Councillors back deal for downtown Hamilton entertainment venues

City politicians have backed a deal with a private consortium to undertake a multimillion-dollar revamp of Hamilton's downtown entertainment venues.

But details of the master agreement with the Hamilton Urban Precinct Entertainment Group (HUPEG) won't be made public until final approval at council next week.

After a confidential staff update Wednesday, councillors voted unanimously in favour of the deal to refurbish FirstOntario Centre, FirstOntario Concert Hall and the Hamilton Convention Centre.

It's taken some time, so I'm elated that it's reached this point," Coun. Jason Farr, who represents downtown, said in an interview. Obviously, we have aging assets and we've addressed it here."

Coun. Sam Merulla, who pushed the city to divest itself of the venues, said the long-term leasing arrangement with the consortium will save the municipality perpetually tens of millions of dollars."

And most importantly, the taxpayers are out of the entertainment business. We need bread, not circus," said the veteran east-end councillor who led the charge 10 years ago to privatize the money-losing Hamilton Entertainment and Convention Facilities Inc. (HECFI).

PJ Mercanti, who's president of the HUPEG, said via email Wednesday night the group was pleased" with the initial approval and looks forward to providing more details after council's ratification.

We would like to thank city staff and council for their vote of confidence. We are eager to making the City of Hamilton proud as we execute on our vision to redevelop the downtown entertainment precinct."

In July 2020, council chose HUPEG to renovate and operate the aging venues over a pitch by Vrancor Group, which had proposed a minimum $200-million investment into the buildings.

The decision to go with HUPEG also involved the approval of a memorandum of understanding with the master plan still to be worked out.

At the time, the arrangement was described as a 99-year lease for the arena and an indefinite lease for the convention centre.

After Wednesday's private session, Farr and Merulla alike noted the months of talks have led to some modifications but said they couldn't share specifics until after a final nod by council next Wednesday.

The amendments are in the best interests of the taxpayer, and it's a mutually rewarding agreement that ultimately the taxpayers benefit the most," Merulla said.

In addition to Mercanti - who leads the Carmen's Group, a local hotel and catering business that operates the convention centre - HUPEG counts the LIUNA Pension Fund, Fengate Capital, Meridian Credit Union, Jetport Inc. and Paletta International as members.

Last year, Mercanti estimated $400 million to $500 million would be invested into the project over a three-to-five-year build-out.

A roughly $50-million renovation was envisioned for the York Boulevard arena that would include a new exterior, transformed lower bowl, expanded concourse level, and a flexible curtaining system for the upper-bowl balcony. A microbrewery, suites and hospitality clubs are also part of the project.

More than $16 million in capital upgrades were projected for the convention centre, concert hall and art gallery next door. As well, HUPEG planned for a mixed-use development, including affordable housing, estimated at $340 million.

Mercanti also leads a private consortium that hopes to host the Commonwealth Games in Hamilton in 2030.

The Hamilton Bulldogs are the arena's major tenant. Michael Andlauer, who owns the OHL team, proposed to build a 6,000- to 8,000-seat arena with millions of his own funds on the Mountain but council rejected the plan.

Teviah Moro is a Hamilton-based reporter at The Spectator. Reach him via email: tmoro@thespec.com