The Calgary Construction Association (CCA) is still holding out hope that the city and owner of the NHL Flames can work out their differences and build the highly-anticipated event centre.
The organization issued a statement noting it is “deeply disappointed” that the city and Calgary Sports and Entertainment Corporation (CSEC) are at an impasse but expressed optimism that the two can work things out and move forward on construction of the centre and culture and entertainment district.
Bill Black, president of the CCA, said in an interview that a lot of time, effort and money has been spent by many parties on putting together and obtaining building permits and doing the design and development of the massive $634 million venture and it is rare for projects of such magnitude to “go off the cliff.”
Although the CSEC has stated it has determined there is no viable path to complete the project, Black is hopeful the plan can be resurrected and the two sides can return to the table to reach an agreement.
“One would like to think that there may be an opportunity for things to be revisited and rethought and discussed and there yet may be an opportunity to salvage,” he said. “But then there’s a bit of ego in there now. People have made statements, people have taken stances, people have pointed fingers at each other.”
The centre, slated for a 2.9-hectare site immediately north of Stampede Park, was planned as an anchor project in the downtown Rivers’ District that would complement the nearby BMO expansion project. The centre would be the new home of the Calgary Flames and replace the Saddledome which would be demolished.
The city’s planning commission approved the development permit and the CCA indicated it was fully supportive of the venture as it would result in construction jobs and set the city apart as a destination to live, work and play.
However, the CSEC issued a statement recently indicating it is backing out of the project because it was not able to resolve a number of issues related to escalating costs and determined there is no way forward.
Specifically, the CSEC was not prepared to fund $10 million related to infrastructure and climate costs that were introduced and insisted on by the city that are above and beyond the project’s original budget.
The CSEC was also concerned about cost escalation and the high level of risk associated with future project cost increases due to supply chain issues and commodity price escalation as a result of COVID-19.
Although the CSEC statement indicates it “has determined that there is no viable path to complete the event centre project,” Black is still hopeful.
“It’s something that I like to think could still be salvaged, there could still be a solution. We’d like to think that there could be a reconciliation of some kind and a return to the table and wiser heads prevail, but the problem is I don’t know if we’re hearing all the story.”
The real issue could be the risk of potential cost overruns as the amount of money related to infrastructure and climate is fairly small in comparison to the overall price tag of the project, said Black.
“It does sound like a fairly small amount of money to walk away from something so substantial. You definitely wonder if there are other things at play. There’s a lot going on with construction costs and lead times and there’s no denying that that is a very legitimate concern for the group to have because nobody can give any kind of assurances or indications as to what that might look like. So, that’s a legitimate concern.”
According to the CCA, the event centre is the catalyst project to lead off the culture and entertainment district within the Rivers District.
“It’s like an anchor tenant in a major development,” said Black. “You can say you’re still committed to the entertainment district but how do you make it viable without the big draw of the event centre and tens of thousands of people coming to events. That’s what all the other businesses need to see to pencil out their development and their restaurant and their bar and their facility and their residential tower.”
At stake are thousands of construction jobs in addition to the number that would be created once facilities open.
Black said Calgarians deserve better than to be told the project is over the hurdle, then find out it is not.
“This development permit could have been a challenge and there wasn’t, so it was kind of, ‘OK, it looks like we’re a go,’ and then a week later, ‘I’ve taken my ball and gone home.’
“Right now, Calgarians deserve better than to have something that was, despite its controversy, it’s importance to Calgary’s rebirth and importance to Calgary’s ability to compete and stand out on the world stage, just towed away because they fell out over solar panels and sidewalks.”
The city and CSEC agreed on terms in 2019 to build the new centre to replace the Saddledome as the home of the Flames.
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