The arena deal returns to city council next week

Roughly 18 months after the project was last debated publicly, Calgary’s new arena deal returns to the chambers of city council next week to debate the existing agreement. The funding package and deal structure for the anticipated future home of the Calgary Flames is on the agenda for the July 5 council meeting, but changes to the finances aren’t expected.

The current $550 million arena deal was agreed to in July 2019 and fully signed in December 2019, with the Calgary Sports and Entertainment Corporation (CSEC) putting in $275 million to build and operate the facility and the City of Calgary putting up $290 million to build and own the facility and tear down the city-owed Scotiabank Saddledome. A provision was put in the agreement for each side to split eligible cost over-runs of up to $25 million on a 50/50 basis. The Calgary Municipal Land Corporation (CMLC), a city subsidiary, was set to act as project manager, with HOK and Dialog serving as primary designers.

The arena project was put on hold in April due to budget issues, primarily stemming from pandemic-related supply chain issues that have caused massive increases in prices for materials like wood and steel. While prices are starting to drop, and could normalize close to pre-pandemic levels by mid-2022, council will consider potential changes that Mayor Naheed Nenshi are “non-monetary” and reportedly involving changing a whole section of the agreement.

There’s some speculation, likely a product of the process of elimination, that the non-monetary changes could involve removing CMLC as project manager and giving CSEC more of a role in steering the project. CMLC has led the redevelopment of the entire East Village, including the new Central Library, and are managing the Rivers District Master Plan, including the redevelopment of the greater Stampede Park area. Even if CMLC’s role in the arena’s development changes, they’re still orchestrating much of the development occurring on all sides of the arena.

The arena was originally slated for an August 2021 groundbreaking and a May 2024 handover for operations. At this point, indications are that those dates will be shifting but the extent of the schedule changes are still unclear.

We’ll have more on this story as it develops.