The BC Place renovation plan featuring a retractable roof is an expensive proposition but it is also the best of all economic options facing BC Pavilion Corp and the Government of British Columbia.
That is the assessment of Vancouver-based sport business commentator Tom Mayenknecht, host of The Sport Market on TEAM 1040 and team1040.ca. “This is an expensive ticket item, make no mistake about that, but given the available options, it is the right plan for BC Place,” Mayenknecht said in Saturday’s edition of The Sport Market. “The higher price tag and the need to build a temporary facility will attract second-guessing but critics should beware: the alternatives make less economic sense than spending $458 million on this retractable-roof and renovation plan.” In a media conference held Friday, BC Pavilion Corp chair David Podmore reaffirmed his intention to proceed with a comprehensive renovation for the 26-year-old stadium, including plans for a fully-retractable fabric roof. It was announced, however, that projected costs had increased $93 million to $458 million from the original $365 million estimated last year and that the retractable roof would only be ready for the summer or fall of 2011, not in the spring of 2011 as initially forecast. That timeline means the BC Lions will play their entire 2010 Canadian Football League season at a temporary stadium accommodating approximately 30,000, along with a good part of the 2011 regular season that will be capped by Vancouver hosting the Grey Cup that year at the new BC Place. It also means that the Vancouver Whitecaps FC will make their Major League Soccer debut in March of 2011 at the same temporary facility, which will be built at the PNE at the old site of Empire Stadium (which was home to both franchises until the opening of BC Place in 1983). “In an ideal world, PavCo and the government would have identified this renovation and roof replacement plan five years ago, or at least three years ago when the prospects for a second tenant in Major League Soccer began to emerge,” said Mayenknecht, noting an earlier and more flexible project timeline would have avoided the need for a temporary stadium to house the Lions and Whitecaps during construction after Vancouver 2010. He suggests it would have made it possible for the Olympic opening and closing ceremonies to be staged in the new BC Place, with the retractable roof and all interior and exterior upgrades completed for Vancouver 2010. “That’s the single biggest caveat on all of this - it would have been ideal to have the retractable roof and the full renovation completed for the two single largest global branding opportunities Vancouver, B.C. and Canada will have in this generation; those Vancouver 2010 opening and closing ceremonies staged before worldwide television audiences,” said Mayenknecht. “It also would have been preferable not to have to spend anywhere from $20 to $35 million or more on the temporary stadium and concessions at the PNE, especially when the government is making funding cuts to sports and the arts on the eve of Vancouver 2010.” Mayenknecht said anyone properly assessing the return-on-investment of the BC Place renovation plan compared to the costs and amenities of other retractable-roof stadiums such as Safeco Field in Seattle, University of Phoenix Stadium in Glendale, Arizona and Lucas Oil Stadium in Indianapolis, Indiana – not to mention retractable-roof renovations to existing stadiums such as Veltins Arena and Commerzbank Arena in Germany – need to reserve final judgment until the proposed amenities are fully detailed. Those concerns aside, Mayenknecht is clearly a proponent of the retractable-roof plan as the best economic model for the future of BC Place stadium. “It is what it is in terms of the timelines and the available options and in that context, this is the right plan for BC Place,” he said Saturday on The Sport Market on TEAM 1040 and team1040.ca. “It is a big ticket item up front but one that has much more upside once the retractable roof is in place.” He is convinced it is also a much stronger economic proposition than any of the other options, ranging from simply replacing the fixed roof with another fixed roof to building a new stadium from scratch. “A new stadium of similar capacity would cost in the range of $800 million to $1 billion to build from scratch,” said Mayenknecht. “That does not include the cost and other impacts of demolishing the existing stadium or relocating the site of the stadium to another part of the city. You would be unwinding 26 years of urban development around BC Place, especially the past 15 years or so since the arrival of General Motors Place and the build-out of the former Expo 86 site has made Yaletown and that part of downtown Vancouver the city’s sports and entertainment hub. Ripping the stadium out of there would be questionable public policy in my view.” Mayenknecht also said that although a simple fixed dome replacement roof would be less expensive, it would also provide much lower annual revenues for PavCo and its tenants than the retractable roof option. “The retractable roof option will not only increase the capacity of BC Place to host more and a wider range of events, it will enhance the ticket-selling propositions for the Lions, Whitecaps and any other tenants at the stadium,” he explained. “Over the long term, that means a much more sustainable economic model for all parties. In my view, putting another fixed roof on BC Place is a non-starter.” He noted that there would have been international public relations damage to British Columbia if the government had reneged on the retractable-roof upgrade, given that Major League Soccer awarded Vancouver a 2011 expansion franchise contingent on those plans. The BC Place renovation plan will be one of the major sport business stories of October on tap for this week’s edition of The Sport Market on TEAM 1040 and team1040.ca, which will be held at a special time of 12 noon to 3 p.m. PT Saturday, October 31st. Mayenknecht will be joined on the show by The Sport Market month-end round table panel of Bob Mackin of Business in Vancouver and 24 Hours Vancouver and Aziz Rajwani of the UBC Sauder School of Business and the Langara College School of Management.