Quote:
Originally Posted by Parallex
As is your transparent attempt to limit "comparable markets" to Edmonton and only Edmonton... Repeat after me: CSEC is not going to get the Edmonton deal. The sooner they accept that the sooner we can get an arena deal done. Calgary is not Edmonton, Edmonton is not Calgary.
Really I have zero interest in seeing my taxpayer dollars go towards seeing N. Murray Edwards "win" some asinine dick measuring contest with Darryl Katz...
Calgary Flames Revenue: $121M (Estimated by Forbes)
Calgary Stampeders Revenue: ?? (Edmonton Eskimo revenue was $23.5M so let's use that)
Calgary Hitmen Revenue: ?? (Hitmen have the 3rd highest attendance in the CHL and the team with the 4th highest... the Kitchener Rangers... pull in $6.5M let's use that).
Calgary Roughnecks Revenue: ?? (I have no idea but if we use an average ticket price of $30 x 11622 (average attendance) x 9 = 3.1M (which doesn't even include concessions).
So let's combine those 4 properties: 121 + 23.5 + 6.5 + 3.1 = 154.1M
Now... what % of that collective will see use at an arena (as opposed to a stadium)? 130.6/154.1=84.75%. So 84.75% will see no change whatsoever from CSEC moving from CalgaryNext to a solo arena project... now what is 84.75% of CSEC offer on CalgaryNext (which would house that 84.75%)? It's $381.38M... what is the CSEC offer on a standalone arena (which again will provide a venue for 84.75 of their revenues operations)? it's (if you buy the ticket tax being entirely a CSEC contribution... which I do in part but don't wholly) 275.00M. Why is there a 106.38M discrepancy between those two numbers? IMO CSEC offer on a standalone arena should start at $381.38M.
... IMO CSEC is to hung up on "the ratio". They should forget about Edmonton (because again: Calgary is not Edmonton and Edmonton is not Calgary) and negotiate based on their own (and Calgary's) economic situation.
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Forbes estimates the Flames operating income to be $18M. So if the Flames' ownership was given a $500M interest-free loan to build a new arena, and if net income were to remain relatively flat (as one may expect based on using outdated facilities) it would take 28 years of that income to pay off the loan without the ticket tax. CSEC is taking the position that the ticket tax is in part its own contribution to the effort, as increased ticket prices will result in reduced ticket sales, considering that the dome is already not selling out at current prices. The Stamps' revenue will have little to no impact, they have far fewer seats, box seats and concessions than Edmonton, have the oldest stadium in any professional football league in North America and are desperately in need of a new stadium, so they will have little to no net income (I suspect that CSEC is likely subsidizing the Stamps' operations). It is unlikely that any ownership group will be willing to foot the bill for an arena under these conditions.
You are right, Calgary is not Edmonton, in the sense that Calgary has neither a modern professional football stadium nor a modern professional hockey arena, nor for that matter a fieldhouse. But in just about every other way, Edmonton is Calgary's closest comparable, with similar tax rates, populations, attendance rates, and gross and net incomes of its professional hockey franchises. Vancouver is not comparable, with an estimated value and operating income almost twice that of the Flames.
This is not to say that the Flames will likely leave Calgary in the short term, and ownership has stated that the team will operate in the Saddledome as long as doing so is financially viable. What we will see over time with the relative erosion of income compared to every other team in the league is that the Flames will transition from being a cap team to being a budget team. There is not necessarily anything wrong with that, but fans should not expect that the Flames will be able to ice a team that is a perennial Stanley Cup contender with a budget salary structure. So, if the people of the city are happy to have the Oilers as the province's model franchise in order to save some tax dollars, well, that is their prerogative, because after all, it is their tax money, and there are certainly more pressing matters in the city than a professional sports franchise.
One could argue that times of economic slowdown are the best times for governments to invest in infrastructure, due to lower costs and the boosts these projects may offer to slumping local economies, but the numbers don't always show that there are significant benefits in doing so.
I guess I'm kind of on the fence here, I feel that having the Flames and the Stamps boosts civic pride, offers entertainment opportunities and improves the quality of life of Calgary's citizens, but I also appreciate that many people can't or don't want to pay increased property taxes in order to enjoy the benefits of having these teams. I just hope that both the city and CSEC stop being so bullheaded and start to work together to find practical solutions.
And yes, it is clear that no team is likely to get the Edmonton deal again, but I do believe that a new arena is simply not going to happen without some partnership between the team and one or more levels of government (even the new arena in Detroit, which is sometimes cited as a privately funded venture, received $324M U.S. in public funding, and has much higher revenue for ownership because it houses an NHL team and an even more profitable NBA team).