Agenda Item No.:__E.1.c.________
Hall D Expansion of the Shaw Conference Centre
Recommendation:
That City Council approve, in principle, the
expansion of the Shaw Conference Centre
on condition that:
1. $30 million in project costs are shared
equally among all three levels of
government;
2. Once Partnership funding has been
secured, a report requesting budget
approval will be brought back to City
Council for concurrence incorporating a
funding strategy for the City share.
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Report Summary
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This report requests City Council's
concurrence in principle to proceed with
the expansion of the Shaw Conference
Centre Hall D conditional on securing
partnership funding with the Federal and
Provincial governments.
Report
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Since the Shaw Conference Centre
opened in 1983, (then known as the
Edmonton Convention Centre),
successful Canadian national
associations as well as international
associations have responded to the
information age by dramatically
increasing their memberships, delegate
attendance at conventions and most
particularly their need for exhibition and
programming space.
Growth in this market has been so strong
that in 1996 Edmonton climbed to third
place among Canadian cities as a
business travel destination. In 1997
Edmonton’s convention facility was 67th
by size in North America but in only two
years we dropped to 84th place.
Routing:
Delegation:
Written By:
April 10, 2001
File: 2001EDE002
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Executive Committee  City Council
Mike Fitzpatrick/Jim Edwards
Mike Fitzpatrick/Jim Edwards
Economic Development Edmonton
(Page 1 of 3)
Industry research in 2000 shows that
16.4 million square feet of new space
will be completed in North America by
2004. That is already 50% more space
than was projected only two years
earlier, and involves the expansion of 72
existing facilities and the construction of
21 completely new buildings. Thirtyfive cities have already started their
projects.
Many prominent and important
Canadian national conventions have
been forced to deal with the reality of
insufficient meeting and exhibition space
in both of Alberta’s largest cities, some
can still not return to Alberta until the
Shaw Conference Centre expands.
Over the years this constraint has
impacted the plans of; Canadian
Association of Broadcasters, Canadian
Institute of Mining and Metallurgy,
Canadian Telecommunications Alliance,
Canadian Cable Television Association,
The Royal Canadian Legion, The Royal
College of Physicians and Surgeons,
Treasury Management Association of
Canada and Rendezvous Canada.
While the space needs of many of the
Shaw Conference Centre clients have
been increasing in recent years, the
overall capacity of the SCC remains
unchanged since 1983. Exhibitor rentals
are the single most important funding
source for many SCC clients and our
inability to provide sufficient space
forces the elimination of Edmonton from
their future schedules. In addition to the
economic losses, space restrictions also
cause financial loss when the SCC is
unable to provide food and beverage
Hall D Expansion of the Shaw Conference Centre
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services because there is no space for
organized meal functions.
The Hall D project involves the
rehabilitation of 55,000 Sq.Ft. of underutilized space at the Pedway level and
includes a spectacular new exhibition
hall of 26,000 Sq.Ft. overlooking the
North Saskatchewan river valley.
The newly developed space will be
designed, as much as possible, for client
program use. Additional storage will be
added elsewhere in the existing building
and a service elevator will provide for
quick and convenient delivery of
equipment and food and beverage
services. Plenary session capacity is
expected to be in the 3000 person range,
1500+ persons for dining, or
approximately 100 to 150 exhibit booths.
Calgary, Quebec City and Toronto have
completed expansions of their
convention facilities. Ottawa and
Vancouver have both completed
extensive feasibility studies and plan to
start construction at the very earliest
opportunity. Edmonton’s ability to
retain our strong position as a destination
of choice is not assured. The relative
proximity of western cities with newly
upgraded facilities will continue to erode
Edmonton’s position in the Canadian
marketplace.
Budget / Financial Implications
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Based on the preliminary design and
feasibility studies, the expansion of the
Shaw Conference Center will require
$30 million in funding (2002 -$1.2
million, 2003 $8.1 million & $20.7
million in 2004).
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Once constructed, it is expected that the
additional revenues generated from the
expansion will offset any operational
costs (no impact on tax levy).
In order for this project to proceed, the
City must be successful in securing
partnership funding with the Federal and
Provincial governments for two-thirds
the capital costs.
To fund the City's share of capital costs
($10 million), City Administration has
considered the following funding
strategies:
1. Increase Pay-As-You-Go funding
over the period 2002 - 2004
generated by way of a property /
business tax increase;
2. Debenture Borrowing - issue a 20
year debenture matched with a
property tax increase to cover debt
charges;
3. Re-Prioritize our existing approved
Capital Priorities Plan to release payas-you-go funds for this project and
correspondingly reduce funding for
other projects.
For financial planning and budget
purposes, Administration will show the
funding source for the City's share of the
project costs as being either Pay-AsYou-Go funding or Debenture
Borrowing.
Under this proposal, City Council is
approving, in principle, the project on
the condition that partnership funding is
secured. This project will appear in the
Capital Priorities Plan as funded
however with no authority to spend.
Hall D Expansion of the Shaw Conference Centre
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Once partnership funding has been
secured, Economic Development
Edmonton will return to City Council to
obtain budget approval and finalization
of the financing strategy for the City's
share.
Justification of Recommendation
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The expansion alone is projected to
generate almost $9 million annually in
non-resident expenditure which would
bring the total for all of the SCC to $40.5
million annually by 2004. Within 5
years the additional economic impact
will exceed, every year, the value of the
City’s initial investment!
Added tax revenues alone will return
$10 million to the Province of Alberta in
about 12 years, and the federal
government will recover their share from
taxes in just over 4 years.
Approving the concept of the project
will allow EDE to accelerate
negotiations in securing partnership
funding from the Federal and Provincial
governments. It shows the City's
commitment to proceeding with this
project on the condition of participation
by other levels of government.
From an investment perspective, this
financing approach returns $67 to the
City for every $33 invested.
Background Information Attached
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Shaw Conference Centre: Proposed Hall
D Expansion Summary Sheet