Rejecting 401/PenEquity is a vote against job creation in London!


To suggest support for the now deferred PenEquity offer to build a signature Gateway project along London’s Hwy. 401 corridor is a watershed moment for this city would be a colossal understatement.

Forget for a moment all the arguments being tossed out by various councillors and environmentalists. What’s really at stake here is the possibility, if rejected, that a third arrow would strike right at the heart of London’s reputation as a City that says it wants to grow, that says it wants to develop the 401 corridor, and a city that claims a desperate need to grow new jobs yet fails to deliver when an opportunity like this presents itself.

Fresh on the heels of losing out to Woodstock in the competition to land the much sought after, Texas-based food-distribution giant Sysco Canada (400,000 sq. ft. food distribution employing 250 to 350) as well as the rejection of Sun Life’s proposed Industrial Park in the same general area, London may well be poised to send yet another and perhaps fatal message to developers and global investors alike that we simply don’t want you here.

Are we actually going to tell the world that we will not accept developments along that corridor unless they don’t cost us any money, produce only 6 figure income jobs, and do not impact the environment in any way, shape, or form? That, as Tom Cruise would know, is mission impossible.

And while we continue to play this dangerous game of development roulette, our competitors are kicking our teeth in all along the busiest trade corridor on the planet, the 401/402 corridor (estimated at over $2 billion daily).

The arguments that are being put forward by some councillors against the PenEquity project are troubling to say the least in that they are short on facts and long on political rhetoric. For instance, the land in question does not have 10,000 trees of significant importance. Actually the number is only 1600 of which, most are Ash and Elm that are either infected or are prone to infection. Some argue that we need to protect the wetlands that are there. Fact is there are no wetlands as defined by the Ministry of Natural Resources. It’s only a small pond area that was created by natural run off after the 401 ramp area was built in the late 90s.

And PenEquity didn’t just show up this spring, the LEDC has been working with them on this project since 2010. As to their credentials, Pen is considered a first-class developer with huge projects right across Ontario including Dundas Square in downtown Toronto and the Kanata Centre in Ottawa.

The project itself would provide a signature Gateway at the centre point of the 401/402 that could provide London the visibility that we have long desired with a premier development. And, in case we forgot, it was London (City Councillors, the LEDC, the Chamber and others) who convinced both senior levels of government to invest $100 million in the 401/402 corridor with the promise of future wealth and job creation as our collective lever. Good luck convincing them (senior government) of the need for future projects if we can’t demonstrate that we are prepared to act on that promise.

The PenEquity people are working with a number of international and North American based signature clients that could create not only a strong presence for the city, but will also provide a regional attraction position. These would be new businesses not another set of outlets of stores that are already here. Furthermore it could position London to take advantage of new high-end, US based retailers wanting to come to this region like Saks for instance, which was recently bought by the Bay.

As a life-long supporter of the free market, the contention by those that have no experience in this area that this project will simply cannibalize existing business from other parts of London is, in my view, simply a lot of noise. Pen will, as any responsible developer does, thoroughly analyze market demand and determine what can work and what cant.

Imagine if we took the view that we will never build anything in London ever again because it would compete with those that are already here. You would never have had a Masonville, White Oaks, Home Depots, Lowes, or two Costcos. Hmmmm….seems they are doing quite well thank you very much.

Councilors who contend that the Pen Equity development will poach existing businesses off of Wellington Street or as far away as Masonville, fail to realize that retailers will go where the market dictates. Case in point, Canadian Tire & Winners at Masonville moved to the Hyde Park big box plaza few years ago. Toys R Us and others moved from Wellington to the Wonderland/Southdale region last year – Home Depot from Wharncliffe to Wonderland/Southdale and the list goes on and on.

And are those former locations empty now? Of course not! The market, as it always does, moves in to fill the demand and the new operators in those old locations are doing very well. Only the market can determine what works and what doesn’t.

Moreover, as a destination we attract customers from an area of over 650,000 people, not to mention the potential for attracting new 401 business from the 60,000+ domestic and U.S. vehicles passing each day.

According to the Altus Group (who participate in many London initiatives), they are able to confirm the following forecasts for the project;

• 681 person-years of employment in direct construction representing over 300 jobs during the development phase

• 150 employment jobs regarding materials and services during the construction of the development.

• 1,200 jobs in the completed development based on the average profile of the anticipated clients

• Approx. $9.4 million in development charge revenue for the City.

• Approx. $440,000 in building permit revenue for the City;

• And, an annual property tax revenue of approximately $2.8 million.

Some Councilors insist that there is no way of getting people to this proposed site as there is no public transit. Wrong again, there is existing service along Wellington and Wilton Grove areas directly across from the proposed site and if successful you can bet the LTC would ramp up service to meet demand.

One of the weakest arguments I have heard in opposition to this development is that we (London) don’t want retail jobs and yet these same naysayers are often the ones that demand more work for our youth in an effort to retain them in London.

Fact is, youth employment is the highest in the retail sector and if we hope to retain our youth in London we will need more, not less retail jobs. Besides, retail is an excellent learning ground for business and with a little effort and hard work, management jobs in retail can be quite lucrative, I know from experience. On the flip side of the coin, the City of Ottawa very progressively started a matching service for youth with available jobs in the …..wait for it – Retail sector!! Good on you Ottawa!

So as we watch the growing number of shoppers (including thousands of Londoners) heading off to the jammed Outlet Mall in Milton as well as the other retail giants that have and will continue pop up along the 401, some London councilors would convince you to wait instead for the construction of the next Mayo Clinic, or Microsoft for the so-called knowledge jobs they provide. Really!

My advice is to start asking these same councilors why no investors are interested in London at all….for anything, anytime. In fact you should start asking them right now. Watch for the electronic voting results on this issue in the days and weeks ahead, write them down and remember them when election time roles around next November.

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5 Comments

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5 responses to “Rejecting 401/PenEquity is a vote against job creation in London!

  1. Dean Sheppard

    It is saddening to see the old school paradigm of economy vs environment being perpetuated by the Chamber. Surely we all realize the importance of a healthy environment and we are smart enough to develop and create jobs in ways that protect and enhance the environment – for our health and for economy. Woodland and wetlands also provide us with millions of dollars in ecological services and protections that we would have to pay for otherwise (e.g. water retention, air quality, cooling, just to mention a few).

    This one development proposal is not the only thing possible on that land – its just the one the developer happens to want right now. Again, its a false choice to believe that this single proposal is a once in a lifetime, all or nothing decision.

    London does not have to prove that it’s “open for business” by approving every development application despite the cost to the environment, community or taxpayer.

    The City has rules to identify and protect Significant Woodlands. This woodland fulfills the requirement literally five times over (as stated by the developer’s consultant). No amount of additional ‘spin’ on the number of trees or the health of some of the trees alters the fact that the woodland, by the City’s own rules requires preservation. I believe Londoners expect the rules to be followed and our remaining woodlands to be protected.

    We should all be happy for new, smart development, but we should not feel pressured into accepting any development at any cost. Perpetuating the idea that we have to accept the destruction of our remaining natural areas in the name of progress is out dated and surely not the way for London to be the best community we can be.

  2. Bravo! About time someone took the anti-economic growth councillors by the tail and flung them out the Window. Their lack of vision in shutting the door to outside business investment in the city is disturbing. To be so uncaring on the unemployment crisis for London citizens, speaks to their suitability to govern.

  3. City Staff

    Excellent article and let it be known that the magnitude of this development has the real potential to be the long needed catalyst to see the entire southend commercial sector revamped into future prosperity.

    There are more than a few global investment groups watching to see if this project sees fruition or rejection.

    It is pretty sad seeing some councillors trying to use the ‘tree hugger card’ over a tiny sector of land that nobody has ever heard of and trying to deny the city of London the prosperity it needs.

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