Scott Radley: Arena debate can’t become another stadium or LRT fight
https://www.thespec.com/opinion-stor...-or-lrt-fight/

Perhaps it's overly pessimistic to worry that the looming debate around the location of a centrepiece arena in Hamilton could end up looking a lot like the divisive battles over Tim Hortons Field and the LRT.

But we wonder.

Big Project No. 3 shows up on the agenda on Wednesday morning. That's when the future of FirstOntario Centre or a new arena will land on council's lap. The independent report it will receive was one commissioned to look at the options for a downtown facility, among other entertainment venues.

But there's a twist. At the same meeting, a proposal from Hamilton Bulldogs' owner Michael Andlauer and Cadillac Fairview will arrive for an arena at Lime Ridge Mall.

Yet before this second option even lands, Ward 4 Coun. Sam Merulla says no consideration will be given to any arena idea outside the downtown core. That idea's already been dismissed. You can be sure others around the table will share that position.

On the flip side, Ward 7 Coun. Esther Pauls says any good idea needs to be considered even if it's not downtown. Coun. Terry Whitehead says he'll be seconding her motion to that end and others have said they're willing to consider it.

Looks like the battle stations are already being manned.

The 130-page Ernst and Young report that recommends a 10,000-seat arena somewhere in the downtown cites a number of ways such a building would ultimately save the city money over merely maintaining FirstOntario Centre. There would be the spinoff benefits to nearby businesses, a 50-cent facility fee on tickets that would go to the city, a new lease deal with the Bulldogs that would put more money in the city's coffers, and some other impacts.

A big part of all this comes from a greater number of people attending events at a new place, predicted to be 50 per cent more for sports and 15 per cent more for concerts and other shows. This means more tickets sold, more people eating in the area, more parking and more food and beverage revenue in the building.

I'm really skeptical of these increase in numbers for a new stadium. You're losing the ability to host really big shows, plus 50% more for the OHL seems like a reach. Plus whatever number they come up with to build a new stadium, I'm skeptical it can be built for that.

These people are lunatics ..... How can you even consider moving such a huge venue from the core ?!?! And why is the argument that the stadium is too big ...yet still argue that the numbers will increase with a smaller venue ????? I in the twilight zone ?!??

Ignoring location, what is this small arena going to offer than FOC currently doesn't?

And limeridge mall should be focusing on becoming a better mall ....better stores ...better restaurants etc .... Not having a large arena in its parking lot that sits empty until used

Modernized equipment, a better viewing experience for fans of the Honey Badgers or Bulldogs, among other aspects. Not only is Copps built for a team and a league that isn't coming, it was built in a different era. Hockey rinks (and indeed, sports facilities in general) are much different now.

Alright, but it seems like quite amount of money and effort just to get a better viewing experience for tenants that don't draw many fans. Sure, maybe the new arena will help attendance at first - but I really don't see these teams garnering that much support in the long term. Hamilton is essentially a major league sports market simply based on it's proximity to all the major NA sports leagues. It never has and never will generate much interest in these smaller leagues. I can honestly see this new arena being built, the OHL team still not getting enough long term support - and then the team relocating.

It's actually saving a lot of money, over $20M. FOC is going to need over $60M in deferred maintenance, not even improvements over the next 5 years. Essentially lipstick on a pig, bandaid fixes to the roof, HVAC, washrooms, elevators, ice making equipement, etc.

The new arena, all maintenance would be responsibility of the operator, with the city only contributing say 50% or less to the capital cost up front.

Didn't that report that just came out say that there were only something like 4 events all year at FOC that required upper bowl seating to be used? The place is simply too big for most events going on there now. The roof also doesn't support many of the new shows going around (this is the same issue Calgary has). Not sure what people are thinking is going to skip on by if they don't have those extra 7,000 seats. Like I said in another thread on this topic, it's the mindset of not having that major league size (if not quality) arena that is going to be the fight. Having Copps makes people think Hamilton is a big league city and they don't want to lose that, even though they aren't really gaining any benefit from having the place either.

Yea, FOC didn't have a lot of events that required the use of the upper bowl - but isn't that something the operators of the arena are trying to change? Hamilton should be hosting more larger concerts/events and drawing more people into the city. Getting rid of FOC just makes the city look minor league in this respect.

Personally, I prefer concerts in a small venue with max capacity of like 2,000 or so and my days of attending in a large venue are long gone - but I know I'm in the minority.

I was at that council meeting, I can tell you with confidence that having a 10,000 seat arena will not block us off from major concert oppertunities.

As for looking 'minor league', Victoria's hockey arena, for example, isn't small-looking at all, and their capacity is only 7000.

Disney on Ice had 4 events alone.... Monster Truck Madness 3.

It'll be a major step backwards to lose Copps and a black mark on Hamilton's history.

City council poised to explore ‘next steps’ on downtown arena plan
(Hamilton Spectator, Matthew van Dongen, Sept 5 2019)

The city appears poised to explore private-sector interest in partnering on a potential $130-million new arena and entertainment facility somewhere in the downtown.

But that won't stop Coun. Esther Pauls (Ward 7) from pitching a separate evaluation next week of a Lime Ridge arena plan from the owners of the Mountain mall and the Hamilton Bulldogs.

Councillors spent hours behind closed doors discussing aspects of a consultant recommendation to investigate private-sector interest in helping build a new 10,000-seat sports arena paired with "high-density" development somewhere in the core. Prospective core locations were also kept secret.

But Mayor Fred Eisenberger emerged from the meeting early and expressed confidence councillors are willing to take "the next steps" to test the viability of a public-private partnership.

Ernst and Young consultant Zack Pendley earlier argued the $130-million plan would give the city the best bang for economic buck and even permanently end the need for annual taxpayer subsidies.

City staff have suggested such a multi-sport facility could also benefit from federal or provincial grants if Hamilton opts to pursue a 2030 Commonwealth Games bid.

The catch?

Pendley said he "can't emphasize enough the importance of an anchor tenant" to the financial sustainability of a new arena.

But the current arena tenant, the Hamilton Bulldogs OHL hockey team, have pitched a separate and smaller arena at Lime Ridge Mall on Upper Wentworth Street.

Mall and team officials attended Wednesday's meeting to watch part of the debate, but they did not comment publicly before the end of a hours-long private session.

Team owner Michael Andlauer, who is in the last year of a two-year lease, has previously indicated he is willing to work with the city on a viable downtown option if it can happen soon.

Pendley told councillors Wednesday a private-public facility could be operating within four or five years.

Andlauer did not respond to questions Wednesday about whether that timeline could work for him or whether the city's decision would affect any ongoing lease negotiations at FirstOntario Centre.

Read it in full here.


Thoughts:

The City is looking at spending $85 million toward a $130 million 10,000-seat facility whose prime tenant draws less than half that and operates on two-year lease increments.

Closing FOC is projected to save as much as $26.3 million in expenses over the next 30 years. So spending that $85 million will potentially help the city avoid $26.3 million in costs by 2049. Of course, a new facility would possibly need additional upgrades during that time — FOC itself is 34 now — so it's hard to know how much of that "as much as" estimate the City can actually claim as a savings.

The Commonwealth Games is being floated as a way of defraying the cost to the City, which would be true if there wasn't a push from said tenant to have this new facility completed yesterday.

"We can't wait five years," Andlauer said a year and a half ago. "People are going to lose interest."

He may not have much choice. The City's consultant on this project, Ernst & Young, projects that a private-public facility could be operating within four or five years. Pushing that timeline forward will presumably increase the total cost, most of which will be borne by the municipality (the current formulation assumes 2/3 of capital costs will be absorbed by the City.). A projected 2024-2025 arena occupancy would see the Bulldogs sign and run out two more facility leases at FOC before the lights go on at the new arena.

The Commonwealth Games hypothetical, which would allow the City to tap money from senior government, requires additional patience. They aren't even planning to award the 2026 CG until next year, and for the City to successfully enlist senior government for cost-sharing would likely require them to wait until after the 2030 CG have been awarded to break ground. So let's say four or five years before the City will even know if they'd have the 2030 CG card to play.

For comparison, Hamilton voted to come aboard the 2015 Pan Am Games in the spring of 2008, the games were awarded in November 2009, the $146 million stadium broke ground three years after that, and opened around two years after that. Assuming that council can agree on and hold to a facility location , they can maybe shave three years off that timeline, but even so, that's another two years from groundbreaking to occupancy.

So depending on how optimistic you are, this will either cost the City $85 million and be open in 2024 or cost the city far less and achieve occupancy in 2027. (Andlauer has previously pledged to match the City's share dollar-for-dollar, so there may be a rosier interpretation, if you assume that he's not counted in the projected $45 million of private funding.)

Cost, of course, is relative. The silver-bullet scenario, hosting the 2030 Commonwealth Games , is thought to carry a hosting cost to the City $300 million or more (by way of an example, the 2022 games are projected to cost Birmingham £184m — $300m CAD even after accounting for the value-engineering of that event and a Brexit-panicked pound).

13 of 98 events required the upper bowl in 2018.

Monster Truck used the upper bowl because half of the lower bowl was cascaded inwards to allow for enough space for Monster truck floor plate. The avg attendance for Monster Truck in 2018 was 10,881.

Also Disney/Marvel on Ice had 16 shows at Copps in 2018 with an average attendance of 4,897, clearly not needing more than 10,000 seats.

Disney on Ice will for sure still come around if we have a 10,000 seat arena.

*All stats from the EY consulting report.

Ever notice how consultant reports always favour tearing down and building new buildings?

What is actually wrong with First Ontario Centre? Why can't it be fixed? I know the biggest issue for the Bulldogs is the aging coolant lines which may fail. So fix them. That would be cheaper than building a new arena.

These reports ignore the environmental consequences of demolishing a building. It is always better environmentally to save and retrofit an old building than to demolish it and build a new one. If they used the 'triple bottom line' approach that the City uses for its own staff reports, I think they would favour retrofitting more often.

The entire roof needs to be replaced. The systems are 35 years old, outdated and not energy efficient. The cost to run a dated 17,000 seat arena far exceeds what it would cost to run a smaller 10,000 seat energy efficient arena.

As has been stated the cost to fix all the end of life parts of the building is over $50 million with the city still on the hook for annual maintenance and operating subsidy.

The list of things that need to be fixed are in the consultant report.

From two years ago a consultant report pegged renovating only the lower bowl at $68m with a full arena reno at $250m.

They are proposing to keep Copps, however change it to a convention centre. Which I'm totally in favour of (as long as the new arena stays downtown).

I imagine between the upper and lower bowl they would be split as two floors of convention space.

They're not keeping Copps. It's going to be demolished.

Yeah, I can't imagine renovating would be cheaper or more practical than demolishing and building new. You'd have to completely gut the building down to the shell and remove the upper seating bowl. I don't even know if you can remove the lower bowl and leave the walls standing or is it an integral part of the building structure.

I agree with this. The odds of them being able to build a new arena with that cost estimate is basically zero.

The new Moncton arena, 8800 seats, was built for a bit over $100million.

Thats probably the template. Looks like it was $113M for 8800 seats. Add 1200 seats, inflation, and maybe a few extra bells and whistles and you get the $135M price tag mentioned.

Place Bell at 10,000 seats cost $200M but that had a community rink in addition to the main rink. It probably also had a lot more high end features than Moncton.

https://twitter.com/JohnPaulDanko/st...91661193084928

^ Interesting numbers on the profit/loss for the arena. Concerts make the most money, by far, for the stadium.

Some interesting nuggets from Bulldogs lease negotiation docs just a few years after they arrived at Copps:

At the November 29, 2000 meeting of the H.E.C.F.I. Board of Directors, staff was directed to develop a proposal for the Hamilton Bulldogs Hockey Team (Bulldogs) that would give further revenues to the Bulldogs based solely upon increased attendance. H.E.C.F.I. staff did so and made a proposal to the Bulldogs which included offering them fifty cents per person from H.E.C.F.l.‘s food and beverage commissions for paid attendance in excess of an average of 4,000 per game (based upon the average for the entire season). As well, H.E.C.F.I. staff proposed to give the Bulldogs the rights to sell the facia, scoreclock, curtain and concourse advertising space in Copps Coliseum provided that the Bulldogs guaranteed that H.E.C.F.I. would receive $150,000 annually from the team for doing so.

The Bulldogs have rejected this proposal and have reiterated their previous demands. They are arguing that their licence agreement should be similar to the one that currently exists for the Hamilton Tiger Cats.

The following are the elements of the Bulldogs’ proposal:

• That no rent be paid for the use of Copps Coliseum. In addition, it should be noted that H.E.C.F.I. would continue to pay for game day labour charges (ticket takers, security, ushers, etc.), box office costs, credit card charges, operating supplies, etc. Currently the Bulldogs pay H.E.C.F.I. a licence fee of $3,000 per game, pay net office rent of $9,430 (after deduction of property taxes) and pay H.E.C.F.I. an annual fee of $21,000 for the
right to lease the private boxes for their games.

• That the hockey team assume full control of all building signage and that they pay H.E.C.F.I. 25% of all “net revenues generated after production and labour costs associated with sales.”

• That the Bulldogs receive 100% of food and beverage concession sales at their hockey games.

The Bulldogs were averaging around 5K attendees a home game at that point. They’re now averaging just over 4K at home.

Bulldogs Lime Ridge Mall arena idea has councillors flummoxed
(Hamilton Spectator, Andrew Dreschel, Sept 22 2019)

Hamilton Bulldogs owner Michael Andlauer has done it again.

His proposal to share the cost of building a new arena at Lime Ridge Mall with the city has councillors scurrying like headless chickens.

Or, as Coun. Terry Whitehead put it, "looking like Keystone Cops."

The flashpoint was a debate over whether councillors should withdraw their invitation asking Andlauer to publicly speak to them about his joint proposal with mall owner Cadillac Fairview.

Andlauer told them he's happy to attend the Oct. 2 general issues meeting but declined their request to publicly release the confidential proposal.

That prompted a motion last week from Sam Merulla that the invitation be "conditional" on the proposal's release.

Merulla argued if Andlauer won't openly discuss how much money he and Cadillac Fairview want the city to pony up, they may as well "uninvite" him because his appearance would just be a waste of time.

That got things rolling.

Judi Partridge agreed any request for city funding needs to be openly discussed. Esther Pauls said Andlauer should be given a chance to address them regardless.

Whitehead warned council will be sending a bad message to investors if it tries to force Andlauer to negotiate in public. Jason Farr opined the real issue is not about building an arena at the mall but developing an entertainment precinct downtown.

Tom Jackson was pleased Andlauer accepted the invitation and wants the chance to "grill" him. Lloyd Ferguson agreed and said it would be a "travesty" to "uninvite" him.

Mayor Fred Eisenberger noted council doesn't expect Andlauer to divulge details of a broader private sector development deal with Cadillac Fairview, but the city needs to know what he's asking from taxpayers.

As the discussion went round and round, Merulla's original motion got watered down. Instead of pulling the invitation, they just asked Andlauer to publicly state how much he wants the city to contribute.

It's clear what's happening here. Some councillors are deeply frustrated that the Bulldog/Cadillac Fairview proposal is distracting attention from a city consultant's recommendation to build a $130-million sports and entertainment complex downtown in partnership with the private sector.

The overall idea is to leverage city-owned assets to build a new convention centre, replace the aging FirstOntario Centre with a new 10,000-seat arena, and redevelop the existing sites with commercial and residential projects to generate new property taxes.

But the Bulldog/Cadillac Fairview proposal for a 6,000 to 7,500 seat arena at Lime Ridge Mall landed at the same time, discombobulating council and sparking calls to evaluate the idea.

Both projects obviously require city funding. The downside to a smaller arena is it wouldn't attract the major concert acts a 10,000 seater would. On the other hand, in the absence of knowing the financial details of the Lime Ridge Mall idea, it's impossible to compare costs and benefits.

Read it in full here.


Thoughts:

• Inflation-adjusted, Cadillac Fairview has invested roughly $85 million into expanding/enhancing the Lime Ridge Mall property since buying the property in 1998. Based on the spitball estimates available to us, that's apparently what the City would be expected to contribute to a new 10,000-seat arena (a 6,000-seat arena twinned with an 1,800-space parking garage might be more expensive still).

• November 2017: "Andlauer says his time touring Ontario and visiting other OHL arenas has made him eager to get the ball rolling on a 5,000- to 10,000-seat arena, which he expects would cost between $60 million and $100 million depending on the size and scope. Andlauer says he would pay half and let the city decide where it goes. “I don’t want to dictate that. I don’t know any better than the city councillors who represent the city,” Andlauer said."

• Andlauer's "confidential proposal" indicates that this arena, along with a multi-storey parking garage that connects directly to LRM, would sit on land leased from Cadillac Fairview.

• In April 2018, council's GIC voted to encourage retail owners such as Cadillac Fairview to dedicate some of the expansive real estate around their malls to affordable housing density, an element that is entirely absent from the HB/CF proposal.

• LRM is reportedly the largest property taxpayer in the city, paying $11.5 million in taxes in 2017.

The only reason Andlauer and CF want the city involved is so they won't have to pay property taxes on the building and parking garage. If they build it privately they would be on the hook for property taxes.

No property taxes would be paid on a new arena downtown either and more city money would presumably go in to that as well. I don't think it's true though that there wouldn't be any taxes paid. CF would retain ownership of the land and lease it to whatever entity is building the arena. If I own a 10 storey office building and I lease one floor to the city for whatever department they need space for, do I pay taxes on only 90% of the building now? I admit to not being fully versed on how property taxes work for the landlord when they lease to a municipality though.

Anyway, I don't personally think a 7,000 or so seat arena is going to fly with the people of Hamilton, no matter where it's built, if the city is ponying up a chunk for it.

Leasing a floor in a building that you don't own is not the same as being the owner of the building. So if the city is leasing a floor in a building the buildings owner still has to pay property taxes.

On the other had if the city was the primary owner of the building as they would be in the case of an arena then they wouldn't pay property taxes since public entities don't pay property taxes.

Dreschel seems to think he's our very own local Geraldo, but a missed point is that "flummoxed" is the way council generally works. Always has, always will. Doesn't matter who the new faces are but they all seem to seamlessly fit into the plotline. Many city councils are like this. They live in a teapot, and a minor tempest or two is the only way to liven things up. Most city council business is very boring and generic.

All due respect to Andlauer for having skin in the game and trying to press for change, but until he makes the financial ask for Lime Ridge known, he's just playing a minor character in Downton HamOnt Abbey who will be quickly forgotten otherwise.

Is it clear the city would own the arena at Lime Ridge Mall, or just be a financial backer of it? Also, if the land is owned by CF and leased to the arena consortium (or directly to the city), what does that do in regards to taxes? That's why I drew the comparison to the city leasing a floor in a privately owned building.

I believe when a City in Ontario Leases parking lot space from a private owner to run a Green P parking lot, the lot is NOT tax exempt despite being run as a green P. A lot of situations in Toronto where the City leases space from a private building in their parking garage to run a green P.

Place Bell is also a problematic precedent for private sector investment: The City of Laval footed 60% of the cost, and the province of Quebec covered another 25%. And there's been no suggestion that the province is partnering on Hamilton's arena.

Yes, thats probably why the consultant recommended a budget of $130M vs the $200M used to build Place Bell. Fewer bells and whistles for sure.

E&Y's Sports and Entertainment Venue Case Studies (for the completed venues, at any rate) also have public subsidy running between $80 million and $226 million (73% to 94%).

Andlauer's pledge to contribute $30 million to $50 million — 50% of capital costs — would be a substantial departure from the way these things tend to play out.

The bulldogs are looking to build a 6000 seat arena. If they are looking to invest 50 million then they can afford to build it themselves. I have never seen anywhere where Andlaurer said he was going to invest 30 - 50 million, probably more like 3 - 5 million.

The city would be better off spending 50 or 60 million to upgrade FOC rather than waste money putting an arena at a suburban mall.

You may be right. I was going off his statements of mid-November 2017, referenced glancingly in the Spec's most recent coverage.

Global News: "Andlauer says his time touring Ontario and visiting other OHL arenas has made him eager to get the ball rolling on a 5,000- to 10,000-seat arena, which he expects would cost between $60 million and $100 million depending on the size and scope. Andlauer says he would pay half and let the city decide where it goes."

Hamilton Spectator: "The owner of the Hamilton Bulldogs has followed up his public call for the building of a new, smaller arena to replace FirstOntario by saying he'd be willing to personally pay for half of it. Michael Andlauer had previously said he'd be willing to cover a "substantial" amount for any such project. But pressed for a more-precise figure — tough to do when nobody knows exactly what a rink would cost — he offered the 50-50 proposition…. "I don't want to dictate where it's going to go. I don't know any better (than others). I think the city councillors who represent all the citizens in the city, they should have their voice and they should know what's in the best interest."

$3 million to $5 million would cover half of a Grightmire-style reno. Maybe jazz up the city's historic OHL arena.

So do it, fix it. It's not even half the cost of building a smaller arena. Plus it's better for the environment. I don't understand why people would think that we can find find money for a brand new building if we can't find money to fix and maintain what we have.

If it's not for an NHL team, I just don't see the point.

And yes, the environmental damage, to which there has been no cost allocated, would be significant.

The City may want out of managing the arena business entirely. Nobody is going to buy FOC off them given its age and state of repair.

They currently subsidize operations at the arena to the tune of $1M a year. This doesn't even include capital rehab. The "fixing" it cost still leaves you with an outdated, non energy efficient building with high utility cost. Fixing it at $50M cost is strictly maintenance, not improvements.

A new arena agreement at a new arena would mean the City no longer provides a $1M annual operating subsidy nor does it have to pay for capital maintenance. The end result is City funding going to services and facilities at a more grass roots level like Community Centres, Pools, Municipal Arena, Housing etc.

I posted this type of funding scenario in another thread which compares costs of new build vs reno. The below doesn't even include the current operations subsidy which should be eliminated as part of a new venue agreement.

For example

New build
City Contribution = $85M up front
Land Sale proceeds of current arena= ($10M)
Net cost to City= $75M
Maintenance cost covered by the operator of the arena

Existing Arena
City Contribution = $50M for deferred maintenance within 5 years
City Contribution = $2M a year for annual maintenance over the next 25 years(based on current maintenance)
Total City Contribution = $100M

Difference between two scenarios = $25M

king10 raises a good point. People often forget about operating and maintenance costs. They're a key point to this and should be factored into the debate about whether capital spending is best allocated to reno/revamp FirstOntario Centre or invested in a new building.

And numbers for a convention centre and adjoining commercial/residential on the FOC site must be included as well.

This is a complex proposal. Even if Andlauer's idea takes flight.

As Ernst & Young projects that a new private-public facility could be operating within four or five years, if we assume that FOC will be operational between now and 2024, that $50M bill for deferred maintenance will be borne by the City under both scenarios.

There must be components that could be dropped though, if not needed to preserve the building until a new one is ready.

E.g., I recall talk about a new roof being needed. Is that part of the $50 million? The replacement cost can probably be avoided or reduced to cover critical rehab to last the 5 years.

The deferred maintenance would not be undertaken at the current facility if an agreement is made on a new facility. The current facility would be "run to failure" with duct tape repairs. You aren't going to sink $50M in deferred capital maintenance for a facility which will close within 4 years. The only reason you do that is if you're sticking with the building for another 25 years.

Direct exeprt from the EY Report.

Capital investment, we understand, is imminently required to ensure the on-going useful life for the next 25 to 30 years.

In order to achieve the on-going operation of these facilities for the next 30 years, capital investment requirements previously discussed in Section 2.4 of this report have beenincorporated from 2019 – 2024.

You'll see the cap maintenance is required in 2019 to 2024 to extend the useful life by 30 years. If a new arena is ready in 2024, that money is not being spent.

Furthermore the report states

As lifecycle maintenance is not expected to greatly improve energy efficiency, the on-going municipal utility subsidy of $1.2 million has been assumed to remain over the forecast period.

So this lifecycle capital maintenance will NOT improve energy efficiency, and will NOT reduce the utility subsidy of $1.2M the City provides the operators. So when comparing keeping the old facility and undertaking capital maintenance(not capital improvements), the old facility will be less energy efficient and still require an operating subsidy from taxpayers, whereas the new facility would not.

Also if there is a new facility, my preference would be to 100% keep it downtown.

Gotcha. Makes sense.

So aside from the $4.3 million in capital expenses that they've just absorbed on FOC (which Clr Farr made sound like a legal obligation under AODA), the expectation is that they'll spend nothing more on FOC (aside from the $2M in annual maintenance).

At least until they reach a decision on the arena's size, location, budget, and funding.

The operating subsidy is another issue entirely, and on that count I must confess that I'm not as optimistic as E&Y. Council's current operating agreement with Spectra incentivizes mediocrity, and history suggests that council is capable of driving Costanza-grade deals.

You could also add an opportunity cost for the land the new arena is built on, i.e. what the city could earn if it was sold and then generated development fees and property taxes. That is assuming it would be built on city owned land.

Also, that all operations and maintenance costs will be covered by a private operator over the next 25 years is a big assumption. Is that the case for Tim Hortons Field? Have the Bulldogs and/or Global Spectrum committed to cover these? $1.2 million doesn't sound egregious to maintain a facility hosting international touring acts as well as multiple sports. Would the cost of maintaining a new facility be that much closer to zero?

I dont think that is the case for THF. The economics for an outdoor stadium vs indoor arena in canada are night and day. Arenas can make money, not stadiums.

The subsidy is for the most part utility costs. The new arena would be smaller and energy efficient negating the need for the subsidized utility costs.

Also it appears some councillors are not on board with continuing to subsidize global spectrum, a billion dollar entertainment company when the city has so many other funding pressures. I think the original Council motion was to “divest” itself of the arena. So theyre looking for someone to essentially run the place on their own dime.

I thought it was part of Global Spectrum's pitch to eliminate the operating subsidy over the course of several years, by bringing more events to the arena and making it profitable. Of course that would have been entirely non-binding.

Probably the same type of deal like they have in London where they are on the hook for any operational deficit. Which they haven't had in the 17 or so years they have operated Budweiser Gardens, and actually give money to the city every year.

E&Y's breakdown (from page 116 of its report) combines the two Spectra facilities. The subsidy is shared between First Ontario Centre and First Ontario Concert Hall, with operating losses accruing mainly to the latter (if I read this correctly).

Status Quo Option - Operating Forecast

First Ontario Centre (2018 Actual)
Total Revenue: $3,347,231
Indirect Expenses: $2,897,194

FirstOntario Concert Hall (2018 Actual)
Total Revenue: $1,488,334
Indirect Expenses: $1,914,638

Net Operating Income (Loss) $23,733

Management Fee: -$450,000
Net Loss Subsidy: -$278,480
Utility Subsidy: -$1,200,000

Net City Proceeds: -$1,904,747

There are no plans to replace First Ontario Concert Hall at this time.

Not sure how the recent motion amending the operating agreement fared, but it gives you an idea how the City has structured the arrangement

Andrew Dreschel: Renovation option elbows its way into arena debate
10,000-seat arena too small for growing city like Hamilton

https://whttps://www.thespec.com/opi...-arena-debate/

A third option besides building a smaller arena downtown or on the Mountain is elbowing its way into the ongoing arena debate.

Why not renovate the aging FirstOntario Centre (FOC) instead?

City staff is currently exploring private sector interest in building a new 10,000-seat arena in the core, while simultaneously looking at the feasibility of Hamilton Bulldogs owner Michael Andlauer's proposal to partner on a smaller facility at Lime Ridge Mall.

But Coun. Terry Whitehead argues the city also needs to take a serious look at doing a major overhaul of FOC, noting that the renovation option has never formally been taken off the table.

Whitehead believes Hamilton is too big a city to quietly settle for the kind of smaller venues being proposed.

"There is no future in a 10,000-seat arena in a city that's growing like Hamilton."

Enter development consultant Jasper Kujavsky, who is co-ordinating a local consortium's push to redevelop the city-owned Hamilton Convention Centre.

Speaking on his own behalf, Kujavsky argues that the 17,000-seat FOC — formerly known as Copps Coliseum — can be transformed into a state-of-the-art 9,000-seater capable of seamlessly expanding to full capacity when needed.

"The renovation gives you everything you get in a new arena but it doesn't limit you to only those 10,000 seats if you have big shows or the occasional major league sporting event," says Kujavsky.

The reno option originally stems from a 2016 report by international venue experts Brisbin Brook Beynon Architects, which Kujavsky commissioned.

That study pegged the cost of completely rebuilding FOC at $252 million. But it said remodelling the lower bowl into an 8,500- to 9,000-seat venue with premium seats, private boxes and party zone amenities could be done for about $68 million.

According to Kujavsky, when you factor in inflation and reinforcing the load-bearing capacity of the roof to handle modern rigging and drop-ceilings to create a sense of intimacy in the lower bowl, the total cost would ring in at roughly $115 million to $130 million — the same price as building a 10,000 seat arena.

The renovation option largely fell by the wayside in August when consultants Ernst & Young recommended that a new "right size" arena be built downtown to replace FOC.

The consultants, who were hired by the city to evaluate its venue needs and examine divestment options, said a smaller arena will better serve Hamilton's market needs and made more financial sense than maintaining or retrofitting the 34-year-old FOC.

The consultants pointed out that in 2018, only 13 of 98 events used the arena's upper bowl.

Kujavsky agrees that a smaller venue would serve Hamilton's normal requirements. But renovating FOC not only gives the city flexibility for hosting megashows, it keeps the door open for Hamilton one day becoming a major league city. Permanently downsizing to a smaller arena would automatically kill this city's abiding dream of landing an NHL team.

Coun. Jason Farr, who represents downtown, says he's "absolutely open" to exploring the retrofitting concept.

Farr notes, however, that a major renovation could create problems for where the Bulldogs — FOC's crucial anchor tenant — play. "Obviously they would need to be part of that conversation."

For his part, Coun. John-Paul Danko believes there's "definitely some merit" in revisiting renovation, but the driving question for him remains which arena proposal provides the best value for taxpayers.

It's hard to argue with that. Which is all the more reason why council should study the reno option before taking a wrecking ball to FirstOntario Centre.

Editorial: FirstOntario Centre reno plan worth considering
As it stands, FOC is far too big for its main uses, Hamilton Bulldogs hockey, Honey Badgers basketball, small to medium concerts and special events.

https://www.thespec.com/opinion-stor...h-considering/

It makes good sense to revisit the idea of renovating the existing FirstOntario Centre (FOC) as part of Hamilton's deliberations over our arena challenge.

As it stands, FOC is far too big for its main uses, Hamilton Bulldogs hockey, Honey Badgers basketball, small to medium concerts and special events. It needs extensive renovations. Barring some miraculous development that brings a major league team to this city, a 9,000- to 10,000-seat arena is plenty for nearly anything Hamilton needs right now.

Hence, the idea of levelling FOC, using the land for some other purpose and rebuilding a rightsized arena elsewhere downtown or on the Mountain in the Lime Ridge Mall area.

Enter development consultant Jasper Kujavsky, who argues the former Copps could be transformed into a state-of-the-art 9,000-seat arena, which would have the capacity to expand by 10,000 seats for large events. And he says it could be done for the same cost as building from scratch in another location.

Count us among the many who firmly believe Hamilton's lingering aspiration to become home to an NHL team is a pipe dream. And as The Spec's Andrew Dreschel points out, only 13 of 98 events in 2018 required the arena's upper bowl.

But that said, if we can get a fully renovated, safe and hospitable arena for the same $115 million to $130 million as a new one would cost, and maintain the current location and upper bowl flexibility, it's worth serious consideration and discussion.