from today's T&T:
http://22864.vws.magma.ca/index.php?&article_id=11208
Events centre to spur growth: studies
Tuesday, June 11, 2013
Times & Transcript
By: Brent Mazerolle
Downtown centre construction could have $340M in impacts; could help reverse decline in downtown
A proposed multi-purpose downtown events centre in downtown Moncton would create hundreds of jobs and millions of dollars' worth of economic activity durÂing construction, and then be an important catalyst for growth in the city's most critical neighbourhood for years to come.
Université de Moncton economist Pierre-Marcel Desjardins and economic development consultant David Campbell presented a pair of studies at a special public meeting of Moncton city council yesterday afternoon, one week ahead of a council meeting at which council is expected to vote on whether or not to buy the Highfield Square property.
The city has an option on the 11 acres of land and has identified it as the site for the centre if the project goes ahead.
Desjardins focused on the more easily quantifiable impacts construction of a presumed $105.4-million project would have, while Campbell looked at the broader impacts and set the context.
That context is a bit troubling, as it turns out.
Campbell, noting that the downtown encompasses just 1.5 per cent of the city's land area but represents 14.4 per cent of the city's tax revenues, demonstrated how it is growing stagnant despite the more than 800 businesses and 18,000 people working there.
There is now 350,000 square feet of vacant office space in downtown. The vacancy rate has risen from 6.6 per cent in 2011 to 13.5 per cent in 2013.
Meanwhile, the number of people living downtown dropped by 3.3 per cent between 2006 and 2011, even as the population of the city overall has grown almost eight per cent. That's likely because downtown residents are older than the average population. By contrast, Halifax's downtown grew almost 10 per cent in the same period.
Neither consultant suggested an events centre alone would bring more and younger residents downtown, but Campbell said it would be a catalyst to a vibrant downtown. He did note London, Ont. saw its downtown population grow 30 per cent after the Budweiser Gardens, and the other related elements of London's downtown revitalization strategy, were built.
'You have to look at the centre as part of a broader strategy for downtown,' Campbell said. 'To think of it as a panacea is a big mistake.' Saying there was always going to be a risk in spending public funds to encourage private development, Campbell said if the city uses four of the 11 acres for the centre itself, private development on the other seven acres could pay the mortgage on the centre in increased property taxes.
He suggested that the development the centre would encourage over a three- to five-year period could create land valued at up to $200 per square foot, though he admitted that figure was probably a bit higher than was realistic.
Nevertheless, he said the actual figure would be far above the $10 per foot the land currently commands as surface parking in a city glutted with surface parking.
With the abandoned shopping mall at the western end of downtown actually having the potential of bringing down other property values in the area, there is risk both in doing something with the land and in doing nothing.
'You've grown 30 per cent since the Coliseum was built. That's pretty impressive,' Campbell said, comparing Moncton to a baby quickly outgrowing its diapers and needing to decide what it wants to be when it grows up.
Apologizing in advance for what he called 'hyperbole,' Campbell told council, 'you have to decide, 'are you a big Miramichi or a small Calgary?' ' Meanwhile, Desjardins said the scale of the project would have a significant economic impact both inside and outside the province when it came to construction, creating the equivalent of nearly 1,500 full-time jobs over its duration.
And while it is difficult for a layperson to grasp, Desjardins said the construction of a $105-million project would actually have $340 million in direct and indirect impacts here and in the rest of Canada.
And as Coun.-at-large Dawn Arnold first pointed out, Desjardins' findings that
construction alone would generate $10.7 million for the federal government in taxes and another $6.2 million for provincial coffers helps make a case for their funding involvement.
Desjardins also forecasted that operations of the centre would bring $242,000 per year to the federal government and $192,000 per year to the province once the centre is built.
Desjardins explained his operations numbers are low, because he included only the costs of dayto-day operations and not the tax revenues from money spent on the events that would be held there.
Of all his figures, he said, 'this is an approximation. It's a ballpark.' He did say, though, it would be reasonable to assume a five to seven per cent margin of error.