Pepsi Centre board pondering ways to increase revenue

Cory
Cory Hurley
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Paid parking and walking fees part of discussion

Gary Bradshaw, acting chairman of Western Sports and Entertainment, poses at the Pepsi Centre Wednesday. — Photo by Cory Hurley/The Western Star

A rental fee increase is just one of the discussions on the board of directors’ table for Western Sports and Entertainment to help balance the Pepsi Centre’s books.

The prospect of a 15 per cent hike in fees has sparked a public campaign by users groups such as Corner Brook Minor Hockey, the Silver Blades Figure Skating Club, Humber Valley Speed Skating Club and other skating and hockey groups.

The board is meeting with representatives today to discuss concerns about paying more to rent the ice at the public facility operated through Grenfell Campus of Memorial University. A petition fighting the increase is expected to be presented.

Gary Bradshaw, acting chairman of the board, said the facility had a $150,000 shortfall in revenue last year, something the board hopes to prevent in future. The deficit will be written off the books for last year, but the board hopes the loss can be recouped.

Money generated through ice rentals accounted for 27 per cent of the Pepsi Centre’s revenue base, Bradshaw said. An increase in those fees was an obvious target as a way to generate more money, he said.

All users are potential revenue generators, he said. That includes walkers who use the track around the stands. The board is also pondering implementing paid parking. Those things are in the discussion phase as the board works toward getting back to a full complement of members.

“We need to look at any user of the facility, in whatever fashion, that might be incurring cost and driving wear and tear on the facilities,” he said. “That is what you can expect that any business would want to recover at a proportionate cost or in support from.”

Paid parking and a fee to use a walking track is common for such facilities in most places, Bradshaw said.

Bradshaw said the expenditures were in line last year, but the board is looking at those, too. About 80 per cent of expenditures go to salaries and energy, so it is challenging to find cost savings there.

Attracting a major tenant and entertainment as a source of revenue appear to be receiving the most attention. Bradshaw said losing the Corner Brook Royals before last season was a hit — he estimated the ice rental, seat sales, and other activities associated with the team to be about 3.5 per cent of the revenue.

“It’s not earth-shattering in that sense, but it is important,” he said.

Combine that with a drop in rentals for the conference and meeting rooms, and he said the impact was significant.

Bradshaw said bringing in entertainers is a risky venture. Fronting costs with the uncertainity of ticket sales leaves the board cautious. He also said it’s unknown if people would come to Corner Brook for shows.

The Annex was recently renovated into a sports complex, and Bradshaw said the board is discussing how best to use that facility as a revenue generator. To date, and for immediate plans, it is a place for organized sports organizations to rent. Whether it becomes more than that remains to be seen.

“We want to market it as much as possible, and also consider whether there are specific programs that we — through the board and management of the Pepsi Centre itself —can do ourselves or commission others to come in and do,” he said.

He speculated the Annex could become the board’s “new shining star.”

There is a concern the Pepsi Centre — a legacy of the 1999 Canada Winter Games — has become a white elephant. Bradshaw said he prefers to think of it as a facility in a financial situation that can be worked through.

“There are a number of opportunities that will, hopefully, allow us to not balance our budget on existing users and stakeholders,” he said. “That is the mind set that the board has. To be creative and try to identify things that, maybe with new investment, we can generate more opportunities.”

Organizations: Pepsi Centre board, Silver Blades Figure Skating Club, Humber Valley Speed Skating Club

Geographic location: Corner Brook, Canada

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Recent comments

  • Jack
    August 08, 2013 - 22:31

    Better ideas to alleviate the Pepsi Centre's financial problems including major cuts to managerial, board, and security staff, purchase an electric Zamboni machine to reduce long term energy costs, and get the City of Corner Brook to take over the facility's management.

  • david
    August 08, 2013 - 10:12

    The Pepsi Center will eventually go bankrupt, or get sold to Wal Mart for $1, but it was a complete success. It got politicians, especially Danny Williams and his Town-fixated ambition, a very ego-stroking ribbon-cutting, a gratifying Winter Games pulpit with national media exposure , and 15 years of easy election victories. Not a dime of their own money, and they're all off enjoying their pensions (As he saunters in last, the crowd on Cheers cries "TOM!"...). Huge success...another Newfie white elephant.

    • Jack
      August 08, 2013 - 22:29

      Danny Williams was not the Premier when Pepsi Centre was built. The facility was built when the Liberals were in power during the Clyde Wells and Brian Tobin eras for the 1999 Canada Games in Corner Brook. At the end of the day, the best policy for the Pepsi Centre is for the City of Corner Brook to take the page of other towns with arenas and recreational centres, and take over Pepsi Centre management.

    • david
      August 09, 2013 - 07:57

      I stand corrected, thank you. I forget those jokers as fast as they come and go....different party, different empty suit, SOS. No matter, the point stands. As for your suggestion, why in the world would you believe that any local group in Newfoundland could take control of a massive white elephant, already well on its way down the toilet, and work some pure managerial magic required to turn it around ---- because there's a long history of that kind of operations restructuring wizardry here ?! Or because it would let resentful Townie taxpayers wash their lilly-white hands clean of yet another non-Avalon headache?

    • Jack
      August 09, 2013 - 08:25

      Dave, you're aware that the Pepsi Centre is the only arena and recreational centre outside the Avalon managed through a third party company, notably Western Sports and Entertainment and Memorial University Grenfell Campus. Other arenas outside the Avalon, such as the Stephenville Dome (Stephenville), Hodder Memorial Recreational Complex (Deer Lake), Joe Byrne Memorial Stadium (Grand Falls - Windsor), Gander Community Centre Ice Rink (Gander), Gros Morne Arena (Rocky Harbour), and Polar Centre (St. Anthony) are town managed and operated, and they manage to turn a profit whereas Pepsi Centre whom are privately operated incur a loss.

    • david
      August 09, 2013 - 08:56

      Jack: you realize that every one of these arenas is just an ice surface, built to fit the town it was built in at the time, with the financing needed to construct it paid off decades ago, and with enough existing activities (not made-up, potential special events) to support it....and even at that, with the qualifiers 'barely' and 'at least for now'. You get that, right? This building is a quasi-convention centre in too small of a town with no capacity from Day 1 to sustain it. And that's not even mentioning the immensely shoddy construction that has left it a complete albatross ---- nicely book-ended with the new shambles of a courthouse just down the road. And, like everything else, the "hope for the best" management strategy was to kick in and save the day.........hooray!

  • a business man
    August 08, 2013 - 06:56

    Personally, I think they should increase the prices at the concessions. Perhaps $5 per bottle of water can generate the money needed. I support increased user fees, increased concession fees and increased parking fees, and maybe even locker rentals. As far as I am concerned, it should be those who use the facility that end up paying for it, and those who use it the most should end up paying the most.

    • Brad
      August 08, 2013 - 10:48

      Once again, your logic, or lack thereof, for a supposed laywer, astounds me. "Attracting a major tenant and entertainment as a source of revenue appear to be receiving the most attention. Bradshaw said losing the Corner Brook Royals before last season was a hit — he estimated the ice rental, seat sales, and other activities associated with the team to be about 3.5 per cent of the revenue...Combine that with a drop in rentals for the conference and meeting rooms, and he said the impact was significant...Bradshaw said bringing in entertainers is a risky venture. Fronting costs with the uncertainity of ticket sales leaves the board cautious. He also said it’s unknown if people would come to Corner Brook for shows." How can you increase prices at the concessions, if there are no events at the arena? 5/bottle x 0 people is still 0.