Many residents have reached out to me from across Ottawa asking for more information, to share their thoughts and vision for the future of Lansdowne and ask my thoughts on the project.
In the coming weeks, Ottawa City Council will be asked to vote on moving forward with what has become known as Lansdowne 2.0. To be clear, this is not a final vote, but rather simply telling staff to move forward on design plans, send out a request for proposals, and to continue with community consultations. While a “no” vote would end the current 2.0 plan; a “yes” vote will only move it forward as an approved concept to be further developed. As background, Lansdowne 2.0 builds on the existing partnership with OSEG and the redevelopment of the South Side stands; and would see the existing North Side stands and arena structures torn down and rebuilt into a smaller, modern, more usable space. As well as adding new housing in the form of two towers, down from the originally proposed three. The stadium stands would also shrink in size, going from 14,072 seats down to 11,200, and the arena dropping from the existing 10,000 seats to 5,500. These changes in design were in response to community consultations on density and the required size for the amenities. While there is room to debate what the future of the site looks like, the features, and what is included in some form of 2.0 project; we also need to be honest about the alternative plans. Staff have shared that should the City opt to not expand the partnership with OSEG, the alternative would see the City propping up the building until the structure unavoidably fails, and rather than cost-share a new facility with OSEG, taxpayers would be wholly on the hook for tearing it down and remediating the site.
Lansdowne is definitely one of the more complicated files facing the City, as it is one of those situations where “doing nothing” is not a realistic option. As background, the north-side seating area, the arena underneath, as well as the supporting infrastructure, is well over 50 years old, and as many are aware from the public engineering reports, has been declared functionally obsolete. With parts crumbling due to age and water damage, making it increasingly unusable. The North Side stands are using port-a-potties as washrooms. When we hosted the World Men’s Curling Championships this year, there were fears that leaks in the arena roof would cause the event to be suspended or cancelled. Ultimately, it required staff and organizers to climb into the rafters to literally plug the holes. Other event organizers, such as Cirque du Soleil, have plainly told Councillors and staff that the site is unusable, and they will never return.
Lansdowne Park belongs to the people of Ottawa, it is a City-owned asset, and regardless of Lansdowne 2.0 passing or not, that won’t change. Simply put – we cannot walk away. For more than 175 years, it’s been a community gathering place and an important public asset. Unfortunately, for decades the City let Lansdowne slide backwards. They didn’t invest in this important community asset, and it eventually became a giant parking lot with crumbling stands and aging infrastructure. Lansdowne 1.0 took the first steps to functionally changing that on half of the site. So much of the concrete and asphalt is gone. Instead, there’s a great lawn and an urban park where kids can run and play, and where world class musicians perform. The crumbling South Side stands were replaced with a modern stadium that has since hosted a Grey Cup, professional soccer, and an NHL Heritage Classic. New shops, restaurants, and attractions, like the Lansdowne Famers Market and music festivals have animated the space and made it a destination for people all over the city. Whereas before, Lansdowne would see 250,000 people annually, since the renovations, Lansdowne has attracted more than 20 million visitors (over 4 million annually) from across the city and around the world, and there are more than 4,000 full and part time jobs on the site.
The cost of doing nothing is not nothing. In fact, it’s very expensive. Too many times in this city, we’ve failed to invest in, maintain, and upgrade important infrastructure and landmarks. As a result, we have let things crumble and dwindle. And then we lose an asset, and the cost is even higher to restore or replace it. So, we end up paying more for less.
The Mayor has shared that the preliminary costs on such long-term maintenance and eventual demolition would be north of $400 million. As for any future after that, I could not begin to speculate on what would be done after demolition, as the City has no plans (or funding allocated) for rebuilding anything, and staff would have to develop an alternative plan. Of course, any costs necessary to build a public space on this site would then still have to be fully taxpayer funded, as there would be no associated revenue stream. Realistically, there is no option where the City does nothing and pays nothing. Ottawa is the owner of the site and cannot simply walk away from it. This model of arenas/stadiums being outright owned by their City is also not unique to Ottawa. Toronto’s BMO Field, Hamilton’s Tim Hortons Field, Winnipeg’s Investors Group Field, Regina’s Mosaic Stadium, Edmonton’s Rogers Place, Calgary’s Event Centre, Quebec City’s Videotron Centre, Laval’s Place Bell, the list is extensive across Canada and the US, including numerous CFL, NFL, NHL, NBA, MLB stadiums, and the precedent for this, well established.
Though we may own the site, the City should still be looking for ways to fund the continued redevelopment of Lansdowne with minimal costs to taxpayers. Currently, OSEG payments are prioritized over the City. Many people are often surprised to hear that Lansdowne 1.0 has not cost the City money, it has been revenue-neutral. The proposed redevelopment plan from staff would see increased revenue from the property tax from re-development; a ticket surcharge; immediate revenue from the sale of the air rights for the condos; and most importantly, the waterfall agreement set up in Lansdowne 1.0 would be restructured, so that the City and OSEG would be repaid their equity contribution at the same time. OSEG has agreed to pay to the City a guaranteed amount of $300,000 for the first 10 years and then $1.50 for every ticket sold for the REDBLACKS, 67’s, and concerts and events, increased by $0.25 every five years after that. This funding source provides an average of $700,000 annually in payments over the term of the agreement. While the waterfall agreement within Lansdowne 1.0 has not returned revenue to the City, OSEG has borne all of those losses, ticket and parking surcharges, as well as property taxes on the new homes are a reliable and predictable revenue stream. This model will still underpin the financials of Lansdowne 2.0. While the upfront costs are high, over $300 million are debt-financed over 40 years, and will be repaid with these revenue streams. The net investment from the City’s general revenue is the much lower $95 million. This forecasting from City staff has been audited by the international accounting firm Ernst & Young and has been found to be accurate.
I must reiterate; the backbone of the Lansdowne proposal is the revenue generated through the construction of these assets. As an example, I often hear residents float the idea that Ottawa tear it down and build a “Central Park”, akin to what is in New York City, or even move the stadium to another location. I fully support urban greenspace, and frankly in a world where money was no issue, might fully support one of these plans, however the reality is that the demolition, remediation, backfill and planting of an urban park would have nearly the same price tag, with quite literally no revenue streams to offset the expense (to speak nothing of losing the 67’s, Redblacks, Atlético Ottawa, the newly announced Women’s Professional Hockey Team, and countless events and concerts). Moving the stadium to a different location would carry similar expenses, including the purchase of any lands on which to build; all with no or limited projected revenues tied to the site. Neither of these options take into account the incredible, City-owned, asset that is the virtually brand-new South side stands. Removing, or moving, the North side stands, would require the funding of a new amenity on that site, as well as the instant obsolescence of the South side stands, both at an incredibly massive cost to taxpayers, with no projected revenue.
There is one other aspect of the proposal that has always been a concern of mine, and that is the removal of affordable housing as part of this plan. The revised proposal includes an immediate allocation of $3.9 million from the sale of the air rights, which will be dedicated towards our current affordable housing needs. As the project moves forward, that number would more than triple. The affordable housing units included in the original proposal for Lansdowne would have been built as the final phase of the project, and not scheduled for realization until after 2030. The term affordable housing covers a broad range of housing initiatives, and includes transitional housing, supportive housing, community housing etc. The affordable housing being included at Lansdowne would have been an allocation of apartments offered at 20% below market rates. I want to reiterate that point, call me a skeptic, but I am not convinced that an apartment in one of the most expensive neighbourhoods of the city can be considered affordable, even with a 20% reduction in rent. If approved, the allocated funding for affordable housing could be used for a range of immediate affordable housing initiatives, including supportive and transitional housing. Additionally, that first $3.9 million would be available NOW, and not in 7-10 years when the towers are built.
As I mentioned, the arena and the stadium are owned by the City of Ottawa, not OSEG, however, OSEG is responsible for the operating AND maintenance costs of the buildings. Ultimately, the result here is that the City would continue to own an incredible sports and entertainment facility with minimal cost to taxpayers. While the initial price carries a massive sticker shock, it becomes less objectionable when the revenue generated by the project is factored in; and especially so when contrasted with the astronomical price tag associated with the do-nothing alternative, that we know has no accompanying revenue streams.
I hope this helps to explain my own thinking and concerns, on the various options in front of us. With that said, I think that there still needs to be much more consultation and due diligence, to ensure that it is clear for both Council AND the public, what the real costs are for the City of Ottawa.
