Stadiums & Arenas of Canada, Part 3

[FrankieFlowerpot]

Safe to say the Flames ownership won't be too happy about the mayoral election vote





The second one (from the Flames communications director) was deleted

[esquire]

Good for Calgary. The cold hard truth is that it doesn't need to dump millions into a private real estate development dressed up as an arena and downtown revitalization initiative. Only an idiot would cave in to the NHL's demands when it's clear that Calgary doesn't actually have to.

That said, it's pretty likely that this will be Nenshi's last term. So really, the Flames just have to ride out the next 4 years and they will have a much better chance next time out of manipulating the process to install a stooge more favourable toward dispensing huge dollops of unnecessary corporate welfare promoting a pro-arena candidate.

[tomthumb2]

Originally Posted by esquire

Good for Calgary. The cold hard truth is that it doesn't need to dump millions into a private real estate development dressed up as an arena and downtown revitalization initiative. Only an idiot would cave in to the NHL's demands when it's clear that Calgary doesn't actually have to.

That said, it's pretty likely that this will be Nenshi's last term. So really, the Flames just have to ride out the next 4 years and they will have a much better chance next time out of manipulating the process to install a stooge more favourable toward dispensing huge dollops of unnecessary corporate welfare promoting a pro-arena candidate.

Jesus, it's already been over 4 years of this BS - do you really think they're going to wait another 4?

I was hoping to dump Nenshi AND see Ken King fired so we could start fresh and have some real meaningful conversation and negotiation. And for those of you who think the Flames will never move? Well let's just say I wouldn't underestimate that little weasel Bettman.

[wave46]

Originally Posted by tomthumb2

Jesus, it's already been over 4 years of this BS - do you really think they're going to wait another 4?

I was hoping to dump Nenshi AND see Ken King fired so we could start fresh and have some real meaningful conversation and negotiation. And for those of you who think the Flames will never move? Well let's just say I wouldn't underestimate that little weasel Bettman.

They'll wait. They're not losing money right now and still in the top 1/3 of the league for profitability. Relocating fee is expensive and not much in the way of venues currently exists (Seattle is renovating).

Had the Flames kept their mouths shut, Nenshi might have been out. It is a shame they turned the mayoral election into an arena debate - distracts people from all the other important issues in the city and Nenshi's handling of them.

By the way, super classy post by the Flames communication director! With geniuses like that running the operation, it's no wonder they're politically tone deaf.

[esquire]

Originally Posted by tomthumb2

And for those of you who think the Flames will never move? Well let's just say I wouldn't underestimate that little weasel Bettman.

I don't think anyone doubts that the Flames would move if push came to shove. But what makes the threat laughable is the fact that Calgary is an extremely attractive hockey market and it's more than likely that some other NHL franchise would relocate to Calgary to fill that gap.

[JHikka]

Originally Posted by tomthumb2

And for those of you who think the Flames will never move? Well let's just say I wouldn't underestimate that little weasel Bettman.

Bettman has worked his ass off in the past to ensure that franchises do not relocate (including Canadian franchises). Calgary isn't moving anywhere.

[Acajack]

Originally Posted by JHikka

Bettman has worked his ass off in the past to ensure that franchises do not relocate (including Canadian franchises). Calgary isn't moving anywhere.

Yeah, I suppose so. Calgary is the most valuable of the "next four" NHL markets in Canada.

[Jaws]

Originally Posted by Acajack

Yeah, I suppose so. Calgary is the most valuable of the "next four" NHL markets in Canada.

To split hairs, Forbes has Edmonton slightly ahead.

[esquire]

Originally Posted by Jaws

To split hairs, Forbes has Edmonton slightly ahead.

I strongly suspect that's because the Oilers are now benefitting from the screw-job they inflicted on Edmonton taxpayers. A similar arrangement is obviously the goal for Flames ownership.

[Calgarian]

Originally Posted by wave46

Had the Flames kept their mouths shut, Nenshi might have been out.

I think Bill Smith got way more votes than he would have otherwise. The Flames promoted the hell out of him (as did a lot of corporate Calgary), I think it was his position on the Green Line LRT that cost him the election. Either way, I'm happy with the result.

Originally Posted by JHikka

Bettman has worked his ass off in the past to ensure that franchises do not relocate (including Canadian franchises). Calgary isn't moving anywhere.

Agreed, the Flames aren't going anywhere despite the rhetoric.

[Acajack]

Originally Posted by Jaws

To split hairs, Forbes has Edmonton slightly ahead.

Due to the presence of a franchise player I suppose.

[craner]

^And a shiny new arena.

[Black Star]

Originally Posted by esquire

I strongly suspect that's because the Oilers are now benefitting from the screw-job they inflicted on Edmonton taxpayers. A similar arrangement is obviously the goal for Flames ownership.

Cost of the arena is $480 million, $130 million paid by the Katz Group, $125 million paid for by a ticket tax on all tickets sold at the venue and $200 million from the City and $25 million from other levels of government for the second ice surface/community rink to be used for the public and nearby university. The City's portion will be paid via a Community Revitalization Zone Levy (CRL) and other extra revenue like parking. Note that there was no tax rate increase in order to pay for any part of the arena.

The philosophy behind the CRL program is:

Major revitalization projects attract and increase local activity, investment and development. Economic growth creates additional tax revenue for all orders of government. Additional municipal and provincial property taxes from the economic growth will help fund the original project.

The amount of new tax revenue that the lands in and around the arena will make for the City on an annual basis, FAR exceeds the $200 million that the City has seeded into this project. There is currently over $2.5 billion in construction going on in the Arena district itself including a 56 floor hotel,69 floor office/condo. A 29 floor office and other retail businesses including a grocer, movie theater complex, restaurants, bars, etc. This district has fast forwarded many new condo high rises that have been announced since the arena was started and would not have existed without the new arena.

The CRL funding forecasts are based on only 40% of the growth predicted in Rollo’s conservative model, and still the CRL was calculated to generate, in net present value, $473 million in new taxes over 20 years.

So how investing $200 million in this multi billion district, getting almost $500 million in new taxation revenue (maybe more) AND revitalizing the city's downtown at the same time is a bad deal?

[esquire]

^ Calgary simply doesn't need to prime the pump that badly to the point where it's basically giving a businessman a $604 million arena project at virtually no cost (well, OK, at a cost of $23.68 million) to get a few towers built.

[240glt]

^ Don't forget that the city of Edmonton was also strong armed into leasing 250k of office space in Katzs towers, emptying out a significant amount of existing office space in the core, and which will have a negative effect on the CRL as commercial values decrease (this is already happening)

And the infamous skybox that council had exclusive access to

And that while owned by the city, the city will see no real tangible benefit to owning the arena, the city is on the hook for major repairs and capital upgrades

And of course the obliteration of a 100 some odd year old Edmonton agricultural institution in the name of "downtown revitalization"

I doubt anyone would've spent the money to build a private arena in downtown Edmonton so this is probably the only way it was going to happen here. But it was definitely a bad deal. Calgary's downtown is of course not nearly in the state Edmonton's is so there's no pressing urgency to embark on a lofty "revitalization" project, and Calgary is much better positioned to negotiate a proper, fair deal for the city

[esquire]

^ I get the impression that the NHL was hoping Calgary could get pushed into playing the "me too" game but it appears it's not going to be that simple for them.

As much as I like to think that it is due to the sophistication of the public in Calgary, I'm sure a lot of it has to do with the sheer ineptitude of the Calgary ownership group when it comes to this issue.

[WhipperSnapper]

Originally Posted by Black Star

Cost of the arena is $480 million, $130 million paid by the Katz Group, $125 million paid for by a ticket tax on all tickets sold at the venue and $200 million from the City and $25 million from other levels of government for the second ice surface/community rink to be used for the public and nearby university. The City's portion will be paid via a Community Revitalization Zone Levy (CRL) and other extra revenue like parking. Note that there was no tax rate increase in order to pay for any part of the arena.

The philosophy behind the CRL program is:

Major revitalization projects attract and increase local activity, investment and development. Economic growth creates additional tax revenue for all orders of government. Additional municipal and provincial property taxes from the economic growth will help fund the original project.

The amount of new tax revenue that the lands in and around the arena will make for the City on an annual basis, FAR exceeds the $200 million that the City has seeded into this project. There is currently over $2.5 billion in construction going on in the Arena district itself including a 56 floor hotel,69 floor office/condo. A 29 floor office and other retail businesses including a grocer, movie theater complex, restaurants, bars, etc. This district has fast forwarded many new condo high rises that have been announced since the arena was started and would not have existed without the new arena.

The CRL funding forecasts are based on only 40% of the growth predicted in Rollo’s conservative model, and still the CRL was calculated to generate, in net present value, $473 million in new taxes over 20 years.

So how investing $200 million in this multi billion district, getting almost $500 million in new taxation revenue (maybe more) AND revitalizing the city's downtown at the same time is a bad deal?

OMG. It's neither $200 million or $2.5 billion. That's just rhetoric. No one is denying it didn't accelerate some development however, patience would have built office, retail, residential anyways without a CRL looming over it. We won't know for a while if it created additional demand for commercial/residential or a looming glut is on the horizon from all the space being built at once. Even then, that doesn't mean a CRL was a good choice.

[FFX-ME]

A CRL simply wouldn't work if you are building a new arena at virtually the exact same location.

[Boris2k7]

Thing is, Vic Park, where the Flames want to build the arena, already pays into a CRL for the Rivers District, and that revenues from that CRL are already budgeted. Another levy on top of that, or an extension of the levy for a private sports team? No thanks.

If fans really want new digs, they can feel free to pay for all of it.

[blueandgoldguy]

Here is an article from a few weeks ago by the Globe and Mail that describes what the Flames ownership demanded from the city in the arena negotiations. Seems like a worse deal than Edmonton's.

https://beta.theglobeandmail.com/new...+Article+Links

The partnership that owns the Calgary Flames proposed a deal for a new arena that would give the private company a chance to transform into the real estate developer for a potentially lucrative new community, according to documents obtained by The Globe and Mail.

Calgary Sports and Entertainment Corp. (CSEC), which owns the Flames and other sports teams, made its first arena offer to the city in a letter and two-page list of terms Feb. 21. The documents provide a glimpse of the club's vision for a complex more extensive than just an arena.

As part of the proposal, the Flames' owners insisted on receiving an option to buy and develop land near the events complex, a slice of the Stampede Casino's revenue, all parking revenue from major events it would manage at the events complex and other goodies. The demands included the city of Calgary covering the cost of flood insurance, reimbursing the club for all provincial property taxes that may be imposed on the facilities, and requiring local ratepayers to pick up the bill for a public gathering place suitable for festivals next to the arena.

The documents underscore how the multimillion-dollar arena negotiations are – for both camps – about far more than a concrete structure in Victoria Park, an underdeveloped zone east of Calgary's downtown.

If Calgary acquiesced to the terms, for example, it would give some of Canada's wealthiest men business opportunities in part thanks to financial support from taxpayers. Further, some of the sticking points would affect the Calgary Stampede's balance sheet. The Stampede, which hosts the city's famous 10-day festival and other events, is a not-for-profit organization and parking and gambling revenue are important to its operation.

So they also appear to want some of the Stampede's revenue as well.