Buzz over pending sale of Battery

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Barb Sweet
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Faculty union taking notice as negotiations pending

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.

 

Possible uses

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.

 

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Organizations: Memorial University of Newfoundland Faculty Association, Battery Hotel, Harris Centre Gardiner Centre The Battery Newfoundland and Labrador Association of Public and Private Employees

Geographic location: California, Signal Hill, Nova Scotia Canada Newfoundland

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Comments

Comments

Recent comments

  • Kathy Foley
    November 23, 2012 - 17:28

    The Battery has had a bad reputation for more years than I can remember. Ryan Cleary has concerns for labour but the University represents a long-term solution and investment in maintaining the property and facility to its finest. Many universities own hotels on their campus for the enourmous number of visiting people from all over the world. A B&B downtown may do little for a person who must daily travel to campus on a crappy bus system and outrageously expensive taxis The university's strategic planning is not to decrease the building's economic value. Its presence there will demand services in the immediate area. It's time we took care of our education development as a priority instead of tourism.

  • Fred Squires
    November 21, 2012 - 07:49

    Revenue based commercial properties should always stay as that. Never let a scenic icon such as the Battery hotel lose its identity.It has the most enviable site overlooking the city of St Johns.Other cities would showcase this property and would only issue permits to renovate, decorate ,and only allow it to remain a beautiful hotel.Once again city of St. Johns should have asked the citizens what should have been done with this situation.Now the taxes are gone, jobs gone, no more Battery hotel.Citizens of St Johns should have taken it over, what a winner that would have been all around. +

  • seanoairborne
    November 16, 2012 - 14:58

    If you guys keep voting for the same old Rhinos every time a city or municipal election rolls around you're getting what you deserve!A backwater mentality from a backwater bunch of old fossils.We only get the government we deserve ultimately.Just look at our recently held US elections ?We're headed down the toilet like "scrubbing Bubbles"!Learn from us!!Those who forget recent history are doomed to repeat it!!

  • You want money...
    November 16, 2012 - 12:44

    ...develop the area into a casino/hotel. Think about these tour ships that come in with people looking to waste a few hours here...and spend money..."We only have a few hours...let's pop up to that very classy looking casino." Who wouldn't head there for a bacholar party or a guys/girl's night out? A place for some shows too...we are a have provance...let's start acting/looking like one.

  • Cynthia Snow
    November 16, 2012 - 10:17

    JP: I did not state that the City of St. John's had any input into who purchased the Battery Hotel, I only stated that I didn't understand why they would be happy about it. Perhaps before you rebuke someone elses comment, you might want to at least read it first. What the City allowed to happen was to lose $300,000 a year in taxes, not to mention additional tourist dollars that would be spend in the downtown core of our city. They refused to put a beautiful new hotel up there a couple of years ago. Since MUN is now the new owner, unless you are a student or a member of a staff member, the view is now lost to you. I actually attended a wedding reception up at that hotel many years ago and the view was incredible. You can see the entire harbour and and well out into the narrows. Personally I wouldn't care about any other hotel being converted into office buildings (with the exception of Hotel Newfoundland), but this building is unique since it sits on a very historical site and I do believe in a case such as this the people of our City should have been allowed to voice their concerns.

  • Brian
    November 16, 2012 - 10:07

    What a bunch at City Hall, lose $300,000.00 look at all the new commercial development throughout this city and new taxes . they always spin on the negative they hove more money than they know what to do with!!!. But waste most of it, such as fence on the Harbour Front???

  • EdB
    November 16, 2012 - 09:52

    My preference is that the Battery should have remained as a hotel because of it's location and views. This site would best be developed into an upscale hotel, very few places can claim this sort of panoramic view. I also believe that MUN should pay some taxes to compensate for the services they receive from the city of St John's. The city provides street maintenance, snow clearing, water and sewer services, MetroBus etc. If MUN does not contribute at least a minimum amount towards these costs they will have to be covered by the taxpayers of the city.

  • Robb
    November 16, 2012 - 09:29

    Leave it to the greedy unions to jump on this.......you have enough money to buy premises, so you should have enough money to pay us more, more, more.....typical union banter.....the university should absolutely come back and say that they have spent all extra money on infrastructure, so there is no extra money left......never mind the greed...!!!!!!!!!!!

    • Douggie
      November 16, 2012 - 11:12

      I just KNEW the greedy unions were behind this! I would expect that single welfare mothers are in on this too. Imagine the nerve of some workers wanting to get paid a decent salary! No good can come from the lower classes getting uppity.

  • Curtis
    November 16, 2012 - 09:22

    You've got to be kidding me.... What a spot for a Hotel, and as mentioned, for tourists and Newfoundlanders to enjoy. Now an office building... wow. I don't know why city council is so against modernization and updating. Do you think New York would be what it is today if they didn't tear anything down? With the right design, taking cues from the existing hotel, it would have been a nice place, and a taxable income for the city. But this opportunity has passed now....you lost out St.Johns.

  • JP
    November 16, 2012 - 09:22

    Cynthia, as with any business transaction over the sale of a property, the city has NO say in who purchases a property, nor has any role in approving it. They can only approve, or not, the redevelopment or rezoning of said property after the transaction is complete. In this case, it does not appear that MUN wants to redevelop the land if they are inspecting the building, and office space is as much a business as a hotel is, therefore no rezoning is required. There is no view of the narrows from the hotel, only a view of the dockyard at the other end of the harbour. If anything, all other office buildings and hotels downtown have a better view of the narrows than the Battery. As for the loss of taxes, the city need only approve 150 new houses at an average cost of $2000 in annual taxes to make up the difference, which they will no doubt have no difficulties in chomping another bite out of the land on Kenmount hill. Or the city can use its multi-million surplus to fix the aging water infrastructure in the city and save hundreds of thousands a year in paying for repeated watermain excavations and repairs. As for the employees who will lose their positions at the Battery I certainly feel for them, but there is never a guarantee that a new hotel operator will maintain the same staff, no matter what they say. Based on the construction on Kenmount, there will be plenty of new positions available in the two...or is it three... new hotels currently being build.

  • kc
    November 16, 2012 - 08:20

    of course he wants taxes but!!! they don't pay taxes elsewhere why should they pay at the battery???

  • Cynthia Snow
    November 16, 2012 - 07:30

    I cannot believe that the City of St. John's would be happy about he sale of this property to MUN. This site could have been turned into one of the most beautiful hotels in the country with incredible views for tourists and Newfoundlanders to enjoy for years. Turning this hotel into an office building, or God forbid, student housing is a step backwards for this city. It is time to give Mayor O'Keefe, Shannie Duff and the rest of the yahoos down at City Hall their walking papers if they allow this to happen. I guess since MUN doesn't have to pay the $300,000 a year in taxes, the taxpapers of St. John's will eventually feel the pinch.