Land and Other Public Infrastructure FAQ
- How much is the City spending on the land for the arena?
- Why is the land costing more than the $20 million originally quoted?
- A City press release and subsequent media reports are saying the City spent almost $75 million for the land – is that number accurate?
- How much land does the City need for actual construction of the arena?
- Why is the City buying so much land if only a portion is needed for the arena?
- What will the City do with the rest of the land?
- Is the Katz Group making a profit on the sale of the land to the City?
- Is the Katz Group’s land purchase part of their $100 million contribution to spark development around the arena? Does this represent the $30 million upfront investment clause that Council included in the Financial Framework?
- The City has spent $75 million on land for the arena and entertainment district. The original land cost was reported to be $20 million. Is this the first sign that this project is going to eclipse the $480 million price cap set by Council for the arena?
- When do these land deals go into effect?
- Will the community rink be built on a portion of this land?
- What other public infrastructure is the City paying for related to the arena? Is the Katz Group paying for any of this additional infrastructure?
- 1. How much is the City spending on the land for the arena?
The total cost of the land on which the arena and community rink will likely be located on is $24.6 million ($20.9M for the arena and $3.7M for the community rink). The final cost will depend on the actual arena footprint, which will depend on the final design.
In addition to buying the land for an arena, the City has acquired surrounding land valued at $15.4 million to provide greater control over development. Any land not used for the arena or other infrastructure (e.g. LRT connection, pedway bridge) will be resold or developed. All lands will be designed and developed consistent with the Capital City Downtown Plan.
- 2. Why is the land costing more than the $20 million originally quoted?
The $20 million was a preliminary unofficial estimate for the arena parcel of land. The cost of the land for the arena plus the land for the community rink is estimated at $24.6 million. The City has acquired these parcels of land at Council’s direction.
- 3. A City press release and subsequent media reports are saying the City spent almost $75 million for the land – is that number accurate?
The City has bought two parcels of land – one north of 104 Avenue and one south of 104 Avenue. The arena, community rink and two development parcels will be located on the north lands. The south parcel is intended for the pedway bridge pedestrian landing area and development.
The arena and community rink land parcel cost $24.6 million and the surrounding development lands cost $49 million. There was also $2.6 million in land transaction costs, of which the Katz Group paid $0.3 million now.
The city is selling the south parcel to the Katz Group for $33.6 million, and has already recovered $16.8 million towards that purchase. The City will also recover the proportionate amount of the land carrying and transaction costs estimated to be $350,000.
- 4. How much land does the City need for actual construction of the arena?
The final design will determine the actual footprint of the arena. Once the arena’s footprint is determined, the other remaining land around the facility will be used, sold or developed. The City will only retain the land necessary for the arena, community rink and associated infrastructure. It is estimated that the arena and community rink will occupy about 8 acres of land.
- 5. Why is the City buying so much land if only a portion is needed for the arena?
Owning the land around the arena allows the City to have greater control over the type and pace of development.
In the end, the City will only own the land needed for the arena and associated infrastructure. Buying the rest now is strategically important for development in the area, and the City will sell it or use it at the appropriate time.
In total, the City owns 12.06 acres of land between 104 Ave. and 105 Ave. and 101 St. and 105 St. (known as the North Parcel), and 3.7 acres of land between 104 Ave. and 103 Ave. and 102 St. and 103 St. (known as the Bridge Lands). The Katz Group has confirmed to the City Manager its commitment to purchase the Bridge Lands parcel from the City at a cost of $33.6 million, and has already paid the City $16.8 million towards the land costs.
- 6. What will the City do with the rest of the land?
- Any land not used for the arena or other infrastructure, such as the LRT connection or the pedway bridge, will be used by the City, resold or developed at the appropriate time.
- 7. Is the Katz Group making a profit on the sale of the land to the City?
No. The City has purchased the land for the same price as the Katz Group had agreed to pay for it.
- 8. Is the Katz Group’s land purchase part of their $100 million contribution to spark development around the arena? Does this represent the $30 million upfront investment clause that Council included in the Financial Framework?
Yes. The Katz Group has already paid the City $16.8 million towards the $33.6 million price of the land between 103 Ave. and 104 Ave. and 102 St. and 103 St. (Bridge Lands) and has committed to buy the rest of the land.
- 9. The City has spent $75 million on land for the arena and entertainment district. The original land cost was reported to be $20 million. Is this the first sign that this project is going to eclipse the $480 million price cap set by Council for the arena?
The $480 million price cap is for construction of the arena building. No land transactions are included in that price.
Of the $75 million that the City has spent on land, $24.6 million is the estimated cost of the land for the arena and community rink. This reflects the initial estimate.
The remaining $50.4. million is for:
- land around the facility, which will be sold or developed ($15.4 million), and
- the parcel of land south of 104 Ave. between 103 St. and 102 St. that is being sold to the Katz Group for $33.6 million
- $2.3 million in costs incurred for the land purchase (e.g. interest, fees, zoning and legal costs, etc.). The City will recover approximately half ($1.3 million) on any land it sells.
- 10. When do these land deals go into effect?
As of October 31, 2011 the City owns the arena and entertainment district lands and is the landlord for all of the leases on this land.
- 11. Will the community rink be built on a portion of this land?
The land area estimated for the community rink is 1 acre, and is included within the 8 acre total.
- 12. What other public infrastructure is the City paying for related to the arena? Is the Katz Group paying for any of this additional infrastructure?
The City routinely pays for other public infrastructure such as LRT or pedway connections to large projects such as hospitals, post secondary education institutions or shopping malls. For example the City paid for the pedway that links the community of Malmo to Southgate Shopping Centre and is also paying for the NAIT LRT line.
In much the same way, the City is providing infrastructure surrounding the arena, including the LRT connection, community rink and pedestrian corridor. The City will also pay a maximum of $25 million, for the Winter Garden pedway bridge over 104 Avenue. The Katz Group will pay the remaining $31.5-million for the pedway bridge.
For more information:
| Online | Contact 311 Online |
|---|
| Telephone | In Edmonton: 311 Outside Edmonton: 780-442-5311 |
|---|---|
| TTY | 780-944-5555 |
| 311@edmonton.ca |
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