Funding plans for new Saskatoon Arena

Image: City of Saskatoon

Canada’s Saskatoon City Council is mulling the city administration’s proposed funding plan for a new downtown arena and associated entertainment district.

CBC News said a positive decision would be a “monumental step” toward constructing the proposed $1.22 billion Downtown Event and Entertainment District.

If approved, the city would be able to put the finishing touches on the financial blueprints to have the project “shelf-ready” if provincial and federal money becomes available.

Saskatoon is the largest city in the Canadian province of Saskatchewan. It straddles a bend in the South Saskatchewan River in the central region of the province.

The arena itself is designed with 15,900 seats, which could expand to 18,000. The footprint will be 624,000 square feet, which is slightly smaller than T-Mobile Arena in Las Vegas, which has an overall size of 650,000 sq. ft.

There will be a variety of suites, boxes, and premium seating throughout the arena.

The city highlighted that the proposed arena plan would come with no direct property tax increases for residents.

Dan Willems, Saskatoon’s director of technical services, transportation and construction, said, “Council has the power to make whatever decision they determine, but I would say if the funding plan is seeing the revenues that it is expected to, that should be a non-issue.

“The estimated costs are felt to be conservative and further work will be done to attempt to reduce the capital costs.”
 
The city said it will not begin planning construction until the project is fully funded. If it is, the city expects construction to take about five to six years. The breakdown of costs is:

• Event centre/arena – $632 million.
• TCU Place convention centre renovation and expansion – $221 million.
• Sir Buckwold Theatre renovation – $52 million.
• Initial infrastructure improvements, parkade and land assembly – $254 million.

 
Saskatoon city council will meet to vote on the project on August 28.

The city’s plan is to fund about 27.5 to 33 per cent of the project itself, with a 30-year debt repayment plan, and depend on the federal and provincial governments to pay for the rest.

The city is expecting to pay about $354 million to $424 million in current dollars, without inflation, if the downtown arena project moves ahead.

Clae Hack, the city’s chief financial officer said, “We’ve been relatively conservative in our assumptions, knowing that we don’t want to be over optimistic at this point and then run into a significant financial challenge 20 or 30 years down the road.”
 
CBC News further stated that the city has outlined seven funding streams estimated to bring in about $602 million to $777 million over 33 years:

• Private partner contributions – a one-time $20 million injection and approximately $150 million over 25 years from revenue sharing.
• Accommodation funding contributions – $5.7 million per year.
• Amusement tax – $1.4 million per year at existing facilities and $1.8 million in the first five years of the new facility.
• Parking revenues – $572,000 each year until the new facility is open, then an estimated $1.26 million per year in the first five years following its opening and more as time goes on.
• Tax incremental financing (TIF) – $66.6 million to $241.4 million over 30 years.
• Property realized reserve contribution – $30 million one-time funding.
• SaskTel Centre reserve contributions – $5 million one-time funding and estimated $500,000 annual funding for the first six years.

 
The city is working on an agreement with OVG360, a venue management company that specializes in sports, live entertainment and hospitality, according to its website.

In Saskatoon, the vision for a Downtown Event & Entertainment District is anchored around the new event centre/arena and convention centre made accessible to everyone through the future Bus Rapid Transit (BRT) system.

The area will be developed sustainably and with a focus on Indigenous placemaking. By offering residents and visitors a gathering place for entertainment and events, with a variety of restaurants, venues, shopping and nightlife, Saskatoon’s Downtown will become an economic driver for the city and the province.

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