Talks ‘moving along quite well’ for new Calgary arena deal as province indicates support
Talks to get a new event centre in Calgary are “moving along quite well” according to the chair of the city’s committee.
But few other details were released to the public after a two-hour presentation by the city’s deal structure advisors, CAA Icon.
In October 2022, the City of Calgary announced the management consulting firm was engaging with Calgary Sports and Entertainment Corporation (CSEC) on a new round of talks after the previous deal expired at the end of 2021.
Monday was the first meeting of the new year to hear from administration and negotiators.
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“Really what we’re looking for is making sure we have good governance, we’re on the kind of progressive timeline that we hope to be on,” committee chair Sonya Sharp told reporters. “We always talk about, you know, time is of the essence.”
“We’re working with cost escalations. Projects, the sooner they happen, the better, when it comes to time and money,” she said. “So we will be as aggressive as we can with our timeline in getting a deal successful.”
Another thing likely on the mind of both sides of the negotiations is the borrowing landscape, according to one economics professor.
City of Calgary enters formal discussions on new event centre project
“Interest rates are now at 25-year highs. The Bank of Canada says that they’re going hit the pause button for a little bit here, but the reality is that I don’t see interest rates going down any time soon,” Moshe Lander, economics professor at Concordia University, said. “So when they do strike a deal here, they’re going to be financing it at the highest rates in a generation.”
Sharp characterized the talks that started in the fall as a “fresh start,” and the project’s goals to build an event centre within the city’s downtown. As before, city council will be presented with a number of alternatives.
“I would say that all viable options will be presented to council,” Sharp said.
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Lander surmised trust between the city and the Calgary Flames ownership group is likely the biggest stumbling block.
“This should not take more than a year if the parties are interested in legitimately dealing with each other,” the Concordia professor said. “I think that the trust has been broken so badly that that’s why they’re having to call this a fresh start as a way to try and build trust.
“The reality is that they’re not reinventing the wheel. They know that the Saddledome needs to be replaced. There’s a limited number of land options available. There’s a limited number of financing options.
“So this isn’t like they’re reimagining what they want to do. They know exactly what they need to do. They just need to finalize these small divisions that tore apart the deal last year.”
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Lander, whose expertise includes the economics of sports, gaming and gambling, said the on-the-ice performance of the Flames could impact feelings around the team getting funding for a new arena.
“That matters when you’re going to the city and saying ultimately to the taxpayer, ‘We need $300 million, $400 million, $500 million from you,’ and that $300 million, $400 million, $500 million is going to mean that more letters are going to go missing on neighborhood signage because we can’t afford to replace it,” Lander said.
“At some point, the city’s going to say ‘Then deliver us the Stanley Cup, deliver us an appearance of the Stanley Cup, deliver us something beyond the first round or lost in the Battle of Alberta.’”
Calgary’s NHL team sits in the bottom half of the Western Division standings and would just miss a wild card playoff berth if the playoffs began today.
“And so, you know, on-ice performance matters in this case in winning over public sentiment,” Lander said.
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The week after the “fresh start” was announced, Premier Danielle Smith named Calgary-Hays MLA Ric McIver as the province’s representative in the event centre talks.
Sharp said the city’s negotiators had an initial conversation with the premier’s office and the Calgary councillor expressed happiness with the province supporting the project.
“Our deal structure advisors will move forward probably with more conversations with the province in due time,” the Ward 1 councillor said. “It’s good to have everybody on the same page as we’re moving through this journey.”
The premier’s office declined to comment, instead saying the province will wait “until the involved parties have something to report.”
The next city event centre committee meeting is scheduled for next month.
–with files from Adam MacVicar, Global News
&© 2023 Global News, a division of Corus Entertainment Inc.
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