Why Scotiabank Place is in Kanata
Mon, Apr 27, 2009 12:00 AM EST
Bruce Firestone
http://www.ottawabusinessjournal.com...3800182473.php
I can't speak to the issue of what we should do with Lansdowne Park or whether a snow dump in Kanata should be the home to a new Major League Soccer team. But I can answer the question – why is Scotiabank Place (SBP) where it is?
I get asked that a lot. Why isn't SBP at LeBreton Flats, Lansdowne Park, in Orleans somewhere along Highway 174, at South Keys, at Lac-Leamy in Gatineau or right downtown – much like the Bell Centre in Montreal or the Air Canada Centre in Toronto?
All of these locations were ones we looked at from 1987 to 1989, before we decided on the current location for the then-Palladium – in Kanata along Highway 417, with its "own" interchange.
First, here are a few observations primarily from Gino Rossetti, the Detroit-based architect who was the architect-of-record for the Palladium and who pioneered the concept of consecutive rings of suites with his successful first effort at stadium and arena design, the Palace of Auburn Hills where the Detroit Pistons play. A city needs an arena site that has:
- A large horizontal surface for parking;
- A site that is not less than 85 acres and preferably 100;
- Access to a major transportation corridor;
- Access to public transit;
- A site that would allow the structure to be half in the ground and half above the surface to distribute guests more efficiently and to make the building more human-scale.
Other things on our collective wish list included:
- Access at grade;
- Double-loaded storefronts at grade so that on days when the arena was dark, there would still be life in and around the facility;
- Opportunity for architectural signage to maximize that revenue stream;
- A curtain-wall entrance that left no doubt as to how to access the arena.
Let's first look at some of the alternative sites. LeBreton Flats is owned by the National Capital Commission (NCC), which informed us that it had a (very) long-term plan for the site that did not include an arena – it was just a rink to them. The NCC felt that national priorities such as a new museum (which turned out to be the War Museum) or a new Supreme Court of Canada building would take precedence.
We also looked at the Lac-Leamy site where the Casino du Lac-Leamy is now. It's a beautiful site, next to water, close to a major highway and just five minutes from the Parliamentary precinct. Better yet, it was for sale at the time.
But there were already two NHL teams in the Province of Quebec (unfortunately, the Nordiques have long since moved from Quebec City to Denver) and the majority of our potential fan base did not want a third team headquartered there while Ontario only had one team.
What about Lansdowne Park? There were two significant issues with that choice. Firstly, there are more lawyers living in the Glebe than practically anywhere else in Ottawa. How would they and the Glebe community react to another two million visitors descending on their neighbourhood? I can tell you from hard experience – not well. The planning for a new arena might have taken years to get approved, if ever.
Secondly, the NCC would never allow OC Transpo to run buses on Queen Elizabeth Drive. Hence, the only way to get people in and out by public transit would be Bank Street. The maximum number of people that OC can run up and down Bank Street would be about 2,500 pph (people per hour). For an arena with a 20,000 capacity, it would take four hours to exit everyone from the building using buses, if you were to rely on public transit for, say, 50 per cent of our attendance.
Now that tells you something about why the ACC and the Bell Centre are downtown arenas. We could have built the Palladium on a downtown site if Ottawa had a big-time people-mover like the Metro in Montreal or the subway in Toronto. Those two systems can move between 20,000 and 30,000 pph.
But I can tell you that if we relied on buses, we would have had one sellout – opening night. After that, there would have been a fan revolt.
In fact, people coming from Orleans by car could have taken more time to get to Lansdowne Park than to get to SBP, considering the traffic issues around the site.
So why not build a big, multi-level parking garage? Well, for the reason discussed above, you can't actually park more than 7,000 vehicles vertically. Since everyone will leave at the same second the team loses in overtime to the Maple Leafs, a multi-level garage will simply not work.
So I knew we needed a site we could own, that would have enough room for 7,000 cars and 500-plus buses on one level. The soil conditions had to be right to bury half the building. There had to be room for a new interchange and there had to be more than one way to get to the site. It couldn't be imposed on existing communities who would react in NIMBY fashion.
(Communities are now being built around SBP by Mattamy, Minto, Richcraft and others, but the key difference here is that people who buy these homes are self-selecting to be near SBP.)
We looked for a long time for an appropriate site and didn't find one – the Central Canada Exhibition Association (CCEA) did that for us.
The association had thought about moving from Lansdowne Park for some time. Its board actually found the site where SBP is now; one day I read in a local newspaper that the CCEA had optioned a site of some 500 to 600 acres at Huntmar and the Queensway. I jumped in my car and drove to the Huntmar overpass, and I stood on the bridge looking east. I could see the homes of Kanata marching like ants over Moodie Hill and I knew that the CCEA had beaten me to a great site.
I silently saluted them and cursed them, too.
I told the guys at Terrace Investments Ltd., the first parent company of the Sens. We were all disappointed.
But only a couple of months later, for reasons known only to the CCEA, its board decided to release its options on these lands. By 10 a.m., Jim Steele (still vice-president of broadcast with the Sens) and I were sitting in one of the local farmer's homes drinking rye and trying to convince the family to sell their lands to us.
Fortunately, many of these fine people did. We ended up with 600 acres.
We told only a few people what we were doing – Des Adam, then mayor of Kanata and Jimmy Durrell, mayor of Ottawa and Andy Haydon, RMOC chair.
We told them and then-premier of Ontario, David Peterson, that they each had a magic wand and we wanted them to use it – private money would buy the team ($50 million) and build the building ($240 million), but we needed three things from the government. One, we needed the 100-acre Palladium site and the remaining lands (500 acres) rezoned for a major community facility and other uses. Two, we needed public monies to fund the $30-million interchange because the day the interchange was completed, it would have to be given to the Ministry of Transportation for Ontario for $2.
Three, we needed their support to sell Ottawa to the NHL.
We asked them to focus their wands on the Palladium lands and, presto, the lands (after due process) would be rezoned. The average price we paid for the lands was $12,000 per acre and we made no secret of the fact that, after rezoning, we hoped the value would increase to $112,000 per acre (lands in the area are now trading for $300,000 to as much as $546,000 per acre).
The $100,000-per-acre increase in value, multiplied by the 500 acres of surplus land we had bought and planned to resell would equal the $50-million purchase price of NHL expansion.
But we told the guys we wouldn't keep that money – we'd take it to the NHL and in return, would get a piece of paper called a NHL franchise under the NHL's "plan of sixth expansion." We would put Ottawa on the map and it wouldn't cost the City of Ottawa a dime.
We won local votes in Kanata and at the RMOC by a margin of 32 to one and obtained the agreement of the Ontario Liberal government to our three requests. Things were looking pretty good in the summer of 1990.
But for some reason, Mr. Peterson decided to call an election two and a half years early and, with a nearly impossible splitting of the vote, Bob Rae and the NDP came to power later that summer.
As a result, after we won a conditional franchise for Ottawa in December 1990, we knew that we faced a brutal Ontario Municipal Board (OMB)hearing to face off with our own provincial government who would a) not support a franchise, b) use all their power to defeat the rezoning and c) not pay for any public infrastructure.
When our lawyer told us we were losing the hearing, I decided to make a public offer – if the OMB approved 100 acres for the Palladium, we would try to keep the other 500 acres in agricultural use for a generation. This would allow the NDP, hockey fans and Ottawa to find a win-win-win solution.
But the offer was rejected by the NDP and the matter was litigated to a conclusion – the board ruled that rezoning for the Palladium could proceed. But it was silent about the fate of the other 500 acres. Plus, we would have to pay for the new interchange. Consequently, we wrote down the value of our land holdings by $50 million and took another equity hit of $30 million (the value of the interchange).
That's why we have NHL hockey in Ottawa, why other people own those lands now and why yours truly is the Entrepreneur-in-Residence at the University of Ottawa's Telfer School of Management and real estate broker and not involved in hockey or land development.
Bruce Firestone is founder of the Ottawa Senators, real estate and mortgage broker, Partners Advantage GMAC Real Estate and entrepreneur-in-residence for the Telfer School of Management.
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). I often reply with many of these same points, but I never knew the details. I like Kanata, enjoyed growing up there, but don't plan on moving back any time in the near future. Luckily, we have the option to put a stadium in the centre of the city this time and all signs point to us going ahead with it at this point.
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