Report
to/Rapport au :
Corporate Services and Economic Development Committee
Comité des services organisationnels
et du développement économique
and Council / et au Conseil
Submitted by/Soumis par : Greg Geddes, Chief Corporate Services Officer/
Contact
Person/Personne ressource : Doug McCaslin, Manager, Real Estate Services
Real Property Asset Management/Gestion des
actifs des biens immobiliers
(613) 580-2424 x 22595, Douglas.McCaslin@ottawa.ca
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OBJET : |
REPORT RECOMMENDATION
That the Corporate Services and Economic Development Committee recommend that Council approve the lease of 3.64 ha of vacant land to the Ottawa Hospital (General Campus) for a term of fifteen (15) years with one (1), five (5) year, renewal option, commencing 01 April 2005 at an annual rent of $639,936.00, plus GST.
RECOMMANDATION DU
RAPPORT
Que le Comité des services organisationnels et
du développement économique recommande au Conseil d’approuver la location d’un
terrain vacant de 3,64 ha à l’Hôpital d’Ottawa (Campus Général) pour une durée
de quinze (15) ans avec une (1) option de renouvellement de cinq (5) ans,
débutant le 1er avril 2005, au loyer annuel de 639,936.00 $, plus
TPS.
BACKGROUND
In April of 1996, the Region of
Ottawa-Carleton (Region) completed a land exchange with the National Capital
Commission (NCC) to acquire lands for the Alta Vista Corridor. As part of this land exchange, all current
lease agreements with the NCC were assigned to the Region.
The Ottawa Hospital, General Campus, (formerly Ottawa General Hospital) at 501 Smyth Road, leased a gravel-surfaced parking lot at 599 Smyth Road, containing an area of approximately 1.2 ha from the NCC to provide an additional 411 spaces for employee parking. This lease agreement, which was assigned to the Region in 1996, expired on 30 April 1999. The lease was subsequently renewed for two additional, two-year terms, which expired on 31 January 2003. At the expiration of the last renewal term, the Hospital requested that the City consider leasing them additional space allowing them to expand the parking lot to meet the growing demand for increased patient, visitor and employee parking. The proposed new leased area has an area of 3.64 ha and will contain 1,111 parking spaces (974 regular pay as you go parking spaces and 137 short term parking spaces required by the City to replace the parking on Lynda Lane).
DISCUSSION
The City currently leases 1.2 ha of vacant land to the Hospital at an annual rent of $199,992.00, plus GST, or $16,666.00 per month, plus GST, on which the Hospital maintains a gravel parking lot with 411 spaces.
The subject parking lot was
situated in an area zoned L2-tp3 [558] (Leisure Linkage Zone) and R5A [558]
(Residential - Low Rise Apartment Zone) , which allowed parking on a temporary
basis only. On 28 January 2004, City
Council approved the Hospital’s application to amend the Zoning By-law to
permit the use of a permanent parking lot and the associated right-of-way.
While the zoning now allows a
permanent parking lot and the associated right-of-way it is recognized by the
Hospital, the community and the City that the use of this lot for parking
purposes is a temporary solution to alleviate parking problems that now exist
in the area. In that regard, the
Hospital is undertaking an extensive study to determine the longer-term
requirements for both parking and transportation flow at the General Campus
location. It is anticipated that a
resolution of the problems will soon be developed.
A multi-storied parking
structure is being planned on the
Hospital site at 501 Smyth Road with construction to be completed within the
fifteen year lease period.
There have been ongoing
discussions with the Hospital concerning the terms of the lease and it is our
understanding that it is the Hospital's ultimate plan to have
"profits" from the parking go into a reserve fund. These funds in
turn are to be committed to the construction of the multi-storied parking
structure. These funds as well as any other funding that the City may offer are
required if the Hospital is to build the proposed multi-storied facility
without negatively impacting patient care and services.
Negotiations between the City of
Ottawa and the Ottawa Hospital centered on the urgent requirement for
additional parking for the Hospital's patients, visitors and employees and resulted in an agreement for the City to
lease the 3.64 ha property to the Hospital for a term of fifteen years,
commencing 01 April 2005 and terminating on 31 March 2020, at an annual rent of
$639,936.00, plus GST. The Hospital
shall have the option to renew the lease for one additional five (5) year term
upon terms and conditions to be negotiated.
The terms and conditions of the renewal shall include rent or
consideration at the then market rent and shall be subject to City Council
approval.
The present access to the lot
exists at Smyth Road and Lynda Lane. In
an attempt to alleviate traffic congestion at that location, the lease will be
conditional upon the Hospital constructing a connection from the parking lot to
Roger Guindon Drive. This addresses one
of the community association concerns regarding traffic congestion at the main
intersection to the Hospital.
The rental rate of $639,936.00 per annum is based on the findings of an independent appraisal report. The negotiated settlement is considered to be fair and reasonable and is hereby recommended for approval.
CONSULTATION
Over the past several years, the Ottawa Hospital, the former Region of Ottawa-Carleton and the City of Ottawa have been involved in discussions with local Community Groups regarding the use of this property. While all the parties would prefer a permanent solution to the Hospital’s parking situation, it is recognized that the use of the City’s lot will be a temporary arrangement pending resolution of concerns over street parking and traffic congestion. Issues surrounding this parking situation were discussed during zoning amendment deliberations at the 13 January 2004 Planning and Development Committee meeting. The Ward Councillor is aware of staff’s recommendation.
FINANCIAL IMPLICATIONS
This lease will provide the City with annual revenue of $639,936.00. The value of the lease over the fifteen (15) year term is $9.6 million. The proceeds will be credited to Profit Centre 171810 – 502610 (Corporate Portfolio).
SUPPORTING DOCUMENTATION
Annex "A" Sketch of subject property.
DISPOSITION
Corporate
Services Department Real Estate Services to execute the
lease agreement
Legal
Services Division to finalize the lease agreement
ANNEX A
