Calgary Flames New Arena Update

[OTown]

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I can pretty well guarantee you absolutely fucking no one decides on where to lived based on the presence of an NHL team, or any other pro sports team.

What about the team itself, paying for physio, medical, catering, direct jobs, alcohol, taxes, airport fees. Then add sponsorships and foundations (charities etc). Then add in the big nights when the teams go out and spend big money in local venues. Then their massive homes with a bunch of purchases, where do you think they get all that from and who gets to pay sales and property taxes on that?

I can tell you that the team itself is a pretty major injection of cash into the city. Not saying it makes up for the 500 mil but it certainly makes a difference and is often overlooked

[SJW]

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I voted for Hallelujah

A fucking inanimate carbon rod would be better than what we have.

[npham]

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Genuine question. Would it be better if Calgary builds an arena/entertainment centre and long term lease out the space to CSEC and concert promoters similar to the current arrangement? That way it's not directly funding a private business, but CSEC will get a better deal out of it.

For me, I would support this if the economics made sense. If Calgary could not recoup the cost of the investment in a reasonable amount of time(no idea what sort of term is acceptable in commercial real estate), then I would be supportive. Not sure why the CSEC would get a better deal out of it though. Was there some other proposal I'm missing? I would imagine the lease costs would need to go up and have a firm commitment of 20 years or whatever to ensure that CoC isn't taking a bath on it. I'd expect the devil is in the details for this arrangement which is why it's not going forward. I doubt all the braindead people at the CoC will be able to book the venue consistently with large paying acts thus never paying off the investment and they don't want to take on that risk.

EDIT: Removed my shitty idea.

[88CRX]

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EDIT: Removed my shitty idea.

LOL I was just about to say could you image the time/cost/headache for the City of Calgary to manage and run the place. Hahahha. 10% property tax hike here we come.

[jutes]

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Yep. Were no better than the Torontonias, Montrealais or Vancouverites that vote for Trudeau year after year expecting something different. Its laughable, actually.

Those places vote for Turdeau because they aren’t expecting anything different…

[rage2]

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For me, I would support this if the economics made sense. If Calgary could not recoup the cost of the investment in a reasonable amount of time(no idea what sort of term is acceptable in commercial real estate), then I would be supportive. Not sure why the CSEC would get a better deal out of it though. Was there some other proposal I'm missing? I would imagine the lease costs would need to go up and have a firm commitment of 20 years or whatever to ensure that CoC isn't taking a bath on it. I'd expect the devil is in the details for this arrangement which is why it's not going forward. I doubt all the braindead people at the CoC will be able to book the venue consistently with large paying acts thus never paying off the investment and they don't want to take on that risk.

EDIT: Removed my shitty idea.

There are some publicly available data (in a different market) to show what market value looks like for renting an arena for an NHL team. The mess that's the Arizona Coyotes has all their dirty laundry aired out so these figures are public information. They pay about $3m USD per year in rent at Gila River Arena ($500k/year plus $55k/game operating expenses), plus misc expenses such as parking sales. Let's generously round that up to $5m CAD. The new arena costs $650m at the latest estimates before it was terminated. At market rates, it would take 130 years to pay it off, assuming there is nobody else to pay that much for the other times the arena is available. That's much longer than the shelf life of any arena. Now, if we had 3 pro sports team that's willing to pay that, it's a more reasonable 43 years. Calgary is a LONG ways from that happening.

Why is this a better deal for the flames? Because the latest agreement had the CSEC pay $346.5m for 35 year lease, or $9.9m/year.

This is why no private company would invest in an arena 100% in Calgary. It's a money losing proposition as the economics doesn't make sense in Calgary with the inability to secure high rent value at 90%+ utilization. The city is in a tough position with the Saddledome falling apart (if the $200m roof repair report is legit). The city isn't in the business of making money from their investments. It's in the business of allocating tax dollars to make life better for Calgarians, and hopefully getting the most bang for the buck. Circling back to the City paying 100%, there is a bright side. Leasing it out for 35 years to CSEC at $5m will net them $175m, while the building will be open for public use like the library majority of the time, which will make Calgarians feel better about their tax dollars. Underlying numbers though are rough, at a cost of $475m for the city. The numbers doesn't make sense considering the cost criticism of our library lol.

I think CSEC knows the city is in a tough spot and has more leverage than they do. This will end up with them getting a better deal at some point, and Gondek looking like a bigger idiot costing the city way more money.

[ExtraSlow]

Flames will get thier deal, I have no doubt.

[killramos]

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There are some publicly available data (in a different market) to show what market value looks like for renting an arena for an NHL team. The mess that's the Arizona Coyotes has all their dirty laundry aired out so these figures are public information. They pay about $3m USD per year in rent at Gila River Arena ($500k/year plus $55k/game operating expenses), plus misc expenses such as parking sales. Let's generously round that up to $5m CAD. The new arena costs $650m at the latest estimates before it was terminated. At market rates, it would take 130 years to pay it off, assuming there is nobody else to pay that much for the other times the arena is available. That's much longer than the shelf life of any arena. Now, if we had 3 pro sports team that's willing to pay that, it's a more reasonable 43 years. Calgary is a LONG ways from that happening.

Why is this a better deal for the flames? Because the latest agreement had the CSEC pay $346.5m for 35 year lease, or $9.9m/year.

This is why no private company would invest in an arena 100% in Calgary. It's a money losing proposition as the economics doesn't make sense in Calgary with the inability to secure high rent value at 90%+ utilization. The city is in a tough position with the Saddledome falling apart (if the $200m roof repair report is legit). The city isn't in the business of making money from their investments. It's in the business of allocating tax dollars to make life better for Calgarians, and hopefully getting the most bang for the buck. Circling back to the City paying 100%, there is a bright side. Leasing it out for 35 years to CSEC at $5m will net them $175m, while the building will be open for public use like the library majority of the time, which will make Calgarians feel better about their tax dollars. Underlying numbers though are rough, at a cost of $475m for the city. The numbers doesn't make sense considering the cost criticism of our library lol.

I think CSEC knows the city is in a tough spot and has more leverage than they do. This will end up with them getting a better deal at some point, and Gondek looking like a bigger idiot costing the city way more money.

Gondek:

We will build our own arena, with blackjack and hookers!

https://www.cbc.ca/news/canada/calga...ndek-1.6305280

[Buster]

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There are some publicly available data (in a different market) to show what market value looks like for renting an arena for an NHL team. The mess that's the Arizona Coyotes has all their dirty laundry aired out so these figures are public information. They pay about $3m USD per year in rent at Gila River Arena ($500k/year plus $55k/game operating expenses), plus misc expenses such as parking sales. Let's generously round that up to $5m CAD. The new arena costs $650m at the latest estimates before it was terminated. At market rates, it would take 130 years to pay it off, assuming there is nobody else to pay that much for the other times the arena is available. That's much longer than the shelf life of any arena. Now, if we had 3 pro sports team that's willing to pay that, it's a more reasonable 43 years. Calgary is a LONG ways from that happening.

Why is this a better deal for the flames? Because the latest agreement had the CSEC pay $346.5m for 35 year lease, or $9.9m/year.

This is why no private company would invest in an arena 100% in Calgary. It's a money losing proposition as the economics doesn't make sense in Calgary with the inability to secure high rent value at 90%+ utilization. The city is in a tough position with the Saddledome falling apart (if the $200m roof repair report is legit). The city isn't in the business of making money from their investments. It's in the business of allocating tax dollars to make life better for Calgarians, and hopefully getting the most bang for the buck. Circling back to the City paying 100%, there is a bright side. Leasing it out for 35 years to CSEC at $5m will net them $175m, while the building will be open for public use like the library majority of the time, which will make Calgarians feel better about their tax dollars. Underlying numbers though are rough, at a cost of $475m for the city. The numbers doesn't make sense considering the cost criticism of our library lol.

I think CSEC knows the city is in a tough spot and has more leverage than they do. This will end up with them getting a better deal at some point, and Gondek looking like a bigger idiot costing the city way more money.

Pay the players less

[rage2]

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Gondek:

https://www.cbc.ca/news/canada/calga...ndek-1.6305280

I guess city lost all their leverage lol.

[dimi]

"There are still many interested parties … that want to see this move forward."

[ExtraSlow]

Jesus, if the flames won't pay half, we'll make them pay . . . less? Wicked negotiating!

[killramos]

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translation

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Funding Secured

[ExtraSlow]

"funding secured" lol.

[finboy]

Really hoping the province comes through with some recall legislation, and maybe shredding the city charter to take any authority away from these poorly trained chimps

[killramos]

It would be Uber hilarious if we tried to recall Gondek before chu

- - - Updated - - -

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I think Gondek is sewering her political career very quickly.

Lets look at her resume in her few short months as Mayor.
1) Declares Climate emergency
2) Created significant division between the city and CPS
3) Created significant division with city council
4) Went rogue and sewered a $600million infrastructure project which was the lynch pin holding together an entire East Side revitilization

She's exactly the Mayor Calgarians deserve.

Speaking of which. Don’t forget the “I refuse to swear in” stunt with Chu

[Sentry]

Gon down in Flames?

[kertejud2]

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. Circling back to the City paying 100%, there is a bright side. Leasing it out for 35 years to CSEC at $5m will net them $175m, while the building will be open for public use like the library majority of the time, which will make Calgarians feel better about their tax dollars. Underlying numbers though are rough, at a cost of $475m for the city. The numbers doesn't make sense considering the cost criticism of our library lol.

The deal as set up had:

City paying ~$310M
CSEC paying ~$310M

CSEC taking on cost overruns (originally it was an even split, unless overruns were caused by only one side wanting something different. But this was part of the deal that saw the city give up CMLC as project manager)

CSEC would get a 35 year lease of the arena management contract and a “ticket tax” (or whatever they’re calling it) would contribute to ~$150M to the city, plus $2.5M from naming rights.

A long term lease was always a part of the deal. Your deal has the city paying hundreds of millions more for nothing extra in return.

A deal structured around the city taking on the construction risk, and increasing CSECs payments through the lease life (I.e $15M/year, so CSECs contribution would work out roughly the same, they just don’t need to take on the large initial capital financing) would be closer to the structure of Edmonton’s deal (Katz pays a lot less of a portion of the Rogers Place cost) but that means the city has to find a lot more money to take on that construction risk.

[killramos]

Sounds like a financial slam dunk

[Buster]

how about the city does city things, and the entertainment companies do entertainment things.

ffs this isn't that complicated.