Final cost of Investors Group Field expected to be $384M

The total cost ofInvestors Group Field continues to rise, as payments on construction loans lag behindmounting interest.

Barring any surprises,the total cost of buildingthe 33,500-seat football stadium at the University of Manitobawillbe $384million when the last principal and interest payments are made in 2058, according to a CBC News analysis.

To date, the total cost of building and financing the stadium in accounting terms is$250million, based on stadium construction and completion costs of $209million, $8.7 million spent to date to repair deficiencies and $32million worth of interest accrued so far.

One year ago, the running tab for the building stood at $235 million. The $15-millionincrease over 2015is due to additional interest as well as the cost of the repairs.

Meanwhile, only $11.5 million has been applied against $172 million worth of stadium-building loans that will eventually cost taxpayers and the Winnipeg Football Club more than double that amount.

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This accounting is based on financial statements posted by the University of Manitoba on Friday,supplemented by information fromTripleB Stadium, the shell company that owns and manages the stadium on behalf of the Winnipeg Football Club, the City of Winnipeg, the province of Manitoba and the U of M.

The final figure

Over the next 42 years, additional interestis expected to take the total cost of building the stadiumup to $384million, provided all the assumptions in the football stadium's business plan are met between now and 2058.

This final figure does not include the cost of additional repairs conducted byTriple B Stadium, which has provincial approvalto spend another$26 million to correct construction or design deficiencies that include cracked concrete on the concourses and drainage issues.

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The large gulf between the capital cost of building the stadium and the final tab, including interest, is due to the complex nature of the financing plan for the facility, which opened in 2013 and serves both the Canadian Football League's Winnipeg Blue Bombers and the U of M Bisons.

That plancalls for the city, province and Winnipeg Football Club to spend $167 million on interest charges on a$160-million stadium-building loanover the 45-year life of the building.Thisinterest is over and above$209million spent on construction and the$8.7 million spent to date to repair deficiencies.

Theinterest charges on the stadium-building loanwill remainunder $167 million as long as the Winnipeg Blue Bombers continue meeting their annual stadium-payment obligations and the former Canad Inns Stadium site at Polo Park starts generating the property-tax revenue envisioned by its business plan.

The Bombers are responsible for paying back $85million of the $160-million loan, plus $90 million worth ofinterest, for a total of $175.1 million by 2058. Under the terms of a stadium management agreement, the Bombers are slated to make additional payments to Triple B of $4.5 million this yearand next, $3.5-million in 2018 and payments of no more than $4.4 million every year until 2058, when the loan is supposed to be paid off.

So far, the football club fulfilled its obligations to transfer $4.5 million a year to Triple B Stadium in both 2014 and 2015. However, only $2 million of this $9 million was applied against theprovincialstadium-building loan; the remaining $7 million was used to pay down a separate, $10-millionCIBCloan taken out by Triple B Stadium to complete the facility. This CIBC loan remains on the books.

Right now, all the interest on the Bombers'portion of the loan is being applied to a separate portion that the city and province are paying off, using property taxes from the former Canad Inns Stadium site. The city and province are responsible for paying $75 million worth of principal plus $76 million worth of interest, for a total of $151million worth of stadium payments by 2038.

1999 bail out

When the Bombers played at Canad Inns Stadium, the Polo Park-area property was exempt from paying property taxes. This was one result of a 1999deal to bail out the non-profit football club, which was struggling financially at the time.

Since the Bombers moved from Polo Park to Fort Garry, the Canad Inns Stadium was sold to a partnership between ShindicoRealty and Cadillac Fairview, which also own Polo Park shopping centre.

So far, the former stadium site remains largely undeveloped. Ithouses an empty Target store and has yet to generate the revenue expected bythe stadium-financing deal brokered by the former NDP government.

In 2014, the former stadiumsite generated $666,000 worth of city and provincial property taxes, all of which were applied against the stadium-building loan. The revenue from this site rose to $1.3 million in 2015 but is expected to decline to $1 million this year, according to a statement fromthe city's assessment and taxation department.

Calls for stadium audit

Earlier this year, the former NDPgovernment blamed thislower-than-expected revenue on weak retail-market conditions, while the Progressive Conservative opposition called for an audit of the stadium project.

The Pallister government has yet to announce an audit of the stadium, which remains the subject of litigation between Triple B Stadium, primary contractorStuart Olson Construction and architect Ray Wan.

The Winnipeg Football Club itself, meanwhile, enjoyed a strong financial year in 2015. The club reported a $7.1 million profit, primarily becauseofthe 2015 Grey Cup, which was held at Investors Group Field.

The Bombers used$1.5 million of its 2015 profits to pay off a $1.5-million loan toTriple B Stadium, forimprovements that were made aheadof theGrey Cup.The club said it would use the remaining $5.6 million for long-range financing.

Breaking down the numbers

$384.1million

Total expected cost of building Investors Group Field, including initial construction costs, additional construction costsand interest charges on loans.

$175.1 million

Principal and interest on an $85-million constructionloan the province gave to the Winnipeg Football Club.Thismust be paid in full by 2058. The Winnipeg BlueBombers have applied $1 million a year against this loan to date and are scheduled to apply no more than $4.4 million each year against this loan untilTriple B Stadium, the shell company that owns Investors Group Field, pays off a smaller loan.

$150.6 million

Principal and intereston a separate, $75-million provincial construction loan that must be paid in full by 2038. Both the City of Winnipeg and the province of Manitoba are paying back this loan, usingcash from property taxes generated by the former Canad Inns Stadium site, which was sold to a partnership betweenShindicoRealty and Cadillac Fairview.This land did not generate any property taxes for either level of governmentwhen the Winnipeg Blue Bombers played out ofCanad Inns Stadium, thanks to an exemption offered to the non-profit Winnipeg Football Club.

$10.9 million

Principal and intereston a $10-million CIBC loan to Triple B Stadium. The Winnipeg Football Club are responsible for this loan off, applying$3.5 million a year against this loan until it is paid off.

$22.5 million

Cashgrant from the province toward the stadium construction.

$8.7 million

Draw so far on a CIBCloan, taken out by Triple B Stadium and guaranteed by the province, which is being used to pay for construction deficiencies. The province has guaranteed up to $35.3 million on this loan, which functions like a line of credit. Lawsuits between Triple B Stadium, Stuart Olson Construction and architect Ray Wan may determine who winds up covering the tab.

$7.5 million

Cash grant from the citythe toward the stadium construction.

$7 million

Additional provincial cash contributions to the stadium, billed as cash used for Grey Cup and energy enhancements.

$1.5 million

Principal and interest on a loan offered by the province to Triple B Stadium. This loan, which had a principal amount of $1.425 million, has been paid back.

$350,000

Press-box repairs, financed by a company controlled by Winnipeg's Asper family.