New Downtown Calgary Arena

[H.E.Pennypacker]

Originally Posted by McMurph

I don't read Nenshi's comments as being obstructionist, he's just calling it like it is and asking for careful and transparent study. The Flames' proposal as unveiled earlier this year was definitely "half-baked" -- the contrast between the scale of the project and the professionalism of the proposal was ridiculous.

The city isn't the thing that is holding this back. The scale of the project, the nature of the site and the Flames apparent desire to squeeze the public for as much as they can get is going to draw it out for a very long time. Due process demands it.

I think most of us around here saw King's presentation and plan as something that was done half-assed.

Glad Nenshi is standing firm .. There's a long way to go on this one.

[MalcolmTucker]

Yeah, the council's report and recommendations are pretty good. Need to go in eyes open. I don't think one should see any action short of cutting a cheque as being negative on the project. There is a long road ahead.

[fusili]

re: moving the team.

Sports teams have to locate in cities where there is a market for their sport. We aren't building any new cities in north America and Calgary is a good hockey market (ranked 13th I believe). The NHL expansion into SunBelt cities was pretty much a failure. There is a reason the largest markets are in large northern cities (Toronto, NYC, Montreal, Chicago, Vancouver, Boston, Philly, in that order). Yeah, someone will leave the 13th largest NHL market to relocate to where, Oklahoma?

[tomthumb2]

Originally Posted by fusili

re: moving the team.

Sports teams have to locate in cities where there is a market for their sport. We aren't building any new cities in north America and Calgary is a good hockey market (ranked 13th I believe). The NHL expansion into SunBelt cities was pretty much a failure. There is a reason the largest markets are in large northern cities (Toronto, NYC, Montreal, Chicago, Vancouver, Boston, Philly, in that order). Yeah, someone will leave the 13th largest NHL market to relocate to where, Oklahoma?

After what happened in Winnipeg and Quebec City, I wouldn't rule anything out. Cities like Seattle, Kansas City, Vegas and even Quebec City have new arenas or are planning to build them.

I'm not saying the Flames are going to move but it's not an impossibility either. Flames and the city need to get on same page soon though, or this is going to drag on forever and then that relocate conversation may just come up.

[suburbia]

Originally Posted by MalcolmTucker

In any case, the Flames are putting in $450 million plus operating in the proposed model.

How do you figure $450M? I thought it was $200M. $250M would be from ticket purchasers to repay a multi-decade no interest loan from the city, in addition to the city coughing up that additional $1B to implement completely including land cleaning and modest road adjustments. Regarding Flames covering operating, what would the rent be on a billion dollar facility, or are they wanting that waived also, in effect, a massive operating budget subsidy forever?

[MalcolmTucker]

A ticket tax lowers the price the flames can charge for events and still sell an optimum number of tickets. Customers pay the ticket tax, but the Flames bear the economic burden of it. The tax can always be set at a level so it covers the financing costs.

[artvandelay]

Originally Posted by suburbia

How do you figure $450M? I thought it was $200M. $250M would be from ticket purchasers to repay a multi-decade no interest loan from the city?

This has been explained several times, but I'll do it again.

The market will only bear a certain price for hockey tickets, based on your typical supply and demand factors. Tickets will be set at this price regardless of whether a ticket levy exists or not. Hence, it is wholly a contribution by ownership.

The terms and source of this loan have not been decided, given how early we are into the process. As stated at the initial press conference, this could be a commercial loan or it could be sourced from the City (likely at the ACFA rate). I'm not sure where you heard that that a no interest loan is being asked for.

[Fuzz]

So why do they need to call it a "ticket tax" if the ticket prices aren't going to change?

[MalcolmTucker]

Originally Posted by Fuzz

So why do they need to call it a "ticket tax" if the ticket prices aren't going to change?

Keeping it out of the flames hands means no GST on it, no income tax. By rolling it in, you'd have to charge rent on the stadium, and pass it through, with all the problems that causes.

[artvandelay]

Originally Posted by MalcolmTucker

Keeping it out of the flames hands means no GST on it, no income tax. By rolling it in, you'd have to charge rent on the stadium, and pass it through, with all the problems that causes.

Also, it would be included in hockey related revenue for NHL salary cap purposes. I believe this is why financing has been structured this way for new arenas in the recent past.

[MalcolmTucker]

Good point! Hadn't considered that.

[Socguy]

Originally Posted by suburbia

How do you figure $450M? I thought it was $200M. $250M would be from ticket purchasers to repay a multi-decade no interest loan from the city, in addition to the city coughing up that additional $1B to implement completely including land cleaning and modest road adjustments. Regarding Flames covering operating, what would the rent be on a billion dollar facility, or are they wanting that waived also, in effect, a massive operating budget subsidy forever?

If they follow the Edmonton model which I expect they will try, they're just counting the rent they would otherwise pay to use the facility as their 200M contribution.

[MalcolmTucker]

I assume that the capital contribution is like up front rent. They get free rent from the city right now.

[Socguy]

Originally Posted by MalcolmTucker

I assume that the capital contribution is like up front rent. They get free rent from the city right now.

I wouldn't assume that. It's one of the things that will need to be hashed out in negotiations if the project proceeds.

[MalcolmTucker]

Not that it really matters in the end of the day. The issues with the ticket tax and capital contribution are tiny compared to the CRL, environmental cleanup and field house.

[suburbia]

Originally Posted by artvandelay

This has been explained several times, but I'll do it again.

The market will only bear a certain price for hockey tickets, based on your typical supply and demand factors. Tickets will be set at this price regardless of whether a ticket levy exists or not. Hence, it is wholly a contribution by ownership.

The terms and source of this loan have not been decided, given how early we are into the process. As stated at the initial press conference, this could be a commercial loan or it could be sourced from the City (likely at the ACFA rate). I'm not sure where you heard that that a no interest loan is being asked for.

How much will the ticket tax be - $5 per ticket? That would be 50,000,000 tickets with zero interest, but with interest, maybe double that. How many seasons to cover off 100,000,000 tickets?

[PPAR]

To address your question: 50 000 000 tickets / 20 000 seats in arena / 42 NHL home games = 59 years to collect at 0 interest! Of course there would be other events, but I would suggest that the ticket tax needs to be substantially more than $5.

[MalcolmTucker]

Further back in this thread we went into how many events would have to happen. The below also doesn't include field house professional sports events.

Originally Posted by woychukb

I just added up the numbers in the link you provided plus the attendance for the Flames/Hitmen/Roughnecks vs. Oilers/Oil Kings/Rush in the last season and the Saddledome has a higher attendance for 2014/15:

Hitmen Regular Season   304,649
Hitmen Playoffs          63,793
Roughnecks Regular      104,785
Roughnecks Playoffs      25,570
Flames Regular          816,187
Flames Playoffs          96,445
Concert Tickets         210,727
Brier                   151,835
-------------------------------
Calgary Total         1,773,991

Oil Kings Regular       244,335
Oil Kings Playoffs       15,567
Rush Regular             59,207
Rush Playoffs            19,965
Oilers Regular          690,399
Concert Tickets         405,408
-------------------------------
Edmonton Total        1,434,881

Maybe Rexall has more events that aren't counted (such as the CFR which I couldn't find the current attendance for) but at best it's about even in the last year. 2013 may have been a different story as the Oil Kings had a good playoff run and the Flames didn't have any playoff games.

[suburbia]

Originally Posted by PPAR

To address your question: 50 000 000 tickets / 20 000 seats in arena / 42 NHL home games = 59 years to collect at 0 interest! Of course there would be other events, but I would suggest that the ticket tax needs to be substantially more than $5.

You really think fans would accept a $50 ticket tax, so that a return on loan of 10 years (including interest) could be achieved??? Guess that's why the sports group wants the city to back that loan, eh'?

[Sands]

Originally Posted by suburbia

You really think fans would accept a $50 ticket tax, so that a return on loan of 10 years (including interest) could be achieved??? Guess that's why the sports group wants the city to back that loan, eh'?

People will pay for even $50 tax if Flame doesnt —.