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Edmonton rejects Oiler [Arena] bid for more taxpayer dollars
Surely I don't have to literally explain to you the differences between Winnipeg's arena and the proposed arena district that Katz has designed, do I?
Winnipeg's arena was built for a paltry $135M. Edmonton's arena district is a proposed $450M+ that encases two rinks, world class design, restaurants, an indoor 'winter garden' (likely scrapped), several office towers, underground parking, condos and LRT access not to mention private investment in the form of bars/restaurants that are part of the project as developable land.
That is a project the city has to be involved in. There was a lot of research that went into developing a feasible project based on historical effects on arenas located in downtown areas. The conclusion was that an arena downtown itself does not revitalize the area and there are many failed arena-only cities worldwide where this is prevalent. They've concluded that a successful revitalization encompasses many aspects and thus the arena district was born. It should be seen as a municipal-wide initiative with the arena as a focal point of the whole revitalization project.
Katz' expectation of public funds is not unreasonable because this project is thinking Edmonton first and arena second. It's incredibly ambitious and one that will change the perception of Edmonton for decades to come if it's built.
TNSE in Winnipeg already own their arena and garner all of the ancillary attached revenue. They additionally own parking structures, a multiplex practice facility, ticketing agency, run a successful concert promotion business, own clubs and restaurants in the surrounding area with plans for more and are also currently building an office tower/hotel/other retail developments around the arena within a new Sports & Entertainment district.
TNSE in Winnipeg already own their arena and garner all of the ancillary attached revenue. They additionally own parking structures, a multiplex practice facility, ticketing agency, run a successful concert promotion business, own clubs and restaurants in the surrounding area with plans for more and are also currently building an office tower/hotel/other retail developments around the arena within a new Sports & Entertainment district.
I believe that there have been one or two additional highrise residential towers added to the Longboat SHED mix in the last few days
That is correct. I should have mentioned the residential component as well. At least one other tower is to go on the opposite corner of Donald/Portage, IIRC?
TNSE in Winnipeg already own their arena and garner all of the ancillary attached revenue. They additionally own parking structures, a multiplex practice facility, ticketing agency, run a successful concert promotion business, own clubs and restaurants in the surrounding area with plans for more and are also currently building an office tower/hotel/other retail developments around the arena within a new Sports & Entertainment district.
Unlike in Edmonton, Winnipeg currently seems able to get things accomplished beyond the conceptual stage though.
This is what I don't understand... Doesn't it make sense for a Canadian billionaire to build his own arena and control all revenue streams? In terms of the fan what's the difference between a ticket tax and a ticket price increase?
First, Katz threat to move is non-credible. There is nowhere better to move, and half the league is in a worse financial position than Edmonton and want the few available locations for themselves. This is doubly so when you consider the abismal product that the Oilers have put on the ice since the lockout. The Oilers arn't even fake NHL .500 since the lockout, compiling a record of 248-261-65 in that timeframe.
Second, the Arena cost does not need to be anywhere near $450 mil, this is a bloated project greased with public money for private profit, and should be opposed. I can see it costing upwards of $300 mil for a credible, modern arena, but the rest of the money is pure bloat.
Third, Edmonton has more money than Winnipeg (this is a city which is nearly twice as large), and should be able to build a new arena with private money and turn a profit. IMHO, the only subsidy that the City of Edmonton should provide is demolition of the current arena to give the new Arena a monopoly, and for a light rail station at/near the Arena. The rest should be left to private funds.
This is not just an arena. I don't know how many times I have to make that clear. If it's just the arena we were talking about here it would have been covered by the $170M that Katz has invested in ($70M in land acquisition and the committed $100M for the arena). Where the problem lies is in the external necessities that are imperative to ensure the success of a revitalization including the office towers, condos, etc. These additions benefit Edmonton and its citizens directly and that's why the city has been asked to jump in with construction costs (Which will be paid for by the levy).
Quote:
Originally Posted by Cap'n Flavour
Taxpayers should cough up for a new arena, of course - as long as it's publicly owned and rented out to the Oilers for a competitive rate. But this is apparently blasphemy.
By the way, for anyone seriously arguing that Edmonton should give in to Katz, try to find a study that shows that publicly funded arenas are not only revenue positive but also have a better return than infrastructure spending. I'd love to see it.
The arena is just one part of the district. There is more to this than just an arena.
Quote:
Originally Posted by Free
Edmonton will always have a hockey team.
Even if the Oilers move, which would be a tragedy, there would be probably 25 other owners dying to move their teams to Edmonton.
Edmonton is probably per-capita the richest city in North America and one of the craziest about hockey. It's just way too profitable for it to not exist.
As long as people want oil, Edmonton will have a team.
Nope. No team is going to willingly come into a situation where they have to live in Rexall place with Northlands sucking up all the profits. They'd want a new arena and will likely be built on the outskirts of the city like Glendale and Ottawa. That helps nobody and Katz learned from those cities that bad arena location is a bad investment.
Quote:
Originally Posted by Puckschmuck
I don't believe that City council have warmed up to a ticket tax idea, which hasn't been discussed in the media in awhile. And besides, this doesn't make up for him not wanting to pay his fair share of property taxesm which will fall on the shoulders of tax-paying Edmontonians for the rest of their lives.
Sorry, billionairs need to pay their taxes just like everyone else.
Oh well. I guess the facts that they will pay property tax went completely over your head.
Where the problem lies is in the external necessities that are imperative to ensure the success of a revitalization including the office towers, condos, etc.
So it's really just a real estate deal that happens to include a hockey team.
This is not just an arena. I don't know how many times I have to make that clear. If it's just the arena we were talking about here it would have been covered by the $170M that Katz has invested in ($70M in land acquisition and the committed $100M for the arena). Where the problem lies is in the external necessities that are imperative to ensure the success of a revitalization including the office towers, condos, etc. These additions benefit Edmonton and its citizens directly and that's why the city has been asked to jump in with construction costs (Which will be paid for by the levy).
Office towers and Condos are constructed routinely without government subsidies. Why are these different?
And the threat to move is still completely non-credible, so the city should simply ignore Mr. Katz until he stops trying to blackmail the city into giving him money and comes up with a more reasonable proposal for city funds.
If you all would really like to understand the arena and the economics surrounding it, I would highly suggest listening to a recent interview with Daryl Katz and Bob Stauffer.
Oh well. I guess the facts that they will pay property tax went completely over your head.
LOL No it didn't. However, what seems to have gone over your head is a member of city council stating that he doesn't indeed want to pay property taxes. There was an article about it in the Edmonton Journal yesterday which, surprise surprise, is no longer available (it was supposed to be kept hush hush, like so much regarding this arena deal, but Tony made the mistake of tipping off reporters). Katz won't state this to the public because he knows exactly what kind of reaction he will rightfully get.
This is not just an arena. I don't know how many times I have to make that clear. If it's just the arena we were talking about here it would have been covered by the $170M that Katz has invested in ($70M in land acquisition and the committed $100M for the arena). Where the problem lies is in the external necessities that are imperative to ensure the success of a revitalization including the office towers, condos, etc. These additions benefit Edmonton and its citizens directly and that's why the city has been asked to jump in with construction costs (Which will be paid for by the levy).
That's totally incorrect. The $450 million is just for the rink not the arena district. The City has already bought the land back from Katz, that cost is on top of the $450 million. The $100 million Katz has committed will be paid over 30 years. He's putting nothing into the arena up front. http://www.edmonton.ca/city_governme...framework.aspx
It sounds like Katz wants to build something similar to the LA Live complex down here. You've got Staples Center, two hotels, condos, the Nokia Theater, a bunch of restaurants.
Anschutz bought the Kings in October of 1995 with the goal of building a brand new arena and this big entertainment district. That was his plan from the beginning. Staples Center was finished in 1999. Construction on LA Live didn't begin until 2005.
So my question is, why does Katz have to get everything he want built right away? Why can't it be done in phases? Get the arena done first, start making increased profits for the Oilers due to more luxury boxes and better club/premiere seating options. If people see you can get that done, I'd imagine that would increase the odds of finding investors for the entertainment/residential complex that he wants built around the arena.
It sounds like Katz wants to build something similar to the LA Live complex down here. You've got Staples Center, two hotels, condos, the Nokia Theater, a bunch of restaurants.
So that will put other, non-Katz enterprises out of business as entertainment dollars get shifted to Katz enterprises, and he gets to reap over-sized rewards for the new Katz establishments.
I get how this is good for Katz. Unclear how this is good for anybody else.
It sounds like Katz wants to build something similar to the LA Live complex down here. You've got Staples Center, two hotels, condos, the Nokia Theater, a bunch of restaurants.
Anschutz bought the Kings in October of 1995 with the goal of building a brand new arena and this big entertainment district. That was his plan from the beginning. Staples Center was finished in 1999. Construction on LA Live didn't begin until 2005.
So my question is, why does Katz have to get everything he want built right away? Why can't it be done in phases? Get the arena done first, start making increased profits for the Oilers due to more luxury boxes and better club/premiere seating options. If people see you can get that done, I'd imagine that would increase the odds of finding investors for the entertainment/residential complex that he wants built around the arena.
I guess because if everything is built, then that means a nicer downtown and more people will spend money? IDK.
LOL No it didn't. However, what seems to have gone over your head is a member of city council stating that he doesn't indeed want to pay property taxes. There was an article about it in the Edmonton Journal yesterday which, surprise surprise, is no longer available (it was supposed to be kept hush hush, like so much regarding this arena deal, but Tony made the mistake of tipping off reporters). Katz won't state this to the public because he knows exactly what kind of reaction he will rightfully get.
Third, Edmonton has more money than Winnipeg (this is a city which is nearly twice as large)
I'm not sure how relevant it is to the topic because I'm not at all up to speed on this arena stuff, but either you think Edmonton is a lot bigger than it is, or Winnipeg a lot smaller.
That's totally incorrect. The $450 million is just for the rink not the arena district. The City has already bought the land back from Katz, that cost is on top of the $450 million. The $100 million Katz has committed will be paid over 30 years. He's putting nothing into the arena up front. http://www.edmonton.ca/city_governme...framework.aspx
Nope. The proposed $450M includes the arena district, as the $100M from Katz is earmarked in both the building itself and the arena district.
"The Arena Building
The maximum cost of new arena is $450 million and the building will be owned by the City of Edmonton.
The $450 million includes:
Design, construction, soft costs, eligible pre-development expenses
Any oversight expenses
Associated development costs.
350 parking stalls
Site servicing costs
Levies"
"Arena Entertainment District
The Katz Group will commit $100 million to development in the arena district, subject to commercial viability. In the Council-approved framework, $30 million of the $100 million must be invested prior to the start of construction of the arena."
As you can see, he has to invest $30M up front. There goes that accusation of him not paying anything up front! The arena and district should be seen as a whole.
I do not believe that Katz has committed $200M for the arena and the arena district, (Or the "greater arena") considering the district is comprised of mainly land development and real estate (Restaurants, bars, stores opening, etc).
And the arena building itself is comprised of many different aspects and is not "just" an arena. It also includes the winter garden and community rink.
Quote:
Originally Posted by danaluvsthekings
It sounds like Katz wants to build something similar to the LA Live complex down here. You've got Staples Center, two hotels, condos, the Nokia Theater, a bunch of restaurants.
Anschutz bought the Kings in October of 1995 with the goal of building a brand new arena and this big entertainment district. That was his plan from the beginning. Staples Center was finished in 1999. Construction on LA Live didn't begin until 2005.
So my question is, why does Katz have to get everything he want built right away? Why can't it be done in phases? Get the arena done first, start making increased profits for the Oilers due to more luxury boxes and better club/premiere seating options. If people see you can get that done, I'd imagine that would increase the odds of finding investors for the entertainment/residential complex that he wants built around the arena.
The Oilers have until 2014 when the lease on Rexall expires. At that point, they will likely enter a year-by-year lease with Northlands. If significant progress (As in, breaking ground) hasn't occurred by then the Oilers will be faced with the reality that they are just not sustainable in the current NHL market at Rexall. If the deal falls through, Katz cannot guarantee the Oilers in Edmonton long term.
The proposed idea needs to be approved before staged construction can begin. Once the financials are in order, then the arena can be built. The surrounding district will be built as it is developed from private investments.
I'm not sure how relevant it is to the topic because I'm not at all up to speed on this arena stuff, but either you think Edmonton is a lot bigger than it is, or Winnipeg a lot smaller.
Some people from Edmonton just like to make this a topic of conversation for some reason (to make them feel better about themselves or whatever).
Winnipeg metro, about 760k
Edmonton metro, about 1.2k
Winnipeg City proper, about 710k
Edmonton City proper, about 850k
The larger difference is in the metro area. But when you compare the city by city populations, not much of a difference there. But really, the metro population is less important because they don`t pay city taxes like those living in the cities do.
Or that it`s true but the city and Katz don`t want it scrutinized by the media and public. Only time will tell, but my gut feeling is that he wants his cake for almost free, and wants to be able to eat it too.
