Carmen's will bid to run FirstOntario Centre, and says it will still build a hotel
Carmen's Group wants the chance to manage Hamilton's three major downtown entertainment facilities, and the city is buying a little time to let it.
City councillors voted Monday to extend their current management agreements for FirstOntario Centre, FirstOntario Concert Hall and the Hamilton Convention Centre into next year.
Right now, Carmen's — a Hamilton-based corporation owned by the Mercanti family — only manages the Hamilton Convention Centre. Spectra (formerly Global Spectrum), a Philadelphia-based company, manages the other two.
These contracts expire on Dec. 31. But the city will extend them by six months, partly to renegotiate the existing agreements with "minor tweaks," and partly so Carmen's can bid on all three. Spectra, meanwhile, will bid to manage all three too, including the convention centre.
Carmen's can do a better job than anyone else, said PJ Mercanti, because they're Hamilton based. They also have Scott Warren, former general manager of FirstOntario Centre and FirstOntario Concert Hall, on their team.
"We would like to be given an opportunity to put our case forward," Mercanti said.
In 2013, Carmen's promised a 44-storey hotel in downtown Hamilton if it won the convention centre bid. Mercanti said it still plans to build one.
'Get the hell out of that business'
Spectra/Global Spectrum, meanwhile, holds an average of 203 events per year, attended by 470,000 annually. It's brought the likes of Paul McCartney to Hamilton. With the company, "you have the biggest global promoter as a partner," said Larry DiIanni, who was speaking on the company's behalf.
Not everyone on city council's general issues committee liked the idea of inviting specific bidders.
Coun. Matthew Green of Ward 3 wanted to take bids from the open market, but no other councillors supported his motion. Sam Merulla, Ward 4 councillor, said the current arrangement helps taxpayers.
"What's before us now is a proven track record, rather than a pig in a poke," Merulla said.
For that matter, "Walt Disney on Ice is not a water and sewer treatment plant, and we need to get the hell out of that business," he said.
The city handed over management of the facilities in 2013 because it was paying millions a year to subsidize the operations. In 2010, for example, the city pitched in about $2 million over and above the usual annual subsidy of about $2.8 million each year.
Still costs taxpayers money
The city still pays a subsidy, although less of one. For Spectra, it's about $2.6 million per year, a staff report said this week. That includes utility costs. The city has subsidized Carmen's by about $964,000 since 2013, although in 2017, Carmen's had a net surplus of $20,000.
As for the Mercantis, they're already part of a consortium that wants to overhaul the 33-year-old FirstOntario Centre arena. They propose a renovation of up to $100,000, or a $300 million rebuild. The consortium presented these ideas last year in a report that cost the city $50,000. But many city councillors say they're not up for paying for a new arena.
Spectra/Global Spectrum holds an average of 203 events per year, attended by 470,000 annually. The Hamilton Convention Centre hosted 137 events across 206 days.
City council still has to ratify this decision Friday.