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Under proposed terms to build a venue to replace the 40-year-old Saddledome, pictured, Calgary will pay $537.3-million, the Calgary Sports and Entertainment Corp. will pay $356-million and Alberta will pay $330-million.Jeff McIntosh/The Canadian Press

Calgary has resurrected plans to build a new arena adjacent to its downtown, striking a billion-dollar deal with the provincial government and the group that owns the Flames hockey team.

Alberta Premier Danielle Smith wore a Calgary Flames jersey to the announcement Tuesday and tied the government’s pledge to the outcome of the coming provincial election. Calgary will be a decisive battleground in the vote, tentatively scheduled for May 29. The United Conservative Party needs to hang on to scores of seats in the city in order to stay in power.

The City of Calgary and Calgary Sports and Entertainment Corp. have spent years haggling over a new events centre, although the province has never been part of any deal to share cost of replacing the Scotiabank Saddledome. The new price tag – at more than $1.2-billion – is roughly double that of the most recent arena estimate, which clocked in at $634-million when CSEC walked away from the project in late 2021.

In Calgary, there has never been broad support for municipal taxpayers to pick up a major portion of the tab in order to make the price more palatable to a privately-held corporation. The new proposal means taxpayers across the province will be chipping in.

Ms. Smith said Alberta’s contribution must be approved by cabinet and the treasury board before the end of summer.

“That’s why, on May 29, I’m hoping Calgarians give our UCP government a clear mandate to proceed with this arena deal,” she said.

Under the proposed terms, Calgary will pay $537.3-million, or 44 per cent of the total cost. CSEC, which is led by billionaire Murray Edwards, will pay $40-million upfront, then $17-million per year (plus an increase of 1 per cent per year) over 35 years, for a present value of $356-million. Alberta will cover $330-million.

Calgary Mayor Jyoti Gondek said the price of her city’s proposed events centre escalated because the latest accounting includes elements such as transportation improvements that would be necessary if a new building emerged in Victoria Park.

“We’re not focused on a singular facility,” she said. “We’re focused on actually bringing an entire district to life and it also includes the type of improvements that people need when they’re experiencing an event.”

She added: “It’s much bigger in terms of scale.”

Calgary and CSEC resumed negotiations over an events centre last October, and days after making that announcement, Ms. Smith released a letter that said she wanted to “identify potential ways” the province could “assist” in making a deal happen. She did not indicate whether cash would be available.

The city’s leaders criticized the UCP after the government’s budget, released in late February, failed to earmark a notable amount of money to revitalization projects in Calgary’s core.

“There’s been lots of proposals about how we can assist in revitalizing Calgary, especially in the downtown area, and we felt that this would be the absolute best way to do it,” Ms. Smith said Tuesday.

While campaigning in the 2012 election as the leader of the Wildrose Party, Ms. Smith said she would not direct provincial money toward Edmonton’s arena project. At the time, the project’s budget called for $450-million and the owner of the Edmonton Oilers wanted the city to pay $125-million and “other orders” of government to chip in $100-million.

Edmonton’s Rogers Place cost $480-million, and was part of a $6-billion downtown renewal effort. The city committed $313-million to the arena, with $231-million coming from a community revitalization levy and increased parking revenue, knowing a 66-storey office tower, stores and restaurants were part of the package. While the new arena is a downtown success, some residents still fuss over the city’s contribution.

Calgary’s famed Saddledome, which was built for the 1988 Winter Olympics, turns 40 in October.

CSEC walked away from the last iteration of an arena deal in December, 2021, when it estimated the project would cost $634-million, with its share amounting to $346.5-million. This, the firm said, excluded Calgary’s $19-million request for infrastructure such as sidewalks and climate mitigation. At the time, CSEC said Calgary asked it to pay $10-million to cover that bill.

That deal’s original budget, released in late 2019, clocked in at $550-million. Calgary and CSEC agreed to split the cost, although the city estimated its share of the entire deal would be $290.4-million because it had to cover the costs tied to demolishing the Saddledome.

By July, 2021, a revised budget reached $608.5-million, with CSEC agreeing to take on a greater share of costs and pay for future price jumps. The changes also allowed CSEC to bring in its own developer in place of Calgary Municipal Land Corp., which is owned by the city. Ms. Gondek, then a councillor, did not support this version of the deal.

Negotiations previously fell apart in 2017, as the city mulled bidding for the 2026 Winter Olympics.

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