City council has approved an agreement framework between the city and the Katz Group to build a new downtown arena.

The framework sustains NHL hockey in Edmonton for 35 years, supports downtown revitalization and limits the city’s risk, the city said in a news release.

“Let’s celebrate today,” said Mayor Stephan Mandel at a press conference late Wednesday evening. “Let’s celebrate two parties coming together … also recognizing the Katz Group’s commitment, and Daryl’s commitment to Edmonton. I think that cannot be overemphasized.”

The framework, which is not a final and binding agreement, includes the price of the arena capped at $450 million.

The city’s contribution will be $125 million and will include $45 million from a community revitalization levy, and the balance from parking revenue and a redirection of current subsidies.

The Katz Group will contribute $100 million, and another $125 million will come from a user-paid facility fee, which will be administered by the Katz Group.

In all, the agreement framework contains many of the same conditions city council put forth after agreeing upon them April 6.

“The vast, vast majority of those conditions are part of (this) agreement,” said city manager Simon Farbrother.

According to the city’s release, the arena will have 18,500 seats and 350 parking stalls.

The city will own the building and the land, and the Katz Group will operate the building and be responsible for all maintenance, upgrades, operating and capital expense costs.

The next step is for both parties to begin work on a master agreement.

“We’ll have to get back to work and start working on the many, many details … for a master agreement,” said John Karvellas, executive VP Katz Group for the negotiating team.

Of course, a final agreement will need to have the $100 million, which still remains to be funded, in place.

Mandel said he would, under city council’s direction, approach the province for the remaining $100 million.

“I’m very optimistic but there are no guarantees in life,” he said of funding from other levels of government.

The design of the arena must be acceptable to both the city and the Katz Group, and the public will have an opportunity to provide input for the plan.

The agreement also ensures the Oilers remain in Edmonton for at least 35 years.

“We need to understand it’s vitally important for this city to have sustainable hockey,” said Mandel. “(And) there is a will on both parties to negotiate the balance (of the deal).”

Other details of the agreement include the city having access to the arena for a set period of time each year for events such as Canadian Finals Rodeo and Capital Ex.

Subject to funding, says the city release, a community rink will also be built. If built, the Katz Group would operate it and receive the revenue.

Mandel said the council vote on the agreement framework was 8-5.

With regards to the arena entertainment district as a whole, the Katz Group will commit $100 million, and the city will purchase some lands for the development.

The agreement also emphasized that the city will work with Northlands regarding the future of Rexall Place.

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