Home Month and Year February 2020 A Beacon of Hope

A Beacon of Hope

Proponents argue new event centre signals Calgary is open for business again

The new event centre will include a two-block community gathering place and street-facing bars and restaurants that are meant to attract Calgarians year-round. Photo courtesy of Calgary Municipal Land Corp..

The long-awaited approval of a $565-million event centre east of downtown turns the tide for a city that’s been beaten down in recent years by mis-steps and misfortune, say advocates.

Those involved in the freshly-signed deal between the City of Calgary, Calgary Sports and Entertainment Corporation and the Calgary Stampede say it is a much-needed economic win for all Calgarians – especially given ongoing woes in the energy sector and the inability to move forward on initiatives such as the 2026 Olympic Games. The deal will bring a new multipurpose centre to Calgary in 2024 and anchor an arts and entertainment district in East Victoria Park.

“It’s an important piece to the vibrancy of the city,” says John Bean, president and CEO of Calgary Sports and Entertainment Corporation (CSEC), which owns the Calgary Flames and has signed a lease that will keep the NHL team in the city for the next 35 years.

“We have taken a few steps back, including stumbling on the Olympic file. So, it was really important for the city that we were able to provide a path forward. It’s a bit of adrenalin. We need some adrenalin in this city. We need to get some mojo back.”

Bean adds this deal – in which the city agrees to pay $290.4 million, including demolition costs for the Saddledome, while CSEC contributes $275 million on top of operating costs – wasn’t about the Flames or “subsidizing millionaires and billionaires,” as many critics have phrased it.

“This was about money being directed to build an event centre for Calgary that’s going to help drive a number of great concerts, community gatherings and more,” he says. “The city has a vision … and we’d like to be supportive of that. They’ve asked us to come to this area, and we are. And if we can be a catalyst for more high-density housing that’s going to come around this area, you bet.”

The deal also provides CSEC with options to purchase a parcel of land that was formerly home to the Enoch Sales House, as well as a 50,000-square-foot spot along the Elbow River that is currently home to the city’s bus barns.

Initial estimates, from the City of Calgary, project returns of around $400.3 million over the next 35 years in direct revenue through a facility fee, naming rights, street-facing retail property taxes, amateur sports payments and community engagement programming.

Coun. Jeff Davison says those numbers are just part of the story. He argues this is the right deal at the right time for Calgarians – and will send a shock wave of economic opportunities for years to come.

“It shows we are willing to invest in our own city. We believe in this district, and we are doing more than just talking about it,” says Davison, who has been a vocal supporter of a new event centre deal since being elected in 2017.

“Calgarians have been looking for something to get behind and deem as a win. When you can build a facility and stand a district up, you can show how we can do things together by partnering with the private sector and encouraging capital to come into our city. I think that’s where we’re going to start seeing the turnaround in the glut that we’ve felt in the city.”

He adds Calgarians couldn’t pass on an opportunity for a private sector partner to contribute to a city-owned facility on city-owned land without increasing operational dollars – “and, by the way, it will end up paying for itself – that’s just more of what we need to do in this city.

“For me, it was about … getting to where we want, which is the development of a tax base where one has not existed before,” says Davison.

A study released by the firm Ernst & Young (EY) and presented to city council in January 2019 projects $1.7 billion in capital spending (or spending in the economy) from 2019-26 based on three projects in the Rivers District: expansions to Arts Commons and the BMO Centre, along with construction of the event centre.

The study, commissioned by Calgary Economic Development and Calgary Municipal Land Corporation (CMLC), also forecasted nearly $300 million in annual economic activity from the facilities starting in 2024.

The study noted 4,750 full-time jobs would be created during the construction phases of the projects. Another 1,536 permanent jobs would be created once the new facilities are open.

“It’s very positive – both on the economic and social benefit sides, in terms of what they’ll bring to this community and this city,” says Clare LePan, vice president of marketing and communications with CMLC, the development manager for the event centre and BMO expansion.

LePan points to comparisons in the study with four other projects: the ICE District in Edmonton, Union Station in Denver, the Arena District in Columbus and Nashville Yards. In all cases, after the initial investment had been made, the comparator jurisdictions experienced significant levels of follow-on private investment related to restaurants, hotels, retail and commercial opportunities.

“Calgary has the same economic opportunity in front of it, as well,” says LePan.

Court Ellingson, vice president of research and strategy at Calgary Economic Development, agrees there was a clear benefit to the construction and operation collectively of the facilities in those four cities.

“There was also an understanding that of any other jurisdiction we looked at, there were perceived increases in vibrancy [and] property value uplift in proximity to those districts,” he says. “In each case, the overall perception of vibrancy of that district was felt to be raised … to be elevated. This is something I think can’t be ignored here in Calgary.”

The event centre’s impact on tourism can’t be ignored either, says Ellingson. He anticipates it will not only attract or keep people locally by bringing additional concerts and events to the city, but will also pull tourists from elsewhere.

Bean estimates Calgary has lost out on more than 50 concerts alone in the last three years due to a lack of a suitable facility – 15 to 20 per year since Rogers Place opened in Edmonton in 2016.

“If you start tracking postal codes of who is going to concerts in Edmonton, we’ve become net exporters of tourism dollars,” he says. “It’s a very large number.”

Calgary Construction Association president Bill Black says the new event centre and BMO expansion couldn’t have come soon enough for Calgary’s commercial construction industry.

Buoyed over the past five years by a successive run of high-profile projects – from the South Health Campus to the Calgary International Airport expansion and numerous highrises in between – these anchor projects have started to dwindle.

And with much of the same expected in 2020, Black says his members are looking at even fewer prospects moving forward.

“If you take the event centre out, you create a significant amount of added concern. There’s nothing else on the horizon of a large and significant nature,” says Black, whose association represents 850 member companies in the region. “Our members are stretched out. Some are busy. Some are doing OK with some mid-sized to smaller work. But it’s a stressful time for lots of them.”

Construction on the event centre is expected to begin in the third quarter of 2021 and be ready for the start of the Flames’ 2024-25 season.

“While it’s tempting when times are tough to say you’re not going to spend anything, the problem is if you stand still while the economy is in a hiatus, you run the risk of falling even further behind,” concludes Black. “Cities like Calgary still have to grow to be considered globally viable.”