Council votes to extend Lansdowne partnership with OSEG
Coun. Menard says city is just hoping 'it all works out' without doing its due diligence
City council agreed Wednesday to extend its 30-year partnership with Ottawa Sports and Entertainment Group (OSEG) at Lansdowne Park for an additional 10 years in order to help the business group survive the COVID-19 crisis.
OSEG has lost money since the revitalized Lansdowne Park was launched in 2014, including an $11-million loss last year. The business group has said it needs to attract another one million visitors a year to Lansdowne.
But the COVID-19 pandemic, which has prohibited sporting events and other gatherings at the Glebe attraction, placed a major strain on retailers there, exacerbating OSEG's problems.
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The OSEG partners, led by Roger Greeenberg, have already invested $97 million more than they originally intended, and will have to invest an additional $40 million to keep the business afloat. The city invested $210 million in Lansdowne, including $135 million in TD Place, home of the OSEG-owned Ottawa Redblacks and 67's.
OSEG has asked the city for the following help:
- Access to the $4.7 million OSEG has contributed to a reserve fund for infrastructure maintenance and repair to help it refinance a loan, to be paid back over the life of its partnership with the city.
- Extend the life of the partnership by 10 years to 2054, to give OSEG more time to recoup some costs.
- Extend the $1 rent agreement covering Lansdowne's retail sector to 2066, instead of making OSEG pay market rates to the city starting in 2044. The city would also forgo half of the revenue from retail operations it would have collected at the end of the partnership period.
Council unanimously agreed to give OSEG access to the reserve fund, but several councillors wanted to wait for more information before approving the more substantial changes to the partnership.
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"We can't just say that we want it to succeed and not do our due diligence and mitigate the city's risk," argued Coun. Shawn Menard, whose ward includes Lansdowne,
He pointed to a recent auditor general's report, that indicated that the city is not properly overseeing its complex partnership with OSEG, as a reason to delve more deeply into the city's potential risks of extending the partnership.
"Don't just say yes ... and hope it all works out, because that's what's happening here."
Menard moved a motion that called for, among other things, a more formal business plan from OSEG and a value-for-money audit on the extension, before council approved it. His motion failed, after the mayor suggested the measures would be the end of Lansdowne.
"If you want to kill Lansdowne, you vote for this motion," said Mayor Jim Watson. "But I would strongly urge you to send a signal to the private sector, and those individuals who have put blood, sweat, tears and money into this facility."
Seven councillors rejected extending the partnership: Jeff Leiper, Catherine McKenney, Carol Anne Meehan, Theresa Kavanagh, Rawlson King, Diane Deans and Menard.
OSEG, along with working groups made up of councillors and city staff, will now come up with a strategy to boost foot traffic at Lansdowne, with a plan to report back to council by June 2021.
Council also approved a motion to include a "stakeholders' sounding board" in the discussions, which would include the Ottawa Farmers' Market, community associations, business groups and representatives from the festival, theatre and music communities.