Sault Blog

In 2013, the Old Hospital Site was sold for $65,000 by the Sault Area Hospital (SAH) Board of Directors with the approval of the Ministry of Health to Toronto Developer #1. The Old Hospital Site was sold on an “as is” basis with the bona fida agreement that the site would be remediated and redeveloped reflected in the minimal sale price. The SAH spokesperson at the time admitted that the Hospital Board members were NOT developers and didn’t want to deal with the site, leaving a decades-long legacy of contaminated property and land.

Was it just so easy to walk away and leave such a massive contaminated property and site for someone else to deal with?

The SAH Board acted like a bankrupt legacy mine leaving behind a massive contaminated brownfield site for the taxpayer to clean up. The SAH Board, the Ministry of Health, and the Ontario Government should have been on the hook to remediate, demolish, and bring to good the site before selling the property.

All across Ontario, these old hospitals were left to municipalities to deal with the remediation, demolition, and clean-up. In certain cases the Ontario Government paid, partially paid, or did nothing; the further north the municipality, the less the Ontario Government cared or contributed.

A lack of legal, management, and developer knowledge was evident in selling the property to Toronto Developer #1. There was NO binding contractual obligation for the remediation of the site, development of the site, or the demolition of the contaminated old hospital buildings in the contract of sale. There was no binding contract for the protection of the City of Sault Ste. Marie, and its taxpayers. The Sault at the time had lawyers on staff, a senior administrator with a legal degree, and had access to local contracted “professional lawyers” but not one “professional lawyer” spoke up for our City to lock down a contract, with Toronto Developer #1, that provided some safeguards for the City of Sault Ste. Marie and its Taxpayers.

As commented on a previous blog, the City didn’t own the property; therefore, it wasn’t the responsibility of the City’s Legal Department to lock down a contract that protected the City of Sault Ste. Marie and its Taxpayers.

This essentially identifies the major problem with the Old Hospital Site; it should have been taken over by the City of Sault Ste. Marie in a land banking program immediately.

The failure to take over the Old Hospital Site, by the City of Sault Ste. Marie, when it was rendered surplus by the SAH Board was a failure of the City Planning Department to adapt itself to modern urban planning. The Official Plan was outdated, and the thinking of the City Planning Management was outdated also: “We will let the private sector developers do everything”. Other cities in Ontario and Michigan moved to a land banking and place-making strategy, and our outdated Official Plan and planning policies conveniently tried to pass the buck to the private sector; while abdicating the duties and responsibilities of “Planning our City’.

A land banking program would effectively capture large pieces of land that come up for sale through any private or public channel and immediately take possession of the property and hold it. What are the significant benefits of a land banking policy and program:


The Planning Department can determine what the best use of the property is based on “what our City needs, not what Toronto Developer wants”.

Citizens can voice their opinion of what should be done with the property. Should the property become part of the Waterfront Park System; or maybe it shouldn’t be developed at all.

The property can be held for “place-making”. Held in trust for a specific purpose, like creating affordable housing units.

The City Legal Department can produce contracts of sale that offer protection to the City of Sault Ste. Marie and its Taxpayers.

The Building Department can order the remediation and/or demolition of end-of-life cycle assets. Deal with problematic buildings immediately, DO NOT allow a culture of blight to persist in our City. Demolishing the Old Hospital Site in 2013 was budgeted at $2 – 5M; now it is likely to cost $16M as did Grace Hospital in Windsor.


Toronto Developer #1 was successful at redeveloping the smaller Plumber Hospital; however, when realizing the General Hospital was too big or risky a project, the Building Department, Planning Department, or Senior City Administration did not try to work out financial incentives to keep the project alive. Once again, because there was no binding contract, Toronto Developer was allowed to back out the the original deal.

The City of Sault Ste. Marie should have bought out Toronto Developer #1, but then again we did not have an Official Plan that allowed the City Administration the ability to land bank for place-making.

The Old Hospital Site was then sold to Toronto Developer #2 for approximately $1.3 million. No development was completed; however, true to his words a “Concentration Camp Fence” was installed.

To add insult to injury when the SAH Board needed a building for the Northway Wellness Centre, (at the old Sault Star building) the SAH Board needed to go to the private sector and enter into a long-term financial lease, while the former Old Hospital Site sat empty.

Twelve years after the fact, we are now in the unenviable position of having to buy out Toronto Developer #2 at a premium price of almost $5 million.

Now, Mr. Tom Vair CAO, SSM is finally proposing what should have happened twelve years ago; the Old Hospital Site property needs to be taken over by the City, thus “land banked” for “place-making” affordable housing.

The Sault Taxpayer will pay, no one will be blamed for this case study in urban planning mismanagement, and worse yet the Official Plan still does not have a land banking and place-making policy and strategy.

Mark Menean, www.saultblog.com