Report to: General Committee Report
Date:
SUBJECT: Canadian Sports Institute
PREPARED BY: Allan Seabrooke, Director,
Joel Lustig, Director, Financial Services, ext. 4715
RECOMMENDATION:
THAT the report titled “Canadian Sports Institute” be received;
AND THAT Council endorses,
in principle, the hosting of a CSIO facility in
AND THAT the Town of Markham support, in principle, a cash contribution of $55.5 million, in-kind contributions with a value of $13 million (projected for 10 years), which includes land at $7 million and Municipal Property tax avoidance of $6 million, subject to confirmation of financial commitments from other levels of government and stakeholders;
AND THAT additional $100,000 be provided to support any further analysis, to be funded from the Corporate Stabilization Reserve;
AND THAT authorization be granted for the Town, in conjunction with the CSCO, to approach the Federal and Provincial governments and other potential stakeholders for financial and non-financial support;
AND FURTHER THAT staff report back to General Committee on an ongoing basis with progress.
EXECUTIVE SUMMARY:
At the
The Steering Committee has worked through completing the identified tasks over the last year for the feasibility studies. The studies included analysis of the following components:
- Proposed Site Location
- Storm Water Management
- Traffic Impact
- Parking Requirements
- Transit
- Economic Impact
- Sport Event Hosting Capabilities
- Needs Assessment
- Implications on the Parks, Recreation, Culture & Library Master Plan
- Capital & Operating Costs
- Financial Implications
The complex is proposed to include international level training facilities and competition venues, accommodation services for existing athletes, office facilities for sport organizations, and will provide the highest level of expertise in coaching, sport science and sport medicine. A “culture of excellence” will be fostered through the encouragement of community grass roots sports participation; the development and training of promising local, regional, provincial, national and international athletes; and by hosting local, regional, provincial, national and international competitions in a state-of-the-art facility; essentially a “playground to podium” environment.
The studies confirm that the proposed site
for CSIO near Highway 407 and
From an economic perspective, the study measured the tangible benefits related to the construction of the proposed CSIO and the hosting of sports events. A review of the potential for incremental investment and as an economic generator for job creation and tourism was also addressed. The total economic impact from construction of the CSIO is estimated at $279.3 million and the hosting of annual regional/national sports events could generate in the $20-75 million range each year. The awarding of large scale events or an international/world event would dictate the magnitude of the economic impact in any given year. The CSIO would be one of the major economic generators in Markham Centre, whereby investment in new businesses and the subsequent job creation would occur in concert with the construction of the facility. Finally, the CSIO as a major destination hub would provide the catalyst for tourism development.
The Committee also undertook the research,
from a needs perspective, to examine the benefits of a sports institute. The Canadian Sport Policy recognized that
Sport is a major contributor to community social life and forms an important part of our culture, traditions and identity. Grassroots sport participation enhances community quality of life and lends to the development of healthy, productive citizens. The research provided a strong correlation between positive youth self esteem and participation in sport. Finally, it has been estimated that every $1 invested in sport today can result in a $5 reduction in future health care costs (source: Conference Board of Canada).
In short, there is ample justification for the need for a Canadian Sports Institute from these perspectives.
Finally, the
- Access to two 50 metre, 10 lane competition pools
- Ability for water polo through moveable bulkheads in the aquatics facility
- 10 metre dive tower and tank
- dryland training area in aquatics with a trampoline for diving and gymnastics training
- dedicated gymnastics hall with permanent equipment
- specialized hall with designated table tennis and badminton courts
- a complex of four arenas, four basketball courts and 12 volleyball courts in one location facilitating effective hosting of large scale tournaments
- a competition venue arena with large capacity seating (6,000 – 7,900) for hosting major concerts, trade shows and other entertainment
- access to sports medicine, sports science, fitness training services and athlete therapy for sports related injuries.
The capital cost of constructing the facility as detailed by the Canadian Sport Centre consultants, in the amount of $198 million (2007 $), was examined by our Finance Department and deemed to be a realistic and representative estimate based on construction costs of other Town of Markham facilities. With additional costs for site servicing, development charges and fees, inflation contingency and transportation contingency of $82 million; the estimated total project cost is $280 million. This does not include the office tower. The Town will analyze any potential partnerships with respect to the office tower during the next analysis phase.
From an operating perspective, a ten year proforma summary was prepared by the Canadian Sport Centre consultants. The net annual income projected is $6,300,000; however, it is important to note that this proforma does not include any debt financing costs. When the project moves to the next stage, should debt financing be required options would be analyzed and incorporated into an operating proforma. In general terms however, given the multiple proposed partners in the facility and the use patterns that differ amongst the partners, a successful operating model is anticipated.
In addition, CSIO provides an enhanced
selection of specialized recreation facilities not currently in the core
package traditionally and directly provided by the Town that will provide
The Canadian Sports Institute is a feasible
and attractive opportunity for the Town of
It is recommended that Council support, in
principle, the hosting of the Canadian Sports Institute in the Town of
The next stage of the project is for the Town, in conjunction with CSCO, to approach the Federal and Provincial governments and other potential stakeholders for additional financial support.
The Steering Committee will report back to Council on an ongoing basis on progress.
1. Purpose 2. Background 3. Discussion 4. Financial
5. Others
(Environmental, Accessibility, Engage 21st, Affected Units) 6.
Attachment(s)
PURPOSE:
The purpose of
this report is to detail the findings related to the feasibility of locating
the Canadian Sports Institute in the Town of
BACKGROUND:
At the
Council
established a Steering Committee consisting of six members of Council to
undertake a Feasibility Study of the proposal to determine if it is in
The Steering Committee was directed to complete the Feasibility Study and report back to Council with recommendations. An internal staff team was formed to support the Steering Committee and a $164,000 budget was authorized to engage outside consulting third party advice that may be required to prepare the Feasibility Study.
Over the last year the Committee has worked through completing the identified tasks to complete the Feasibility Study. The feasibility study has included analysis of the proposed site location, storm water management, traffic impact, parking requirements, transit, economic impact, sport event hosting capabilities, a needs assessment, implications for the Parks, Recreation, Culture & Library Master Plan, capital and operating costs, and financial implications. The results are now contained in this report and reflected in the recommendations before Council for consideration.
OPTIONS/ DISCUSSION:
Vision
The Canadian Sports
Centre Ontario (CSCO) is proposing to establish and operate the Canadian Sports
Institute
The CSIO will be
ideally located to serve the large and growing community in Markham, York
Region and the Greater Toronto Area. It
will also establish close links with sport organizations throughout
Over the past
year, the focus on high performance sport in
An Ideal Location in the Town of
The Town of
With historical
roots in the 1790’s,
The CSIO will be
ideally positioned adjacent to two major highways (407 & 7), within easy
access to a GO Station, serviced by York Region new advanced VIVA bus system,
and a network of new connecting roads that are part of the overall Markham
Centre plan. In addition, future plans
call for a rapid rail system along Highway 407.
Regional Sports Centres
In order to
develop a successful sport development system in a province the size of
The Regional
Sports Centres will also provide a formalized link to all
The Canadian Sports Centre
The proposal to
develop a Canadian Sports Institute in
Needs Assessment Research
Canadian
Olympic Underachievement:
A new Canadian
Sport Policy, which has been developed over the past several years, recognizes
that
The new policy recognizes the essential connection between participation and achievement. Participation is the base of a healthy community and sporting excellence. Access to appropriate facilities ensures that anyone can participate and enjoy their chosen sport at any level of competence.
The ultimate expression of participation is demonstrated by the excellence of those committed and talented athletes who compete at the highest international level. The achievements and high standards set by these individuals provide strong motivation and intense enthusiasm for others to participate. As the ranks of talented athletes increase, so too will the numbers of those who proudly take their place on the winners podium.
Social
Benefits:
Sport is a major contributor to community social life and forms an important part of our culture, traditions and identity. Community sport can be an important element of family life by transmitting positive values to children. Grassroots sport participation enhances community quality of life and lends to the development of healthy, productive citizens.
In addition, the
vast majority of Canadians believe that participation in sport can have a
positive influence on the personal and moral development of youth. Participation in sport and recreation
develops self esteem, self discipline and responsibility among our youth; while
also helping to establish fitness and a positive identity for persons of all
ages. In the report “
Reducing
Healthcare Costs:
The strain on our
healthcare system across
Proposed Facility Components
v International level facilities for hockey, figure skating, short-track speed skating, basketball, volleyball, table tennis, badminton, gymnastics, swimming, diving, water polo, synchronized swimming, as well as several combative sports.
v A centre for coaching education and home to the National Coaching Institute of Ontario and the Coaches Association of Ontario.
v An association with the major new sports high school located nearby and a link to a broader network of schools, colleges and universities to facilitate athletic education with training support, as well as a shared expertise and resources.
v Expert sport medicine and sports science/fitness testing services and state-of-the-art equipment.
v Accommodation facilities, food and beverage services and day care support. These and other similar services would be offered in conjunction with the nearby Markham YMCA.
v A venue for hosting community, provincial, national and international sport competitions providing a much needed competition location where amateur sport is a priority.
v A fully accessible facility for athletes with a disability.
v A home for many provincial and national sport organizations and the Canadian Olympic Committee, moving them to a true sport environment close to the athletes and coaches they support.
Aquatics
Centre – 164,000 sq.ft. (Attachment B)
The CSIO Aquatics
Centre will include
Field House –
150,000 sq.ft. (Attachment C)
The field house will have four halls:
v Basketball and Volleyball – there will be four basketball courts with at least one court meeting international size regulations. Three volleyball courts can be accommodated within one basketball court so there will be a total of 12 volleyball courts located within this hall.
v Gymnastics – this hall will house permanent equipment for artistic and rhythmic training for both male and female gymnastics. The field of play will be equipped with full podiums to meet the regulations of the International Gymnastics Federation and the Canadian Gymnastics Federation. A trampoline training space adjacent to the Aquatic Centre will be shared by divers and gymnasts.
v Combative Sports – this large and flexible hall will accommodate a variety of combative sports and martial arts such as boxing, wrestling, judo, karate and Tai kwon do.
v Badminton & Table Tennis – there will be eight designated table tennis courts and four badminton courts with space for some removable spectator bleachers.
Competition
Venue & Community Arenas – 289,000 sq.ft. (Attachment D)
The Competition Venue will be a multi-use sports and entertainment complex with a seating capacity of 6,000 – 7,900, depending on the event. This facility will be ideal for hosting provincial, national and international events. The Competition Venue will be international size and hold an NHL size ice surface that will serve as the home for both an OHL hockey team and an OHA hockey team. The facility will be designed to be adapted as a state-of-the-art entertainment venue for concerts, family shows and other events.
The Community Arena complex will include two NHL size ice surfaces, as well as one other international ice surface. Seating capacity for each arena will be 250. The complex will include food concessions, an ice viewing restaurant, pro shop and meeting/party rooms.
Training
Centre – 34,000 sq.ft. (Attachment E)
The Training Centre will provide sports medicine and sports science/fitness testing services, as well as state-of-the-art equipment for strength training and athlete therapy for those with sports related injuries. The facility will have its own change rooms and administrative offices.
Office Tower
& Residences (Attachment E)
An eight floor, 128,000
sq. ft. office tower and residences will be reserved for, and leased to, Sport
Alliance provincial sport organizations (Sport Alliance is an
The residential component will offer 30 – 50 two-bedroom units for visiting athletes. A main floor cafeteria will serve the office tower, residences and the CSIO facilities.
The Town will analyze any potential partnerships with respect to the office tower during the next analysis phase.
Specific Site Consideration/Analysis
Site Location:
The proposed site
is located on the north side of Highway 407, west of
GO Transit 10.09 acres
Ontario Realty Corporation 12.26 acres
YMCA of Greater Toronto 4.00 acres
Town of
The CSIO concept would comply with the Official Plan and the Markham Secondary Plan.
A tributary of
the
The recommended preferred option is to provide an open channel along the south and east boundary of CSIO (see Attachment F), which is feasible and is estimated to cost $2.5 – 3.0 million. The Toronto Region Conservation Authority advised that treatment of the tributary was acceptable.
There are two
stormwater management facilities to be installed north and south of the
Negotiations with the benefiting owners (i.e. GO Transit, Edwards) as to funding the tributary relocation and construction of the south storm water management facility are required.
Traffic Impact
Study:
Cole Engineering Group was retained by the Town to undertake a Transportation Impact Study for the proposed Canadian Sports Institute. The study reviewed the following existing road networks and traffic volumes adjacent to the proposed development; an estimate of the traffic generated by the proposed uses and their specific distribution; assessment of current and future boundary road operating assessment of the impact of site generated traffic on the adjacent road network; assessment of the site access; a review of the proposed on-site parking supply and expected demand; a transportation management plan for critical events that will occur at the facility.
The conclusions of this study are as follows:
v No other roadway improvements are required to accommodate the site traffic generated by the CSIO beyond those planned in the East District Precinct Plan for 2011 (Attachment G). These planned improvements, however, should be in place for the 2011 horizon to accommodate growth related to the Markham Centre, as well as to accommodate CSIO traffic.
v CSIO would have different peak traffic periods (evenings, weekends) than typical residential/employment users.
v The traffic generation associated with CSIO development results is less than the trip generation characteristics generated by the current approved zoning for East Precinct Assessment at the AM and PM peak hours.
v All boundary and internal roadways can accommodate the projected traffic associated with the CSIO development during the peak time periods assessed. Special provision and contingency plans are recommended to be coordinated prior to a major event occurring in the main competition arena including traffic police to direct vehicles accessing YMCA Boulevard from the Ring Road upon completion of an event whose attendance approaches 6,000 persons, a combination of flexible or reversible lanes, a third parking garage ramp and satellite parking lots.
v
The Engineering Department is
currently reviewing the feasibility of a southerly access, Hwy. 407 to either
v
An underpass to the south side
of Hwy. 407 could be considered to access an overflow parking area and to
provide a further access to
Parking
Requirements:
BA Group Transportation Consultants were engaged to undertake a high level overview of the parking requirements associated with the proposed CSIO complex. Sports and Entertainment centres like CSIO attract large volumes of people at one time, and as such, advance planning to ensure an adequate supply of parking is available is an essential part of the overall planning process.
The vision and
Council approved plan for Markham Centre is clearly to develop a traditional
downtown area. The parking requirements
for CSIO were analyzed in this context.
Locating the CSIO complex adjacent to the GO Train Station and a transit
hub is good planning in that it will provide a large pool of unused parking
during evenings and weekends when the sports complex will have a much higher
demand than during a weekday from
The conclusions of this parking analysis are as follows:
v The CSIO development should provide a net new parking supply of approximately 1,170 stalls as part of the development program to meet everyday recurring needs.
v Current plans indicate 300 stalls on site; therefore, there is need for 870 stalls which could be provided over the expanded 1,500 stall GO Station parking lot (lowest cost alternative).
v Together with 1,100 vacant GO Station stalls, which would be available evenings and weekends, a total of 2,160 stalls would be available for peak needs.
v
Ten to twenty times per year an
additional 150 – 1,200 stalls might be needed when parking demand would range
from 2,250 – 3,300 stalls on evenings and weekends. Approximately 670 stalls would be available
in the immediate area (i.e. NRC, street and high school) accommodating demand
for most events. Additional parking
further to the west along
v The estimated capital for the above-grade 870 stalls required can be generated by parking charges of $6.00 per visit and $100.00 per month and could encourage transit use.
Highway
The Ministry of Transportation (MTO) is the provincial government department responsible for the Highway 407 rapid transit way. The identification of a transit corridor within the Parking Belt West from York Region dates back to the late 1980’s. The conceptual transitway Kennedy Station is currently planned on the north side of the 407 ETR and just east of the Unionville GO Train Station (Attachment H). The main reason for the choice of this location is connectivity to the GO Train Station, VIVA and road access to local transit. The transitway bus loop, bus platforms and the parking required for the transitway requires approximately 10 acres, which if located on the planned north side would have a significant impact on the proposed CSIO site. MTO has retained consultants and have agreed to include the review of a transit station on the south side of Hwy. 407.
Economic Impact Analysis:
This section will
examine the economic benefits of building and operating the CSIO in
Construction
Economic Impact:
To calculate the
economic impact of CSIO with construction activities, the firm of Marshall
Macklin Monaghan was retained. The focus
of this work was an estimation of benefits to the local and provincial economy
and the so-called “soft” government revenues.
“Soft” revenues will accrue to governments as a result of the implementation
of this project. There are three
categories of impact referred to as direct, indirect and induced, which were
assessed using two accepted models for economic impact analysis.
The findings are summarized as follows:
v
The construction of CSIO will
account for a total of 1,600 person years of direct employment and 1,400 person
years of indirect and induced employment in
v In terms of wages and salaries, the construction will result in $95 million direct and $91 million indirect and induced. The majority (88%) will accrue within the Toronto Census Metropolitan area.
v The “soft” government revenue benefits generated for direct federal and provincial taxes total $54.5 million.
v The “soft” government revenue benefits generated for indirect and induced federal and provincial total $19.3 million.
v In summary, the total economic impact from construction of the CSIO is $279.3 million.
Sport Event
Hosting:
Sport Tourism is
one of the fastest growing market segments of tourism in
To provide an
overview of the opportunities to host sporting events in the proposed CSIO and
the potential economic impacts, McIntosh Consulting was retained. The study identified where the CSIO could
compete with other major markets in securing major sporting events at the
Provincial to International Level.
Hosting sporting events will be instrumental in generating economic
growth, creating civic pride and awareness in the Town of
It is evident that an assessment of the potential events to be hosted by the CSIO and the respective facilities has demonstrated there are numerous local, regional, national and international events that could be secured with the proposed infrastructure. The CSIO could be a potential host to the following sports: hockey, figure skating, short-track speed skating, basketball, volleyball, table tennis, badminton, gymnastics, swimming, diving, water polo, synchronized swimming and combative sports. McIntosh Consulting identified over 90 events that could be hosted or bid on. The events can range from a local event to an international or world event for a multi-sport or single sport. Examples of events that could be hosted include Canadian Interuniversity swimming championships, Provincial Dive Ontario Championships, Canadian Open Badminton Masters Championships, Canadian Wheelchair Basketball National Championships, Gymnastics Canada Regional & Provincial Championships, International Weightlifting Association Championships, Memorial Cup (hockey), Canadian Figure Skating Sectional Championships, Ontario Speed Skating Association Competition and Karcher Jr. Curling Championships. It should be noted, while not within the scope of this analysis, the facility has the ability to capitalize on the entertainment portion of hosting such as concerts, trade shows, car shows, etc. Finally, another opportunity for the CSIO is sport AGM’s and sport related conferences. These are big business and can generate income for the facility and the associated additional economic benefits to the area.
Sports events are
a catalyst for tourism development.
Apart from the economic benefits that accrue during the actual time of
the events, participants, spectators and their families often incorporate time,
both before and after sporting events, to engage in other
activities/attractions in the area. The
CSI, as a major destination hub, will provide the focus upon which to market
and package visits to attractions in the Town of
Measuring
Economic Impact:
The value of the
sport tourism market and events large and small can be ascertained through the
Sport Tourism Economic Assessment Model (STEAM). This model has been used for over 300 sport
events in
The CSIO is
proposed to be capable of hosting up to 12 sports events in the regional to
national categories, of which could generate in the $20 million range of
economic impact per year. It should be
noted that this is a conservative estimate, not considering the award of the
much larger scale events or an international/world event where the CSIO could
co-host with another community partner. An
award of such a large scale event, over and above the ongoing annual events, in
any given year can result in substantially more economic impact of up to $75
million in a year. It is also important
to realize that this estimate does not include the day-to-day impact of regular
tenant users and those events outside of sport in the entertainment area (i.e.
concerts, trade shows, etc). As an
example, the Bell Canada Cup Hockey Tournament alone was calculated as
generating $11.1 million in economic activity in
Incremental
Investment/Economic Generator:
The CSIO can have
a significant economic impact both as impetence for development and on an
ongoing basis. The facility can be one
of the major economic generators of the Markham Centre. In other cities where sports and
entertainment centres have been built, the evidence shows that there has been significant
new investment in residential, retail and office development. This investment has helped energize the
cities cores, broaden their municipal tax base and create attractive and
people-friendly space downtown. As an
example, since the opening of the John Labatt Centre (JLC) in
The Canadian
Sport Institute Committee has had inquiries from the private sector about the
status of the project and expressing interest in constructing a major
convention centre and hotel in close proximity to the site. In addition, interest is expressed in
investigating additional private sector sports opportunities such as an indoor
soccer complex. Clearly, investment in
new businesses would occur in concert with the construction of the facility. Once the CSIO facility is established, there
are both direct and indirect economic spin-offs for existing and potential new
businesses that would occur. Research of
other new facilities has clearly shown that irrespective of the level of other
economic spin offs, food and beverage and related service sectors have
benefited in every case. As an example,
the economic impact of the new
v Retail – some additional impulse retail expenditures
v Transportation related spending on parking, transit, taxes, gas purchases, etc.
v Accommodation – depending on the type of event there would be demand for overnight accommodation. This would come from attendees, teams and personnel with events.
The Canadian
Sports Institute will not only create jobs and economic impact from
construction, but will also contribute to keeping the regional economy strong
by creating new jobs. In a
Among other issues identified, the economy was highlighted from the perspective that there is a need to create jobs to match new residents, to create new quality jobs, and to continue to be the location of choice for businesses.
The CSIO will
contribute from this perspective and has the potential to enhance job creation
in the art, culture, recreation and sport occupational category. The provincial sports organizations, Canadian
Olympic Committee, and in some cases national sports organizations (i.e.
Basketball
Put simply, an investment in CSIO would inevitably generate more business in the Markham Centre downtown and would foster additional investment which would, in turn, attract more customers.
Commitment to the Environment & Energy
Reduction
LEED (Leadership in Energy & Environmental Design) guidelines will be followed during the design, construction and operating phases of the CSIO project. The LEED building rating system is a voluntary, consensus-based national standard of building design and construction practice that significantly reduce or eliminate the negative impact of buildings on the environment and their occupants. LEED covers six main topic areas and each area has associated goals that will be used during the construction of CSIO building: site development, water efficiency, energy efficiency, material selection, indoor environmental quality and innovation in design.
In addition, the complex will incorporate a district energy system which is an energy efficient, environmentally sound method of heating and cooling buildings. District energy systems produce hot water or chilled water at a central plant located within the community. The water is then piped underground to individual buildings within a designated area for heating, cooling or process use. District energy is also easy to operate and maintain, reliable, comfortable and convenient, has lower life cycle costs and offers design flexibility.
Sport Partners Support
Feasibility study meetings were held with local and regional sport partners, provincial and national sport organizations and representatives of the Canadian Olympic Committee. As one might expect, there is strong support from the sport community with the current vision for the sport institute proposal. The committee has received numerous letters, e-mails and phone calls detailing the benefits that CSIO would have for their organization and for sport and recreation in general. The list of organizations responding and having participated in the meetings is noted in Attachment I.
In general terms, the local organizations support the concept as providing not only additional needed facilities, but facilities in quantity and at a quality level that are not currently available. The provincial and national organizations welcome a central location affording the opportunity to host national/provincial training, coaching education programs and national, provincial and in some cases international competition.
Markham’s Parks, Recreation, Culture & Library
Master Plan
Background:
The Parks, Recreation, Culture & Library Master Plan establishes priorities and policies to guide the delivery of facilities and services to the year 2021. The Master Plan includes an analysis of the demand for indoor and outdoor recreation opportunities and libraries across the Town. The timing of the delivery of facilities and services is based on population projections to meet the demands of growth. The plan recommends service provision standards in four facility types; Outdoor & Parks Facilities, Indoor Recreation Facilities, Libraries and Culture Facilities. For the purposes of detailing the implications of this plan relative to the CSI, discussion will focus on the Indoor Recreation Facilities component. It should be noted that the opportunity to provide indoor recreation facilities through the CSIO has surfaced since the completion of the Master Plan.
Implications
on CSIO:
The CSIO project
complements the Master Plan in so far as the proposed components (indoor
swimming pool, arenas, fitness space, gymnasiums) will serve the identified
needs of the Town at the provision standards specified in the plan. In particular, the community access to the
CSIO facilities will provide Town of
With the multiple
proposed sports partnerships at CSIO, including the
For ease of reference, more detail on the specific Master Plan Recommendations and the implications for CSIO are contained in Attachment J.
In terms of the Southeast facility, should the provision of arenas, a pool and gymnasiums be provided at the CSIO facility, potential components for the Southeast could include: library, sportsfields, multi-purpose spaces, banquet halls (private sector lease), and a partnership on an indoor soccer facility.
Further analysis, including comprehensive public consultation will be required to determine the needed components for the Southeast facility.
The capital
contribution to the CSIO by the Town of
Specifically,
based on projected recreational demand at the time when construction of CSIO is
complete, the Town of
The following is a synopsis of projected demand and what the content of the agreement could provide in terms of use of the arenas, aquatics and field house.
|
Arenas |
Aquatics |
Field House |
|
Prime time allocated totaling 4,160 hours annually (2 community arenas / 8 months per year |
Prime time allocated totaling 3,562 hours annually (equivalent of one 25m pool, 12 months / year) |
Prime time allocated totaling 7,488 hours annually (equivalent of 2 double gymnasiums) |
|
Primetime hours
are Monday – Friday, |
Primetime hours
are Monday – Friday, |
Primetime hours
are Monday – Friday, |
Note: These hours equate to approximately 8% of the total hours available at the CSIO.
The hours will
ensure that there is sufficient programming to provide Town of
The synergies and overall benefits that occur through this partnership with CSIO can be summarized as follows:
v Financial annual operating cost avoidance potential and future facility repair and replacement savings.
v Potential to address pent up Recreation demand in the Region.
v Potential annual tax revenue of approximately $500,000.
v Flexibility in expanding required hours, thereby facilitating no need to build future facilities within the current urban boundary.
v Access to facilities that would otherwise be financially challenging for any one level of government to provide on their own (i.e. 50m pool).
v A centerpiece of Markham Centre.
v Minimizing downtime in non-peak hours due to daytime use of facilities by provincial/national sport organizations and school boards.
v Accommodating diversity in the community.
v
Access to new specialized, high
quality facilities for Town of
v
Synergy with the
Conclusions:
The Canadian
Sports Institute is a feasible and attractive investment opportunity for the
Town of
The facility can be one of the major economic generators of the Markham Centre and will have a significant economic impact, both as an initial impetence for development, an ongoing catalyst for tourism development and annual economic generation.
The project
complements the
The Town of
FINANCIAL CONSIDERATIONS:
The Recreation
Master Plan details the following requirements by 2014: Two 25M pools, two Arenas, and two double
gyms. However, based on updated
projections, there will actually be demand for 3 double gyms. As the approved new
|
|
2014 Demand |
|
Unallocated |
|
25M Pools |
2 |
1 |
1 |
|
Arenas |
2 |
0 |
2 |
|
Double Gyms |
3 |
1 |
2 |
Traditionally, the Town would look to build a facility (or two) that would house these components. The cost of building a facility containing two arenas, one 25M pool and two double gyms (excluding land) would be approximately $50 million:
|
COMPONENT |
|
|
Two Arenas |
$25,000,000 |
|
One 25m Pool |
$11,500,000 |
|
Two Double Gyms |
$3,500,000 |
|
FACILITY
COST |
$40,000,000 |
|
Site Servicing/Inflation Contingency |
$10,000,000 |
|
TOTAL COST |
$50,000,000 |
The CSIO provides
an alternative option to the Town.
Rather than the Town building its own stand alone facility, a financial
partnership with the CSIO can address the unallocated demand in a possibly more
cost effective manner. A capital contribution
to the CSIO by the Town of
CSCO Requests
The Town has had several meetings with the CSCO. The CSCO has expressed a desire for certain items to be included in the agreement with the Town:
- The Development of an Operating Agreement
- The Facility be designated as a Municipal Capital Facility
- Donation of
- Site Servicing to be provided by the Town
- Waiving of Development Charges
- The Town to be a Guarantor
- A Capital Contribution to be provided by the Town
Town staff has considered these requests and have recommended the following:
1. The Development of an Operating Agreement – The proposal is that the CSCO and the Town are equal partners in the facility. It is expected that The CSCO requires 20-30% of the total operating hours to dedicate towards high performance athletes and that the Town will require 10-20% of the total operating hours. As previously mentioned, the prime time hours that the Town will have demand for by 2014 account for only 8% of the total CSIO hours; therefore, there is significant room to increase the hours available for Town Community use (and thereby reducing the need for building further Town facilities within the existing urban boundaries). The remaining 50-70% of the CSIO operating hours would be rented out to the Adult Sports market/other at full market rates.
|
User |
Market |
Usage |
Rates to be Charged |
|
CSCO |
High Performance Athletes |
20-30% |
CSCO Rates * |
|
Town |
Community Use |
10-20% |
Community Rates |
|
Market |
Adult Sports Market/Other |
50-70% |
Full Market Rates |
* The CSCO rate will be no less than the Town’s community rate.
It is expected that the Adult Sports Market/Other usage will result in an operating profit that will allow the Town and CSCO to provide the facility to their users at discounted rates while still generating a net profit.
§ CSIO Estimated Annual Operating Pro Forma Summary is as follows:
$11,100,000 Total Revenue
$ 9,400,000 Operating
Expenses
$ 1,700,000 Net
Operating Income
$ 5,100,000 Sponsorship & Capital Campaign
$ 500,000 Capital
Reserves
$ 6,300,000 Net Income (before debt)
Source: CSIO Capital Cost
Estimate & Operating Proforma – Redcliffe Realty Group
§ This pro forma assumes no annual debt financing costs.
§
Sponsorship and Capital
Campaign estimates are based on assumptions that were used in the Canadian
Sport Centre previous
In general terms, given the multiple proposed partners in the facility and the usage patterns that differ amongst the partners, a successful operating model is anticipated.
Looking at a
worst case scenario with 75% to 100% of operating expenses and only 50% of
revenues with zero naming rights or sponsorship revenue, the CSIO facility
would lose $1.5 – 3.8 million annually, based on the Redcliffe Proforma. If this loss is shared with CSCO, then the
worst case scenario for the Town would be an annual loss of approximately $1.9
million. This is comparable to the
approximate $1.6 million subsidy to operate
2. The Facility be designated as a Municipal Capital Facility – The CSCO position is that the facility be classified as a municipal Capital Facility in order to make it exempt from property taxes. Town staff agrees with this concept and by designating it as a Municipal Capital Facility, it would result in the avoidance of approximately $4.9 million in property taxes annually; $625,000 of which the Town would forego.
|
Town of |
$ 625,000 |
|
Region of |
$1,175,000 |
|
|
$3,100,000 |
|
Total Taxes |
$4,900,000 |
3.
Donation of
4. Site Servicing – The CSCO requested that the Town pay for all costs related to site servicing. Currently site servicing costs are estimated to be approximately $10 million made up of the following items:
|
Access Roads, Storm Water Management, Sanitary Sewer Connection, Storm Sewer Connection |
$ 5,000,000 |
|
Watercourse Diversion, Service Relocation |
$ 3,000,000 |
|
Contingency |
$ 2,000,000 |
|
Total |
$10,000,000 |
Town staff’s position is that these costs be included in the total cost of the facility.
5. Waiving of Development Charges – the CSCO has requested that the Town waive the Development Charges on the project. The Development Charges for a project of this magnitude are estimated to be approximately $17.2 million:
|
Town of |
|
|
Town Wide Hard |
$ 920,000 |
|
Town Wide Soft |
$ 200,000 |
|
Area Specific |
$ 9,330,000 |
|
Town of |
$10,450,000 |
|
Region of |
$ 6,590,000 |
|
|
$ 160,000 |
|
Total |
$17,200,000 |
Town staff’s recommendation is that since these costs will have to be paid, that they be included in the total cost of building the facility.
6. The Town to be a Guarantor – The CSCO’s position is that the Town would guarantee the loans necessary if there is a capital funding shortfall and to be responsible for any operating shortfalls. Town staff’s position is that the Town could consider a guarantee under certain circumstances (eg.. if the funding shortfall is not significant and the operating projections look favourable) and that the Province or third parties be approached to co-guarantee any required loans and operating shortfalls. As well, as the CSCO and the Town would be equal partners, they should both share in any operating surpluses or shortfalls.
7. A Capital Contribution to be provided by the Town – The CSCO requires a capital contribution by the Town in order to seek funding from other levels of government. The total cost of building the CSIO facility (not including the office tower) will be approximately $280 million, made up of the following components:
The breakdown of
the Facility Capital Cost is:
Construction $129,700,000
Soft Costs $ 19,600,000
Furniture, Fixtures & Equipment $ 17,900,000
Project Indirects $ 1,300,000
Project Contingency $ 29,500,000
$198,000,000
Additional costs include:
Site Servicing $ 10,000.000
Dev. Charges/Fees $ 17,000,000
Inflation Contingency $ 25,000,000
Transportation
Contingency $ 30,000,000
Therefore the total estimated cost is $280,000,000
§ Land costs are excluded. There is no construction financing costs.
§ The capital cost of the office tower and residences is $38.5 million, anticipated to be constructed by private enterprise.
§ The capital cost of constructing the required parking structure is excluded as it is anticipated this cost will be funded by GO transit.
The capital cost
of constructing the facility as detailed by the Canadian Sport Centre
consultants was examined by our Finance Department and deemed to be a realistic
and representative estimate based on construction costs of other Town of
The Development Charge Reserve for Recreation is the proposed funding source for the capital contribution to CSIO. An analysis of future Development Charge (DC) revenue identified the construction of two new community centres in the period 2004 – 2021, which are specifically referenced in the Master Plan as an East Markham Community Centre and a Southeast Community Centre.
Assuming construction of the East Markham Community Centre, at approximately 104,000 sq.ft. of recreation amenities, there are sufficient DC funds projected to provide a capital contribution of approximately $50 million for the CSIO.
|
Total Projected DC Revenue to 2021 |
$86,500,000 |
|
Projected |
$46,500,000 |
|
DC Balance Remaining |
$40,000,000 |
|
Inflation Adjustment |
$10,000,000 |
|
Projected DC Balance |
$50,000,000 |
As the CSIO facility would allow for the same community usage that a stand-alone Town operated facility would provide (as well as having the opportunity to increase hours as needed), the Town should at a minimum be prepared to pay the same amount as it would to construct a South East facility (estimated at $50 million). As a result, it is recommended that the Town contribute the full $50 million of DCs towards the CSIO project. Furthermore, as Development Charges can only be used to fund 90% of soft services, there would need to be an additional $5.5 million contribution from a non-DC source (taxes, reserve, etc) for a total cash contribution of $55.5 million. Therefore $224.5 million would still need to be contributed from other sources. Any funding shortfall would have to potentially be borrowed or the project be scaled down.
It should be noted that in addition to the recommended $55.5 million cash contribution, it is also recommended that the Town contribute 7 acres of land (valued at $1 million per acre). As well, by making the CSIO a Municipal Capital Facility, the Town is foregoing over 600,000 annually in property taxes. Therefore the total Town contribution to the CSIO is as follows:
|
Cash: |
|
|
Recreation Development Charges |
$50,000,000 |
|
10% Non-Development Charges |
$ 5,500,000 |
|
In-Kind: |
|
|
Land |
$ 7,000,000 |
|
Property Tax Exemption* |
$ 6,000,000 |
|
Total Contribution |
$68,500,000 |
*Municipal portion; calculated for 10 years at $600,000 annually
Project Expenses
The next step is for a consultant to prepare a more detailed financial analysis of this project given the assumptions outlined in this report. As well, other levels of government will be approached to determine their respective funding commitments.
To date, $164,000 has been approved for the analysis of this project of which $145,072 has been committed:
It is recommended that a further $100,000 be approved to support any further analysis, to be funded from the corporate rate stabilization reserve. It is anticipated that these additional funds will be used to engage outside consulting expertise to revise the initial cost estimates and operating proforma based now on Markham’s articulated needs, an in depth peer review of all capital and operating costs and projected revenues, preparation of briefs and visuals to various levels of government and potential private sector stakeholders, legal consultation and general expenditures and travel.
ENVIRONMENTAL CONSIDERATIONS:
The Canadian Sports Institute will incorporate an environmentally friendly building design, energy consumption and product procurement in the development of the facility.
ACCESSIBILITY CONSIDERATIONS:
The facility will be designed with regard to ensuring accessibility of all its users.
ENGAGE 21ST CONSIDERATIONS:
This project
aligns with the following Town of
BUSINESS UNITS CONSULTED AND AFFECTED:
Community & Fire Services
Corporate Services
Development Services
RECOMMENDED
BY: ________________________ ________________________
Allan Seabrooke Joel Lustig,
Director,
Jim Sales, Commissioner, Andy Taylor, Commissioner,
Community & Fire Services Corporate Services
ATTACHMENTS:
Appendix A Site Layout & Overall Ground Floor Plan
Appendix A-1 Canadian Sport Institute
Appendix B Aquatic Centre, Ground Floor Plan
Appendix C Field House, Ground Floor Plan
Appendix D Arena, Ground Floor Plan
Appendix
Appendix F Option 2 – Open Channel along South & East Boundary of CSIO
Site
Appendix G East District Precinct Plan – Planned Road Improvements
Appendix
Appendix I Canadian Sport Institute
Appendix J Master Plan Recommendations – Implications for CSIO
Q:\Strategic
Services\Members\Allan Seabrooke\CSIO\Report - CSIO Study Final.doc