Edmonton Arena District

Katz Group Statement on Council Vote

Wed, 26 Oct 2011 17:06:00 -0700

We very much appreciate City Council's strong vote of support for the downtown arena, as well as the considerable time and effort Mayor Mandel and City Administration, in particular, have put into this project.

We will work with City Administration to understand the implications of the new elements of the deal introduced in today's motion in the context of the agreements that need to be completed by month-end.

We also want to take this opportunity to thank everyone who participated in the public hearing and to say once again that we believe the Edmonton Arena District is a great opportunity that will benefit our entire city and region.

John Karvellas

Executive Vice President

Katz Group

"I am thrilled for the City of Edmonton and I want to congratulate and thank Mayor Mandel and Daryl Katz for their hard work and commitment. The future of the Oilers couldn't be brighter."

Gary Bettman

NHL Commissioner

Katz Group Statement on October 14 meeting

Fri, 14 Oct 2011 17:06:00 -0700

We respect the City's process and appreciate the time Council and Administration devoted to the arena project in today's special meeting. We have the basis of an agreement that will enable us to move this project forward, subject to the approval of City Council on October 26, 2011. We continue to believe, as we have from day one, that this project represents a great opportunity to help revitalize our downtown and ensure the Oilers' long-term sustainability in Edmonton.

John Karvellas
Executive Vice President
Katz Group

Katz Group Comments on Status of Arena Negotiations

Thu, 29 Sep 2011 10:55:00 -0700

The Katz Group today released the following statement from John Karvellas, Executive Vice President and General Counsel:

We appreciate the time and effort City Council and City Administration have devoted to the proposed downtown arena project, and want to offer some context on a number of points that have been the subject of recent discussion.

It is important for Edmontonians to understand why we have set a deadline of October 31, 2011 to have a firm agreement with the City.

The expiry of our purchase rights on the downtown land is one important factor, but it is not the only one. The Oilers’ lease at Rexall Place expires in less than 33 months, and we are already well past the point of being able to have a new arena in place when the Oilers' 2014 season opens. Soon we will lose the opportunity to be in a new arena for the 2015 season. And construction costs are rising, as we have feared they would. These and other factors create a real and unavoidable urgency to get something done.

As we have exhausted our rights to extend the closing date on the land needed for the downtown arena, we must make a very significant investment by no later than October 31, 2011 to keep the project alive.

This would be in addition to the more than $25 million we have invested since the City asked us to lead this project more than three years ago, in the spring of 2008.

To be absolutely clear, the Katz Group remains firmly committed to getting a deal done with the City. Under the May 18 Agreement Framework, Daryl Katz is to invest $100 million into the arena, which the City would own, and to contribute a further $125 million from ticket sales, the proceeds from which would otherwise go to the Katz Group. In addition, subject to commercial viability, he intends to invest at least an additional $100 million in the private sector development around the arena, and to have the Oilers sign a location agreement that will keep the the team in Edmonton for 35 years. Added to the value of the team itself, this represents a total commitment to this project and the City of Edmonton of more than $525 million.

This is significantly greater than the commitments made by owners of NHL franchises operating in comparable or even larger markets that are much better able than Edmonton to sustain an NHL franchise. NHL Commissioner Gary Bettman has called Daryl Katz’s proposed investment in this case “unprecedented”.

This project has enormous potential to transform our city and create jobs, opportunity and other benefits for the entire region – and to ensure the Oilers’ long-term sustainability in Edmonton. By City Administration’s own estimate, a new downtown arena can be the driver for $1.2 billion in new municipal revenues that the City could use to fund a host of exciting civic projects.

The challenge is that the City has not yet been able to resolve certain fundamental elements of the Agreement Framework. These include closing a $100 million funding gap and obtaining a non- compete agreement from Northlands, which we have always understood to be the City’s responsibility and without which the new arena is not economically viable. We are seeking fair and reasonable solutions to these issues so that we can continue to move this project forward.

It has been more than three years since the Mayor’s Leadership Committee called a new downtown arena “Edmonton’s greatest opportunity”. We have seen what has been accomplished since that time in Winnipeg, where government support was key to bringing the NHL back to that city; in Quebec City, where two orders of government committed $400 million in public funding towards a

new arena to attract the NHL; and with the publicly-funded $500 million refurbishment of BC Place in Vancouver. We have every confidence Edmonton can realize a similar opportunity – especially given Daryl Katz’s proposal and the considerable public support that exists for the project.

We have great respect for the City’s process and its need to achieve an agreement that is fair for all concerned. But ultimately this is not just a debate over a funding model - it is a question of what kind of city Edmonton wants to become.

About Katz Group

Founded by Daryl Katz in 1990 and headquartered in Edmonton, the Katz Group is one of Canada’s largest privately- owned companies with operations in the pharmacy, sports & entertainment, and real estate development sectors. In addition to the company’s North American pharmacy operations, which operate primarily under the Rexall, PharmaPlus, Guardian, IDA and Medicine Shoppe banners, the Katz Group owns the Edmonton Oilers (NHL), Edmonton Oil Kings (WHL), Oklahoma City Barons (AHL) and the Edmonton Capitals (NAL), as well as Aquila Productions, one of Canada’s leading entertainment and event companies. Through its wholly-owned C&H group of companies, the Katz Group is involved in land assembly, site and building development, and the operation of multiple development projects in Canada and the US.

Daryl Katz in conversation with Bob Stauffer of Oilers Lunch on Team 1260

Thu, 19 May 2011 12:17:00 -0700

May 19, 2011 -- Daryl Katz discusses last night's announcement of an agreement framework to fund a new downtown arena for the Oilers in Edmonton with Bob Stauffer of Oilers Lunch. Listen now: Oilers Lunch on Team 1260

City and Katz Group agree on agreement framework to build arena

Wed, 18 May 2011 20:45:00 -0700

City Council has approved an agreement framework between the City and the Katz Group to build a new downtown arena. The framework sustains NHL hockey in Edmonton for 35 years, supports downtown revitalization and limits the City's risk.

The terms of the framework will form the basis for the City and the Katz Group to negotiate a formal Master Agreement. Both parties can now also begin to pursue additional funding sources.

"We believe this framework is fair for both sides and reflects what we heard from Edmontonians," says City Manager Simon Farbrother. "This framework allows us to move forward with this project and ensures that we will continue to align our efforts with what the community has told us are Edmonton's priorities for this important project."

"From the beginning we have approached this project with the twin objectives of creating a major engine to drive the revitalization of downtown and of creating a model for the long term sustainability of the Oilers in Edmonton," says Katz Group Executive Vice President Bob Black. "City Council's decision is a watershed moment that puts us on a path towards achieving these objectives. There remains a lot of hard work ahead to conclude a definitive agreement and we are anxious to do so as soon as possible."

The framework closely reflects the terms and conditions outlined by Council in the motion passed at their April 6^th meeting (www.edmonton.ca/downtownarena). Among the key highlights:

The price for the arena building is set at $450M

The City's contribution to the building is $125M

The Katz Group will contribute $100M

$125M will come from a user-paid facility fee

The City will own the building and land

The Katz Group will operate the building and be responsible for all maintenance, upgrades, operating and capital expense costs

The Oilers will remain in Edmonton for at least 35 years

This framework does not constitute a final and binding agreement. Both parties will now begin to work on the Master Agreement to advance the project further, including by working to secure the remaining funds required.

Contact:

Ronna Bremer

City of Edmonton, Corporate Communications

Phone: 780.944.7753 or 780.405.6484 (cell)

Steve Hogle

Edmonton Arena District, Vice President Communications

Katz Group

shogle@katzgroup.ca

780 932 2615 c

NHL Commissioner Bettman comments on the proposed Edmonton Arena District

Mon, 21 Feb 2011 11:23:00 -0800

On February 21, 2011, NHL Commissioner Gary Bettman spoke to Edmonton media on the proposed Edmonton Arena District. You can view his comments on our video page.

Katz Group statement

Mon, 21 Feb 2011 09:54:00 -0800

Katz Group EVP Bob Black responds to NHL Commissioner Bettman's comments on the proposed Edmonton Arena District on February 21, 2011.

"We appreciate the Commissioner's comments and his support for the project. We continue to work with City Administration to settle on a financial framework that serves the City and ensures the Oilers' long-term sustainability in Edmonton. We sincerely hope we can make some significant progress in our talks in the next short while. Time is the enemy and we need a deal with the City very soon in order to ensure we have a new building before our lease expires in 2014, to lock down pricing before the predicted escalation in labour and materials prices and to capitalise on the numerous expressions of interest we have received from prospective tenants and partners for the district."

To watch the video of NHL Commissioner Bettman's comments to media, watch the video online.

City of Edmonton Releases Consultation Report

Thu, 13 Jan 2011 12:34:00 -0800

The City of Edmonton released a consultation report today revealing broad support for the Edmonton Arena District. The report was one in a series of documents released before City Council meets to discuss the EAD on January 17, 2011. You can find more details and all the reports by visiting http://www.edmonton.ca/city_government/news/survey-shows-conditional-support.aspx.

Information about Oilers' visit to Quebec City

Wed, 01 Dec 2010 12:25:00 -0800

Edmonton Oilers' President and CEO Patrick LaForge, President of Hockey Operations Kevin Lowe and Katz Group CFO Paul Marcaccio met Quebec City Mayor Regis Labeaume, among others, today in Quebec City. Our representatives are on a fact-finding mission to gather information on the Quebec arena project, the contemplated funding model and that City's discussions with other orders of government.

Patrick, Kevin and Paul hope to learn from the Quebec City experience and bring back insights that will help move the process forward here in Edmonton. We remain focused on our efforts to develop the funding structure required to enable the Edmonton Arena District project to proceed. Today was a convenient date for the meeting in Quebec City since the Oilers are already in nearby Montreal to play the Canadiens and our group is with the team.

Information About the City of Edmonton Public Consultation

Mon, 01 Nov 2010 09:16:00 -0700

The City of Edmonton is currently conducting a public consultation on the proposed downtown sports and entertainment facility. The results will be used by City Council as part of its analysis and decision-making. City Administration was asked to develop a consultation program at the July 21, 2010 meeting of City Council.

For more information about the public consultation and to participate in the City's online survey, click here.

Katz Group Issues Request for Qualifications for Architectural and Engineering Services for Downtown Arena

Fri, 22 Oct 2010 10:02:00 -0700

The Katz Group today issued a Request for Qualifications (RFQ) for Architectural and Engineering Services for the proposed downtown arena, the centrepiece of the Edmonton Arena District. A copy of the RFQ is available for download here (PDF).

The RFQ is a preliminary step in the process of building a team of professionals to initiate the architectural design of the proposed arena. With the support of City Administration, the Katz Group is beginning this process now, in the absence of certain agreements, including a resolution of City Council with respect to funding, to be in a position to meet future timelines for design and development of the project.

The RFQ will gather expressions of interest and qualifications from Edmonton-based firms and as well as other national and international candidates. The Katz Group intends to engage an internationally renowned architect to serve as the Design Architect for the project. This RFQ is requesting interested architectural and engineering firms to submit their qualifications to serve in roles supporting the Design Architect, including the "Arena Architect" and other supporting roles within the "Architect of Record Team".

Architectural and engineering firms interested in serving as the Arena Architect or on the Architect of Record Team are encouraged to submit their qualifications. The Arena Architect must have extensive experience in the design of professional sports and event centres, with particular emphasis on recently constructed NHL arenas. Arena experience is not a prerequisite for members of the Architect of Record Team, but they will be required to demonstrate experience that is relevant to this project.

The Katz Group is committed to drawing heavily on local expertise. Accordingly, if submissions are judged to be equal, preference will be given to local firms.

The Katz Group has engaged ICON Venue Group as its Project Manager to assist in the solicitation of interest in the Arena Architect and the Architect of Record Team. City Administration recognizes ICON as a firm with worldwide experience in project management in this field. ICON has held similar positions in recent arena developments in North America, including the new facility in Pittsburgh, which was the first Certified LEED Gold Sports Arena in North America.

Katz Group Presentation to Edmonton City Council - July 21, 2010

Fri, 23 Jul 2010 14:20:00 -0700

CHECK AGAINST DELIVERY

** To view a video of Daryl Katz's portion of the presentation, click here.

John Karvellas

Good afternoon Mr. Mayor, members of City Council and City Administration. My name is John Karvellas and I am Executive Vice President and General Counsel for the Katz Group.

I would like to thank the Mayor and City Council for inviting us here today. I would also like to thank Simon Farbrother, Gary Klassen, Lorna Rosen and their colleagues for their report and presentation of it today, and for the work they have done on this matter over the past many months.

Let me quickly introduce the members of our team who are here today to participate in our presentation and to answer questions. From the Katz Group, we have:

- Daryl Katz, Founder and Chairman of the Katz Group
- Paul Marcaccio, Executive Vice President and Chief Financial Officer,
- Bob Black, Executive Vice President, Sports and Entertainment,
- Patrick LaForge, President, Edmonton Oilers Hockey Club, and
- Janet Riopel, who has led our community consultation program.

I am also very pleased to introduce you to Ted Tanner, Executive Vice President, Real Estate Development for AEG. AEG is the world leader in developing vibrant and successful sports and entertainment-based districts and has been advising us on the Edmonton Arena District. Ted has joined us from Los Angeles for today's meeting.

We have had many others, both in-house and outside advisors and consultants, assist us with this project and I wish to acknowledge the value they have provided, as they will not be part of our presentation today.

Daryl Katz will begin our presentation by talking about the need and opportunity for a new downtown arena.

Ted Tanner will speak briefly about AEG, its capabilities and its expertise developing arena projects elsewhere in North America and around the world and the value such projects can bring to a city.

Paul Marcaccio will discuss some of the financial realities facing the Oilers and professional sports teams in general , and will then comment on the funding framework described in the Administration report.

I will offer some closing remarks, at which point we will be pleased to turn the meeting back to you for your questions.

With that, I would like to call upon Daryl Katz.

Daryl Katz

Thanks John, and good afternoon Mayor Mandel and members of city council.

I want to thank you... each of you... for the opportunity to share our vision and answer your questions.

I particularly want to thank Mayor Mandel and the City Administration for your efforts over the past many months to help us move this project through the City's process.

I know we haven't always made it easy -- and I'll be the first to apologize for that -- but I can assure you that our hearts are in the right place.

Like each and every one of you, I am passionate about this city. I love its community spirit. I believe in its future, and I am committed to helping build it.

I also recognize that I have the easy job. I am the proponent of a bold vision...which is not mine alone... for a project that can help Edmonton realize many of its broader goals... as a gateway to the North, as a liveable city that is attractive to business and marked by great urban design, and as a vibrant centre of sports, culture, post-secondary education and so much more.

You have the difficult job. You have to weigh this project against other worthy priorities. I respect that, and I hope that through today's discussion we can help make your job easier by articulating why this project is necessary... important and can benefit all Edmontonians.

I also want to say we recognize the many positive developments already underway downtown. Many of these -- like the LRT expansion, the Jasper Avenue upgrade and the Art Gallery of Alberta -- are the direct result of your leadership and support.

Our own direct involvement in the revitalization of downtown began...over 2 years ago... in April 2008 when then-City Manager Al Maurer asked John Karvellas if we would agree to lead the process of developing a new downtown arena.

This was before we had even closed our purchase of the Oilers, but we were proud to accept that role and have since put... our time, our energy, our reputations and a significant amount of risk capital into the effort.

We have accomplished a lot since then, not the least of which has been to secure 16 acres of undeveloped downtown real estate and engage AEG to advise on its development.

But today isn't about real estate.

It's about giving you the information you need to properly consider this project.

From my perspective, this project has always been about three fundamental things:

1) It is about sustaining the NHL and the Edmonton Oilers -- in Edmonton -- for the long-term;

2) It is about using Edmonton's need for a new arena to provide a major catalyst for the ongoing revitalization of downtown; and

3) It is about capitalizing on the broader opportunity to secure a dynamic future for our city.

Let's start with the Oilers.

It's no secret that I have had a lifelong passion for the Oilers and would desperately love to see the Stanley Cup back in Edmonton.

But that's not why I bought the team. If that was all this was about, I could have remained a fan without all of this public attention.

I bought the team for 3 reasons:

FIRSTLY...While the EIG recognized the need for a new arena to ensure the team's viability, the group did not display the willingness or cohesion to build one;

SECONDLY...I wanted to work with the various stakeholders to ensure the long-term sustainability of the Oilers in Edmonton; and

THIRDLY...I am an Edmontonian, born and raised, and I saw the arena as a means to create something really significant for the city's future.

Now some may say the Oilers are just a hockey team, but I think we all know that they are much more than that.

They are an essential part of our history, our identity, our community and our economy.

We are all very fortunate to have them.

But the team is also a business and like any business, it needs a sound financial base in order to be sustainable which today it is NOT.

I'll ask Paul to speak more specifically about the realities of the Oilers' business in a few minutes.

But first, I'd like to talk about the contribution that I believe the Edmonton Arena District can make to the future of our City...

Edmonton is a great, great city.... I believe that as strongly as anyone here... and with all my heart.

But if we don't move forward... we will fall behind.... It's that simple.

So we can - and we should - debate transportation concerns, funding models and design details...and we will.

But at the end of the day, the real question is: How do we make Edmonton better? How do we make Edmonton more competitive? How do we build on our identity as a great Northern city... with an unrivalled community spirit?

The answer... as this Council has demonstrated it is well aware... is that we have to make strategic investments in our future and in our community.

We have invested in ring roads, the LRT and other civic infrastructure - and for good reason.

But we also need to make strategic investments in the heart and soul of our city - and that means our downtown.

No one combines sports, entertainment and community better than Edmonton.

Think about the Heritage Classic.

That event -- in its originality, in its scale, and in the way in which it drew upon the special relationship between Edmonton and the Oilers -- is what Edmonton is all about.

The Heritage Classic is now a marquee event of the NHL season and every year it is acknowledged to millions of people across North America that Edmonton was the city that gave birth to it. OUR CITY CREATED THAT.

If we can bring that kind of vision and spirit into our downtown, we will have done something really good and important.

But it's more than that, too.

From the beginning... we have pursued a vision that we believe will benefit all Edmontonians... by creating jobs... by providing a jolt of investment to our urban centre... by shrinking our environmental footprint and by developing a world class sports and entertainment district in the core of our City.

I believe we have a once in a generation opportunity -- through the Oilers, and through the need for a new arena -- to do something transformative for downtown and for our city.

Edmonton is the gateway to the North - a region that is poised to become the oil capital of the world. There is currently $150 Billion of committed investment in our region...with far more to come.

A new downtown arena district can represent Edmonton's potential, its capacity to be bold and to think big, and its future as a leading Northern city.

I believe this project is important for Edmonton's long-term competitiveness. I also believe it is achievable, and I want you to know that I am prepared to do my part to make it happen...

As you know, I invested on the order of $200 million to buy the team.

At that time, I made a commitment to invest $100 million towards the development of a new arena. Several months ago, we proposed a model that would see that money drive private sector investment to help support public financing of the arena.

Mayor Mandel has since stressed to me the importance of putting my investment directly into the construction of a new arena... that will be owned by the City of Edmonton...and if that's what it takes to move this project forward..... then I am prepared to do that.

I am also prepared to sign a location agreement as part of a lease in a new downtown arena.....that will keep the Oilers in Edmonton.

In addition.... I still fully intend to invest at least another $100 million in leading the development of the Arena District.

Taken together, I expect that I will invest no less than $400 million with the aim of:

- ensuring the long-term sustainability of the Oilers in Edmonton,

- creating a major catalyst in the ongoing revitalization of downtown, and

- contributing to a positive sense of momentum in our city that is worthy of our place in the world and our potential.

This is not an amount of money I invest casually or without regard for risk.

But to make it happen, we need the City of Edmonton to be our "partner". And like in any partnership we understand that the deal has to work for both sides.

So, what am I asking for in return?

We respect City Council's role in this process.... And... we are not asking you to sign off today on an arena, an arena district or a funding model.

We are asking City Council to give City Administration a mandate to negotiate a deal that -- assuming we can come to terms, and subject to your approval - will enable us to move forward with the development of a new downtown Arena District.

I believe that...together... we have a great opportunity here to do something that will benefit Edmonton for generations to come.

I sincerely hope you will all join us in this effort.

Paul Marcaccio

Thanks, and good afternoon.

As Daryl indicated earlier, I will be sharing with you some of the business realities of operating a National Hockey League franchise and what that means for the Oilers. I will also comment on a potential financial framework for a new arena in the context of the Information Report prepared by the city administration.

NHL Hockey teams generate revenue in the following ways:

- They sell tickets

- They sell advertising and sponsorship opportunities

- They sell broadcast rights

- They sell food, beverages and parking at games

These revenue streams are what we, and the League, refer to as "Hockey Related Revenues". These must be reported to the League and are referenced by the League in making various determinations which impact owners and players across the league.

Most NHL hockey teams also generate revenues from concerts, entertainment events and other arena-based activities. These streams are not considered as Hockey Related Revenues and hence, do not get reported,measured or referred to in any League determinations or statistical reports.

Let's look at each of these in turn.

With the second smallest arena in the League, we are limited in the revenue we can generate from the sale of tickets for seats, and, we have limited premium seating opportunities. As you would expect, food & beverages sales and parking revenues directly correlate to the number of seats available.

Also, Edmonton has the NHL's highest percentage of individual - as opposed to corporate -- season ticket holders, which means many of our ticket holders are paying with after-tax dollars and as such, there is a relatively higher sensitivity to what we can charge for a ticket.

And because the Oilers operate in the smallest media market in the NHL, we face significant limits on the amount of broadcast, advertising and sponsorship revenues we can generate.

I will spend a minute on this point as it is a particularly important and not well appreciated. Edmonton, including the broader capture area which defines the Oiler's geographic market, has the smallest population of any NHL market. In fact, the entire Alberta market, which of course we split with the Flames, is still one of the smaller NHL markets.

This matters because the value of broadcast rights, advertising and sponsorship revenues are based on size of market.

Having the league's second oldest building limits what we can do with food and beverage sales. This is because the concourses at Rexall Place are antiquated and narrow, the commissary facilities are of limited capacity and there is not a full service dining area -- as is the case in virtually every other arena in the NHL.

The last revenue stream I mentioned - concerts, entertainment events and other arena-based activities -is a very important component of the sustainability model for today's NHL teams. These are commercial activities which are ancillary to the game day and other scheduled dates of the team or teams which are the anchor tenant or tenants in a sports facility.

Today, the Oilers are the ONLY team in the NHL that does not control its arena, and the ONLY team that does not receive the Non-Hockey Related Revenues from the facility in which they play.

For sake of comparison: in Edmonton, those revenues go to Northlands. In Calgary, they do not go to the Stampede Board; they go to the Calgary Flames organization.

On the expense side of the ledger, we are more in linewith other teams. That is to say, in the hockey business, expenses are somewhat similar across all teams, given that the single largest component of expense are player salaries, which are bound by a cap and floor, calculated based on league wide Hockey Related Revenues.

As a result, hockey is a business where the operator does not have much discretion over its most significant cost item.

In fact, as the other teams raise the bar on Hockey Related Revenue opportunities, our costs potentially go up while our revenues do not.

Further on the cost side, salaries and certain other costs are denominated in U.S. dollars while for all of the Canadian teams, most revenues are Canadian dollar based, resulting in significant currency exchange risk.

While we exercise prudent risk management over currency exposure, in the long-run this is a risk we cannot control.

Due to our geographic location, the Oilers also incur more travel miles and travel expense than almost any other team in the League.

It is for all of these reasons that we find ourselves talking about the Oilers' long-term sustainability in Rexall Place.

Currently, Daryl Katz has had to subsidize the team by several million dollars in each of the past two years in order for the team to break even.

As I indicated before, this is not because the Oilers' expenses are higher than other teams, but because our revenue opportunities are limited - despite the fact we sell out almost every game.

Under the Oilers' current operating model at Rexall Place - a model in which we do not control non-hockey related revenues -- that trend will likely continue in each year between now and 2014.

As we all know, businesses must generate profits to be sustainable. Hence, if professional hockey in Edmonton is going to be sustainable, something has to change, regardless of who owns the team. No business can sustain losses in perpetuity.

Many factors - such as the size of our market -- cannot be helped. We understand and accept that.

Others can only be addressed by a new arena and having the same operating model as the Calgary Flames and all other NHL teams.

I hope that's a helpful overview. We can try to answer any questions you have in this regard during the Q&A session. For now, let me turn to a discussion of funding.

To preface my remarks on funding, we believe a new downtown arena can be funded with a mix of public and private investment in a manner that benefits the City of Edmonton, without an increase in property tax rates as a direct consequence.

What we hope to do is build on what you have heard from the City Administration and to communicate our optimism that, starting with their proposed funding model and having an opportunity to work through the various elements with the City Administration, we will arrive at a workable solution.

Picking up on Daryl's comments, the Katz Group would invest $100 million directly into the construction of a new arena that will be owned by the City of Edmonton.

We agree with the City Administration report that an additional amount of funding can be financed by the City of Edmonton using a CRL (or Community Revitalization Levy), with all of that amount being repaid over time. We hope to have the opportunity to assess and agree with City Administration on what this amount can be, if based on all new development in and around the proposed arena district.

The prospects of success for the CRL will be greatly enhanced by Katz Group's plans to lead the development of the district, for which we have earmarked a minimum of $100 million of additional investment over time.

We understand Mayor Mandel's belief that there should be some element of "user pay" - or a ticket tax - in the funding model, and we are prepared to have that discussion with City Administration, though for the reasons I touched on earlier, there are natural limits to what we can agree to as relates to revenue streams which impact ticket prices. The balance of funds, including funds for related infrastructure, would come from other sources, including the Federal and Provincial governments.

For this, we would need the City of Edmonton to signal that a downtown arena is a priority and join us in making this request.

In summary, we are aligned with the direction set by the city administration, subject to reaching agreement on the various financial estimates inherent in the structure and specific business terms of the arrangement.

We believe this can work for everyone.

Thank you for your attention. I will now turn the presentation back to John for some closing remarks.

John Karvellas

Thanks Paul.

The need for a new arena is not unique to Edmonton. At some point or another, every NHL market has faced or will face this question.

Certainly, it is a question faced by every market that is in search of a team. In many ways...it is simply the price of being an NHL City and all that brings in the way of national exposure, civic pride, economic impact and identity.

Before I close, permit me to make a few additional points regarding the idea of renovating the existing Rexall Place:

- We know that a renovation of Rexall Place will cost an estimated $250 million, according to a 2008 study by HOK Sports, a world leader in arena design.

- We also know that if that estimate has indeed come down as a result of lower prevailing labour costs, then the same would be true of the construction costs for a downtown arena.

- We know - or at least, we have to believe - that any renovation of Rexall Place will be funded out of existing tax dollars, while construction of a new arena would not. In other words, the cost of renovating Rexall Place will likely come out of the pockets of Edmonton homeowners by way of increased taxes.

- We also know that the financial model to justify any renovation would depend in large part on the willingness of the Edmonton Oilers and Oil Kings to enter into a new lease that runs beyond June 2014. To avoid any uncertainty in this regard, I can tell you that we do not believe a renovation would assist in the sustainability of the Oilers, we will not invest in or otherwise support such a project, and we do not intend to have the Oilers play in a renovated Rexall Place As well, renovating Rexall Place does nothing for downtown Edmonton and will not benefit the City overall in our view.

- Finally, we know - we absolutely know...and understand...and respect - that this downtown project only works if it satisfies the City's planning and development process, fulfills the City's public consultation requirements, and meets with the approval of Edmonton City Council.

In that regard, I would like to say that with Daryl's rather extraordinary support, we are ready and willing to lead the development of a new downtown arena district that can achieve a number of important goals for our city.

We have written expressions of interest from national and international hotel chains, restaurants and retailers.

We have had positive discussions with major office tenants.

These are high quality prospective partners and tenants, but they are facing timelines, competing priorities and decision points of their own.

In order for us to be able to move forward and secure these opportunities, we need some commercial certainty.

Perhaps it goes without saying that we have timing concerns of our own, not the least of which is the need for a new home for the Oilers by the fall of 2014.

So what are we asking for today?

As Daryl indicated, we are asking that you give your Administration authority to negotiate with us to develop an agreement dealing with the design, construction and financing of a new arena and related sports and entertainment facilities in downtown Edmonton.

We will support the City's public consultation process and continue with our own.

It is our desire and hope that prior to the end of this calendar year, a proposed form of agreement would be brought back to Edmonton City Council for discussion and, hopefully, approval.

Let me conclude with Daryl's words: We have an opportunity here to do something that will benefit Edmonton for generations to come. We hope you will join us in the effort.

We will now be pleased to take your questions.

This is your forum and we respect that you will proceed as you may wish, but if you would be so kind as to direct your questions to me, I can refer them to the member of our team that would be best able to respond to each question.

Katz Group Aims to Operate and Develop Sports & Entertainment Assets in Hamilton

Tue, 29 Jun 2010 16:43:00 -0700

Katz Entertainment Holdings Corp. (KEHC), a member of the Katz Group of companies, is working to develop and operate sports and entertainment facilities in Hamilton.

KEHC, with the support of AEG, is currently working with the City of Hamilton to secure a license to manage various facilities owned by the City but currently being operated by Hamilton Entertainment Convention Facilities Inc. (HECFI) including the Victor K. Copps Coliseum.
Hamilton City Council unanimously approved a motion earlier today directing City Administration to work with KEHC to prepare a recommended "non binding MOU with KEHC for operating and managing various City facilities" and bring it back to Council before September 1st for a vote.

Bob Black, Executive Vice President, Sports and Entertainment, Katz Group, said, "We are very pleased to work with the City of Hamilton to build on what is already a rich sports market and a key stop for major cultural attractions and live performances. For the Katz Group, this venture continues the growth of our sports and entertainment business, builds on our relationship with AEG, and opens the door to exploring additional real estate investments in Hamilton."

Mr. Black added, "We understand that this agreement may raise some eyebrows in Edmonton, where we are working to build a new downtown arena for the Oilers. We want to make clear that we remain committed to working with the City of Edmonton to move this project forward. We are confident we can find a way to do this that best meets the needs of all concerned and that secures the long-term sustainability of the Oilers in Edmonton."

"Working with the Katz Group, we are on our way to creating a world class arena and sports and entertainment district in Edmonton and are looking forward to developing equally dynamic work in Hamilton," said Ted Tanner, Executive Vice President, AEG Real Estate Development.

In November 2009, the Katz Group engaged AEG Development and AEG Facilities, both divisions of AEG, to advise the company on all aspects of a new entertainment and sports district in downtown Edmonton, including the development of a new arena for the Oilers.

"Our work with the Katz Group in Hamilton is a natural expansion of our relationship," said Bob Newman, AEG Facilities Chief Operating Officer. "We strongly believe the greater Hamilton marketplace has the potential of becoming one of the region's most active sports and entertainment markets. We look forward to working with the City and stakeholders in creating this new state of the art venue."

About AEG
AEG is one of the leading sports and entertainment presenters in the world. AEG, a wholly owned subsidiary of the Anschutz Company, owns or is affiliated with a collection of companies including over 100 facilities such as STAPLES Center, NOKIA Theatre Times Square, The Home Depot Center (Carson, CA), The Rose Garden (Portland, OR), American Airlines Arena (Miami, FL), Target Center (Minneapolis, MN), Mercedes Benz Arena (Shanghai, China), Wukesong Arena (Beijing, China), Acer Arena (Sydney, Australia), Ahoy Arena (Rotterdam, Netherlands), The Globe arena (Stockholm, Sweden), O2 World arena (Berlin, Germany), O2 World Arena (Hamburg, Germany) and The O2 arena and entertainment district (London, England); sports franchises including the Los Angeles Kings (NHL) and two MLS franchises in addition to overseeing privately held management shares of the Los Angeles Lakers (NBA). AEG has created L.A. LIVE, a 4 million square foot / $2.5 billion downtown Los Angeles sports, residential & entertainment district featuring Nokia Theatre L.A. LIVE and Club Nokia, a 54-story, 1001-room convention "headquarters" destination (featuring The Ritz-Carlton and JW Marriott hotels and 224 luxury condominiums - The Residences at The Ritz Carlton - all in a single tower), the Regal Cinemas L.A. LIVE Stadium 14, "broadcast" facilities for ESPN, along with entertainment, restaurant and office space and developed The Home Depot Center in Carson, California designated as an "Official U.S. Olympic Training Site" by the United States Olympic Committee that includes major facilities for soccer, tennis, track & field, cycling and other sports. AEG Sports owns and operates a variety of events and tours and AEG Live is the world's second largest concert promotion and touring companies. The company is also developing 12 arenas in China and arenas in Stockholm and Las Vegas.

About Katz Group
Founded by Daryl Katz in 1990 and headquartered in Edmonton, The Katz Group is one of Canada's largest privately-owned companies with operations in the pharmacy, sports & entertainment, and real estate development sectors. In addition to the company's North American pharmacy operations, which operate primarily under the Rexall, PharmaPlus, Guardian, IDA and Medicine Shoppe, banners, Katz Group owns the Edmonton Oilers (NHL), Edmonton Oil Kings (WHL), Oklahoma City Barons (AHL) and the Edmonton Capitals of the Golden Baseball League, as well as Aquila Productions, one of Canada's leading entertainment and event companies. Through its wholly-owned C&H group of companies, the Katz Group is involved in land assembly, site and building development, and the operation of multiple development projects in Canada and the US.

Media Contacts

For Katz Group:
Steve Hogle
(780) 932-2615
shogle@katzgroup.ca

For AEG:
Michael Roth
(213) 742-7155
mroth@aegworldwide.com

Public Hearing on Proposed Arena District Zoning Application Deferred

Mon, 07 Jun 2010 14:54:00 -0700

The Katz Group and the City of Edmonton have agreed to defer the June 28th public hearing on the Katz Group's zoning application for the proposed Edmonton Arena District.

Executive Vice President of Sports and Entertainment for the Katz Group, Bob Black, says, "We have received an incredible amount of support for our project but we have also heard city council and others tell us they want to see a funding model. We understand that. Even though it is a separate issue from zoning, it is clear to us that the questions about funding distract from a consideration of the zoning application."

"A deferral gives us and the city further time to arrive at a funding model. We will look to build upon our many months of talks with the city to develop a funding model that best meets the needs of all concerned."

Mr. Black adds, "We will also use this time to further refine this zoning application based on the constructive conversations we've had with thousands of people, dozens of business and community groups and the City of Edmonton."

Mr. Black concludes, "We sought a date before the summer break due to important commercial considerations. The city administration accommodated us in setting the hearing for June 28th. We appreciate the City's efforts to meet what we all knew was an ambitious timeline."

A new date for the public hearing has not been set but it's expected to take place sometime in the fall.

For more information, contact:

Steve Hogle
VP Public Affairs & Communications
Katz Group
(780) 932-2615 c
shogle@katzgroup.ca

Thank you Edmonton!

Fri, 07 May 2010 18:30:00 -0700

2,651 Edmontonians visited the Arena District Open House yesterday - that's about 300 people per hour! The AGA was buzzing with energy and excitement. We were amazed and gratified to see the room at full capacity several times throughout the day.

The discussion was fantastic -- just the kind of dialogue we hoped for. We got a ton of support and some valid expressions of concern and constructive criticism. There were also a great many suggestions on all manner of issues. It will take some time to digest all of these but we are grateful for the level of engagement that was shown by the great citizens of the City of Edmonton.

Much of the discussion centered on traffic, parking and details of the evolving design. Our technical experts were present and able to speak to these issues and share their research and opinions. We are confident that the technical analysis establishes that neither parking nor traffic will be a problem. The design elements are still evolving and we are determined to get them right. We believe that we can deliver something that will be well aligned with the goals of the new Downtown Plan and which will be a source of inspiration and pride for the citizens of the city.

We also had a lot of questions about the funding model. These are important and fair questions. We certainly understand and respect the desire of the public to know the funding deal. However, these questions are premature as we continue to work through a process of establishing a funding model that will work for everyone. There will certainly be time for the public to weigh in on this issue.

Gathering all of your suggestions and feedback is what made the Open House a tremendous success. We collected hundreds of blue and yellow sticky notes with your questions, comments and suggestions. Over the next week our team will be going through all of them and incorporating them into our thinking.
In the meantime, if you couldn't make it to the Open House, please visit our virtual tour on our on Facebook Fan page.

I'd like to take this opportunity to thank the Art Gallery of Alberta for hosting us. The gallery is a testament to what can be achieved by pursuing a vision to accomplish something extraordinary.

I would also like to thank everyone on our team -- Jim Low, Mischa Kowall, Janet Riopel, Steve Hogle, and the folks from Stantec, Bunt & Associates, and AEG -- for contributing their time, energy and expertise.

The Open House event may be over but we want to keep the dialogue going. Send us your comments and questions to info@revitalizedowntown.ca, Twitter and Facebook.

Thank you one and all for coming out and sharing your views.

Bob Black, Project Lead

Open house virtual tour

Fri, 07 May 2010 18:00:00 -0700

Thank you to everyone who attended the open house on May 6th. If you missed the Open House, we've put together a virtual tour of the information boards below.

Some of the images below may be a little difficult to read, so please visit our Flickr page to view them in full size.

Created with Admarket's flickrSLiDR.

Artist renderings capture the current vision for the site

Thu, 06 May 2010 14:00:00 -0700

The Edmonton Arena District will create a vibrant, walkable district that will be attractive for residents and businesses, and be a magnet to draw people to the city's downtown.

Katz Group opens doors to Edmonton Arena District open house tomorrow at the Art Gallery of Alberta

Wed, 05 May 2010 15:00:00 -0700

The Katz Group is ready to open the doors to an Open House to discuss the proposed Edmonton Arena District tomorrow, Thursday, May 6, from 11:00 a.m. to 8:00 p.m. at the Art Gallery of Alberta.

"This is a great opportunity for the people of Edmonton to learn more about the Edmonton Arena District and to have their voices heard," said Bob Black, Executive Vice President Sports and Entertainment, Katz Group, and Project Lead for the Edmonton Arena District. "Continued public engagement is essential as we work towards building the future of our city together."

In addition to the Katz Group, representatives from Stantec Consulting, Bunt & Associates, Anschutz Entertainment Group and other design and technical experts will be on hand to discuss the project, answer questions and record comments. The Open House will include details about the proposed concept plan, improvements to support street level activity, potential features of the new arena, traffic flow for pedestrians and vehicles, sustainable design principles and more.

Mr. Black added, "I recognize that people want to learn more about funding. We are working hard to establish a funding model for the project, but there is nothing to announce at this time."

Artist's rendering of the entertainment plaza within the Edmonton Arena District looking south. The Katz Group envisions this plaza as a vibrant outdoor pedestrian area bordered by entertainment venues, restaurants and shops. With heat lamps, heated awnings and fireplaces, this space will embrace Edmonton's place as a great northern city and extend the season for enjoying the outdoors downtown.

Media Availability
Bob Black, Janet Riopel, Lead, Communications and Community Consultation for the Edmonton Arena District will be on hand at the open house tomorrow and available for media interviews as time permits throughout the day. Additionally, representatives from the various consulting firms will also be available to speak to their respective areas of expertise (i.e.: parking, arena design, sustainability, etc).

About the Edmonton Arena District
The Katz Group has acquired a 16-acre "T"-shaped parcel of land on the site of the Baccarat Casino and the city block West of the Bell Tower and South of 104th Avenue as the development site. The proposed new entertainment and sports district includes new retail, office, public space, a casino, hotels, residential housing, and other amenities, anchored by a world-class entertainment and sports venue and a new home for the Edmonton Oilers and Oil Kings.

For more information, please contact:

Steve Hogle
Vice President, Public Affairs and Communications
Edmonton Arena District
(780) 293-5050

Katz Group to host public open house for proposed Edmonton Arena District May 6, 2010 at the Art Gallery of Alberta

Tue, 27 Apr 2010 08:30:00 -0700

- Media availability 1:00pm MST today at Katz Group offices in Bell Tower -

EDMONTON, ALBERTA - April 27, 2010 - The Katz Group will host a Public Open House regarding the proposed Edmonton Arena District on Thursday, May 6, 2010 from 11:00 a.m. to 8:00 p.m. at the Art Gallery of Alberta, located at 2 Sir Winston Churchill Square in downtown Edmonton.

The Open House will provide the public with an opportunity to learn about the proposed Edmonton Arena District and to provide feedback to the project group. The event is being held in connection with the project's proposed plan amendment and zoning applications, filed recently with the City of Edmonton Planning and Development Department.

The Open House will present information about the proposed concept plan, improvements to support street level activity, features of the arena, parking, pedestrian and vehicular traffic, connections to public transit, sustainable design principles and more.

Representatives of the Katz Group, Stantec Consulting, Bunt & Associates, Anschutz Entertainment Group, and other design and technical experts will be on hand to discuss the project and answer questions.

"We believe this project will be a catalyst for the continued revitalization of Edmonton's downtown and will help achieve the City's goal of being recognized as a vibrant, attractive and sustainable city," said Bob Black, Executive Vice President Sports and Entertainment, Katz Group and Project Lead for the Edmonton Arena District. "This is an opportunity for Edmontonians to learn more about the project, ask questions and provide their feedback. This is about getting the community involved in continuing to build the City's future together."

Further information, including a detailed look at the site, traffic flows, parking capacity, connectivity to public transit and pedestrian corridors, as well as design and sustainability features, will be showcased. The Open House will include new conceptual drawings of the proposed development, but will not include architectural designs or further discussion about potential funding models.

Media Availability

Bob Black, Executive Vice President Sports and Entertainment, Katz Group and Project Lead for the Edmonton Arena District, and Janet Riopel, Lead, Communications and Community Consultation for the Edmonton Arena District, will be available today at 1:00pm MST at the Katz Group offices on the 17th Floor, Bell Tower, 10104 - 103 Avenue to discuss the upcoming Open House with local media.

About the Edmonton Arena District

The Katz Group has acquired a 16-acre "T"-shaped parcel of land on the site of the Baccarat Casino and the city block West of the Bell Tower and South of 104th Avenue as the development site. The proposed new entertainment and sports district includes new retail, office, public space, a casino, hotels, residential housing, and other amenities, anchored by a world-class entertainment and sports venue and a new home for the Edmonton Oilers and Oil Kings.

- 30 -

For more information, please contact:

Janet M. Riopel
Lead, Communications and Community Consultation
(780) 409-2587
info@revitalizedowntown.ca

Katz Group Media Availability to Discuss Edmonton Arena District Zoning Application

Mon, 19 Apr 2010 08:16:00 -0700

EDMONTON, ALBERTA - April 19, 2010 - Bob Black, Katz Group Executive Vice President Sports and Entertainment, and Jim Low, Lead of Planning and Development for the Edmonton Arena District, will be available to speak to media regarding its zoning application for a new entertainment and sports district in downtown Edmonton.

DATE: Monday, April 19, 2010

TIME: 11:15 am

PLACE: Suite 1702, Bell Tower, 10104-103rd Avenue
Edmonton

For more information, please contact:

Janet Riopel
(780) 409-2587
info@revitalizedowntown.ca