(rshsdepot) Toronto, ON - Union Station

[Bernie Wagenblast <brwagenblast_@_comcast.net>]

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Union Station plans inspired, but up in the air


      By JOHN BARBER


      Wednesday, June 26, 2002


      We'll leave it to Mother Nature to pluck the last hair off my head,
which I brazenly wagered on the predictable result of the secret corporate
competition to take over Union Station.

      As predicted, city staff selected a well-connected local group over a
consortium of top U.S. specialists in railway station revival. They also
recommended that Union Pearson Group, Inc., which includes companies
controlled by the Reichman family and steel magnate Larry Tanenbaum, get
control of the station for a potential 100 years -- twice the 50-year term
anticipated in the proposal call.

      But confusion and concern about the terms of the recommended deal,
which calls for a private-sector investment of about $200-million into the
city-owned station, prevented councillors from approving it yesterday. After
a brief discussion in private, during which one frustrated proponent
threatened legal action against the city, council's administration committee
instead deferred the issue to a special meeting at an undetermined date in
the future.

      "Obviously this is a hugely important development for the city," said
Councillor David Miller, who moved the deferral. "It's too important to deal
with in a rush."

      The greatest confusion centred on exactly what the proponents get from
the city in exchange for the long-term lease. Art McIlwain of the Urquhart
Consortium, a company that failed in its bid to take over the station, told
the committee that the recommended deal potentially surrenders $100-million
in value without compensation.

      The potential value lies in the right to build office towers above the
railway platforms, according to Mr. McIlwain -- a concept that Mr. Tanenbaum
first introduced five years ago in his daring but ultimately stillborn
scheme to erect a new hockey arena (with towers) above the tracks.

      City staff reported that they accorded "very little weight" to the
"additional density proposals" made by both the final bidders, arguing that
any tower designs are too conceptual to consider prior to awarding the "base
proposal" lease.

      But when it does come time to build towers over the tracks, as Mr.
Tanenbaum recently proposed, he and his partners will have "exclusive rights
to do it," according to Mr. McIlwain, who acted as chief negotiator for the
city thoughout the ill-fated 1997 negotiations.

      "We say it's unfair to award the right to develop more than
$100-million worth of density above the railway tracks without a tender,"
Mr. McIlwain said in an interview.

      "It's just a superb opportunity," he added. "It's the best place to
build office space in this country, bar none."

      Corporate Services Commissioner Joan Anderton replied that there is
"no additional density there now," and that any proposal to create some
would be subject to the normal routines (and hazards) of the planning
process.

      "This proposal deals only with the base," she said.

      The commissioner's assurances failed to satisfy the politicians,
however, who ordered a follow-up report on the air-rights issue.

      Most politicians are holding fire, recognizing that they could be
entering another major battle in the ongoing war over irregular procurement
procedures.

      "Based on what I know, I think [Mr. McIlwain's Urquhart group] was
properly excluded from the competition," Mr. Miller said. "But the question
about whether the development rights were treated properly is a serious,
legitimate issue, and I think it's appropriate for Mr. McIlwain to raise
it."

      There is no particular reason why Mr. Tanenbaum shouldn't earn the
right to carry through on his vision to bridge the platforms with a giant
truss and raise towers above and behind a restored Union Station, the jewel
in the crown of the financial district. It's inspired. But there is plenty
reason to ensure he pays for the privilege when he and his partners take
control of the station for the next 50 years -- a full century if they care
to renew the lease.

      "My concern as a citizen is that Union Station is going to be sold for
a lot less than its market value," Mr. McIlwain said.
      jbarber_@_globeandmail.ca



  Bernie Wagenblast
  Transportation Communications Newsletter
  http://groups.yahoo.com/group/transport-communications/

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railroad structures at: http://www.rrshs.org

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