Regional Municipality of Wood Buffalo
Sports and Entertainment Centres
November 19, 2013
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 2
What is a Sports and Entertainment Centre
November 19, 2013
• Commencing in the early 1990’s, central and western Canada have experienced a “boom” in the construction of new, state-of-the-art multi-purpose spectator arenas and event centres
• These new facilities contain many of the same amenities and features that exist within much larger NHL buildings, including:
• luxury suites• club seat areas• restaurants• retail outlets• enhanced food and beverage / concession areas• larger concourses• wider seating• corporate hospitality areas• better advertising positions and opportunities
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 3
What is a Sports and Entertainment Centre
November 19, 2013
• The main impact of these enhancements has been to:
• enhance the in-game experience of fans and thereby increase average attendance
• provide greater revenue generating opportunities to both the main tenant hockey club and the facility
• broaden the range of other events, including concerts, family shows, other sporting events, trade shows, corporate events, community events, etc. which can be booked into facility
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 4
Sports and Entertainment Centre – Images
November 19, 2013
Interior Savings Centre, Kamloops BC
Size: 5,500 seats
Location: downtown
Date opened: 1993
Cost: $18.5 million
Lead tenant: Kamloops Blazers (WHL)
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 5
November 19, 2013
CN Centre, Prince George BC
Size: 6,000 seats
Location: suburban
Date opened: 1995
Cost: $20.0 million
Lead tenant: Prince George Cougars (WHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 6
November 19, 2013
Prospera Place, Kelowna BC
Size: 6,200 seats
Location: downtown
Date opened: 1999
Cost: $19.0 million
Lead tenant: Kelowna Rockets (WHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 7
November 19, 2013
Western Financial Place, Cranbrook BC
Size: 4,300 seats (add-on to a large community recreation complex)
Location: suburban location
Date opened: 2000
Cost: $22.6 million (cost of add-on 4,300 seat facility; total project was approximately $30.0 million)
Lead tenant: Kootney Ice (WHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 8
November 19, 2013
Save-on-Foods Memorial Centre, Victoria BC
Size: 7,000 seats
Location: downtown
Date opened: 2003
Cost: $32.0 million
Lead tenant: Victoria Royals (WHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 9
November 19, 2013
Prospera Place, Chilliwack BC
Size: 5,000 seats plus community ice pad
Location: suburban (abutting downtown)
Date opened: 2004
Cost: $20.3 million
Lead tenant: Chilliwack Chiefs (BCHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 10
November 19, 2013
Encana Events Centre, Dawson Creek BC
Size: 4,500 seats (part of larger agriplex)
Location: suburban
Date opened: 2008
Cost: $20.0 million
Lead tenant: n/a (the facility has been without a lead tenant since 2012 when the NAHL Dawson Creek Rage folded)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 11
November 19, 2013
Events Centre, Langley BC
Size: 5,000 seats (facility also includes a community centre, gymnastics centre and three gymnasiums)
Location: suburban
Date opened: 2008
Cost: $57.0 million
Lead tenant: Langley Chiefs (BCHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 12
November 19, 2013
South Okanagan Events Centre, Penticton BC
Size: 5,100 seats
Location: suburban (abutting downtown)
Date opened: 2008
Cost: $78.0 million
Lead tenant: Penticton Vees (BCHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 13
November 19, 2013
Entertainment & Sports Centre, Abbotsford BC
Size: 7,000 seats
Location: suburban
Date opened: 2009
Cost: $80.0 million
Lead tenant: Abbotsford Heat (AHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 14
November 19, 2013
Enmax Centrium, Red Deer AB
Size: 5,800 seats (currently undergoing expansion to 7,000 seats)
Location: suburban (located in Westerner Park, a agricultural fair grounds complex)
Date opened: 1991
Cost: n/a
Lead tenant: Red Deer Rebels (WHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 15
November 19, 2013
New Sports and Entertainment Centre, Medicine Hat AB
Size: 5,700 seats
Location: suburban
Date opened: 2016
Cost: $64.7 million
Lead tenant: Medicine Hat Tigers (WHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 16
November 19, 2013
Mosaic Place, Moose Jaw SK
Size: 4,500 seats
Location: downtown
Date opened: 2011
Cost: $61.2 million
Lead tenant: Moose Jaw Warriors (WHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 17
November 19, 2013
Molson Centre, Barrie ON
Size: 4,200 seats
Location: suburban (built on land donated by Molson Breweries)
Date opened: 1995
Cost: $13.0 million
Lead tenant: Barrie Colts (OHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 18
November 19, 2013
RBC Centre, Sarnia ON
Size: 5,000 seats (part of multi-pad complex)
Location: suburban (built on lands provided by Lambton College)
Date opened: 1998
Cost: $18.5 million
Lead tenant: Sarnia Sting (OHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 19
November 19, 2013
Powerade Centre, Brampton ON
Size: 5,000 seats (part of multi-pad arena and sport field complex)
Location: suburban
Date opened: 1998
Cost: $24.5 million
Lead tenant: Brampton Beast (CHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 20
November 19, 2013
Hershey Centre, Mississauga ON
Size: 5,400 seats (part of multi-pad arena and sport complex)
Location: suburban
Date opened: 1998
Cost: $22.0 million
Lead tenant: Mississauga Steelheads (OHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 21
November 19, 2013
Sleeman Centre, Guelph ON
Size: 4,800 seats (built into a former Eatons department store-anchored downtown mall)
Location: downtown
Date opened: 1998
Cost: $21.5 million
Lead tenant: Guelph Storm (OHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 22
November 19, 2013
Budweiser Gardens, London ON
Size: 9,100 seats
Location: downtown
Date opened: 2002
Cost: $47.0 million
Lead tenant: London Knights (OHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 23
November 19, 2013
Essar Centre, Sault Ste. Marie ON
Size: 4,800 seats
Location: downtown
Date opened: 2005
Cost: $25.0 million
Lead tenant: Soo Greyhounds (OHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 24
November 19, 2013
GM Centre, Oshawa ON
Size: 5,400 seats
Location: downtown
Date opened: 2005
Cost: $45.0 million
Lead tenant: Oshawa Generals (OHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 25
November 19, 2013
Rogers K-ROCK Centre, Kingston ON
Size: 5,200 seats
Location: downtown
Date opened: 2005
Cost: $46.5 million
Lead tenant: Kingston Frontenacs (OHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 26
November 19, 2013
WFCU Centre, Windsor ON
Size: 6,500 seats (part of multi-pad recreation complex)
Location: suburban
Date opened: 2008
Cost: $71.7 million
Lead tenant: Windsor Spitfires (OHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 27
November 19, 2013
Meridian Centre, St. Catharines ON
Size: 5,000 seats
Location: downtown
Date opened: 2014
Cost: $45.0 million
Lead tenant: Niagara Ice Dogs (OHL)
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 28
November 19, 2013
Proposed new Event Centre, Thunder Bay ON
Size: 5,700 seats (proposed to be developed along side a 50,000 square foot of conference centre)
Location: downtown
Date opened: 2017
Cost: $106.1 million
Lead tenant: t.b.d.
Sports and Entertainment Centre – Images
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 29
Sports and Entertainment Centre – Uses
November 19, 2013
Hockey
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 30
November 19, 2013
Other Sports
Sports and Entertainment Centre – Uses
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 31
November 19, 2013
Concerts
Sports and Entertainment Centre – Uses
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 32
November 19, 2013
Family Shows
Sports and Entertainment Centre – Uses
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 33
November 19, 2013
Other Entertainment
Sports and Entertainment Centre – Uses
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 34
November 19, 2013
Community Events
Sports and Entertainment Centre – Uses
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 35
Sports and Entertainment Centres – Financing
November 19, 2013
• Project financing of sports and entertainments generally includes a combination of:
• municipal financing (including an up-front capital contribution and / or municipal debenture)
• federal / provincial government support (grants)• community fundraising• private equity (in the case of P3 arrangements)
• Once open, operational responsibility can take the form of:• the municipality assumes all operating and financial risk• the municipality transfers a portion of operating risk to a
third party management company, but still retains all financial risk
• the municipality annually contributes a fixed amount to the building, with a private partner taking on any additional financial risk
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 36
November 19, 2013
• Examples:• Kelowna
• City contributed $6.0 million up front and guaranteed $11.0 million in project debt
• City makes fixed annual payment to private partner in return for 1,500 hours of community access per year
• Private partner operates facilities with no additional obligation to municipality
• Kingston• Project financed through a combination of municipal reserves,
debentures, provincial grant, community fundraising and donations from local businesses
• Facility operations contracted to third party operator, who has put their management fee “at risk” (i.e., if the facility does not generate the level of net operating income projected, the operator does not earn its base management fee; if net operating profits are exceeded, the operator is entitled to retain a percentage of those excess proceeds
Sports and Entertainment Centres – Financing
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 37
November 19, 2013
• Examples:• London
• City contributed $32.5 million up front and guaranteed $7.0 million in project debt
• Private partner contributed $2.5 million and is obligated to repay project debt
• Private partner operates facilities with no obligation to municipality
• Brampton• City contributed $7.0 million up front and guaranteed $15.5 million
in project debt• Private partner contributed $2.0 million• Private partner operates facilities and repays debt from net
operating income• City covers first $0.5 million of any operating loss (after debt
service), private partner covers next $0.25 million of any operating loss. City and private partner equally share any additional operating loss over $0.75 million
Sports and Entertainment Centres – Financing
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 38
November 19, 2013
• Impetus to construct new Sports and Entertainment Centres has generally arisen from three factors:
• need to replace an aged “arena” facility• desire to achieve broader economic development goals• desire to enhance quality of life factors
• Broader economic development goals include:• sports and entertainment event hosting (and attracting events
that would not previously have considered coming to the community because of its lack of a suitable venue)
• visitor attraction and increased spending by visitors attending events held at the facility; and
• incremental investment and economic development impacts resulting the siting of the facility and its ability to (a) support complementary developments in its environs and (b) support new investment by broadening the range of amenities available within the community
Sports and Entertainment Centres – Benefits
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 39
November 19, 2013
• Positive benefits which have resulted from new Sports and Entertainment Centres constructed since the mid 1990’s include:
• In Prince George BC, the CN Centre has had an “enormous beneficial impact on the community”, with positive benefits resulting from “the flood of visitors that come to town for events”.
• Kelowna BC similarly has realized significant benefits – when the facility was completed, Prospera Place was “on the outskirts of the downtown core” and “since its completion, other businesses and city buildings have popped to make the downtown something to behold”…”this venue helped a thriving cultural district develop in the surrounding area”.
• In Oshawa ON, the GM Centre is credited for producing economic spin-offs in the downtown core, attracting non-residents to the city, and for driving the “night time economy”. Moreover, with the opening of the GM Centre, the downtown commercial vacancy rate decreased from 21% in 2006 to approximately 11% by early 2011; in addition 83% of all building permits, by value, issued in downtown Oshawa between 1994 and 2011 where issued after the GM Centre opened (roughly $540 million).
Sports and Entertainment Centres – Benefits
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 40
November 19, 2013
• In Guelph ON, the City made a number of investments in its downtown “cultural infrastructure” (including the Sleeman Centre, River Run Theatre and Market Square development), projects which have proven to draw people to the district, generate higher property values, support enhanced retail economies and provide associated returns from an enhanced tax base.
• In the case of Kamloops and Victoria, their Event Centres have been noted to contribute financially to downtown businesses, providing an enhanced vitality of surrounding businesses, including restaurants, bars, specialty retail shops and have contributed to the liveability of their respective downtown cores.
Sports and Entertainment Centres – Benefits
RMWB – Sports and Entertainment CentresPricewaterhouseCoopers LLP 41
November 19, 2013
Sports and Entertainment Centre – Benefits to RMWB• In addition to the above identified social, development and economic
development benefits, a number of direct and indirect economic benefits can arise within Fort McMurray and across the Regional Municipality of Wood Buffalo as a result of the construction and on-going operation of the Sports and Entertainment Centre.
• The quantitative economic benefits include:• Spending Impacts: the impact resulting from the purchase of
goods and services• Employment Impacts: the increase in employment resulting
the purchase of goods and services• Income Impacts: the increase in personal income resulting
from increases in employment• Tax Impacts: the amount of personal income and sales taxes
(including HST, where such amounts are able to be estimated) and property tax which various levels of government could reasonably expect to receive as a result of a project’s development and operation