When negotiation time rolls around next year, the Memorial University of Newfoundland Faculty Association (MUNFA) will remember MUN had the cash to buy the Battery Hotel.
“The union’s position is the university can use its money how it sees fit, so I guess we would not have a view pro or con,” MUNFA president Ross Klein said of the pending purchase.
“Since we are entering negotiations next fall, we hope this sort of expenditure isn’t going to lead them to say when we talk about salaries ‘We have no money.’ There’s always a concern when they are making these kind of expenditures are they going to plead poverty when it comes to salaries.”
The contract expires in August 2013, and MUNFA is concerned MUN will either offer no increase or seek a rollback.
The Telegram broke the story on its website Thursday morning that MUN has an agreement to purchase the Battery, located on Signal Hill, with one of the most desirable harbour views in the city. The deal closes in January, and in the meantime, MUN is doing due diligence. The sale will depend on a detailed inspection of the property, a satisfactory closing arrangement and approval from government.
University president Gary Kachanoski told The Telegram Thursday MUN is currently paying out close to $1 million a year leasing off campus space around the city, and the Battery purchase would be cost neutral.
Kachanoski did not disclose the purchase price or discuss how much it would cost to upgrade the facility. But it was listed for sale at $10 million. When the deal is done, the purchase price will be released, Kachanoski said.
A Nova Scotia-born developer now based in California bought the hotel in 2005, and originally planned to tear it down and build a 10-storey hotel. He couldn't get development approval.
“As a former professor at Memorial in the mid-’70s, I'm particularly proud to see the Battery’s landmark property contribute significantly to making Memorial University’s campus one of the finest in all of Canada,” hotel owner Rick Butler said in a news release issued by MUN Thursday.
Under MUN ownership, possible uses include office space for divisions such as the Harris Centre, whose work includes holding public policy events and promoting MUN’s research, and the Gardiner Centre, which is part of the faculty of business.
Rooms could also be used for graduate student housing, which would be a revenue generator. The hotel has 127 guest rooms and suites.
There’s also 40,000 square feet of office space.
Kachanoski said the university would use the existing building footprint.
But there’s a sizeable property for future endeavors. The Battery, which first opened in 1970, sits on 4.52 acres.
“It became absolutely obvious it was a great investment for us in terms of the space purchase and what we might put up there,” Kachanoski said.
“We’re very excited and we hope the community is excited.
“As an individual property this makes sense. It makes great sense. It’s a great value acquisition for the university. Otherwise we wouldn’t be proposing it.”
MUN is pretty much out of space — completion of a new science building is five or six years away. Ground is not even broken yet. MUN has also announced the doubling of its engineering faculty by 2020, which will put more space pressure on the university.
If the sale goes through, detailed planning for the space will take place in January, February and March, Kachanoski said. He hopes to have people in the facility next year.
The movement of divisions will be somewhat a game of checkers — the Battery won’t necessarily be used exclusively for those in leased space. Some will shift back to the university on Prince Philip Drive as other offices move over to Signal Hill.
Kachanoski said the Battery’s got great parking and a historic location at the foot of Signal Hill and the edge of the downtown.
“For 400 years people were up on Signal Hill looking forward to the future, trying to get messages coming about what is going to happening the future. We see a university being very similar to that — looking forward to the future and helping signal the way Newfoundland should be going,” he said.
“So we think it’s a great piece for us on our own reputation.”
Klein said the other concern MUNFA has is that there be an adequate arrangement for faculty who have to go back and forth to the university, so they aren’t disadvantaged when it comes to parking at MUN. For example, he said the union worked out a deal for pharmacy faculty at Tiffany Place whereby the university covers cab fares, but other staff who moved voluntarily to that building don’t have the same arrangement.
He also said MUN must be careful those staff moving to the Battery don’t become marginalized from the rest of the campus. And he said he hopes there’s a plan for how students are going to get back and forth.
Joe Donnelly, president of the Graduate Students’ Union, said the wait list for graduate rooms — the union has about 30 in its building — sits at about 100, so the news of more rooms is great. The union had approached Kachanoski with its housing concerns earlier this semester. The union represents about 3,400 graduate students.
Metrobus could help
Donnelly also noted Metrobus could be approached to help solve the transportation problem.
And he said as able operators of a university pub — Bitters — the union would be happy to talk about running the bar at The Battery.
“I congratulate Dr. Kachanoski for landing the deal. It bodes well for the university and province,” Donnelly said.
Candace Simms, executive director of advocacy for MUN students’ union, was also pleased about the news, especially if there is no effect on tuition.
“Hopefully those savings they’re going to be recording (from not leasing) are going to be redirected to student services,” she said.
“The buzz for the most part is it will address space concerns, and consolidate the offices that are scattered around the city under one roof that can truly be a Memorial building.”
St. John’s Mayor Dennis O’Keefe said he thinks it’s a fantastic idea for Memorial University to buy the
Battery Hotel, but he wants the university to pay property taxes on that site.
The city stands to lose $300,000 a year in lost property taxes. As a provincial public entity, MUN doesn’t have to pay property taxes or draw permits for renovation or construction.
But O’Keefe said the city has a good relationship with the university and hopes an exception would be made for the Signal Hill property. The city contributes $100,000 a year to MUN towards the Aquarena.
O’Keefe said the historical nature of the site — at the foot of Signal
Hill — plays well with MUN as a memorial to Newfoundlanders and Labradorians who have served their country.
“There’s no doubt about it. It is an absolutely terrific use of property,” O’Keefe said. “It’s a win-win acquisition.”
The sale to MUN would also put to rest the push between the city and private development proposals for the site that have become contentious over the years.
“It dispels any possibility of some development going there that’s unacceptable to the city,” O’Keefe said.
“The university will be very respectful of the environment there, the historical nature, and will do the right thing.”
O’Keefe said if MUN isn’t up for paying property taxes, the city would not make up the loss by passing it on to other city taxpayers.
Rather, he said the city would hope other new development would offset the loss.
The loss of the prime real estate site as a hotel venue is causing some concerns.
St. John’s South-Mount Pearl NDP MP Ryan Cleary said Thursday one disappointed bidder told him he would have guaranteed employees at the hotel would have kept their jobs, as the space would be renovated and kept as a hotel.
“I am concerned about the university taking coveted hotel and conference space in St. John’s out of the mix and the impact that will have on he growing demand, specifically in the downtown,” Cleary said.
“The Battery, as a refurbished hotel, has always been seen as having incredible commercial potential that’s never (been) realized.”
He said while there are several other hotel plans for around the city, the Battery has an iconic location overlooking The Narrows that could be seen as an “incredible economic opportunity lost.”
Earlier this month, 71 workers at the site, represented by the Newfoundland and Labrador Association of Public and Private Employees, were given layoff notices effective in January.
Kachanoski said as a public building, jobs will be open for people to apply for. “We have our own unions, great relationships with our own unions so we have got particular procedures,” he said.