The city is spending about $200,000 to retrofit a brand new community arts space in downtown Hamilton, even though it has never been used and was built to the city's own original specifications.

Everything at the CityHousing Hamilton building at 95 King Street East is brand new, but crews will soon rip out parts of the bottom floor and start renovations for a new community performance and art space operated by Sonic Unyon Records that's set to open in July.

'There may well have been things we could've done differently, but this project has evolved.' - Coun. Brian McHattie

The city-owned housing agency's adaptive reuse project was highly touted during its restoration — but the city couldn't find a tenant to run the bottom floor arts space before the original construction project was complete. Now it has a tenant, but they want an entirely different space — and that lack of focus in the planning stages has forced the city into the costly retrofit.

The additional costs were only ever discussed in closed-door, in-camera board meetings and never made public.

City officials say costs like this are expected when a tenant moves into a space, but CityHousing board of directors president Coun. Brian McHattie says there are "some throwaway costs" attached to the project that could have been avoided if the city had "done things differently the first time."

He admits that if the city were to do a project like this again, they would approach things differently.

"But I'm not sure we could've envisioned this early on," McHattie said. "There may well have been things we could've done differently, but this project has evolved."

An expensive evolution

It's that "evolution" that is now costing the city. The original vision for the building was as a mostly visual arts centre with a multipurpose gallery and event space, eight artist studios, a meeting room and 12 loft apartments on the upper levels. That plan was crafted without a specific tenant for the main floor arts space in mind, and so the area was originally capped at a 44-person capacity. That number was reached through a series of arts community consultations, the city says.

'We're going to work super hard to make this work for the community.' - Tim Potocic, Sonic Unyon

No tenant for the main floor space materialized until February, when news broke that Sonic Unyon records was working out a deal with the city to run the lower floor gallery space. But Sonic Unyon's vision for the space included other elements of the city's art scene like music, theatre and dance. The original 44-person capacity setup wouldn't be large enough for that.

"The space wasn't being created with anyone in particular in mind. [The city] didn't have a tenant," Sonic Unyon owner Tim Potocic told CBC Hamilton. "Generally when you're building for a project you have a tenant, but they didn't. But that's nobody's fault."

To double the building's capacity in order to accommodate bigger shows, several things need to be changed or upgraded — like fire exits, air conditioning units, electrical and mechanical upgrades and installing more bathrooms. The city is footing the bill for those improvements, says CityHousing senior project manager Vimal Sarin. The cost of the contractor is $185,000, permits are another $900, and there are additional fees that could be incurred on top of that, he says.

Sarin says it's "standard practice" for a landlord to make changes to a building space in situations like these. "Nobody knows how it will all turn out — but provisions like this are always in any commercial lease," he said. "Any kind of cost that you incur involves renting it out and making it suitable for a tenant."

"Whether it's $185,000 or $210,000, we don't really know for sure yet," Sarin said.

The gutted materials from portions of the building that were never used are also worth about $10,000 to $25,000, sources say.

'We're trying hard to finish what needs to be done'

Sonic Unyon is also contributing over $100,000 to the renovations, Potocic says. "The costs are fluctuating, but substantial," he said. Sonic Unyon will cover upgrades to the stage space, lighting and electrical, sound dampening, installing a bar, and more.

The city's original budget for the project was $3.3 million. Sarin says "some of that money" wasn't used in the original overhaul, and he "thinks" the city saved about $150,000 from that budget, but isn't sure. Any funds that weren't used the first time around would have been reallocated back to the city for other projects.

CityHousing has also applied for leaseholder permits for the space, but hasn't received them yet. "We're trying hard to finish whatever needs to be done," he said.

Then there's the matter of privacy. It's not uncommon for the details of business deals with the city to be negotiated during private in-camera sessions, but McHattie says there is "no reason" the cost of the retrofitting project shouldn't have been made public after the fact. "It stayed in-camera as part of the lease discussions, but it never came back to the board. So that's probably why it never stood on its own," he said. "But I have no problem with it being public."

Making it work for the community

McHattie also said any critical look at the funding costs for the building should be done while also looking at all the good the project could do for the arts community and the area. Seeing as this building was once a boarded up old strip club, the adaptive reuse project being implemented here is a boon for the city, he says.

Sonic Unyon is also doing everything they can to use the space to enhance the city's art scene, Potocic says. "We're doing exactly what everybody wanted. This is a community event space," he said. The main floor studio spaces in the building that are on the same floor as the main gallery space are all currently leased to community groups, he says – including the Fringe Festival and some artists. Basement spaces will also be available for rent on a daily, weekly and monthly basis.

"Just an art gallery is not going to satisfy the needs of the entire art community," Potocic said. "When we think community and collaborative, we think everything."

"We're going to work super hard to make this work for the community."