View Full Version : New Downtown Calgary Arena
PPAR
Nov 12, 2015, 4:32 AM
Ok, so with the new attendee information of approx 1.8 million a year,(thanks) a new facility could pay off an interest free 250 million loan in 28 years with a $5 ticket tax. Add a buck or two to cover interest.
Ayreonaut
Nov 12, 2015, 4:56 AM
Ok, so with the new attendee information of approx 1.8 million a year,(thanks) a new facility could pay off an interest free 250 million loan in 28 years with a $5 ticket tax. Add a buck or two to cover interest.
Just in time to start planning the Saddledome's replacement's replacement!
Fuzz
Nov 12, 2015, 2:14 PM
How price sensitive are Flames fans though? I'd imagine 20% would be fine for most of them, given they like to complain how bad the facilities are at the dome, and that they would gladly pay more for better facilities. As for concerts, people seam to have no problem spending $200-$400 for concert tickets. I think $5 is way to low.
My point is, I think there is a lot of room to have the users pay for it. I'd rather it come out of the users than general public. In fact, I might go to Calgary Puck and start a thread asking how much they would be willing to pay in a ticket tax. I'd do it here, but there are a lot more users there. Would it be best to offer the choices as a % or $ figure? Let's see what the appetite is...
You Need A Thneed
Nov 12, 2015, 3:39 PM
How price sensitive are Flames fans though? I'd imagine 20% would be fine for most of them, given they like to complain how bad the facilities are at the dome, and that they would gladly pay more for better facilities. As for concerts, people seam to have no problem spending $200-$400 for concert tickets. I think $5 is way to low.
My point is, I think there is a lot of room to have the users pay for it. I'd rather it come out of the users than general public. In fact, I might go to Calgary Puck and start a thread asking how much they would be willing to pay in a ticket tax. I'd do it here, but there are a lot more users there. Would it be best to offer the choices as a % or $ figure? Let's see what the appetite is...
How much the ticket tax is doesn't really matter. The overall cost of the ticket matters.
fusili
Nov 12, 2015, 3:42 PM
If we are debating whether fans are willing to pay an increase in ticket costs to cover the cost of the arena, etc, then there is no justification for a new arena. If the argument is that our current arena is not up to standard, then purchasers should be willing to pay more for the upgrade.
At the end of the day, this is still a proposal by a for-profit organization asking for government money to make more profit, with little to no public benefit. Unless you are providing a public good (a non-excludable, non-rivalrous good that provides a positive benefit to citizens) then you shouldn't get money.
The Fisher Account
Nov 12, 2015, 4:21 PM
If we are debating whether fans are willing to pay an increase in ticket costs to cover the cost of the arena, etc, then there is no justification for a new arena. If the argument is that our current arena is not up to standard, then purchasers should be willing to pay more for the upgrade.
At the end of the day, this is still a proposal by a for-profit organization asking for government money to make more profit, with little to no public benefit. Unless you are providing a public good (a non-excludable, non-rivalrous good that provides a positive benefit to citizens) then you shouldn't get money.
Yeah, but you and everyone here knows it's going to happen, so why keep bringing up this tired old idealistic argument? The Flames are going to get taxpayer money because no other organization is going to step in a build a new arena in this community of 1.5M people.
It's inevitable. Cross your fingers The City get's a good deal and the area gets cleaned up. But this will never be 100% privately financed, so just bend over and try to smile a bit.
fusili
Nov 12, 2015, 4:38 PM
Yeah, but you and everyone here knows it's going to happen, so why keep bringing up this tired old idealistic argument? The Flames are going to get taxpayer money because no other organization is going to step in a build a new arena in this community of 1.5M people.
It's inevitable. Cross your fingers The City get's a good deal and the area gets cleaned up. But this will never be 100% privately financed, so just bend over and try to smile a bit.
No its not. We can say no. That is actually something that governments and citizens have the power to do. I understand that no other organization is going to build an arena, but honestly, unless fans and the organization are willing to pay for it, we don't need it.
I get the field house argument, that is a public good. It provides recreational opportunities for everyone in the city, which I see as a public benefit. Being able to watch your team play hockey in a nicer arena is not.
The Fisher Account
Nov 12, 2015, 4:42 PM
Disagree with me if you want, but there will be a new facility built. It really is inevitable.
fusili
Nov 12, 2015, 4:46 PM
Disagree with me if you want, but there will be a new facility built. It really is inevitable.
I don't doubt that, but I hope that what is built is properly paid for and more thought out.
MalcolmTucker
Nov 12, 2015, 5:03 PM
Ok, so with the new attendee information of approx 1.8 million a year,(thanks) a new facility could pay off an interest free 250 million loan in 28 years with a $5 ticket tax. Add a buck or two to cover interest.
$13,134,797 a year at ACFA 3.266 % for 30 years. Totally doable.
lubicon
Nov 12, 2015, 8:21 PM
It would make more sense if the ticket tax was a variable amount depending on the ticket price rather than a fixed tax per ticket regardless of price. People wont want to pay a $20 dollar tax on a $15 Hitmen ticket.
PPAR
Nov 13, 2015, 2:20 AM
Fans go to the same building though. Facility fee should be fixed. The Hitmen can stay at the saddledome if they don't like it.
WhipperSnapper
Nov 13, 2015, 2:43 AM
Yeah, I can't see a ticket tax being a flat rate when ticket values range greatly. See something between 10 and 20%. I'd be concerned if it were applied to non Flames owned events even if they end up managing this city owned facility.
Big Sky
Nov 13, 2015, 8:22 PM
I don't necessarily agree with that. True that it's mostly sports fans and concert goers who will benefit, but I would argue it's just it would be used by more citizens of Calgary then say Nose Hill or the bike path system. The city government pays millions for things that are of benefit to only a certain segment of the population. This would be no different except for the ownership.
The argument will be that the city owns Nose Hill and the bike paths, but those items cost money to maintain year after year. The cost into the new arena/stadium would be a one time thing from the city, and it's revenue generating situation (through taxes) unlike the bike paths or Nose Hill which are a cost only.
I'm an avid biker and user of Nose hill and the Bike path system, and I'm thankful the city has supported these things. I also like the idea of having a good stadium or arena available for things that bypass the city because of the current facilities, things like soccer tournaments or concerts, etc...
If we are debating whether fans are willing to pay an increase in ticket costs to cover the cost of the arena, etc, then there is no justification for a new arena. If the argument is that our current arena is not up to standard, then purchasers should be willing to pay more for the upgrade.
At the end of the day, this is still a proposal by a for-profit organization asking for government money to make more profit, with little to no public benefit. Unless you are providing a public good (a non-excludable, non-rivalrous good that provides a positive benefit to citizens) then you shouldn't get money.
MalcolmTucker
Nov 13, 2015, 8:33 PM
I would argue the facility existing is the public benefit.
The public owns plenty of facilities that are rented out to private corporations at a loss to the government. The only difference is that once the facilities exist it is easy to forget about both the initial and ongoing subsidies.
Should we not rent the Jubilee out for Phantom of the Opera because the profits go to billionaires? Should we only rent out the Jack Singer to artists who can prove they make less than $100k a year?
Big Sky
Nov 13, 2015, 8:42 PM
I would argue the facility existing is the public benefit.
The public owns plenty of facilities that are rented out to private corporations at a loss to the government. The only difference is that once the facilities exist it is easy to forget about both the initial and ongoing subsidies.
Should we not rent the Jubilee out for Phantom of the Opera because the profits go to billionaires? Should we only rent out the Jack Singer to artists who can prove they make less than $100k a year?
I'm not sure if this post was a response to my post. Either way, I'm in agreement on what you are saying. I'm fine with the government chipping in money for the sports complex as long as it's a reasonable amount. I have no problem with the city chipping in money to the Library, NMC or other venues that are a benefit to only a certain segment people.
I think alot of the opposition is because of the Flames being the owners. I get that, but instead of the city footing all of the cost for new facilities I'd rather they chip in a fraction of it. The public still gets their new facilities in the end.
fusili
Nov 13, 2015, 8:44 PM
I don't necessarily agree with that. True that it's mostly sports fans and concert goers who will benefit, but I would argue it's just it would be used by more citizens of Calgary the say Nose Hill or the bike path system. The city government pays millions for things that are of benefit to only a certain segment of the population. This would be no different except for the ownership.
The argument will be that the city owns Nose Hill and the bike paths, but those items cost money to maintain year after year. The cost into the new arena/stadium would be a one time thing from the city, and it's revenue generating situation (through taxes) unlike the bike paths or Nose Hill which are a cost only.
I'm an avid biker and user of Nose hill and the Bike path system, and I'm thankful the city has supported these things. I also like the idea of having a good stadium or arena available for things that bypass the city because of the current facilities, things like soccer tournaments or concerts, etc...
It is entirely different. It is a public good vs a private good. I am talking about the economic definitions of these things.
A public good is non-excludable, which means that once you provide it, you cannot exclude others from benefitting from it. Police services are public, because the city can't somehow exclude some and not others from the benefit of increased security and reduced crime. The same goes for fire protection. I would argue parks are the same (and in fact education and health care, but that is going on a tangent now). The city cannot exclude you from the benefit of using the park (other than fencing it and charging admission, but in that case I wouldn't call it a public good), even though you might not use it.
People who go to hockey games pay for them. And others do not if they cannot pay. That is an excludable good. I can get into the argument that in fact hockey games are primarily attended by wealthier socio-economic classes, which further exacerbates the criticism that we shouldn't be subsidizing them, but I won't. The point is, professional sports games are NOT a public good. They are entertainment the same way watching a movie is, or going to a comedy club. We need to understand this difference if we are going to properly assess whether this is in fact in the public interest.
Also, saying its revenue generating vs not revenue generating is a misunderstanding of costs. If parks cost us $5/year/citizen and we subsidize tickets $100/year/attendee, just because one generates revenue, it doesn't mean it doesn't cost more. Costs should be evaluated on a per activity basis not as a percentage of recovery. Recovering a higher percentage isn't a plus if the cost is commensurately higher.
And the cost for the arena sure as hell isn't a one-time thing. Do you know what kind of liability insurance, maintenance, depreciation etc we would get with an arena? The Flames proposal would be for the City to own the arena. That is stupid. We get to own a depreciating asset with a limited number of potential sources of revenue, none of which would come close to covering the depreciation in capital, insurance, liability, maintenance etc. The reason we are being asked to build it is because it is a money pit.
How about you buy me a house, (on contaminated land mind you, that you have to pay to clean), I get to live in it, pay you rent that doesn't cover the mortgage, insurance or anything else, you have to insure and maintain it, then at the end you get to own the house, which is now a completely useless asset? Also, my friends will come over a lot and we will have epic parties, so you can live with the knowledge that you helped some awesome parties happen. What a deal!!!!
Big Sky
Nov 13, 2015, 8:55 PM
I guess the plan has changed. I thought the plan was for the city to chip in part of the cost and the Flames be the owner of the complex. Which is the way I would to like to see it.
As far as the excludable and non-excludable, argument goes, I don't buy that. In the end they are both for the public good, just because something can be owned privately doesn't mean it can't be for the public good. Yes technically anyone can use the bike paths or Nose Hill, or the Public Library, or the NMC, or anything else the city operates or has donated money to. Either way not everyone uses those facilities, even if they totally allowed to do so. Is going to the Jack Singer or the NMC or the Library much different than the sporting events?
I agree with you on not wanting the city to own the sports complex, and I also agree about the cleanup. The cleanup part of the argument is specific to the location though, not in general. If the city is not the owner of the complex, then the cost would be a one time thing, and it's a different argument.
It is entirely different. It is a public good vs a private good. I am talking about the economic definitions of these things.
A public good is non-excludable, which means that once you provide it, you cannot exclude others from benefitting from it. Police services are public, because the city can't somehow exclude some and not others from the benefit of increased security and reduced crime. The same goes for fire protection. I would argue parks are the same (and in fact education and health care, but that is going on a tangent now). The city cannot exclude you from the benefit of using the park (other than fencing it and charging admission, but in that case I wouldn't call it a public good), even though you might not use it.
People who go to hockey games pay for them. And others do not if they cannot pay. That is an excludable good. I can get into the argument that in fact hockey games are primarily attended by wealthier socio-economic classes, which further exacerbates the criticism that we shouldn't be subsidizing them, but I won't. The point is, professional sports games are NOT a public good. They are entertainment the same way watching a movie is, or going to a comedy club. We need to understand this difference if we are going to properly assess whether this is in fact in the public interest.
Also, saying its revenue generating vs not revenue generating is a misunderstanding of costs. If parks cost us $5/year/citizen and we subsidize tickets $100/year/attendee, just because one generates revenue, it doesn't mean it doesn't cost more. Costs should be evaluated on a per activity basis not as a percentage of recovery. Recovering a higher percentage isn't a plus if the cost is commensurately higher.
And the cost for the arena sure as hell isn't a one-time thing. Do you know what kind of liability insurance, maintenance, depreciation etc we would get with an arena? The Flames proposal would be for the City to own the arena. That is stupid. We get to own a depreciating asset with a limited number of potential sources of revenue, none of which would come close to covering the depreciation in capital, insurance, liability, maintenance etc. The reason we are being asked to build it is because it is a money pit.
How about you buy me a house, (on contaminated land mind you, that you have to pay to clean), I get to live in it, pay you rent that doesn't cover the mortgage, insurance or anything else, you have to insure and maintain it, then at the end you get to own the house, which is now a completely useless asset? Also, my friends will come over a lot and we will have epic parties, so you can live with the knowledge that you helped some awesome parties happen. What a deal!!!!
MalcolmTucker
Nov 13, 2015, 9:05 PM
The public has lots of reasons to provide private goods. I would argue that there is a market failure (whether in the case of the arena it is an incomplete market due to the merit nature of the good, a lack of information about the ability to attract tenants over time, or an equilibrium falling below the price of provision [ a form of adverse selection]) — and it doesn't matter why it exists, it just matters that it does.
fusili
Nov 13, 2015, 9:17 PM
I guess the plan has changed. I thought the plan was for the city to chip in part of the cost and the Flames be the owner of the complex. Which is the way I would to like to see it.
As far as the excludable and non-excludable, argument goes, I don't buy that. In the end they are both for the public good, just because something can be owned privately doesn't mean it can't be for the public good. Yes technically anyone can use the bike paths or Nose Hill, or the Public Library, or the NMC, or anything else the city operates or has donated money to. Either way not everyone uses those facilities, even if they totally allowed to do so. Is going to the Jack Singer or the NMC or the Library much different than the sporting events?
I agree with you on not wanting the city to own the sports complex, and I also agree about the cleanup. The cleanup part of the argument is specific to the location though, not in general. If the city is not the owner of the complex, then the cost would be a one time thing, and it's a different argument.
I am just providing the definition economists use to define public goods: https://en.wikipedia.org/wiki/Public_good
Big Sky
Nov 13, 2015, 9:24 PM
I am just providing the definition economists use to define public goods: https://en.wikipedia.org/wiki/Public_good
Fair enough. I don't disagree with the definition, just that not all things that benefit the public have to be publicly owned. If the plan was for the Flames owners to pay for the site cleanup, and be the owners of the building, I would be okay with a one time cost of public money going to the project.
In the end almost every one of us here on the forum has used the Saddledome or McMahon at least once in the past year. These facilities do get used by a broad number of people whether privately or publicly owned. I'm fine with the $245 million we gave to the new library, and the $25 million to the NMC. I would be okay with the same amount going to the sports complex.
fusili
Nov 13, 2015, 9:24 PM
The public has lots of reasons to provide private goods. I would argue that there is a market failure (whether in the case of the arena it is an incomplete market due to the merit nature of the good, a lack of information about the ability to attract tenants over time, or an equilibrium falling below the price of provision [ a form of adverse selection]) — and it doesn't matter why it exists, it just matters that it does.
I agree. The government should provide private goods when there is a market failure, but I don't see one here. What market failure is there with professional sports?
As for building a sports facility (field house or arena) for minor league sports or general recreation, I am all for that. 100%. To me a field house is just like building soccer fields or baseball diamonds or parks. But when we build an arena so it can hold 50K people, it isn't about physical activity anymore, it is about entertainment for profit. What separates this from subsidizing a monster truck show?
I don't watch sports very often. Instead I like to read, go snowboarding, drink coffee, drink wine, and go cycling. Why does a sports fan get a subsidy, but I don't?
Big Sky
Nov 13, 2015, 9:30 PM
I agree. The government should provide private goods when there is a market failure, but I don't see one here. What market failure is there with professional sports?
As for building a sports facility (field house or arena) for minor league sports or general recreation, I am all for that. 100%. To me a field house is just like building soccer fields or baseball diamonds or parks. But when we build an arena so it can hold 50K people, it isn't about physical activity anymore, it is about entertainment for profit. What separates this from subsidizing a monster truck show?
I don't watch sports very often. Instead I like to read, go snowboarding, drink coffee, drink wine, and go cycling. Why does a sports fan get a subsidy, but I don't?
The same reason someone going to the Library on NMC or Jack Singer would get public funding. It might not benefit everyone, but it benefits enough people that it can be warranted.
One could debate whether there is a market failure. I'm sure there are numerous stats and figures that could put a spin on it for either side. In a nutshell it looks like the owners could build a cheap arena with their own money and the market failure is only there because they want to build something fancy. But isn't that the same thing with the library or the NMC? We could easily have built a cheap library that would be supported by library members only, but that's not the case.
fusili
Nov 13, 2015, 9:31 PM
Fair enough. I don't disagree with the definition, just that not all things that benefit the public have to be publicly owned. If the plan was for the Flames owners to pay for the site cleanup, and be the owners of the building, I would be okay with a one time cost of public money going to the project. In the end almost every one of us here on the forum has used the Saddledome or McMahon at least once in the past year. These facilities do get used by a broad number of people whether privately or publicly owned. I'm fine with the $245 million we gave to the new library, and the $25 million to the NMC. I would be okay with the same amount going to the sports complex.
Agreed. If you think hockey games benefit the public, then I agree the arena doesn't have to be publically owned.
The issue here is that the Flames are NOT paying for the cleanup, the infrastructure or even a considerable amount of the arena. They are asking for the public to pay almost all of it, take on all the risks, and all the costs. It is complete nonsense.
PS- The Library is free. Plus, it provides information and education resources to the public. That to me is an actual public benefit: living in a society where people are educated is a benefit to everyone. Someone having internet access actually improves their economic situation in life, improves the general economy, and benefits society as a whole. Living in a society where some people like to watch hockey does not, in my opinion, have any affect on the rest of society.
Big Sky
Nov 13, 2015, 9:39 PM
Agreed. If you think hockey games benefit the public, then I agree the arena doesn't have to be publically owned.
The issue here is that the Flames are NOT paying for the cleanup, the infrastructure or even a considerable amount of the arena. They are asking for the public to pay almost all of it, take on all the risks, and all the costs. It is complete nonsense.
PS- The Library is free. Plus, it provides information and education resources to the public. That to me is an actual public benefit: living in a society where people are educated is a benefit to everyone. Someone having internet access actually improves their economic situation in life, improves the general economy, and benefits society as a whole. Living in a society where some people like to watch hockey does not, in my opinion, have any affect on the rest of society.
I'm in total agreement about the cleanup costs and the public having to pay for most of it. IMO it should be a clear cut case of the owners asking for a one time funding of 'X' amount of dollars and the owners do the rest.
I'm mostly being a devils advocate here. I haven't been to a sports game in a few years, but personally I would love to go see some of the concerts that have skipped Calgary. They might not be educational, but it's more likely I would go to those concerts than I would to the library or the NMC. Different strokes for different folks :)
MalcolmTucker
Nov 13, 2015, 9:44 PM
I agree. The government should provide private goods when there is a market failure, but I don't see one here. What market failure is there with professional sports?
As for building a sports facility (field house or arena) for minor league sports or general recreation, I am all for that. 100%. To me a field house is just like building soccer fields or baseball diamonds or parks. But when we build an arena so it can hold 50K people, it isn't about physical activity anymore, it is about entertainment for profit. What separates this from subsidizing a monster truck show?
I don't watch sports very often. Instead I like to read, go snowboarding, drink coffee, drink wine, and go cycling. Why does a sports fan get a subsidy, but I don't?
If Calgary wants a facility like the Canadian Tire Centre in Ottawa, we should leave it to the market to provide, and be prepared for that to not even be built. I am not convinced that even a 'optimal' arena only complex could be built with private support alone. Still think you'd end up a couple hundred million short.
In 20 years when the Saddledome needs a major lifecycle renovation for a couple hundred million in todays dollars, will people object to maintaining the public asset? Or will the citizenry be ok not having a large arena?
As for the rest, wine from BC is taxed at a lower rate, snowboarding benefits from land leased from the province and federal government (who knows if at economic rates - not like the leases come up for auction!), cycling has lots of public facilities provided for it.
McMurph
Nov 13, 2015, 9:50 PM
Once again I find myself hoping for a new arena for no other reason than so we can stop talking about it.
Cowtown_Tim
Nov 13, 2015, 9:55 PM
You might not use a lot of public funded facilities, but in general most people do. You have to fund sports just like you would art, literature or music. The city funds those things at all levels right up to the top level such as the new central library or the NMC. At some point I'm sure the city will chip in money for an art gallery. Should we discount that too? Even though it will only be used by %1 of the population.
Regarding this particular proposal. I agree with much of what you have said, the cleanup is a big issue that hasn't been addressed properly. If the city is to chip in, the city should get some say in how this thing is designed and built. That said, I don't have much of a problem with the principle of the city partially funding an arena.
I don't watch sports very often. Instead I like to read, go snowboarding, drink coffee, drink wine, and go cycling. Why does a sports fan get a subsidy, but I don't?
Halofire
Nov 13, 2015, 10:14 PM
You might not use a lot of public funded facilities, but in general most people do. You have to fund sports just like you would art, literature or music. The city funds those things at all levels right up to the top level such as the new central library or the NMC. At some point I'm sure the city will chip in money for an art gallery. Should we discount that too? Even though it will only be used by %1 of the population.
Regarding this particular proposal. I agree with much of what you have said, the cleanup is a big issue that hasn't been addressed properly. If the city is to chip in, the city should get some say in how this thing is designed and built. That said, I don't have much of a problem with the principle of the city partially funding an arena.
Funding art, and sports at a development level is generally accepted, and there's definitely a grey area between amateur and professional... however the NHL is well past that zone and massively profitable. Their inability to manage their own costs revenue usage is not the responsibility of the public to compensate for. If they reduced salaries by 25% to start paying for their own facilities, we wouldn't be having this discussion.
Cowtown_Tim
Nov 13, 2015, 10:27 PM
Funding art, and sports at a development level is generally accepted, and there's definitely a grey area between amateur and professional... however the NHL is well past that zone and massively profitable. Their inability to manage their own costs revenue usage is not the responsibility of the public to compensate for. If they reduced salaries by 25% to start paying for their own facilities, we wouldn't be having this discussion.
I'll refer to MalcolmTucker's statement about the Canadian Tire Centre in Ottawa. There's no doubt that there's a business case for owners to be able to afford a new arena on their own, but is there a business case for something special? We can leave it up to the owners and get an average run of the mill building like the Canadian Tire Centre or something a level up like the XL energy Centre\Rogers Arena\Consol Centre with funding help from the city. I know not everyone agrees with that idea, but I do. If the owners do it %100 themselves, we get an average arena, and no new stadium.
I couldn't care less how much profit the owners make or what the players salaries are, for me it's simple; is it worth putting in $200-300 million of taxpayer money to get a nice new arena and a new stadium? If that's what it's going to cost us to get a nice new building and a nice new stadium, then yes.
Other factors like the site cleanup change the situation of course.
fusili
Nov 13, 2015, 10:35 PM
If Calgary wants a facility like the Canadian Tire Centre in Ottawa, we should leave it to the market to provide, and be prepared for that to not even be built. I am not convinced that even a 'optimal' arena only complex could be built with private support alone. Still think you'd end up a couple hundred million short.
In 20 years when the Saddledome needs a major lifecycle renovation for a couple hundred million in todays dollars, will people object to maintaining the public asset? Or will the citizenry be ok not having a large arena?
As for the rest, wine from BC is taxed at a lower rate, snowboarding benefits from land leased from the province and federal government (who knows if at economic rates - not like the leases come up for auction!), cycling has lots of public facilities provided for it.
I drink wine exclusively from the most taxed jurisdiction, I only snowboard in my (non-existent) backyard, and I only cycle on my trainer in my condo. ;)
fusili
Nov 13, 2015, 10:37 PM
Funding art, and sports at a development level is generally accepted, and there's definitely a grey area between amateur and professional... however the NHL is well past that zone and massively profitable. Their inability to manage their own costs revenue usage is not the responsibility of the public to compensate for. If they reduced salaries by 25% to start paying for their own facilities, we wouldn't be having this discussion.
Exactly.
I am all for facilities for amateur and recreational sports. But professional sports with a limited number of very high paid participants? No.
craner
Nov 14, 2015, 3:13 AM
Once again I find myself hoping for a new arena for no other reason than so we can stop talking about it.
Oh man - the talk hasn't even really started yet - we've got years of talking ahead. :P
MichaelS
Nov 14, 2015, 5:06 PM
I'll refer to MalcolmTucker's statement about the Canadian Tire Centre in Ottawa. There's no doubt that there's a business case for owners to be able to afford a new arena on their own, but is there a business case for something special? We can leave it up to the owners and get an average run of the mill building like the Canadian Tire Centre or something a level up like the XL energy Centre\Rogers Arena\Consol Centre with funding help from the city. I know not everyone agrees with that idea, but I do. If the owners do it %100 themselves, we get an average arena, and no new stadium.
I couldn't care less how much profit the owners make or what the players salaries are, for me it's simple; is it worth putting in $200-300 million of taxpayer money to get a nice new arena and a new stadium? If that's what it's going to cost us to get a nice new building and a nice new stadium, then yes.
Other factors like the site cleanup change the situation of course.
Does the same principle apply to office towers? If a developer proposes a bland box, should the government step in and provide funding to make sure it is an architectural masterpiece?
MalcolmTucker
Nov 15, 2015, 1:43 AM
^ isn't that what the government does with bonus density? Extra density is a non monetary transfer. A regulatory giving. Happens all the time.
suburbia
Nov 15, 2015, 4:14 AM
Edmonton arena update:
https://twitter.com/EugenePski/status/663028670399823872
Cowtown_Tim
Nov 16, 2015, 3:45 PM
Does the same principle apply to office towers? If a developer proposes a bland box, should the government step in and provide funding to make sure it is an architectural masterpiece?
Apples to Oranges. Just because they are both privately owned, an office building isn't the thing as an arena/stadium. An arena or Stadium is still going to get used by the public, whether it's privately or publicly owned. The concept is the same as chipping in for another facility like the NMC, the only difference is the ownership.
MichaelS
Nov 17, 2015, 10:46 AM
^ isn't that what the government does with bonus density? Extra density is a non monetary transfer. A regulatory giving. Happens all the time.
Not sure how often a bonus is given for exceptional design, but even so I would think increasing density for a project would be more beneficial for the city, given the likely higher assessed value of the project. Certainly not the same as Council giving them a portion of the budget or debt capacity.
Apples to Oranges. Just because they are both privately owned, an office building isn't the thing as an arena/stadium. An arena or Stadium is still going to get used by the public, whether it's privately or publicly owned. The concept is the same as chipping in for another facility like the NMC, the only difference is the ownership.
Okay, replace office building with shopping mall. And I think a big difference with a stadium and NMC is the goal of profit. I am assuming the NMC is run as a non-profit, but if not I would have the same issue with the subsidy for it.
Socguy
Nov 17, 2015, 6:21 PM
Yeah, but you and everyone here knows it's going to happen, so why keep bringing up this tired old idealistic argument? The Flames are going to get taxpayer money because no other organization is going to step in a build a new arena in this community of 1.5M people.
It's inevitable. Cross your fingers The City get's a good deal and the area gets cleaned up. But this will never be 100% privately financed, so just bend over and try to smile a bit.
It's by no means a done deal. The Edmonton deal died on the table half a dozen times before squeaking by. It only survived because they had a mayor who took a personal interest in making it work and there was a real argument that moving an arena downtown would generate redevelopment and so on.
I don't think Nenshi feels the same way as Mandel. Who is going to champion this project in city council when it's going to cost the city twice what Edmonton's did and the redevelopment argument is so thin, it's transparent?
Halofire
Nov 17, 2015, 8:42 PM
Apples to Oranges. Just because they are both privately owned, an office building isn't the thing as an arena/stadium. An arena or Stadium is still going to get used by the public, whether it's privately or publicly owned. The concept is the same as chipping in for another facility like the NMC, the only difference is the ownership.
Okay, replace office building with shopping mall. And I think a big difference with a stadium and NMC is the goal of profit. I am assuming the NMC is run as a non-profit, but if not I would have the same issue with the subsidy for it.
Other examples of non-office commercial operations that have 'public' customers... grocery stores, restaurants, yoga studios, and in some countries, brothels - none of which should be subsidized for a 'nice new' building...
The only way it would somewhat makes sense, is if the city would be compensated with an equity stake in the flames so that they'd potentially have a return on their investment. But a city really shouldn't be getting involved in something so far away from their mandate.
NMC, Arts Commons, Jubilee are different in that they are non-profit organizations that are entrusted balance a need to generate revenue to maintain their facilities as well as provide public services like high school graduations, amateur performance space, and artist development. The stadium's primary purpose is to host flames games, and then they schedule whatever they can to fill in the rest of the time.
I have minimal issue with government sponsorship of facilities like Max Bell Area and WinSport, because they are built to a scale which actually facilitates public use, and no single professional sports organization dictates their schedule.
I know it's not a perfect argument, but that's the grey area in-between.
MalcolmTucker
Nov 17, 2015, 9:11 PM
NMC, Arts Commons, Jubilee are different in that they are non-profit organizations that are entrusted balance a need to generate revenue to maintain their facilities as well as provide public services like high school graduations, amateur performance space, and artist development. The stadium's primary purpose is to host flames games, and then they schedule whatever they can to fill in the rest of the time.
I have minimal issue with government sponsorship of facilities like Max Bell Area and WinSport, because they are built to a scale which actually facilitates public use, and no single professional sports organization dictates their schedule.
I know it's not a perfect argument, but that's the grey area in-between.
The Jubilee has 76 announced shows for the next year.
The four main tenants are:
ALBERTA BALLET 13 shows
C.P.O SYMPHONY 3 shows
CALGARY OPERA 10 shows
KEY BRAND ENTERTAINMENT (BROADWAY ACROSS CANADA) 26 shows
So yeah. The greatest tenant by number of performances is as date intensive as all of the other permanent tenants put together, is a billion dollar for profit corporation.
You think Key Brands doesn't get to call the tune at the Jubilee?
ByeByeBaby
Nov 17, 2015, 10:29 PM
The Jubilee has 76 announced shows for the next year.
The four main tenants are:
ALBERTA BALLET 13 shows
C.P.O SYMPHONY 3 shows
CALGARY OPERA 10 shows
KEY BRAND ENTERTAINMENT (BROADWAY ACROSS CANADA) 26 shows
So yeah. The greatest tenant by number of performances is as date intensive as all of the other permanent tenants put together, is a billion dollar for profit corporation.
You think Key Brands doesn't get to call the tune at the Jubilee?
That's a terrible metric for Jubilee shows; musicals have matinees on weekends whereas opera has to alternate dark nights due to the demands on the vocal cords of the performers. This November, Broadway Across Canada did Once (3rd to 8th) and Calgary Opera is doing Lakme (21st to 27th); both have 6 day runs from first to last show. Yet there are 8 shows for Once, and 3 for Lakme. (The Opera is actually occupying the Jube for longer to do their show since they have a dress rehearsal this Thursday; BAC does a show in Calgary on Sunday and then moves the show to Edmonton starting the next Tuesday).
By my count of days occupied (not including load in / dress / strike days - just from first to last performance), the Jube is occupied for 22 days by Broadway Across Canada, 22 days by Calgary Opera (actually more because their load in is longer), 19 by Alberta Ballet (or their guest companies), 4 by CPO, 17 days of concerts or other professional performances and 4 days of community events - although grad season is after May. I don't know why you think a tenant occupying 25% of the time would be the one calling the shots, unless they pay substantially more than the arts orgs for their time.
The Fisher Account
Nov 17, 2015, 10:30 PM
It's by no means a done deal. The Edmonton deal died on the table half a dozen times before squeaking by. It only survived because they had a mayor who took a personal interest in making it work and there was a real argument that moving an arena downtown would generate redevelopment and so on.
I don't think Nenshi feels the same way as Mandel. Who is going to champion this project in city council when it's going to cost the city twice what Edmonton's did and the redevelopment argument is so thin, it's transparent?
What I'm saying is that a new arena is inevitable. Whether it's 3 years, 5 years or 10 years, we're going to need one. This is the only group stepping up to pay for a portion of it. You may not like the portion, but the province or city isn't going to jump in to ever build the whole thing, so get ready one way or another for your tax dollars to be involved in Calgary's 'Next' stadium/arena development at some point
Riise
Nov 17, 2015, 11:16 PM
What I'm saying is that a new arena is inevitable. Whether it's 3 years, 5 years or 10 years, we're going to need one. This is the only group stepping up to pay for a portion of it. You may not like the portion, but the province or city isn't going to jump in to ever build the whole thing, so get ready one way or another for your tax dollars to be involved in Calgary's 'Next' stadium/arena development at some pointt
If the first section in bold is true and a new arena will never be fully financed by the private sector, does the second section in bold have to be true? Especially when the private firm wants the City to be the owner of the arena.
At what point does the Province and City say, "Fuck it, let's just build the damn thing ourselves and customize it to meet our needs."?
CalgaryArchitecture
Nov 17, 2015, 11:32 PM
Ken King was just on AM770 this morning and confirmed that their will be a translucent roof for the field house. He also mentioned their would be a unique feature that has never been done before.
speedog
Nov 18, 2015, 12:20 AM
Ken King was just on AM770 this morning and confirmed that their will be a translucent roof for the field house. He also mentioned their would be a unique feature that has never been done before.
:gaah:
Their, there, they're - c'mon, this shit ain't rocket science.
monocle
Nov 18, 2015, 4:16 PM
Ken King was just on AM770 this morning and confirmed that their will be a translucent roof for the field house. He also mentioned their would be a unique feature that has never been done before.
OK, stadium nerds: what kind of unique features are out there? Mechanically moving seating (for different events)? Field turf AND natural grass options? Seat side concession delivery (ala Costco air tubes)?
fusili
Nov 18, 2015, 4:28 PM
Ken King was just on AM770 this morning and confirmed that their will be a translucent roof for the field house. He also mentioned their would be a unique feature that has never been done before.
Ken King doesn't know what he is doing. Someone probably pitched this to him, he thought it was cool, and then he just ran with it, without any due diligence. I doubt they have any idea of cost, technical feasibility, impact on structural design, etc. Just a pie-in-the-sky idea that they like.
This is the most poorly thought out project I have seen. I don't think they gave more thought to it than a bunch of teenagers fantasizing about how cool the skateboard ramp they want to build in their backyard would be.
Full Mountain
Nov 18, 2015, 4:55 PM
If the first section in bold is true and a new arena will never be fully financed by the private sector, does the second section in bold have to be true? Especially when the private firm wants the City to be the owner of the arena.
At what point does the Province and City say, "Fuck it, let's just build the damn thing ourselves and customize it to meet our needs."?
If we (the public) are going to foot the bill for construction, then lets build what we need where we need it (i.e. field house at foothills). Then it can be managed similar to our other public assets.
Further if we are paying for it we should build it where the costs are reduced (foothills) rather than someplace where we have significant other costs and the project would take away future revenue (land sales & property tax).
Halofire
Nov 18, 2015, 4:59 PM
The Jubilee has 76 announced shows for the next year.
The four main tenants are:
ALBERTA BALLET 13 shows
C.P.O SYMPHONY 3 shows
CALGARY OPERA 10 shows
KEY BRAND ENTERTAINMENT (BROADWAY ACROSS CANADA) 26 shows
So yeah. The greatest tenant by number of performances is as date intensive as all of the other permanent tenants put together, is a billion dollar for profit corporation.
You think Key Brands doesn't get to call the tune at the Jubilee?
It's possible Key Brand gets special consideration for scale, but that's one snapshot in time. However, along with what ByeByeBaby said, I think the option for the Jubilee to seek out other tenants is much more viable.
MalcolmTucker
Nov 18, 2015, 5:32 PM
Still, we shouldn't hold any illusions that the majority of the activities are profit making events, even moreso when you count all the one off concerts. The snapshot nature of it captures the rest of the season of the main tenants, which may vary based on demand, but it isn't like Key Brands is just going to disappear.
The point still stands that somehow an arena feels different, but it isn't really all that different. By aligning with and using arguments of people who also don't want government support for the arts, and use the same arguments for it, I think we end up on a dangerous path.
If an arena is something the city wants, we should by all means try to get the best deal for providing that service. It the context of most north american arena development deals we have something somewhat reasonable on the table at the starting point at least.
The Fisher Account
Nov 18, 2015, 5:41 PM
OK, stadium nerds: what kind of unique features are out there? Mechanically moving seating (for different events)? Field turf AND natural grass options? Seat side concession delivery (ala Costco air tubes)?
Think it's the modifiable roof panels that were leaked last year:
https://static.dyp.im/zbLOFnoy7W/5eb87319cff45435f12ac40365552d91.gif
Innersoul1
Nov 18, 2015, 6:54 PM
If the first section in bold is true and a new arena will never be fully financed by the private sector, does the second section in bold have to be true? Especially when the private firm wants the City to be the owner of the arena.
At what point does the Province and City say, "Fuck it, let's just build the damn thing ourselves and customize it to meet our needs."?
I just don't think it will be a priority to the point where the city/province is willing to fund the entire thing.
Ken King was just on AM770 this morning and confirmed that their will be a translucent roof for the field house. He also mentioned their would be a unique feature that has never been done before.
This stuff is just ridiculous. How do these concepts even exist if there isn't really a master design for this.
Spring2008
Nov 18, 2015, 7:15 PM
I agree. I also think ownership came in with a low-ball offer knowing the city's at the opposite end of the spectrum, unwilling to offer any money aside from fieldhouse and infrastructure. I'm pretty sure ownership will be expected to at least double the amount of equity they're offering. The levy for example doesn't make sense. If the city were to offer a levy it would be for supporting infrastructure/public realm for the entire West Village neighborhood similar to EV, not to finance the stadium/arena directly as was proposed.
Ken King doesn't know what he is doing. Someone probably pitched this to him, he thought it was cool, and then he just ran with it, without any due diligence. I doubt they have any idea of cost, technical feasibility, impact on structural design, etc. Just a pie-in-the-sky idea that they like.
This is the most poorly thought out project I have seen. I don't think they gave more thought to it than a bunch of teenagers fantasizing about how cool the skateboard ramp they want to build in their backyard would be.
Socguy
Jan 11, 2016, 10:07 PM
Bettman was in town and he's playing his assigned role of applying pressure to the City. Half trying to shame the city (2nd oldest rink) and then trotting out the tired cliche of economic benefits
http://www.cbc.ca/news/canada/calgary/gary-bettman-calgarynext-chamber-commerce-1.3398581
Fuzz
Jan 11, 2016, 10:09 PM
When all you have is a hammer....
Calgarian
Jan 11, 2016, 10:13 PM
Bettman can pay for part of it himself if it's so damn crucial to one of the most successful markets in the whole league!
CalgaryNEXT WILL get built, but in what form remains to be seen. I think we still have several years of back and forth before the design is finalized and the permit process begins.
simster3
Jan 11, 2016, 10:15 PM
Did he announce the League's $100M contribution? That would be a good start when you are pushing a city to build an arena for you and your league.
Cage
Jan 12, 2016, 12:56 AM
Being a member of the Chamber of Commerce, I was at the Bettman event.
The agenda for the event was 1/2 about CalgaryNext and 1/2 about league, but in reality it was all about CalgaryNext.
Overall I think Bettman gave a good presentation about the need for a new arena, the business case for the arena is solid, IMHO. For the record, going into the meeting I was skeptical about the need for a new arena.
For the doubters out there, for people who just want to hate Bettman for being NHL Commish, or hate the CalgaryNext proposal because its public money for private interests; I submit the CFL Commissioner should come to Calgary and advocate for the stadium/field-house portion of the venue. I doubt the CFL business case is solid as Bettman/NHL.
Something I learned at the luncheon, NHL revenues have grown from $400 million to over $4 billion under Bettman's 23 year tenure. I would estimate that inflation and league growth by 6 teams would account for natural rise in revenue to $1.5 to $2 Billion. The other $2 billion has to come from revenue expansion realized in part by newer stadiums.
Another aspect of Bettman's speech, the City and in-particular the city political leaders need to get behind this proposal if its to be brought to fruition. Bettman did correctly point out that Edmonton's Mayor at the time, Mandel, was 110% behind the new arena and sportsplex proposal. During the Q&A session with Chamber CEO, Bettman did disclose he requested a meeting with Mayor but could not fit it into their schedules. I find it interesting that Bettman is in Calgary during the City Council's scheduled meeting. It provides a convenient out for everyone involved.
suburbia
Jan 12, 2016, 1:23 AM
Being a member of the Chamber of Commerce, I was at the Bettman event.
The agenda for the event was 1/2 about CalgaryNext and 1/2 about league, but in reality it was all about CalgaryNext.
Overall I think Bettman gave a good presentation about the need for a new arena, the business case for the arena is solid, IMHO. For the record, going into the meeting I was skeptical about the need for a new arena.
For the doubters out there, for people who just want to hate Bettman for being NHL Commish, or hate the CalgaryNext proposal because its public money for private interests; I submit the CFL Commissioner should come to Calgary and advocate for the stadium/field-house portion of the venue. I doubt the CFL business case is solid as Bettman/NHL.
Something I learned at the luncheon, NHL revenues have grown from $400 million to over $4 billion under Bettman's 23 year tenure. I would estimate that inflation and league growth by 6 teams would account for natural rise in revenue to $1.5 to $2 Billion. The other $2 billion has to come from revenue expansion realized in part by newer stadiums.
Another aspect of Bettman's speech, the City and in-particular the city political leaders need to get behind this proposal if its to be brought to fruition. Bettman did correctly point out that Edmonton's Mayor at the time, Mandel, was 110% behind the new arena and sportsplex proposal. During the Q&A session with Chamber CEO, Bettman did disclose he requested a meeting with Mayor but could not fit it into their schedules. I find it interesting that Bettman is in Calgary during the City Council's scheduled meeting. It provides a convenient out for everyone involved.
I think Libin selling the international hotel may have been in prep to get his portion in place (percentage of the owners' percentage). Interestingly, he sold it to Greenberg, the Ottawa team's owner. The formulas are complicated as these things are always about more than it seems. The knock-on benefits, oh the knock-on benefits!
Fuzz
Jan 12, 2016, 1:52 AM
I listened to it online, and I'm not sure what business case you are referring to? I didn't hear any part where he mentioned the city would get back all the money for reclamation, field house and inevitable road and transit costs. He basically showed up as a cheerleader and reiterated everything we already know. I'm not impressed at all with the proposal, and he didn't change my mind.
He talked like we are going to be reaping benefits of revitalizing a blighted area, and I might agree if the proposal was to pay for reclamation. If it made economic sense to do that at this point in time, the city would have moved on it. I'd be OK with the city giving them the land, but asking us to clean it up is a bit rich.
Riise
Jan 12, 2016, 2:55 AM
Overall I think Bettman gave a good presentation about the need for a new arena, the business case for the arena is solid, IMHO.
[...]
The other $2 billion has to come from revenue expansion realized in part by newer stadiums.
Thanks for the review, it's nice to hear from someone who was present.
Can you elaborate on the solid business case? Also, was this a solid business case for the Flames and the City or just a solid business for the Flames?
Ramsayfarian
Jan 12, 2016, 3:08 AM
Here's the video of Bettman's presentation.
ZDOI0cq6GZM
I think I or someone else posted this video in this thread, but it fits so well.
AaronMak
Jan 12, 2016, 3:23 AM
I think the project is great idea. Unfortunately i only THINK it is because we haven't been given enough information to KNOW if it really is or not. Calgary desperately needs the complex not only for the flames; but also: the stamps, roughnecks, added convention space (as our convention centre is almost ready to also be replaced), and we lose countless big-name concerts due to the horrendous condition of the saddledome. CalgaryNext should be used to revitalize the west village, spark regional investment, bring in an MLS team and bring the city the caliber of entertainment that it really deserves. And if we build it while times are slow, it keeps thousands employed over the period of construction. Im glad Nenshi isn't buckling to anyone and being cautious, but this project is moving ahead painfully slow and the mayor seems to be the one holding up the reigns.
As someone who grew up in Vancouver, I was saddened for Calgary when I went to my first flames game. The fans are amazing, the atmosphere is amazing; but the arena reminded me of a basement. Its dark, ugly, unwelcoming, small and cold. It's also ONLY an arena. this is 2016. We don't just build arenas, we build whole neighbourhoods. Time for a modern stadium district.
tomthumb2
Jan 12, 2016, 3:49 AM
With all the negativity about CalgaryNEXT (and our ever sliding economy), I just don't see it ever happening. Best case scenario is the Flames build their own rink with no bells and whistles (not sure how much that would cost) and just forget about a stadium. I guess as long as fans still show up, they won't improve McMahon, not that U of C would pay for that anyway.
CrossedTheTracks
Jan 12, 2016, 4:39 AM
Something I learned at the luncheon, NHL revenues have grown from $400 million to over $4 billion under Bettman's 23 year tenure. I would estimate that inflation and league growth by 6 teams would account for natural rise in revenue to $1.5 to $2 Billion. The other $2 billion has to come from revenue expansion realized in part by newer stadiums.
Or, um... how about ticket price inflation totally out of step with general inflation? I don't have any long-term numbers I can point to (Flames prices up 26% from 2012 to 2014 according to http://blog.tiqiq.com/2013/09/2013-14-nhl-average-ticket-prices-team/), but I just about fell out of my chair when I looked at ticket prices recently.
Hey, if the market supports it, bully for the owners & players. But I'm not so sure that "newer stadiums" is the proximate cause of this... (yes I'm well aware newer stadiums have more luxury boxes...)
Another aspect of Bettman's speech, the City and in-particular the city political leaders need to get behind this proposal if its to be brought to fruition. Bettman did correctly point out that Edmonton's Mayor at the time, Mandel, was 110% behind the new arena and sportsplex proposal.
Kind of self-evident when the Flames are asking for so much from the city? Pardon me if I'm putting words in your (Bettman's?) mouth, but it kind of sounds like this means that council should get behind it for, uh, the sake of getting behind it.
dazzlingdave88
Jan 12, 2016, 4:47 AM
I think the project is great idea. Unfortunately i only THINK it is because we haven't been given enough information to KNOW if it really is or not. Calgary desperately needs the complex not only for the flames; but also: the stamps, roughnecks, added convention space (as our convention centre is almost ready to also be replaced), and we lose countless big-name concerts due to the horrendous condition of the saddledome. CalgaryNext should be used to revitalize the west village, spark regional investment, bring in an MLS team and bring the city the caliber of entertainment that it really deserves. And if we build it while times are slow, it keeps thousands employed over the period of construction. Im glad Nenshi isn't buckling to anyone and being cautious, but this project is moving ahead painfully slow and the mayor seems to be the one holding up the reigns.
As someone who grew up in Vancouver, I was saddened for Calgary when I went to my first flames game. The fans are amazing, the atmosphere is amazing; but the arena reminded me of a basement. Its dark, ugly, unwelcoming, small and cold. It's also ONLY an arena. this is 2016. We don't just build arenas, we build whole neighbourhoods. Time for a modern stadium district.
You have some interesting priorities....You argue for spending money on an arena and against spending money on the Green Line
Coldrsx
Jan 12, 2016, 4:59 AM
Meanwhile is awesometon...
https://pbs.twimg.com/media/CYKtnYLUAAEWEh1.jpg:large
https://twitter.com/HCDurech/status/685300991521112065
tomthumb2
Jan 12, 2016, 5:19 AM
^^^ Yeah we get it already, Edmonton is better than Calgary in every way. Thanks for sticking the knife in a little further.
O-tacular
Jan 12, 2016, 5:23 AM
Meanwhile is awesometon...
Yes indeed...
http://img.photobucket.com/albums/v315/Blackjebus/Banner-Venetian.jpg
Cage
Jan 12, 2016, 6:00 AM
Riise and fuzz bring up the point about Business Case, I thought it would be good to review the definition of business case;
https://en.m.wikipedia.org/wiki/Business_case
A business case captures the reasoning for initiating a project or task. It is often presented in a well-structured written document, but may also sometimes come in the form of a short verbal argument or presentation. The logic of the business case is that, whenever resources such as money or effort are consumed, they should be in support of a specific business need.
At its basics a business case document identifies that a potential course of actions will solve the identified needs. In this aspect, the Bettman speech did identify the business needs CalgaryNext is hoping to satisfy. Additionally the Bettman speech did offer examples where the CalgaryNext approach has been successful in the North American market place. From these angles, the Business Case is solid.
Bettman stated in his speech that he is primarily stumping for the arena and entertainment complex aspects of CalgaryNext and really doesn't concern himself with the stadium/field house portion. The stadium portion is the perview of CFL Commissioner to explain.
Cage
Jan 12, 2016, 7:22 AM
Or, um... how about ticket price inflation totally out of step with general inflation? I don't have any long-term numbers I can point to (Flames prices up 26% from 2012 to 2014 according to http://blog.tiqiq.com/2013/09/2013-14-nhl-average-ticket-prices-team/), but I just about fell out of my chair when I looked at ticket prices recently.
Hey, if the market supports it, bully for the owners & players. But I'm not so sure that "newer stadiums" is the proximate cause of this... (yes I'm well aware newer stadiums have more luxury boxes...)
Kind of self-evident when the Flames are asking for so much from the city? Pardon me if I'm putting words in your (Bettman's?) mouth, but it kind of sounds like this means that council should get behind it for, uh, the sake of getting behind it.
The $400 million to $4 billion figure is top line revenue growth for the NHL as a league, and is net of markets that have tanked, such as Tampa Bay, Atlanta, and Phoenix to a certain extent.
Note the figures quoted on the URL including the flames 26% 2 year ticket price increase figures solely relate to secondary market fluctuations for flames ticket and not reflective of primary market price increase.
As for council being onboard or not, what Bettman is saying is that unless council is 110% behind getting CalgaryNext completed, the arena, stadium, entertainment complex will not be built. Does council want to get CalgaryNext deal done or is council looking for way to decline CalgaryNext.
Fuzz
Jan 12, 2016, 1:20 PM
Betman talked about other cities that had areas of blight and could benefit form stimulus. The West Village is not that. When I think of "business case" I think that someone has looked at the financials and it makes sense. I did not get that feeling at all. Well, OK the business case is 100% solid for the legue and the Flames organization, absolutely. I just don't see it for the city. And I don't think he made that case at all. If he had said, "his is what we think it is going to cost on the cities side, and this is how much additional revenue can be brought in to cover that", then OK. But I didn't get that at all. Probably because they know it doesn't make financial sense for the city.
s211
Jan 12, 2016, 3:48 PM
Yes indeed...
http://img.photobucket.com/albums/v315/Blackjebus/Banner-Venetian.jpg
Where dumpster (should) meet fire.
Cage
Jan 12, 2016, 3:56 PM
Most of what cities provide does not meet financial economic sense. Take Transit as an example. Hand over the reigns of Calgary Transit to Westjet and they will make it profitable. But most transit supporters will be horrified at he results. Bus schedules cut 75% and only operating on the busiest of routes. Feeder service to c-train cut unless each bus is 80% full, but a massive expansion of park and ride and LRT.
can you give me three examples where the city utilizes greater than $50 million capital and has an investor grade return on capital (eg the financial business case makes sense)?
The city needs to put together their own analysis based on their own business case formula. Then the city needs to tell Calgary Sports and Entertainment a yes or no answer. Either way the city council will get a lot of negative feedback. It just a matter of deciding the faction that will be dissapointed the most.
MalcolmTucker
Jan 12, 2016, 4:03 PM
Betman talked about other cities that had areas of blight and could benefit form stimulus. The West Village is not that. When I think of "business case" I think that someone has looked at the financials and it makes sense. I did not get that feeling at all. Well, OK the business case is 100% solid for the legue and the Flames organization, absolutely. I just don't see it for the city. And I don't think he made that case at all. If he had said, "his is what we think it is going to cost on the cities side, and this is how much additional revenue can be brought in to cover that", then OK. But I didn't get that at all. Probably because they know it doesn't make financial sense for the city.
Only two arenas in the league have solid investment cases, as in revenues they bring in directly fund them: Air Canada Centre and Madison Square Garden.
fusili
Jan 12, 2016, 4:12 PM
Being a member of the Chamber of Commerce, I was at the Bettman event.
The agenda for the event was 1/2 about CalgaryNext and 1/2 about league, but in reality it was all about CalgaryNext.
Overall I think Bettman gave a good presentation about the need for a new arena, the business case for the arena is solid, IMHO. For the record, going into the meeting I was skeptical about the need for a new arena.
For the doubters out there, for people who just want to hate Bettman for being NHL Commish, or hate the CalgaryNext proposal because its public money for private interests; I submit the CFL Commissioner should come to Calgary and advocate for the stadium/field-house portion of the venue. I doubt the CFL business case is solid as Bettman/NHL.
Something I learned at the luncheon, NHL revenues have grown from $400 million to over $4 billion under Bettman's 23 year tenure. I would estimate that inflation and league growth by 6 teams would account for natural rise in revenue to $1.5 to $2 Billion. The other $2 billion has to come from revenue expansion realized in part by newer stadiums.
Another aspect of Bettman's speech, the City and in-particular the city political leaders need to get behind this proposal if its to be brought to fruition. Bettman did correctly point out that Edmonton's Mayor at the time, Mandel, was 110% behind the new arena and sportsplex proposal. During the Q&A session with Chamber CEO, Bettman did disclose he requested a meeting with Mayor but could not fit it into their schedules. I find it interesting that Bettman is in Calgary during the City Council's scheduled meeting. It provides a convenient out for everyone involved.
That's nice that those new stadiums have yielded $2 billion in additional benefit to the NHL. Also awesome that the vast majority of the capital required for that increase in revenue has come from municipalities. Are all of these cities now part owners of the NHL. Are they receiving dividends on the investment. Because they are the largest investors now. No? Why not.
Next time I want to start a company, I'm going to ask the city to build my production facility for me. They can build the structure, I will use it, pay not rent, they can take on the maintenance and liability, but don't worry, I am employing people and contributing to the economy. Plus, my profits will increase massively.
How about this? Calgary builds the arena, but receives 70% on the net increase to the value of the team from today? If I was an investor contributing 70% of the capital necessary for increased productivity, I would expect 70% of the increase in value. Wouldn't that be fair?
Also, what economic benefits does the stadium provide? Low income employment from concessions and caretaking staff? Does a sports stadium attract labour? Does it give access to new markets? Does it enhance existing businesses?
Ask yourself these questions: What does an arena do to attract an IT company? A pharmaceutical company? How about an energy company? Are these the primary drivers which cause companies to move or invest in a city? Or is it the availability of labour, permissive regulatory and tax environments, ability to attract and retain labour, access to markets, infrastructure, etc. What the hell does an arena have to do with any of these things?
Riise
Jan 12, 2016, 4:29 PM
At its basics a business case document identifies that a potential course of actions will solve the identified needs. In this aspect, the Bettman speech did identify the business needs CalgaryNext is hoping to satisfy. Additionally the Bettman speech did offer examples where the CalgaryNext approach has been successful in the North American market place. From these angles, the Business Case is solid.
What I'm taking from this is Bettman spoke about the solid business case for CSEC. It is great to hear that they have thought things through on their side but CSEC is going to require a fair bit of assistance from the City and Province. The City and Province will need to evaluate the proposal based on their needs but as CSEC is putting in a request for a substantial amount of assistance, shouldn't there be an onus for them to show how this project is more than a 'want' for the City.
Fuzz
Jan 12, 2016, 4:44 PM
The city needs to put together their own analysis based on their own business case formula. Then the city needs to tell Calgary Sports and Entertainment a yes or no answer. Either way the city council will get a lot of negative feedback. It just a matter of deciding the faction that will be dissapointed the most.
I'm not sure why it is up to the city to provide a business case for this? King should have had numbers with this proposal. They showed up with a few really bad renders, and some vague numbers of what the facility will cost, that's it. They did nothing to convince the city it is in their interest to do this. I've got nothing against some contribution form the city, but they are asking for a huge hit to taxpayers, with little justification.
Bigtime
Jan 12, 2016, 4:52 PM
I wonder if this proposal can start a war in our own media? The sports guys are all for it and wondering why the city just won't get behind it, while other reporters and such are questioning it and the public dollar ask.
It also seems that the one thing economists seem to agree on is that there is no discernible return on public dollars being used to build arenas/stadiums for private sports enterprises.
MalcolmTucker
Jan 12, 2016, 5:07 PM
Though it should be said: our governments spend lots of money on things with no discernible returns. In fact, if they had discernible returns, there would be no reason to use public money!
DizzyEdge
Jan 12, 2016, 5:15 PM
Though it should be said: our governments spend lots of money on things with no discernible returns. In fact, if they had discernible returns, there would be no reason to use public money!
Well it could be argued that almost everything the city spends money on does have a discernible return, just that the return might be quality of life vs monetary.
That said, although you could argue the above for a public park, harder to make the argument for something the public has to pay a high ticket price to enjoy.
milomilo
Jan 12, 2016, 5:15 PM
Though it should be said: our governments spend lots of money on things with no discernible returns. In fact, if they had discernible returns, there would be no reason to use public money!
There are discernible returns though - for the very rich owners, just not so much for the city and it's residents. That makes it a pretty tough pill to swallow.
MalcolmTucker
Jan 12, 2016, 5:20 PM
Well it could be argued that almost everything the city spends money on does have a discernible return, just that the return might be quality of life vs monetary.
That said, although you could argue the above for a public park, harder to make the argument for something the public has to pay a high ticket price to enjoy.
What about the national parks? Where public support reduces the cost of going while simultaneously protecting something that otherwise wouldn't be protected.
All of our rec centres have very high fees compared to other Canadian cities, yet there is still support for them, even when they have fully private competitors.
Fuzz
Jan 12, 2016, 5:23 PM
I wonder if this proposal can start a war in our own media? The sports guys are all for it and wondering why the city just won't get behind it, while other reporters and such are questioning it and the public dollar ask.
It also seems that the one thing economists seem to agree on is that there is no discernible return on public dollars being used to build arenas/stadiums for private sports enterprises.
Really? On that other Calgary forum there is only 25% support. I'd suspect if it was well supported by sports fans, I'd expect it to be much higher.
Poll at top.
http://forum.calgarypuck.com/showthread.php?t=151776&page=13
Bigtime
Jan 12, 2016, 5:41 PM
I'm referring to the sports journalists in Calgary, not the CP'ers. Just listening to the drive home show on 960, Eric Francis and his tweets, and some others speak to my point.
DizzyEdge
Jan 12, 2016, 5:48 PM
What about the national parks? Where public support reduces the cost of going while simultaneously protecting something that otherwise wouldn't be protected.
All of our rec centres have very high fees compared to other Canadian cities, yet there is still support for them, even when they have fully private competitors.
I don't think national park fees are very high, especially if you consider you get 24 hrs of use vs 3 hrs at a hockey game.
I think there is an argument that if rec centres have high fees that maybe private industry should not be competed with.
milomilo
Jan 12, 2016, 6:02 PM
I don't think national park fees are very high, especially if you consider you get 24 hrs of use vs 3 hrs at a hockey game.
I think there is an argument that if rec centres have high fees that maybe private industry should not be competed with.
Or a years worth of use for about the same price as a hockey ticket. The National Parks also aren't primarily there for the profit of a single multi million dollar company.
MalcolmTucker
Jan 12, 2016, 6:11 PM
Or a years worth of use for about the same price as a hockey ticket. The National Parks also aren't primarily there for the profit of a single multi million dollar company.
But if they were ... Have you heard of Brewster? ;)
milomilo
Jan 12, 2016, 6:22 PM
But if they were ... Have you heard of Brewster? ;)
I had to re-word that post from what I had written originally, of course there are big companies profiting from within the national parks (Sunshine Village was my obvious one), but they are not the main reason for them.
MalcolmTucker
Jan 12, 2016, 6:24 PM
If the main reason for the arena was concerts, would you be closer to ok?
milomilo
Jan 12, 2016, 6:52 PM
If the main reason for the arena was concerts, would you be closer to ok?
Definitely. And I know that's a slightly irrational position to take, but I hate the emotional attachment that many people have for sports teams, in this case the Flames, which is just a company that happens to be based in Calgary at this moment in time. They do not deserve the fawning they get from the public, nor our money.
MalcolmTucker
Jan 12, 2016, 7:09 PM
^ I am glad you can acknowledge it is irrational.
hulkrogan
Jan 12, 2016, 7:15 PM
Something I learned at the luncheon, NHL revenues have grown from $400 million to over $4 billion under Bettman's 23 year tenure. I would estimate that inflation and league growth by 6 teams would account for natural rise in revenue to $1.5 to $2 Billion. The other $2 billion has to come from revenue expansion realized in part by newer stadiums.
That sounds like a great reason for the NHL and its owners to reinvest some of that revenue in new stadiums in cities like Calgary to grow it even further.
I bet the league laughs to themselves behind closed doors how much they've been able to grow league revenue based on the investment of municipalities.
milomilo
Jan 12, 2016, 8:05 PM
^ I am glad you can acknowledge it is irrational.
We are all irrational by nature! I believe it is just as irrational for people to justify this by the Flames threatening to leave if they don't get their way. So what if they do?
Socguy
Jan 12, 2016, 9:35 PM
Over the noon hour, CBC radio had David Staples as a guest. He's a columnist with the Edmonton journal. He made several interesting points about arenas, comparing both Calgary to Edmonton's deal. I don't know if it's up yet on the CBC website, but I'll try to recount as much as I can remember.
1st. The Flames are in no danger of becoming unsustainable even if they stay in the Saddledome. Taking their proposed contribution to the new arena and putting some/all towards the 'dome will provide most of the benefit of building a new building for the Flames.
2nd. Arena deals aren't really about the sustainability of the team. These days they are mostly a real estate play by the owners where they make huge $$$ by selling off condos and so on around the arena.
3rd. Edmonton and Calgary are in different situations. Edmonton didn't have a downtown arena and was in a situation where their downtown was languishing. Calgary already has a downtown arena and no trouble attracting business and people. The business case for Calgary building a new arena is thin.
4th. Columbus was the best example so far of an arena district that worked. Public money was rejected by plebiscite 4 times before the developers finally gave up and paid for 95% of the cost themselves.
5th. In his opinion, what has been proposed so far is very one sided to the benefit of ownership.
6th. A new building provides an instant valuation increase to a team. In the Oilers case, the new arena under construction increased the value of the team by $200 million.
MalcolmTucker
Jan 12, 2016, 9:44 PM
^ What he doesn't say about Columbus is even on a $147 million arena the team lost money on the head lease, and the arena owner was taken over by the state, to be bailed out by casino money which never materialized.
Hardly an example of success.
lineman
Jan 14, 2016, 8:10 PM
Going to a NHL hockey game is one of my favourite things to do. A new arena would be awesome too.
That said, I'm not at all convinced that what's been thus far presented is a good deal for Calgary. Bettman's dog and pony touting entrepreneurship, then pushing for a meeting to wrestle a disproportionate share of public funds is just crass.
bt04ku
Jan 14, 2016, 11:28 PM
It would be great to see polling numbers for the public's support of CalgaryNEXT pre and post-Bettman visit, because I have a suspicion that he did a lot more harm than good on his visit.
ggopher
Jan 14, 2016, 11:42 PM
I am a Flames season ticket holder, and I don't think there is a desperate need for a new arena. And I don't think the should be a major contribution of public funds.
The Flames WANT a new arena for the following reasons:
-More lower bowl seats to increase revenue
-More luxury boxes to increase revenue
-Better concessions to increase revenue
-Complete control of the parking to increase revenue
-Improved jumpotron will increase the fan experience
Most of those things are not going to increase the value that I get out of going to a Flames game. In fact, it is just going to end up costing me more money.
The Flames are profitable in their current state. If they want to increase their revenue further, that is fine, but they can then pay for the new arena themselves. If a new arena isn't built what are the Flames going to do? Move? Good luck finding a better market or business case anywhere else.
Toronto, Vancouver, Montreal, and Ottawa all financed their new arenas privately.
Any public money needs to go towards a public benefit. The City's contribution of $200 million towards the football stadium in exhange for a field house is a , which is a resonable request for public funds from the Flames. But above that, they need to provide more of a benefit. It will take a lot of free skating nights to pay the area back.
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