Central arena would anchor a new Edmonton core
Graphic supplied/For MEtro Edmonton
A new $450-million arena complex must be built in downtown Edmonton, but it’s "highly probable" that all levels of government and the private sector will have to make contributions, says a long-awaited report on the feasibility of such a project.
The report was unveiled moments before Mayor Stephen Mandel delivered a speech to the Downtown Business Association on his 30-year vision of downtown.
Mandel called for the arena to become part of a "broad, integrated downtown vision," citing there is an "abundance" of room in the inner-city to be redeveloped.
"It’s clear today that this deal can work as part of an overarching revitalization effort," he said.
The arena report, authored by a nine-member panel, suggests a downtown location could spur redevelopment on land currently vacant or used as surface parking lots.
Complete private financing isn’t a viable option because it would limit the city’s ability to influence the development of the project, the report reads.
Businessman and committee chairman Lyle Best said they studied six downtown sites as options to replace the current Rexall Place with an 18,000-seat arena, but they won’t be releasing the exact locations to prevent land speculation.
"We say it must be downtown because it’s the only financial model that works," he told reporters yesterday.
The Oilers and Northlands, a city agency that manages Rexall, do not generate enough revenue to offset the enormous costs of construction, he said, while the appetite for private development outside the downtown core is limited.
An arena could therefore be paid for by attaching a redevelopment zone that will raise part of the needed financing through borrowing, he said.
Local billionaire Daryl Katz, who is expected to officially purchase the Oilers in June, has already pledged $100 million toward a downtown arena.
The committee expects another $35 million to be raised privately, leaving $315 million to be funded through a new levy for the arena district or through government contributions.
Mandel reiterated yesterday he won’t accept any property tax or grant allocations to be funnelled toward the arena project.
Financing the arena could be provided by ticket surcharges and grants already given to Northlands, he said.