Arena Negotiation Discussion v2

[Parallex]

Originally Posted by GioforPM

Well, the city (especially the mayor) has placed an emphasis in trying to move population inward, and, more specifically, in that area. I do suspect a lot of businesses would set up there that wouldn't in any old area. Suburban areas aren't as attractive for restaurant/bars, etc.

But there won't be any additional population due to the arena... there won't be additional people requiring a place to live because the Saddledome gets replaced (so the residential market is unchanged). Likewise people aren't going to set their money on fire if they can't spend it two blocks away from the Saddledome... that's $ that they'd just spend elsewhere (so again it isn't generating additional income city wide it's just moving it around).

If I take $2.00 out of my right pocket and put it in my left pocket I'm not $2.00 richer.

[GioforPM]

Originally Posted by Parallex

But there won't be any additional population due to the arena... there won't be additional people requiring a place to live because the Saddledome gets replaced (so the residential market is unchanged). Likewise people aren't going to set their money on fire if they can't spend it two blocks away from the Saddledome... that's $ that they'd just spend elsewhere (so again it isn't generating additional income city wide it's just moving it around).

If I take $2.00 out of my right pocket and put it in my left pocket I'm not $2.00 richer.

I'm not convinced about the "spend it elsewhere" argument. Especially in the early phase of a new venue. There's a third alternative, which is simply to not spend the money. I guess it gets spent much later, but that's not really the point of the argument.

If I can't go to a hockey game or a concert I'm not automatically choosing some other live entertainment. I'm probably on the couch. Or in Vancouver or Edmonton to watch the concert I wanted to see.

[RM14]

Also, there is economic increase by drawing in spenders from Southern Alberta or out of province. An arena/concert center with an NHL team & big name artists absolutely brings additional out-of-towners' and tourists who would not otherwise come to the city and spend entertainment dollars.

[Strange Brew]

I hope this EY report specifically addresses the whole concert issue, how many new concerts a year, and what the economic impact would be.

[Parallex]

Originally Posted by GioforPM

I'm not convinced about the "spend it elsewhere" argument. Especially in the early phase of a new venue. There's a third alternative, which is simply to not spend the money. I guess it gets spent much later, but that's not really the point of the argument.

It's the point of my argument. The money will get spent... it just won't get spent in that particular part of the city. It won't generate much in the way of surplus economic activity for the local economy as a whole and likely not pay back the municipal government's investment barring some kind of miraculous lease agreement with CSEC based on their (CSEC) public posturing.

Travis is suggesting that it'll be "the closest thing to a guarantee to put millions in the city's pocket each year" but what I'm saying is that it's in actuality just going to move it from one of the city's pockets to another.

[Robbob]

Originally Posted by RM14

Also, there is economic increase by drawing in spenders from Southern Alberta or out of province. An arena/concert center with an NHL team & big name artists absolutely brings additional out-of-towners' and tourists who would not otherwise come to the city and spend entertainment dollars.

This is where I think the value will be. They estimate the Calgary stampede injects around $400 million to the Calgary area over the 10 odd days. The city coffers may not benefit directly, but the city and economy does as you get people outside the area coming in to spend money.

If you can bring half of that through extra events each year there is value to the city.

[Travis Munroe]

Originally Posted by Parallex

But there won't be any additional population due to the arena... there won't be additional people requiring a place to live because the Saddledome gets replaced (so the residential market is unchanged). Likewise people aren't going to set their money on fire if they can't spend it two blocks away from the Saddledome... that's $ that they'd just spend elsewhere (so again it isn't generating additional income city wide it's just moving it around).

If I take $2.00 out of my right pocket and put it in my left pocket I'm not $2.00 richer.

On a Friday or Saturday night there is a good chance that the wife and I might be lounging at home or go for dinner and then come home. Lets say it costs us $150.
When I go to a flames game, I have spent $150 before I enter the arena as chances are we go for dinner before hand. That flames game was directly involved with me spending 2-3x as much as I normally would have.

Anytime someone says that those people will move from somewhere else and impact another area I wonder if they think we should stop developing all together.
1) The city has said but needs to put more emphasis on building up and in, not out.
2) The population is growing and attractive cities tend to grow faster.

If we put a ban on no new people allowed to move to Calgary then yes, I get your point but when thousands of people start to move here as we snap out of this recession, they will require homes. If the city stops allowing a new community in the burbs every chance it gets then we create added demand. This demand will ensure that arena-ville as well as the areas people moved from to get to arena-ville are all filled.

[Travis Munroe]

Originally Posted by Parallex

It's the point of my argument. The money will get spent... it just won't get spent in that particular part of the city. It won't generate much in the way of surplus economic activity for the local economy as a whole and likely not pay back the municipal government's investment barring some kind of miraculous lease agreement with CSEC based on their (CSEC) public posturing.

Travis is suggesting that it'll be "the closest thing to a guarantee to put millions in the city's pocket each year" but what I'm saying is that it's in actuality just going to move it from one of the city's pockets to another.

I sort of covered this in my last post but going to a flames game = dinner, the game, drinks, possibly out after. An easy $500 night.
No flames game = going for dinner and maybe a movie before calling it a night. Roughly a $200 night.

If only 1/4 of the arena spent $300 more to make a full evening of a flames game than they would have if they didn't go to the game then we would see millions of additional spending each season from locals into local establishments.

If I save that money and don't go to the game, there is a very good chance that money is leaving the city. "Fun money" which is used for entertainment such as dinner or a flames game turns into "vacation money" or "amazon/wayfair money".

[Parallex]

Originally Posted by Travis Munroe

On a Friday or Saturday night there is a good chance that the wife and I might be lounging at home or go for dinner and then come home. Lets say it costs us $150. When I go to a flames game, I have spent $150 before I enter the arena as chances are we go for dinner before hand. That flames game was directly involved with me spending 2-3x as much as I normally would have.

Would you have literally set that 2-3x money on fire otherwise? If no then you would spend it sometime on something else.

Originally Posted by Travis Munroe

when thousands of people start to move here as we snap out of this recession, they will require homes.

Yes they will... and those homes will get built regardless of whether there is a replacement arena or not. Building a replacement arena will not increase the market size for residential property.

[MacDaddy77]

He already said he would spend it however the spend would be outside the calgary economy.

[Travis Munroe]

Originally Posted by Parallex

Would you have literally set that 2-3x money on fire otherwise? If no then you would spend it sometime on something else.



Yes they will... and those homes will get built regardless of whether there is a replacement arena or not. Building a replacement arena will not increase the market size for residential property.

As mentioned.... yes, I would have basically set it on fire as I spend it in another economy on vacation.

If the mayor is serious about the platform he ran on, then no, those homes won't be built with as much ease as in the past. It used to be easy to throw another thousand homes up and push the city outward. Should the mayor put his money where his mouth was, stop the sprawl and force inner city development. The vacancy in vic park and ev is beyond gross right now. A new arena announcement most likely sees that vacancy disappear before the arena is even built.

[Parallex]

Originally Posted by MacDaddy77

He already said he would spend it however the spend would be outside the calgary economy.

I didn't see that while I was writing but my response would be to call balderdash... he's gonna say he knows with perfect clarity what he would spend hypothetical money on? Sure. He would almost certainly spend the money local v. non-local in roughly the same % that he does now.

Originally Posted by Travis Munroe

The vacancy in vic park and ev is beyond gross right now. A new arena announcement most likely sees that vacancy disappear before the arena is even built.

Sigh... you don't need an arena to build residential. Period. If you could build residential in the EV with an arena then you could build residential in the EV without an arena. An arena doesn't affect market need for residential.

[Boreal]

The economics of this debate can be set up to reinforce the perspective any person has on the issue. The bigger issue is that the arena, and the Flames, are part of a bigger piece of Calgary, and city building in general.

The economics are essentially a wash, what this is about is placemaking and building something that leverages the geography of the City which both citizens and tourists frequent regularly, optimally beyond event-driven scenarios.

City building is not easy, it involves risk, but... when it works it creates places that are worthwhile and really priceless.

If someone thinks the whole area is fine as is, or we don't need an entertainment district, or even a new arena... fine... you're entitled to hold that perspective.

But that is the kind of perspective that does nothing.

I know this because I lived in Saskatchewan for 35 years where they only initiate projects when they have no other option or when there is maximal reward with minimal risk.

Bargain hunting 101.

Calgary is built on an entirely different way of entrepreneurial thought.

[IamNotKenKing]

Originally Posted by Parallex

I didn't see that while I was writing but my response would be to call balderdash... he's gonna say he knows with perfect clarity what he would spend hypothetical money on? Sure. He would almost certainly spend the money local v. non-local in roughly the same % that he does now.

But it's not balderdash. I am in the same boat. I am not going to increase my spending on other stuff within the city with the Flames gone. It will be road trips and vacations. There is nothing in the city I don't do now that I would increase spending on. Dinners out would be significantly cut, as many of those are pre-game dinners.

[GioforPM]

Originally Posted by Parallex

It's the point of my argument. The money will get spent... it just won't get spent in that particular part of the city. It won't generate much in the way of surplus economic activity for the local economy as a whole and likely not pay back the municipal government's investment barring some kind of miraculous lease agreement with CSEC based on their (CSEC) public posturing.

Travis is suggesting that it'll be "the closest thing to a guarantee to put millions in the city's pocket each year" but what I'm saying is that it's in actuality just going to move it from one of the city's pockets to another.

By "much later" I mean decades. And almost certainly outside the city.

[powderjunkie]

Originally Posted by Travis Munroe

I get that many don't want tax payers paying for this but I challenge you to find me another private investment which is the closest thing to a guarantee to put millions in the citys pocket each year that they would not have otherwise seen.

(of course we need the people to fill said establishments which comes with not being in a recession as proven in the past)

Timing is not yet right (as you rightly mention EV vacancies), but cleaning up the West Village will be a golden goose guarantee of actual property tax revenue directly to the city (as opposed to mostly indirect economic benefits that will come near a new arena).

IMO the right timing for either project is ~15 yrs away; given the choice at that point, the clear winner in public $$ ROI (both tangible and intangible) for me would be WV.

Originally Posted by MacDaddy77

He already said he would spend it however the spend would be outside the calgary economy.

I didn't realize not having an arena (or relevant to this discussion - a new arena), meant that everyone gets more vacation days?!?!?!

The proportion of people who are self-employed might be able to re-direct hockey ticket money to an additional week-long vacation, but I think realistically most people are looking at an extra weekend in the mountains, or perhaps opting for a room upgrade on their big vacation.

Dining out on game nights isn't going to drop to zero; instead of a relatively quick meal every week or so, perhaps it probably becomes a bigger restaurant bill every 2-3 weeks. If you weren't going to hockey games as much, maybe you actually go to a different show at the Jubilee that you were otherwise on the fence about...

[TheIronMaiden]

Originally Posted by RM14

Also, there is economic increase by drawing in spenders from Southern Alberta or out of province. An arena/concert center with an NHL team & big name artists absolutely brings additional out-of-towners' and tourists who would not otherwise come to the city and spend entertainment dollars.

I agree, Tourism, although it is not the most lucrative, is still a very important part of Alberta's economy.

Tourism-related industries accounted for 127,000 jobs in Alberta in 2015, representing a nine per cent share of the total number of jobs in Alberta. Alberta’s tourism industry jobs also accounted for 12 per cent of Canada’s total tourism industry jobs.

https://industry.travelalberta.com/v...isitor-economy

[Hot_Flatus]

Originally Posted by monkeyman

I don't know if you realise this, but that area has already been kickstarted, and it had nothing to do with an arena.

It really has. If you look at it from the bow river all the way up to the stampede grounds, functionality is evolving every year within the area. There are numerous festivals with fantastic pathway, vehicle and transit access. Dining options are starting to show as above average and shopping is slowly popping up as well.....All of this with no arena. It's only going to improve as Inglewood is reconnected with the new bridge and improved pedestrian access continues as the pathways are upgraded. Other venues like studio bell, the central library, the proposed indoor food hall, new convention center, outdoor gym and urban parks only add to the sustainability of the area. Again, all without an arena.

I'd much rather have an area like this that is capable of standing on its own merit than having some shallow arena district plugged in that offers little to nothing unless you're talking Flames game day or concert. Working backwards to fit everything that actually matters around an arena is nothing more than lunacy derived from simplistic small town ideology that produces areas that quickly lose their luster due to serving only one primary function: the arena.

[Parallex]

Originally Posted by powderjunkie

I didn't realize not having an arena (or relevant to this discussion - a new arena), meant that everyone gets more vacation days?!?!?!

The proportion of people who are self-employed might be able to re-direct hockey ticket money to an additional week-long vacation, but I think realistically most people are looking at an extra weekend in the mountains, or perhaps opting for a room upgrade on their big vacation.

Dining out on game nights isn't going to drop to zero; instead of a relatively quick meal every week or so, perhaps it probably becomes a bigger restaurant bill every 2-3 weeks. If you weren't going to hockey games as much, maybe you actually go to a different show at the Jubilee that you were otherwise on the fence about...

Precisely. Everyone saying that they'll for sure only spend the newly freed up money decades later (and then only outside the local economy) is basically saying that they're going to completely defy normal human behavior.

You're gonna have this extra money and your not going to go see that movie in the theater instead on renting it on VOD? Not gonna buy your wife a nicer Christmas present? Not gonna sign your kid up for an extra activity at the rec centre? People are just going to become extravagant travelers confining themselves to the house on a night they otherwise would have gone out...

You'll pardon me if I think that's a rather unlikely scenario.

[Boreal]

Originally Posted by Hot_Flatus

It really has. If you look at it from the bow river all the way up to the stampede grounds, functionality is evolving every year within the area. There are numerous festivals with fantastic pathway, vehicle and transit access. Dining options are starting to show as above average and shopping is slowly popping up as well.....All of this with no arena. It's only going to improve as Inglewood is reconnected with the new bridge and improved pedestrian access continues as the pathways are upgraded. Other venues like studio bell, the central library, the proposed indoor food hall, new convention center, outdoor gym and urban parks only add to the sustainability of the area. Again, all without an arena.

I'd much rather have an area like this that is capable of standing on its own merit than having some shallow arena district plugged in that offers little to nothing unless you're talking Flames game day or concert. Working backwards to fit everything that actually matters around an arena is nothing more than lunacy derived from simplistic small town ideology that produces areas that quickly lose their luster due to serving only one primary function: the arena.

I agree, which is why I found how the Flames approached it last year so toxically stupid.

Stick to what you know how to do... run professional sports franchises and let developers who understand city building and placemaking build what is best for the city and in turn the Flames with their help as a partner.