With council poised to decide next week whether to give the Ottawa Sports and Entertainment Group a financial lift, two of the city’s top politicians want the owners of the CFL’s Redblacks and OHL’s 67’s to guarantee the teams will be around for the long haul.
In a letter to OSEG managing partner Roger Greenberg on Thursday, Mayor Jim Watson and Coun. Mathieu Fleury, the city’s sport commissioner, are urging the organization to commit to operating the franchises at TD Place until at least 2032.
“Today, we are writing to you seeking OSEG’s commitment to guarantee the continuation of both the Ottawa Redblacks and the Ottawa 67’s for an additional 10 years beyond the eight-year commitment in the original agreement,” the letter says, adding such a commitment would play a “key role” in council’s decision on Dec. 9.
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In its original deal with the city, OSEG had pledged to keep the teams at the stadium until 2022.
Watson and Fleury said the guarantee would extend only to the franchises OSEG owns – not tenants of Lansdowne Park such as soccer club Atletico Ottawa.
Last month, the city’s finance and economic development committee approved a staff report calling for changes to OSEG’s 30-year partnership with the city. The organization wants to extend the agreement by a decade to give it more time to make its money back and is seeking approval to tap into a $4.7-million capital reserve fund to cover expenses.
Default ‘a very real risk’
The report noted that OSEG’s $106-million mortgage on the retail component of Lansdowne Park is due to be refinanced in the next two years, putting the owners “at a very real risk of having default be their best business decision” – which would leave the city on the hook for millions of dollars in payments.
Critics such as Capital Coun. Shawn Menard, who represents the Glebe, slammed the proposal as a “short-sighted stop-gap measure” that won’t solve Lansdowne’s financial problems. City manager Steve Kanellakos tried to alleviate concerns about the plan at last month’s committee meeting, saying it was “not a bailout.”
OSEG chief executive Mark Goudie told OBJ last month that Lansdowne’s sports and retail operations have been hit hard by the pandemic. He said Greenberg and fellow partners William Shenkman, John Pugh and John Ruddy are willing to pump an additional $40 million into the site over the next five years to cover additional expected losses.
“So when we go to the city with the stark realities of what’s going to be required over the next five years, it’s to ask for help,” he said.
Four million visitors in 2019
Goudie said costs of refurbishing the aging home of the Ottawa 67’s and other improvements were far costlier than initial budget projections, adding it’s also taking longer than expected to hit the “magic number” of five million annual visitors Lansdowne needs to break even.
Last year, the park attracted about four million people to its shops and events.
Watson and Fleury are asking Greenberg to respond to their letter in writing before the Dec. 9 council meeting.
In an email to OBJ on Thursday morning, OSEG spokesman Chris Hofley said the organization would reply “in due course.”
Last month, Goudie insisted the ownership group has no intention of pulling up stakes at Lansdowne.
“The OSEG partners … could have chosen a path that says, ‘This isn’t in my best interest – emotionally, financially – and they could have chosen a different route,” he said. “They haven’t chosen that route. I think that demonstrates their commitment to this project.”
