Wednesday, January 23, 2013

The Cityplace Casino

CityPlace with MTS Centre at Right.

CityPlace with Walkway to MTS Centre. Photo by Bryan Scott.

CityPlace
CityPlace was Winnipeg's first downtown mall built in 1979. It emerged from the ashes of the closure of Eaton's catalogue division in 1977 and initially was called Eaton Place.

It would be wrong to say it was not a success at the start. It was. The mall and office portion of the building were a going concern and Eaton's beside it did well.

The opening of several more malls all in a matter of years including Portage Place had an impact on shopping everywhere. However, the writing was on the wall and with the movement of multiplex movie theatres to the suburbs, the younger crowd that inhabited the mall left as well.

In 2001, Eaton's closed for good and it is a wonder we didn't see Eaton Place go as well. However, the newly re-branded Cityplace had the income from its offices to sustain it as well as generous revenue from the parkade and parking lots. The building has increased in value in every decade since it has been open unlike Portage Place.

The mall is a shadow of itself now. The connection to the MTS Centre built in 2004 did not help the mall in a meaningful way other than ensure that the restaurants still had people to come to them. The extended walkway in 2010 also helped in that regard as people from the Winnipeg Convention Centre came over to use restaurants.

The mall continued to serve a very niche local business area but it was not a destination mall nor did it have a huge retail anchor. The prospects for Cityplace all changed when the Winnipeg Jets returned last year.

While the Manitoba Moose were appreciated, they drew a smaller crowd, more of a family crowd and one with a more limited budget.

The arrival of the Jets and some rushed renovations to upgrade from True North drew a commitment from the province of Manitoba for further investment in the MTS Centre in the form of video lottery terminals. At present, those VLTs are in the Tavern United across the street with revenue going to pay off the arena.

Public support from the city and the province will rise to $11 million a year with all the revenue from tax discounts and VLTs added in. I don't know the economics of this. I have to suspect that the province makes a lot of money back on sales tax for liquor and merchandise sales, food and for parking. The city has fewer revenue streams but if the property values around the MTS Centre have risen, it may be worth the investment.

The fact that Longboat and Artis are building a large complex across from the MTS Centre indicates that the investment in MTS Centre is paying off. By my reckoning, the increased tax from off site might well make up for the discount the arena gets. However, I am not a accountant so I can only guess. It would be nice if someone actually did an economic impact study of the subsidy and how it affects government and business for Winnipeg and the province.

Back to the casino though...

I have long advocated a return of a casino to the downtown. I had said it would be a great way to get the Winnipeg Convention Centre the expansion they wanted. In the end though, the three levels of government stepped up and work is being down now.

All that was left was to fulfill the promise the NDP government made to True North about more VLTS to pay for improvements to the arena. The rumour had been that a sports bar was coming and the talk was the Shark Club, a sports chain in every western province except Winnipeg. But wait, we have a Shark Club. Doh, wrong club!

Like the problems we faced with Calgary's Cowboys coming to town, someone has registered and is using the Shark Club name on Lombard. If the Shark Club wanted to come here and use their name, they would likely have to make a deal with the Winnipeg club using the name these last years. Ask the The Brick how they feel that worked out for them when they sued Brick's Fine Furniture.

We finally know some of the details about what the province is planning. We are not just going to see the Tavern United's VLTs combined with new VLTs in a new restaurant. We are going to see a full restaurant and casino with 140 slot machines, 2 poker tables and 4 blackjack tables.

Holy big difference from VLTs, batman!

Some local bloggers have indicated there are a strong gains that can be made to the facility that holds a casino. We can expect this is going to trigger a property value increase as well as help elevate the value of all surrounding property in 2013 and beyond.

Some of the negative comments from bloggers and people posting to Free Press and CBC pages is in regards to gambling.

No argument there. Still, prohibition comes with ill effects too.

Would eliminating gambling and drinking cause more crime than regulating and taxing said vices? I think there is strong evidence to support that it does.

The provinces online gambling site is now love today. I think that might have a bigger impact than the casino.

As more details come available, we will see what the name will be, what the look will be and how the casino will be in relationship to the MTS Centre.

My view is that there is more good in this decision than bad. It will be interesting if in later years what the Jet Effect will actually be.

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