The same day that Eugene Melynk’s Capital Sports Management was hit with a $1-billion countersuit by its partner in the redevelopment of LeBreton Flats, the Ottawa Senators have publicly proposed a deal with John Ruddy’s Trinity Development Group that the team says would allow the project to proceed.
In short, the proposal – released to the media Tuesday evening – would see the Senators-backed CSMI dramatically reduce its involvement in the project, turning over its interest in the retail, residential, commercial and recreational components of the project to Trinity.
In turn, Trinity would be responsible for financing the new NHL arena. CSMI would “focus on the design, development and management” of the facility and be responsible for lifecycle costs during its lease.
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While the Senators did not mention any proposed financial terms of the arena lease, a Trinity spokesperson said Tuesday that Melnyk and CSMI have demanded “a free arena courtesy of local taxpayers and Trinity.”
Senators chief operating officer Nicolas Ruszkowski did not respond to messages requesting further details on the team’s proposal.
CSMI’s proposal is the latest in a public war of words that erupted late last month when Melnyk and CSMI launched a $700-million lawsuit against Ruddy and Trinity.
The crux of the lawsuit alleged that Trinity was in a conflict of interest over its nearby development of a three-tower mixed-use project at Bayview Station that CSMI argues makes the LeBreton Flats redevelopment unviable in its current structure.
“If Trinity is correct in its belief that the LeBreton Flats project remains viable and profitable despite the impact of 900 Albert Street, then it must also conclude that this deal enables Trinity to collect greater profits than it would have under the original structure of the deal,” CSMI said in its statement.
