[News Roundup] CSEC/City arena deal UPDATED: Third Party Facilitator

[DoubleK]

Originally Posted by krazycanuck

Bring Enmax in to pay for and install the solar panels. They keep the revenue generated from the electricity and work in some sort of branding to help provide them benefit in the up front capital.

There are a lot of obstacles to Enmax doing something like that, since the City owns them and they are a party to the arena.

Someone like Greengate though, that could work.

[Locke]

I wonder if there any IT guys on CP that have ever had experience with a client or partner changing the parameters of a project on the fly?

My understanding is that everyone is a huge fan of moving goalposts. The stationary ones are just too easy to hit.

[Envitro]

Yes, it's called a Project Change Request. You capture the scope/schedule/budget change and get your stakeholder/sponsor to sign off on it. If not, it doesn't happen.

Speaking as a Project & Program Manager with 20 years experience in IT projects.

[powderjunkie]

Who would be on the hook for paying the monthly power bills? Presumably the tenant?

It's not unreasonable for the city to demand current/future thinking design specifications...if CSEC wants to design to the bare bones codes for fire exits and accessibility, they are always welcome to fund and own the project themselves...

Originally Posted by Locke

I wonder if there any IT guys on CP that have ever had experience with a client or partner changing the parameters of a project on the fly?

My understanding is that everyone is a huge fan of moving goalposts. The stationary ones are just too easy to hit.

Is it uncommon for big projects to have X Y and Z that aren't yet specified in detail, but are known to exist and will require further consultation?

[burn_this_city]

Construction always has changes happening until the final handover. Considering this was a constantly evolving rendering I doubt the final design was 100%.

This seems pretty cut and dry, the Flames can't afford to build the building in the current environment, due to cost escalation and a stipulation that they have to shoulder any increase.

They picked a handful of agreed to items in the cost they knew would seem like bull#### to the general public and used those to bludgeon the city in the media.

They want a cash injection from the taxpayers so they aren't on the hook for spiraling material and eventual labor increases. We could see 5-10% inflation in 2022 the way things are going in Alberta, compounding increases over a few years of construction and it adds up fast.

[kermitology]

Originally Posted by Locke

I wonder if there any IT guys on CP that have ever had experience with a client or partner changing the parameters of a project on the fly?

My understanding is that everyone is a huge fan of moving goalposts. The stationary ones are just too easy to hit.

Happens all the time. Sometimes it’s a change discovered during development, sometimes there’s a big shift in focus, or a plan is started and partway through you realize it doesn’t work.

In my experience the best course of action is to talk the problem through.

The reality is that this building will be like a 1000:1 return for the Flames vs the City. Ticket prices will rise as well. It only serves to put more money in the pockets of the Flames.

[BLOCKEDCAT]

As someone who works for one of the world's largest Automation and Controls companies (and we'll guaranteed be bidding on the event centre), I can say that this "climate resiliency" thing is a non-factor.

All new constructions are designed with energy efficiency and carbon footprint as a prime factor, doubly so with any government/public funded build. New buildings at the University of Calgary and City of Calgary are being built with some truly amazing technology and theory. The new MacKimmie Tower in particular has a motorized facade and adapts to the environment to provide "free" cool/heat to the building. The cost for this is amazingly low when the EROEI is considered.

Solar panels is really just an example (and its debatable as to how beneficial they really are for return on investment/space requirements), but I would fully expect the Event Centre to be built with Net-Zero Carbon in mind.

Just all sounds like posturing. I'm not worried. New building will happen, Flames aren't going anywhere.

[Brad Marsh]

Lots still to unpack here. It does sound like CSEC in the short/medium-term is committed to Calgary and the Saddledome, which buys everyone time to re-assess this, and/or time for a new ownership group to step forward at some point, if needed.

I've never understood the polar ends of the fiscal debate. The cost-share has made sense from day 1, IMO. Billionaire owners getting a big subsidy? Sure, but.....the city gets a world class event center built in their city for about half the cost. Both parties in this partnership come out as winners.

I'm executive lead on a $20M project right now, and I know that's a rounding error compared to this project, but price escalations just in the last 8 months or so have easily been 20%. That coupled with a very rocky forecast on the Canadian dollar are almost certainly the major drivers in CSEC's decision to back away.

So CSEC's decision is likely not the Mayor's fault at all, but her taking to Twitter yesterday can't have helped the situation.

[calgarywinning]

Originally Posted by Brad Marsh

Lots still to unpack here. It does sound like CSEC in the short/medium-term is committed to Calgary and the Saddledome, which buys everyone time to re-assess this, and/or time for a new ownership group to step forward at some point, if needed.

I've never understood the polar ends of the fiscal debate. The cost-share has made sense from day 1, IMO. Billionaire owners getting a big subsidy? Sure, but.....the city gets a world class event center built in their city for about half the cost. Both parties in this partnership come out as winners.

I'm executive lead on a $20M project right now, and I know that's a rounding error compared to this project, but price escalations just in the last 8 months or so have easily been 20%. That coupled with a very rocky forecast on the Canadian dollar are almost certainly the major drivers in CSEC's decision to back away.

So CSEC's decision is likely not the Mayor's fault at all, but her taking to Twitter yesterday can't have helped the situation.

Post of the thread.

[CaptainCrunch]

I just look at the dropping annual operating income since 2014 to last years $400k. Inflation or materials, questions around Canadian Curency and an organization that pays it payroll in US dollars. Supply chain issues, and yeah I can understand why the Flames have become cost increase sensitive, and if I'm wrong I'm tremendously sorry. Having new cost features added after agreement and I can see why the ownership group would stop this project. There are too many cost questions and instability around it.



Will the Flames stay? Without a new arena? We'll for the short and mid term its likely. Will a new local ownership group step in? Maybe, but the Flames owners aren't going to sell this team at a super deep discount out of the goodness of their heart, so a new ownership group is probably looking at a near billion dollar investment to buy the club and build a new facility that increases the value and viability of the team.


If lets say and its way off down the road, would the NHL move another franchise here or grant it an expansion franchise? I doubt it unless any bid to gain a team includes a Katz like deal for a new rink that's favorable to a new ownership group coming in.


Is it time to panic, curse out the owners, curse out the mayor, bemoan the potential loss of the team and all of that stuff? No, not really, we're in the both sides of the equation trying to put out their spin on the situation, we're a long way from knowing and might never know what actually happened here.



Does it matter to me, you know the Captain if the Flames play here or elsewhere. Honestly not really at all, I rarely go to games now, Hockey isn't holding my interest as much anymore. So I can casually watch the the Houston Flames or la Flames du Quebec or whatever.



But right now, this is all political theatre and BS, and at some point the two sides will return to the table, the Flames are hoping that public sentiment drives the city back to the table. Our mayor hopes her basic F the Billionaires message forces the Flames back to the table.

[Flame On]

I don't know what I've learned from this thread. Other than that if solar panels on one new building in Calgary, don't solve the climate crisis globally for good, then all mitigation efforts are worthless posturing.

[Groot]

Originally Posted by Flame On

I don't know what I've learned from this thread. Other than that if solar panels on one new building in Calgary, don't solve the climate crisis globally for good, then all mitigation efforts are worthless posturing.

I will only post this time in this thread cause I learned a while ago that either side can make grand, hyperbolic and passive aggressive statements that they feel is a "witty" way to try and demean the opposing argument. It's childish, doesn't move the conversation forward, and I think causes the opposition to dig their heels in.

Quite frankly it has no place in any serious discussion and only serves to agitate the conversation, and this thread has been way, way too full of those posts.

[The Familia]

Nothing else to say that hasn’t been said already. Quite frankly, the whole thing has been an embarrassing mess since day one. This arena should have been built 5-10 years ago. Instead everyone dragged their feet and here we are.

I’m truly at the point where I don’t care what happens. Do I want the arena built? Yes, this city needs a decent piece of sports infrastructure (we probably have the worst collection of major sporting infrastructure of any big city in North America). Do I like the arena design? No, I still think it looks like ####. Is the arena vital to the entertainment district? Absolutely. Do I care if the Flames move? Yes and no. It would be a shame if they left and I’d be disappointed, but at this time of my life, I really don’t follow pro sports much these days.

I’m not going to pick a side in this battle. I think the city and the Flames have both made mistakes and neither have bargained in good faith. All I know it it’s the citizens who are getting the short end of the stick. Hoping for a positive outcome.

[Groot]

Since everything has been repeated as nauseum, here's an angle that I haven't seen discussed (and I apologize if I missed it or did come up).

Ticketmaster.

When it comes to cost recovery, revenue etc, something that I rarely if ever see mentioned is how much Ticketmaster will make off service fees selling tickets at new Event Centre. I don't have my statistics in front of me (based off of the city and CSEC projections from earlier plans) but Ticketmaster is set to make literal tens of billions on this one location alone over the projected lifetime of the project.

A few other NHL clubs have gone to other ticketing providers, and I have a fully-fledged business proposal I had completed for a large corporation in Alberta, that CSEC actually had interest in. The corporation I prepared it for, dumb as rocks, didn't even explore it further cause they said they "weren't a tech company". That's all I'll say with my NDA even though I'm not contracted by that company anymore.

If the City and CSEC offered tickets on an in-house platform the ticket cost could go down by a fair amount as service fees are reduced, and those fees themselves actually go into operations for the Event Centre itself, or to CSEC/Calgary to repay investment.

There's a lot smarter people than me out there and I wish this was a focal point more than it has been as it has huge financial implications which could alleviate many concerns.

[The Familia]

Good post. Ticketmaster is literally the scum of the earth. How they can get away charging the fees that they do and monopolizing the entire entertainment industry is beyond me. As Groot states, there has to be a better system to lower processing fees or at least divert those processing fees back into the facility itself. Ticketmaster should not exist.

[heep223]

I have a ton of appreciation for the Flames ownership group and what they’ve done for this city. Including bringing the team to Calgary in the first place.

I’m of the belief that regardless of this whole debate, we’re due for new ownership.

[KipperFaNaTic]

If the Flames do happen to leave because of this arena debacle, would you still watch hockey? Which team would you cheer for?

[OldDutch]

Originally Posted by Groot

If the City and CSEC offered tickets on an in-house platform the ticket cost could go down by a fair amount as service fees are reduced, and those fees themselves actually go into operations for the Event Centre itself, or to CSEC/Calgary to repay investment.

There's a lot smarter people than me out there and I wish this was a focal point more than it has been as it has huge financial implications which could alleviate many concerns.

A tech solution brought to you by CSEC and the City of Calgary.

How late and over budget would that be combined with total lapse in quality and security?

[Flame On]

Originally Posted by Groot

I will only post this time in this thread cause I learned a while ago that either side can make grand, hyperbolic and passive aggressive statements that they feel is a "witty" way to try and demean the opposing argument. It's childish, doesn't move the conversation forward, and I think causes the opposition to dig their heels in.

Quite frankly it has no place in any serious discussion and only serves to agitate the conversation, and this thread has been way, way too full of those posts.

I mean I guess what you are missing is my frustration with others in this thread doing exactly what you are suggesting and me making a point about that, in a different way than you just did. Which is to single one person out.
Which is fine, you respond to a discussion as you want.

[Goriders]

If anything kills the new building it’s the endless printing of money in Ottawa.

Devalued dollar = inflation. As some have said up to 20% on projects. The owners don’t want to eat that.

It’ll be no deal or a new deal. They are just playing chicken with Gronden.