Council agrees to 'start fresh' on new arena deal, explore interest from partners

CALGARY -

A deal to partner with the Calgary Sports and Entertainment Corporation (CSEC) to build a new arena may have died when the calendar flipped to 2022, but city council has pledged to "start fresh" and gauge the interest of the Flames' ownership group about whether to forge ahead.

Late Wednesday night, councillors unanimously voted in favour of bringing in a third party to find out whether a new deal to build an arena can be established with CSEC. If not, the city will explore whether other parties are interested in partnering to build a new event centre.

"What we have before us now is the opportunity to work in this new environment with partners and actually strike a deal that is respectful of the fact that the economic conditions are completely different globally, including in Calgary," Mayor Jyoti Gondek told journalists Thursday.

"It's a new opportunity that unshackles us from the old arrangement," she said.

An agreement to build a new event centre was officially signed in December 2019 between the city and CSEC, with each party deciding to share the $550 million cost for the project. But the deal changed and costs eventually ballooned to around $634 million before the deal expired on December 31, 2021.

Councillors spent nearly seven hours behind closed doors Wednesday, hearing from administration about why the previous deal failed and determining the next steps. The work to find a third party to act as an intermediary will begin right away and a report is due back to council on March 8.

"We can start fresh without any kind of -- I hate to use the word -- 'baggage,' but that's really what we need to do here," said Ward 1 councillor Sonya Sharp.

The council motion states that if CSEC isn't interested in re-starting discussions to build a new arena, the city would explore whether any other parties are open to partnering to construct an event centre.

"Other cities have managed it differently. They've also got partners that are responsible for entertainment, outside of sports. So anything is possible at this point," Gondek said.

The mayor said the city could be open to a tenancy agreement for a new event centre in which a private company would step in to build and manage a new arena for the Flames. Such agreements exist in many U.S. sports markets, including T-Mobile Arena in Las Vegas, owned by AEG, and Climate Pledge Arena in Seattle, owned by Oak View Group.

CSEC has not yet responded to a request for comment on the new developments.