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Old 07-23-2019, 12:15 PM   #521
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Originally Posted by PepsiFree View Post
That's why there is a different cost associated with being a presenting sponsor vs. a title sponsor, AFAIK.

With the presenting sponsor, you don't have a choice, you have to keep the original name but you attach yours on to it. With the title sponsor, you can call the thing whatever you want. Arena, Centre, Dome, whatever. Whatever generic "sounds good" with your corporate entity, presumably.
Yah I guess I meant is there ever a new building anymore that isn't a "title sponsor"?
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Old 07-23-2019, 12:19 PM   #522
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Design edit: add fire that shoots into the air from the roof every time the Flames score.
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Old 07-23-2019, 12:20 PM   #523
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How are you getting $8000?

150 000 000 / 41 home games / 19 000 seats = $192.55 average seat cost for the Flames to generate $150 million in ticket sales.

Which is still relatively high, but the facility fee is supposed to be also collected from Hitmen, Roughneck, and other non CSEC commercial events (i.e. concerts) which I think is part of the projected $150 million. So it is plausible IMO.
What is the expected outcome. We've been told the tax should generate $150m over 35 years and can't exceed $3m in any of the first 5 years. Assume an inflation escalator of 3% a year and start with a $2.5m number in Year 1. You end up with $2.8m in year 5 and $150m over the life of the deal. Given how well this lines up with the numbers provided to us, this is the expected outcome.


Year 1 - $2.5m in ticket tax
Year 5 - $2.8m in ticket tax
Year 35 - $6.8m in ticket tax

How do you get $2.5m in year 1 assuming a tax of 2% of revenues? Its not hard. Assume 45 nights of flames at $70 per ticket, 50 nights of low revenue sports at $11 per ticket, and 30 nights of concerts at $85 per ticket.

Flames games: $1.26m
Other sports: $0.22m
Concerts: $1.02m
Total: $2.5m

These numbers are actually super conservative and if the CSEC and City work together, there is a ton of upside for both parties.

Can the city actually make money from this venture? Yes, in theory. For example, at 100 nights of concerts and special events per year (instead of 30), the ticket tax revenue jumps to $5m in year one and the present value of the ticket tax actually becomes equal to the City's initial investment. So its unlikely, but if the city goes through a population and economic boom, its somewhat plausible that between ticket price increases and increased special events, the city could do quite well. The city also wins big if it after 35 years, the deal is renewed.
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Old 07-23-2019, 12:20 PM   #524
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The bars/restaurants downtown and on 17th hope otherwise.
Yeah and I get that. But I've also left a game at -25 in December and there's not a lot of options to head to. And if you want somewhere to eat before the game, there's almost nothing nearby.
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Old 07-23-2019, 12:21 PM   #525
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Originally Posted by Cappy
Fair point, I wasn’t looking at the “facility fee” as a ticket tax in the same way as the Edmonton deal included a straight up surcharge on all tickets specifically for that purpose.

It's basically a ticket tax, but the main difference is that this one is being used to re-coup roughly half of the city's contribution, rather than acting as a contribution itself. The $125M ticket tax in Edmonton is on top of the city's $280M contribution, while for this deal the ticket tax eats away at the city's $275M contribution.



In the end, CSEC is paying over $100M more than Katz did for the same deal on the arena itself (and not getting anything like the side benefits).
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Old 07-23-2019, 12:25 PM   #526
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Originally Posted by GullFoss View Post
What is the expected outcome. We've been told the tax should generate $150m over 35 years and can't exceed $3m in any of the first 5 years. Assume an inflation escalator of 3% a year and start with a $2.5m number in Year 1. You end up with $2.8m in year 5 and $150m over the life of the deal. Given how well this lines up with the numbers provided to us, this is the expected outcome.


Year 1 - $2.5m in ticket tax
Year 5 - $2.8m in ticket tax
Year 35 - $6.8m in ticket tax

How do you get $2.5m in year 1 assuming a tax of 2% of revenues? Its not hard. Assume 45 nights of flames at $70 per ticket, 50 nights of low revenue sports at $11 per ticket, and 30 nights of concerts at $85 per ticket.

Flames games: $1.26m
Other sports: $0.22m
Concerts: $1.02m
Total: $2.5m

These numbers are actually super conservative and if the CSEC and City work together, there is a ton of upside for both parties.

Can the city actually make money from this venture? Yes, in theory. For example, at 100 nights of concerts and special events per year (instead of 30), the ticket tax revenue jumps to $5m in year one and the present value of the ticket tax actually becomes equal to the City's initial investment. So its unlikely, but if the city goes through a population and economic boom, its somewhat plausible that between ticket price increases and increased special events, the city could do quite well. The city also wins big if it after 35 years, the deal is renewed.
What discount rate are you using to get that $5m/year for 35 years to come to the $275m PV? Or am I looking at this wrong? I did the calculation and my side and I don't even want to post what I got as an answer because it's so crazy.
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Old 07-23-2019, 12:32 PM   #527
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Design edit: add fire that shoots into the air from the roof every time the Flames score.
We do have all of this extra Oil & Gas laying about....may as well vent it...

We were the 3rd highest scoring team in the League last season so it would generate a considerable Carbon footprint.

Maybe we should consider some form of environmental Blackmail Policy?

"If you dont buy it then we burn it!"
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Old 07-23-2019, 12:32 PM   #528
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Is there really a difference?

I thought the move to <sponsor> place/center/whatever was simply to make the sponsor more prevalent as was suggested. No one is paying 5 million a year to have everyone call it the dome (or whatever name). Like how people in Edmonton call it Rogers. Thats what the sponsor is paying the money for.
Well, the sponsor is mostly paying to have the full name presented on TV and in newspaper and internet coverage - which is what the media does. You and I talking at the water cooler or on this forum don't really register.
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Old 07-23-2019, 12:33 PM   #529
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Question about the location; With the arena essentially sitting on a 1 city block area, will there be enough room for foot traffic to move in the space around the arena during large events like hockey games, concerts, etc? Would the streets directly adjacent to that block be converted to a Stephen Avenue style, where it's just for foot traffic during these times etc?
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Old 07-23-2019, 12:36 PM   #530
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Yah I guess I meant is there ever a new building anymore that isn't a "title sponsor"?
No idea. I assume most are happy to pony up the dough for full naming rights.

My main point was that it isn't the city that would be naming it "Arena" to make it easier to throw a sponsor on the front of it. The sponsors themselves will pick the entire name (including whether it's called an Arena, a Centre, etc.).

If the city bothers naming it, it'll be something original and they'll go with the presenting-sponsor route. Otherwise they'll sell the entire rights to a sponsor who can call it whatever they want.
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Old 07-23-2019, 12:38 PM   #531
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No idea. I assume most are happy to pony up the dough for full naming rights.

My main point was that it isn't the city that would be naming it "Arena" to make it easier to throw a sponsor on the front of it. The sponsors themselves will pick the entire name (including whether it's called an Arena, a Centre, etc.).

If the city bothers naming it, it'll be something original and they'll go with the presenting-sponsor route. Otherwise they'll sell the entire rights to a sponsor who can call it whatever they want.
Either way it's a waste of money IMO. What company ever got an additional customer out of naming rights? I know I didn't throw all my business to Pengrowth. Nor would I have chosen Rogers as my service provider on the basis of naming an arena if I lived elsewhere. I know getting the name out there is supposed to be worth something, but I question it.
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Old 07-23-2019, 12:42 PM   #532
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Good comparison of the old deal vs. this new deal: https://www.cbc.ca/news/canada/calga...deal-1.5221185
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Old 07-23-2019, 01:07 PM   #533
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Question about the location; With the arena essentially sitting on a 1 city block area, will there be enough room for foot traffic to move in the space around the arena during large events like hockey games, concerts, etc? Would the streets directly adjacent to that block be converted to a Stephen Avenue style, where it's just for foot traffic during these times etc?
I guess it depends on where the majority of parking is located; I think, ideally speaking, they would need to add parking facilities on the East side of the site and route traffic on 12th toward a 5th street entrance and encourage people to use what will be the 17th ave or 25th ave to access parking in front of the big 4/grandstand. Basically avoiding vehicle access on Olympic way between 17th and 12th.
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Old 07-23-2019, 01:21 PM   #534
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Question about the location; With the arena essentially sitting on a 1 city block area, will there be enough room for foot traffic to move in the space around the arena during large events like hockey games, concerts, etc? Would the streets directly adjacent to that block be converted to a Stephen Avenue style, where it's just for foot traffic during these times etc?
12th avenue likely won't be since it's a major traffic route and there will be a new underpass on 5th street so expect that to align to back of house and access to parking and the parkade.

The west side (Stampede Trail) will be part of the public plaza and you'd have to think that will be pedestrian only during events.
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Old 07-23-2019, 01:26 PM   #535
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Yeah and I get that. But I've also left a game at -25 in December and there's not a lot of options to head to. And if you want somewhere to eat before the game, there's almost nothing nearby.
Agreed, there is basically nothing in close proximity to the saddledome. Seems like a huge area of opportunity for any pub/restaurant for food and drinks before and after games. Hope the new arenas has lots nearby. I've been to a Coyotes game and there is tons to see/do right outside the arena
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Old 07-23-2019, 01:35 PM   #536
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Either way it's a waste of money IMO. What company ever got an additional customer out of naming rights? I know I didn't throw all my business to Pengrowth. Nor would I have chosen Rogers as my service provider on the basis of naming an arena if I lived elsewhere. I know getting the name out there is supposed to be worth something, but I question it.
While I hate this naming business too, I’m pretty sure there’s been enough research to validate its worth to companies. These aren’t rich people getting some vanity kick out of it. These are public companies for the most part with accountability for their results.
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Old 07-23-2019, 01:35 PM   #537
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The retail businesses on the outside of the new building will pay property taxes, and the Flames will be responsible for the provincial portion of property taxes once the Community Revitalization Levy is up (since it's a City building, it obviously doesn't pay the municipal portion of the taxes at all).
This should be clarified. Any business operating out of the event centre with street frontage on any of the 4 sides will pay property tax. However it's likely 5th will be full back of house. A segment of 12th avenue will be entrances to the event centre. We'll have to wait to see what will be programmed on the 13th avenue facade.

A minute benefit of this is also that the city could extract some property tax out of a FanAttic in the building as I'd expect one at street level.
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Old 07-23-2019, 01:41 PM   #538
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It's definitely a better deal (although not perfect), but I just hate the one-week timeline to make a decision. Nothing like pushing a false sense of urgency rather than taking your time and studying/analyzing/consulting properly before spending hundreds of millions of dollars.
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Old 07-23-2019, 01:43 PM   #539
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While I hate this naming business too, I’m pretty sure there’s been enough research to validate its worth to companies. These aren’t rich people getting some vanity kick out of it. These are public companies for the most part with accountability for their results.
I don't even hate it. That said, I do know some people in the types of companies involved and I don't think the research you think would be there exists. Maybe at the big media companies but certainly not at a place like Pengrowth.
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Old 07-23-2019, 02:02 PM   #540
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How far away is the LRT green line supposed to be from the arena? Are they going to connect it somehow to it or the current line?

Also, aren't the redeveloping one of the current stations there? They might want to pause that and move it closer if possible.

Last edited by bob-loblaw; 07-23-2019 at 02:20 PM.
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