Calgary Flames arena plans go down the drain


Calgary Flames arena cancelled Image: Dialog

The owners of the National Hockey League (NHL) team Calgary Flames (Canada) say they’re ending a multimillion-dollar plan to replace the aging Saddledome.

The ‘Calgary Herald’ stated that the Calgary Sports and Entertainment Corp. (CSEC) said the growing price tag of its planned new arena, which was to have been built under a cost-sharing agreement with the City of Calgary, led the owners to conclude “there is no viable path to complete the event centre project”.

A statement sent out recently stated, “At this point, it is clear that the City and CSEC have been unable to resolve a number of issues relating to the escalating costs of the project.”

In the early part of 2021, the multimillion dollar arena deal (new arena for the Calgary Flames) between the City of Calgary (Canada) and the owners of the professional ice hockey team Calgary Flames – CSEC – hit the pause button over “a difference in the current budget estimate and the program requirements for the facility”.

The Calgary Flames are a professional ice hockey team based in Calgary (Canada). The Flames compete in the National Hockey League (NHL) as a member of the North Division. The club is the third major professional ice hockey team to represent the City of Calgary, following the Calgary Tigers and Calgary Cowboys. The 19,289-capacity Scotiabank Saddledome in Calgary is their home venue.

The Calgary Sports and Entertainment Corporation (CSEC) is a privately-owned professional sports and entertainment company based in Calgary, Alberta, Canada, formed in 2012 and owned by N. Murray Edwards, Alvin Libin, Allan Markin, Jeffrey McCaig, Clay Riddell, and Byron Seaman.

The ‘Calgary Herald’ further stated that millions in additional costs identified by the City for infrastructure and climate change mitigation make up one of those issues, the Flames ownership said, with CSEC being asked to cover $10 million.

Separately, the project’s overall cost has increased by $25.5 million since its $608.5-million budget was approved in July 2021, the CSEC said.

The Corporation also noted a “high level of risk associated with future project cost increases” due to the impact of COVID-19, including supply chain woes and the rising price of commodities.

Mayor Jyoti Gondek first broke the news recently on social media that she spoke with Calgary Flames majority owner Murray Edwards, who told her CSEC intended to “pull the plug” on the agreement – “I wanted Calgarians to be the first to know. I am as disappointed as all of you that this is the way things are ending.”

The CSEC also expressed disappointment with the outcome of its event centre project.

The Flames owners said in their statement, “While not ideal for Calgarians nor competitively for the Flames, the people of Calgary should understand that nevertheless CSEC’s intentions are to remain in the Scotiabank Saddledome.”

Plans for the new building had already been finalized, and a development permit – one of the final steps before starting construction – was approved in November 2021.

But there are a series of conditions that have to be met before the development permit can be released. Gondek said a little less than $10 million of additional costs related to road work, public realm improvements and climate change mitigation that are a necessary part of that process have become an insurmountable obstacle.

“(Edwards) has tried his best to get his partners to keep moving forward with the event centre deal,” Gondek stated in a presser recently.

Added Gondek, “There was additional funding that had to be taken on by Calgary Sports and Entertainment Corp. It appears they’re unable to make that financial commitment, following the approval of their development permit. So it would appear that they are ending the deal.”

The City and CSEC initially signed an agreement in 2019 to split the $550-million cost of building the new event centre, as the City calls the facility, in East Victoria Park. Public money would also cover the costs of demolishing the Saddledome, while the CSEC was additionally granted options to acquire two valuable parcels of nearby City-owned land.

The agreement changed earlier this year after “budget issues” put progress toward construction on pause for several months. In the end, the cost-overruns provision of the deal was activated, which saw the City and CSEC both commit an additional $12.5 million.

The City-owned Calgary Municipal Land Corporation was removed as the project’s Development Manager so the Flames ownership group could hire someone of their own choosing, and they agreed to shoulder any further cost overruns for the new building.

Council heard in the summer cost estimates for the event centre were around $608.5 million.

That amount has since risen to $634 million, according to the CSEC’s statement, not including the additional funds for infrastructure and climate change mitigation identified in the City’s permitting process.

Gondek said it “appears” CSEC would like the City to help cover the additional costs that have been identified – “I do have to tell you that the deal that was struck in July 2021 indicated that additional costs would be borne by the Calgary Sports and Entertainment Corporation. So, according to that contract, the City can’t come back with additional funding.”

She said the City has tried to ensure that it would pay for any roadwork that’s strictly its responsibility.

The Mayor said she was “quite surprised” by the latest turn of events and she can’t say what might happen next. She added the City will have to “unpack” any legal implications – “I know our administration is incredibly dedicated to this project as well. Unfortunately, the brakes have been put on it.”

The Calgary Municipal Land Corporation (CMLC) strengthens connections between people and the places they share, its passionate approach to elevating the urban experience infuses communities with new energy and the confidence to build, grow and believe.

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