SBD/May 20, 2011/Facilities

Katz: Rexall Place Should Not Compete With Proposed Downtown Edmonton Arena

Oilers owner expects Rexall Place to shut down once new arena is built
Oilers Owner Daryl Katz Thursday said that Rexall Place Owner Northlands "will do the right thing and not operate" the facility as a competitor to a proposed $450M (all figures Canadian) arena for the Oilers in downtown Edmonton, according to Kent & MacKinnon of the EDMONTON JOURNAL. Northlands officials have "repeatedly indicated they might continue holding concerts and other events at Rexall if the Oilers move out," but Katz said that "that wouldn't be best for Edmonton." Katz: "This (project) is in the best interests of the city, and clearly we can't support two arenas." Katz and the city have "reached a deal in principle on how to build and operate a 18,500-seat arena, including a 35-year location agreement." But Edmonton City Council member Bryan Anderson "warned Thursday the arrangement will be derailed unless Rexall is effectively shut down once the downtown facility opens." Anderson: "If there's no non-competition clause, I think then this deal will fall apart." Katz said, "Northlands has always said that they would do what's in the best interests of the city. The mayor has spoken and I think council has spoken, and the citizens of Edmonton have, too." Northlands Dir of Government & Public Relations Cathy Kiss said that the organization is "still waiting to see details of the proposed agreement, but a lease that can be renewed until 2049 prevents the city from forcing it to mothball Rexall." Kent & MacKinnon note the "proposed arena funding scheme includes $100 million cash from Katz, $125 million from a ticket surcharge, and $125 million from property taxes on surrounding development and other city sources." Alberta Premier Ed Stelmach "has consistently ruled out putting money into such a facility," but Katz "supports city efforts to pry the remaining $100 million out of provincial and possibly federal coffers" (EDMONTON JOURNAL, 5/20). Meanwhile, Calgary Mayor Naheed Nenshi said that he is "open to discussions with the Flames over a multi-million project similar" to the Oilers deal. Nenshi: "I've never been a huge fan of public dollars for that kind of infrastructure but I'm willing to be open-mined" (CALGARY SUN, 5/20).

OUT OF THE LOOP: Kiss said that Northlands officials "learned the Oilers -- which have been playing at the Northlands-owned Rexall since the early 70s -- were moving to a new home after picking up the newspapers Thursday." Kiss: "We're shocked. Certainly we would have hoped we would have been advised." She added that Northlands "was never consulted with about how a new arena could hurt its business." Kiss said that she is "confident Northlands can survive the blow," but noted that the organization "needs to consult with the city about what this will mean about the venue" (EDMONTON SUN, 5/20).

ISSUES TO SORT OUT: An EDMONTON JOURNAL editorial notes with Ottawa "having categorically ruled out a direct contribution, the Alberta government will be asked to ... fill most if not all of a $100-million hole in current financing arrangements." That is a "significant chunk of cash for a government with a serious deficit problem, made doubly uncomfortable by the Alberta reality that a similar sum would have to be set aside to even things up with Calgary." Additionally, "significant fine print almost certainly still needs to be worked out between the parties," and there is "no language for dealing with cost overruns." But the editorial states, "Make no mistake, major steps forward have been made" (EDMONTON JOURNAL, 5/20). In Edmonton, Terry Jones writes, "Do you think Mayor Stephen Mandel and city council, as well as Daryl Katz and his team, would have done so much work to complete the framework for a deal that will change the face and image of the city, if they were worried about the missing $100 million? ... I'm sure the mayor has assurances that if they finally managed to get the framework built, the rest of the money to top it off to a $450 million building would be forthcoming" (EDMONTON SUN, 5/20).
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Edmonton Oilers, Hockey, Facilities

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