A delay in approving a private partner to manage Saskatoon’s planned downtown arena and convention centre isn’t stopping city staff from moving forward with the project.
“I don’t feel that the project is on hold,” city manager Jeff Jorgenson said Wednesday during the city’s governance and priorities committee meeting.
“I feel that the project is moving forward, kind of component by component.”
Plans to redevelop an area of downtown to become the downtown event and entertainment district seemed to hit a snag Wednesday when administration opted to delay a committee approval vote on a private partner framework deal.
The deal, struck with Oak View Group (OVG360), has been part of a lengthy process for two separate councils after last November’s election had six new councillors join the fold.
The city announced a 25-year deal with OVG360 last summer, which is expected to generate up to $170 million in revenue over the course of the deal, including $20 million up front.
Oak View, a Denver-based company, manages hundreds of venues across North America — including 22 in Canada.
After announcing the deal on August 7, 2024, OVG360 representatives didn’t show up to answer the committee’s questions the following week as they reviewed details. Oak View contacted the city in October to renegotiate some changes. The deal was ultimately agreed and finalized in mid-December.
“However, at this time, it’s unknown how the current evolving economic and political landscape in North America and the world may affect progression of the agreement,” project lead Dan Willems said to councillors Wednesday.
“For example, tariffs or retaliatory tariffs could be applied that could add significant additional cost to service contracts.”
Willems told councillors committee approval is needed and nothing is finalized with Oak View Group as both sides wait up to six months to update the committee on the economic outlook.
Jorgenson attempted to ease concerns from councillors by saying the project as a whole isn’t in jeopardy, and the private partner agreement is one of eight tools that are necessary to fund the $1.22 billion project, at last estimate.
“Each of them needs to be negotiated and worked upon in order to achieve the full funding for the project,” Jorgenson said.
Those eight funding tools — ranging from a hotel tax and tax incremental financing, to event and parking charges — covers the city’s contributions.
Under the current plan, the city is looking for the federal and provincial governments to cover two-thirds of the cost while the city pays the remaining third.
A funding strategy approved last August is based on a 33-year plan that includes a 30-year debt repayment. Roughly $602 million to $777 million could be generated from the revenue tools. When adjusted for borrowing costs, the city’s funding contribution would be $354 million to $424 million overall without having to increase property taxes.
“All of them have to come together at some point, but all of them also have variability,” Jorgenson said.
While council waits for an update, Mayor Cynthia Block put her support behind the project and urged her colleagues to carefully consider doing the same.
“We know where the downtown goes, our city goes,” she said. “It’s crucially important that we weigh carefully our way forward.”
“But what is the cost if we don’t go forward with this?”
