by Yale to buy the former Bayer site in the affluent West Haven suburb has irked some at The city of N. Haven as a missed opportunity to encourage start-ups and feed the tax base inside N.Haven.

I commend Councillor Bratina on his efforts to get a student residence downtown. This is City's best interest in the short term, and the University's interest in the long term. Yale students love being in downtown N. Haven because of the culture and amenities. The disposable income of the average Yale student is higher than a Mac student, but our enrollment is much larger, meaning that there is a buying force that we are not currently captivating. Most Mac students spend their money on campus during the week, and at home in the GTA on weekends.

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By Balance (anonymous) | Posted December 31, 2009 at 00:36:56

You're right Councillor Brattina, business people don't want to be downtown at this time. So let's not loose them entirely. Give them a choice and they have decided to move. Should we limit their options and see them leave the City? Maybe it is about time that the City's Downtown Renewal group focussed more energy on helping the poor obtain employment then giving away taxpayer's money. I don't know the answer but it is high time to try something new, it has been 9 full years since amalgamation and little is improving. Would what improvements have occurred taken place without city dollars? I wonder, I always laugh at how the program's existence is justified by those who received a hand out. If the "people" in the downtown are the problem, then help them, instead of spending money on glorified projects, fancy street lighting and sidewalks.

With respect to MIP, I hope the City recoups their costs at a market value. I think it is a great re-use of the site in general.

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By Keith Mann (registered) - website | Posted January 02, 2010 at 10:49:01

Councillor Bratina, to The Spec's "Holiday Wishes" request (http://www.thespec.com/article/696119) you replied, "That McMaster Innovation Park stop poaching tenants from our downtown core." Your comments here reinforce that. I'm curious about your use of the word "poaching". Is the MIP actively soliciting tenants from downtown? Are they doing so in violation of some agreement?

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