Plan would see derelict Sault hospital sold for $1, buyer to pay $4.6M demolition cost

On Monday, city council in Sault Ste. Marie will vote on a proposal that would see the quick demolition of the former hospital site, part of a larger plan to redevelop the area.

Council voted to buy the property early last month, which has been vacant for 13 years and had become an eyesore in the community.

Vacant, and falling into disrepair, the former Sault hospital site has sat vacant for the last 13 years, with the most notable changes being fencing to keep out squatters. (Photo from video)

The city bought the property for $4.75 million and had planned to spend another $4.6 million to demolish it. The plan was to then sell the land to a developer who would build residential units – possibly including affordable housing – which would allow the city to eventually make back its investment in new property tax revenue.

The city received three bids in response to an RFP to develop the property, which closed Nov. 4. A city staff report recommends accepting a combined bid from Green Infrastructure Partners Inc. and Ruscio Masonry and Construction Limited.

The proposal breaks down the site into three parcels of land, dubbed A, B and C. GIP proposes buying parcels A and B, which includes the former hospital, for $1 each.

If approved, GIP commits to paying demolition costs and to begin that process within 30-45 days of the sale being finalized. Once it starts, the demolition would be completed within six to eight weeks.

The city would also agree to an "exemption from the noise by-law during demolition to permit work on a modified work schedule of 10 days on, four days off, with site work to be completed Monday to Friday, 7 a.m.-6 p.m., and Saturday and Sunday, 7 a.m.-5 p.m., which activities may include crushing brick and shredding of materials," the staff report said.

Building permits within five years

The terms of the agreement would require GIP to submit a master plan to build housing units on the property within three years, and to apply for building permits within five years.

"If these terms are not met, the city will have the ability to take the properties back," the report said.

Ruscio would buy Parcel C for $2 million, to be paid over five years, interest free. Construction on residential units would have to begin within 12 months.

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If approved, the city would recoup its investment in the property within six to eight years if the development doesn't include affordable housing units, and within 11-12 years if it includes 30 per cent affordable housing.

The staff report recommends approving the plan.

"The proponents are two credible companies — GIP is one of Canada’s largest and most diversified infrastructure companies with the significant human and capital resources required to complete the demolition of the former General Hospital," the report said.

"Ruscio Construction is a respected local builder with a positive development track record in the community."

Councillors will vote on the plan at a special meeting Monday at 5 p.m. Read the full report here.