Carmen’s wants to run Hamilton’s core entertainment venues
https://www.thespec.com/opinion-stor...inment-venues/
The Carmen's Group is making a play to take over operations of all three city-owned downtown entertainment facilities, including the arena, concert hall and convention centre.
In addition to seeking the management contracts, Carmen's is also asking council for a green light to "spearhead" a local consortium to explore redevelopment options for the aging facilities.
CEO PJ Mercanti says the goal is to maximize the potential of the existing buildings while beginning discussions on how they'll look in the future.
"It's important that we start to look at the next generation of these facilities," said Mercanti. "The conversation needs to start now.'
In a letter to council members, Mercanti proposes running the venues in partnership with Scott Warren, former general manager of FirstOntario Centre (formerly Copps Coliseum) and FirstOntario Concert Hall (formerly Hamilton Place).
Warren ran both venues for Spectra Venue Management — which has a five-year operating agreement with the city — for about four years before leaving the company at the end of December.
Spectra's management contract with the city expires at the end of 2018. Carmen's already operates the convention centre. Its contract also expires at the end of the year.
Mercanti says the new offer was sparked by the recently approved motion from Coun. Sam Merulla that directed staff to explore opportunities for the redevelopment of the tired facilities — which need millions of dollars of repairs — and to investigate private sector interest in creating a sports and entertainment precinct in the area.
It also builds on a privately funded consulting report on options for overhauling the 33-year-old arena, which include a $68-million renovation and a complete $250-million rebuild.
Jasper Kujavsky, the lawyer and consultant who stickhandled the arena study, is advising Carmen's on the facilities proposal. Carmen's was one of the funders of the $240,000 arena report. Others included billionaire Ron Joyce, FirstOntario Credit Union, LIUNA and Fengate Capital.
According to Mercanti, those same players are part of an emerging consortium interested in exploring redevelopment options for the three venues.
"It's fair to say that every member of the arena study is aware and at the table with the conversation and the pursuit."
Mercanti envisions talking with the city about more amenities for the existing buildings and a "bigger conversation" around adding commercial, retail and residential components.
Merulla is excited by Carmen's proposal but says the city can't consider a potential billion-dollar redevelopment project without a competitive process. He intends to put forward a motion directing staff to talk to other potential bidders and "aggressively pursue" options.
"We need to be open and transparent and give an opportunity to everyone rather than sole-sourcing."
Mercanti says Carmen's is fully prepared to compete with other bidders. "The Carmen's Group is respectful of process and we understand that ultimately things have to happen through due process."
Merulla notes that privatizing operations of the former HECFI buildings in 2013 has already saved the city millions of dollars. He says the goal should now be to capitalize on the development possibilities with an eye to growing tax assessment and generating revenue.
Coun. Terry Whitehead agrees. He says the pitch from Carmen's underlines that the venues are at a "crossroads" regarding their lifespan and economic redevelopment possibilities.
'We haven't really tested the development community — the private sector — in regards to what there is now and what it could be. It's time to have that discussion."
Interestingly, the proposal comes fast on the heels of renewed complaints from Hamilton Bulldogs owner Michael Andlauer about the city dragging its feet on what to do with the arena.
It also lands just days after Carmen's — which operates five hospitality and entertainment businesses and employs about 400 people — publicly announced it's relocating its corporate headquarters to the downtown Hamilton City Centre from Stone Church Road East.
Combine that with Carmen's recent role in saving the Hamilton Cardinals baseball team and its financial contribution to the upcoming HAMILTON sign at city hall and you're left with the impression of an intensely local company on a strategic roll.
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