City of Calgary, Flames near deal on new arena

A negotiating team for the city has forged a "tentative agreement" with the Calgary Flames on building a new arena to replaces the NHL team's aging home rink, a council member says.

Coun. Ward Sutherland told CBC News there is a proposal ready to present to city council on Monday.

"It's not a deal at this particular point, there's still lots of steps to go through. It's really a proposal and we'll be giving an update," said Sutherland, who is vice-chair of council's event centre committee.

"Negotiations, as we mentioned a few weeks ago, had been ongoing. It's a multi-party deal, so it's very complex. It deals with the Stampede board, the Flames organization, CMLC [Calgary Municipal Land Corporation] and also the city."

Talk about a new arena to replace the Scotiabank Saddledome, which opened in 1983, has been swirling for years.

Negotiations between the city and the Flames ownership on a new arena fell apart in 2017.  

Ken King, the head of Calgary Sports and Entertainment Corp. — which owns the Calgary Flames, Calgary Stampeders and Calgary Roughnecks — said at that time the city's proposed contribution toward the arena was far short of what the team's owners wanted.

Mayor Naheed Nenshi says it'll have to be a solid deal financially for him to support it, given the city's tight fiscal situation.

"In times of limited public budgets, it's got to be a good deal for Calgary. And it's got to have that public benefit. So that is ultimately the criteria on which I would evaluate any proposed deal," he said.

The city is being represented in the negotiations by Barry Munro with Ernst & Young; the CEO of the Calgary Municipal Land Corporation, Michael Brown; and by the acting city manager, Glenda Cole.

The negotiating team was instructed to follow council's direction on a potential arena deal.

Those conditions include that any public money must be used for public benefit, and that a new arena be viable on its own while being a catalyst for the redevelopment of east Victoria Park. It's proposed to be built at 12th Avenue and Fourth Street S.E.

"I suspect that if we stay within that financial framework that I don't see why council wouldn't accept and ratify the deal later on," Sutherland said.

Sutherland says the project is much more than an arena for the Flames.

"Yes, it has an arena inside it, but it's set up for the future — we're talking about e-games, e-entertainment, virtual reality concerts, mixed use. It's quite different," he said.

"This is the future of Calgary," he said, noting that the expansion of the BMO Centre is already underway.

Sutherland said he's confident the project will be the catalyst for the whole Rivers District to take off, generating hundreds and hundreds of millions of dollars of private investment in hotels and other things.

Calgary Sports and Entertainment Corp. paid an architectural design firm in Detroit for conceptual drawings that were unveiled last year.

Sutherland said the price tag in the tentative agreement is about $600 million.

"The one thing we have always said on the events centre committee is, if a proposal comes forward, it will be presented to the public," he said.

"There's a lot of legal work that needs to get done, so even if we do come to an agreement, it's at least four months of lawyer papering until it's finally signed.

If council signs off on the tentative deal, construction would get underway some time in 2021, Sutherland said.