The first property Metrolinx purchased for Hamilton's LRT project was bought for an east-end transit terminal that will no longer be at that location.

Metrolinx has purchased a large piece of property that used to house Herbie's Drug Warehouse at the Queenston traffic circle. That was supposed to be the final stop for Hamiltons $1 billion LRT line and the property would be necessary for the end-of-the-line terminus.

But city council changed where the light rail transit (LRT) system ends, leaving the agency trying to figure out what to do with the property.

The end of the line is now set to be at Eastgate Square.

The provincial agency had been in negotiations to buy 75 Queenston Rd. this spring.

Then on April 26 — about one month before the land formally changed hands — city council voted to have LRT to go to Eastgate Square, and the province agreed.

That left Metrolinx holding Herbie's, a 0.75-hectare site next to the former City Motor Hotel land.

"Metrolinx reached an agreement to purchase the property located at 75 Queenston Rd. prior to the decision to extend the LRT corridor by three kilometres to Eastgate," said spokesperson Alex Burke in an email.

The city plans to sell the former City Motor Hotel land, but the plan was on hold pending the approval of LRT. (Samantha Craggs/CBC)

"We are currently considering various options for future use of this property related to the project."

Herbie's was just the first of about 250 of properties Metrolinx will buy — in whole or in part — for LRT. The agency is negotiating with landowners of about 45 properties right now.

Those deals effectively mark the point of no return for LRT, said Coun. Chad Collins when he reluctantly supported the project in April. Once they close, council is on the hook for millions.

Metrolinx won't say which properties are being negotiated right now, only that whenever possible, it will buy them willingly rather than expropriate them.

As for Herbie's, some of the terms still aren't clear. Land registry documents show Metrolinx bought it from Herbert Title Holdings of Mississauga, which owned it mostly mortgage free since 1985.

These plans from June 2014 show the potential future of the City Motor Hotel site. (City of Hamilton)

A land registry search lists the sale price to Metrolinx as $0, although Coun. Sam Merulla of Ward 4 said it was most certainly sold for more than that.

One option for Metrolinx would be to resell the land. Whoever buys it can add to a large area of mixed-use development that includes the City Motor Hotel site.

The city spent $1.9 million to expropriate the City Motor Hotel site in 2013. It's looking for developers now. Plans allow for buildings as tall as eight stories on the site, which is at 55 Queenston Rd. They also include getting rid of the Queenston Road traffic circle.

The Herbie's property is zoned for buildings as high as 12 stories, Merulla said. "You could probably build another three buildings there."

"I have people calling about both parcels of land because they assume we own both," he said. "People are anxiously awaiting the development of that."

"Whoever owns it, there's a market for it and they're probably going to profit from it."

The city delayed its plans for the City Motor lands to see what would happen with LRT, Merulla said. Now, he said, its development is "imminent."

There are "three or four" interested developers who want the City Motor land, he said. Money from that sale will go to buying up some problem properties on Kenilworth Avenue North.

The Herbie's property, Merulla said, has also housed a Dominion grocery store and a gym.

samantha.craggs@cbc.ca | @SamCraggsCBC