Quote:
Originally Posted by Wormius
From my understanding, “owning” the building was what CSEC wanted. I might be wrong here, but the CSEC basically wanted none of the risk associated with owning the building, but all of the rewards and profits from any event held there and more as part of their proposal. That seems hugely inequitable. Why would the City take a deal like that? I would be okay with the City paying for the arena as long as the City made money of it, not this “trickle down” stuff that the CSEC was peddling.
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They wanted the same deal most American teams have conned out of their counties and cities, and what Katz got in Edmonton. Always what it comes down to.
Quote:
Originally Posted by GioforPM
They don't want to own it, just lease it. That's the same as the present situation. However, the lease they would take on puts pretty much all risk on the lessee, CSEC. For example, CSEC had to cover all the cleanup after the flood. CSEC would be liable for any accidents in the premises. CSEC covers all the maintenance, utilities, security, etc. It's a triple net lease.
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Yes, the operator of the arena is in charge for the operational costs associated with the arena. That isn't taking on pretty much all the risk. What's their risk when the lease is up? Zero. They get to walk away from a building that becomes valueless if a new arena is built, letting somebody else take on the risk of demolition and redevelopment of the land. They didn't have to pay property tax on the building that would have been more than their lease payments and didn't have to finance construction debt. This is pretty good risk most business owners could only dream of having.
Financing the arena and taking on the cost of ownership, now THAT would be risk. Which is what the Leafs, Habs, Canucks, and Senators have had to do.