Downtown Arena A Sound Idea...
“As long as it doesn’t cost me any money, that is.” That statment seems to go hand-in-hand with any discussion about a new arena located in the downtown core. It’s a debate that’s been floating around for years and seems to have reached a boiling point within the past few weeks or so. This follows an announcement by Northlands that refurbishing Rexall Place will cost a tasty quarter billion. Preliminary estimates on a new arena are in the $400M to $500M range. It makes good finacial sense to build a new arena, IF the price tag is in that range. However, I believe that no small amount of caution is necessary when considering this. Fortunately, Mayor Mandel has appointed a task force to study the cost impact of such a project.
A construction project of this scope would, without question, go over budget. It won’t matter what the budget will be, it will invariably cost more than anyone would have thought. Building something this big is risky. Steel and copper prices are volatile and unpredictable. One spike in the market and suddenly you’re spending another ten mil on structural steel and rebar. Or another quarter mil on electrical cable and building wire. Beyond those concerns, the big question is this: Who will build the damn thing? Who has the labour force and the financial wherewithal to execute the job? Certainly someone will do it, but there aren’t many general contractors out there with that kind of muscle. PCL is the only one that comes to mind. If you’ve only got a few players (or one player, as the case may be) bidding on the thing, guess what that does to the price? I can see many contractors walking away from this project simply because it would be too easy to lose the farm on something this size. Of course I’m no expert, but when you factor in labour issues, fluctuating raw material costs and the sheer size and scope of the job, I could see a new arena running close to a billion dollars.
Which is not to say that it shouldn’t be done. Rexall Place is a crumbling, decrepit building. Improvements must be made. If properly implemented (i.e. with new and exciting retail & entertainment in the surrounding area), the long-term financial impact of a new arena would surely outweigh any construction cost overruns (one would hope, anyways). The big question is this: Who is going to pay for it? Mandel has stated that he doesn’t want taxpayers on the hook for it, but that well-intentioned idea seems a tad unrealistic. It looks like he’s changed his tune a little, but still doesn’t want to have to dig too deeply into taxpayer’s pockets. The reality is that a project of this size can’t materialize without some form of government subsidy.
Let me go on record as being a cautious supporter of the downtown arena project. It would inject needed life into the downtown area and help to bring our fair burg up to snuff. Lets be realistic with the costs and let the taxpaying citizenry know what to expect.