Other Global arenas in red ink

They’re not losing as much as Abbotsford, but two other communities that recently built arenas and contracted Global Spectrum to operate the facilities are also recording red ink.

They’re not losing as much as Abbotsford, but two other communities that recently built arenas and contracted Global Spectrum to operate the facilities are also recording red ink.

The South Okanagan Events Centre (SOEC) in Penticton had a $1.8-million deficit this year, compared to $2.2 million in its first year of operation.

The 7,000-seat Abbotsford Entertainment and Sports Centre (AESC) had a shortfall of $2.6 million in 2009, rising to $3.4 million in 2010, including $1.2 million in payments to the AHL Heat under a supply fee contract.

City of Penticton chief administrative officer Annette Antoniak said the situation in Penticton is slightly different than Abbotsford, because a trade and convention centre is also part of the SOEC picture, and such centres are generally viewed as costing money to generate business.

“They run at a loss,” said Antoniak. “They’re created to generate economic spinoff for the community.”

She said the city shares in the expenses to stage performances at the SOEC, and has become very selective about what acts are booked. Carrie Underwood was a financial success, and country acts are generally considered a safe bet. Abbotsford rock band Hedley gave the SOEC a profitable night, and the facility is hosting Cirque du Soleil, as is Abbotsford on June 2.

However, the rock band Kiss, also appearing in Abbotsford, was not booked in Penticton. Staff felt the ticket prices would be so high they might not sell enough to cover considerable expenses.

Doug Leahy, Penticton’s chief financial officer, said he expects the SOEC will generally be subsidized to the tune of $1.5 to $1.6 million for the foreseeable future. However, he said it will also generate millions for the city in economic spinoffs.

Dawson Creek’s arena subsidy rose in its third year of operation. The 4,500-seat EnCana Events Centre had a deficit of $1.6 million its first year in 2008, dropped to $1.3 million in 2009, and rose to $1.5 million last year.

Jim Chute, Dawson Creek’s chief administrative officer, said last year’s figures were down, both for the number of events at the building, and the profit per event.

With Junior A hockey coming to the building, the Dawson Creek Rage of the North American Hockey League, Chute is projecting better years. He noted the team also brought some added expenses such as changeroom upgrades, and netting around the arena.

And, the team is going to be subsidized by the city for its first three seasons – $250,000 the first year, $200,000 the second and $175,000 for the third.

Dawson Creek is a 10-minute drive to the Alberta border, and shoppers travel there for lower taxes. The EnCana Events Centre is intended to reverse that flow of traffic. Estimates have put the economic benefit as high as $10 million per year.

Kiss will be performing there – selling out in 22 minutes.

As to Global Spectrum’s performance – it’s meeting expectations, he said.

Like his Penticton counterpart, Chute also expects the City of Dawson Creek to be subsidizing the EnCana Events Centre for years.

“The original plan at opening was to get to break-even in 10 years.”