Planning and Development Approvals Commissioner CAPITAL CENTRE CAPITALE PROJECT FOLLOW-UP: EXPANDED CONVENTION FACILITIES FOR OTTAWA- CARLETON

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1 72 REGIONAL MUNICIPALITY OF OTTAWA-CARLETON MUNICIPALITÉ RÉGIONALE D OTTAWA-CARLETON REPORT RAPPORT Our File/N/Réf Your File/V/Réf. DATE 17 September 1996 TO/DEST. FROM/EXP. SUBJECT/OBJET Co-ordinator Corporate Services and Economic Development Committee Planning and Development Approvals Commissioner CAPITAL CENTRE CAPITALE PROJECT FOLLOW-UP: EXPANDED CONVENTION FACILITIES FOR OTTAWA- CARLETON DEPARTMENTAL RECOMMENDATIONS That the Corporate Services and Economic Development Committee recommend Council: 1. Support, in principle, the initiative to provide Ottawa-Carleton with a convention centre in the downtown core; 2. Authorize the Convention Centre Steering Committee to: a) develop guidelines for detailed submissions of interest for the convention centre; b) invite submissions from any interested proponents with suitable sites in the downtown core; c) evaluate the submissions and recommend a specific site/submission for Committee and Council consideration no later than 31 January BACKGROUND On 18 June, 1996 Committee received the final report of the Capital Centre Capitale Project Feasibility Study for information. This report was prepared by KPMG and jointly funded by Minto Developments Inc. and the RMOC. The report examined the market, technical and economic feasibility of a new convention facility in Ottawa-Carleton generally, and specifically looked at one site located just south of the Rideau Centre, on lands owned by Minto

2 73 Developments Inc., the Government of Canada and the RMOC. This follow-up staff report is in response to three recommendations approved by the Committee at the June meeting. A Steering Committee was established by the Commissioner of Planning and Development Approvals to deal with Committee s recommendations. The Committee met several times and had representation from OCEDCO, OTCA, the Congress Centre and City of Ottawa along with Planning and Development Approvals staff. FOLLOW-UP TO COMMITTEE RECOMMENDATIONS A) Refer the final report to the Ottawa Tourism and Convention Authority (OTCA) and to the Ottawa-Carleton Economic Development Corporation (OCEDCO) for an analysis of the economic development opportunities of this project, with their analysis and comments to be received by 30 August In addition, OCEDCO and OTCA be asked for an assessment of the ability and willingness of the local tourism industry, and the relevant provincial and federal departments or agencies, to invest in the convention/parking component of the proposal. OTCA Response: OTCA agrees with the beneficial impact of an expanded convention facility outlined in the KPMG report. It emphasises the $48 million to be generated in annual tax revenue and the creation of 2,600 direct and indirect full time equivalent jobs in the region. OTCA notes two factors which were not considered in the KPMG study. First, that Ottawa would be a popular convention destination for groups desiring a bilingual setting and for those conventions whose major attendees would come from Toronto and Montreal, especially when a neutral meeting site is preferred. Second, that expanded facilities would allow the private sector to host larger trade shows in the region, which is important because many conventions use a trade show component to finance their meeting. OTCA is concerned with the impact on the economy if an expanded facility is not built. The average convention attendee, per party, spends $852 per stay in our region, which is three times more than the average tourist, per party. Thus the increase in convention attendees from a new facility, or conversely the decrease if a new facility is not built and business is lost, has a substantial impact on the local tourism industry and the regional economy. The report notes that weather protected pedestrian linkages from the new facility to hotels, the Government Conference Centre, and across the canal to the National Arts Centre and other facilities is important to the success of the expanded convention centre. These linkages would make the region a much more attractive convention destination. For example, the construction of just two of the links would connect 1,473 hotel rooms with the Congress Centre, which would be more than any other city in Canada. The Government Convention Centre is strategically located as a hub for some of the links, especially for crossing the canal. The continued work of the Linkages Initiative Steering Committee is vital in this regard. OTCA reports that the construction of an expanded convention facility would be a good investment of public sector funds. It is unlikely that the private sector would directly invest in the convention facility, but it would invest in the related components - retailing, entertainment and a hotel. Additionally, a survey of downtown hotels and the Rideau Centre indicated a high degree

3 74 of support for private sector funding of the linkages component. The private sector would also help fund partnership marketing of the expanded convention centre. In conclusion, OTCA believes that an expanded facility will produce significant positive economic impacts and an immeasurable boost in Ottawa s image as a world class destination. The full report from OTCA is attached as Annex A. Note that the contacting of provincial and federal departments was undertaken by Regional staff, as noted below. OCEDCO Response: OCEDCO believes that expanded convention facilities are required to ensure that the convention and tourism industry remains a vital sector in the regional economy. A primary economic development goal in Ottawa-Carleton is to reduce reliance on government and create a climate conducive for private sector growth, with strategic actions by Regional government as a catalyst. Expanded convention facilities can help achieve the goal. Tourism jobs are important because they require skills different than those of the high-tech sector and because they provide more opportunities than other sectors for part time and youth employment. Maintaining and enhancing the convention/tourism industry is essential for a balanced and diversified economy, which results in a strong and dynamic economy. The findings of the KPMG report are supported by OCEDCO. The economic impacts from both construction and operations are substantial. A clear argument is made that market demand for expanded facilities exist, and that a downtown core site linked to the Congress Centre is required. The report provides good arguments for investing in the facility, both from a government cost recovery perspective and as an economic generator. Expanded convention facilities in the downtown core would be compatible with other core initiatives. Of special note is the linkages proposal to create weather protected fixed links for pedestrians between downtown hotels and destinations such as the NAC, Sparks Street and the Congress Centre. This project would improve the marketability of the region, especially as a winter destination. An expanded convention centre would also benefit the redevelopment of the Daly site, and provide more customers for Rideau Street and the By Ward Market. The role of the centre to showcase the region as a place to do business, both nationally and internationally, should not be underestimated. OCEDCO suggests a local operating authority, comprised of both public and private sector representatives, be established to manage the facility. This authority would have more local control than the current Provincial Crown Corporation managing the Congress Centre. To determine financing options, a survey of the methods used for recent similar expansions elsewhere could be undertaken. Although a second phase government infrastructure program could be a financing vehicle, other options for both private and public sector investment should be identified. Possible financing options could include guarantees, covenants, cash, tax revenues, programs and services.

4 75 OCEDCO recommends that additional work be undertaken to develop plans for the appropriate sites identified by Regional staff. Financial options can then be developed based on this work. Concurrently, other supporting projects in the downtown core, such as the Linkages project and the transfer of the Government Conference Centre to local control, should be worked on and finalised. The full report from OCEDCO is attached as Annex B. Response Re. Provincial and Federal Government Support: Letters were sent by Regional staff to various Provincial and Federal departments seeking support for an expanded convention centre in Ottawa-Carleton. Three replies have been received to date. Mac Harb, MP was supportive and noted that his caucus will be considering what role to play with respect to the proposal. Industry Canada indicates that all the funding for the Canada/Ontario Infrastructure Works Program is essentially committed, and that the Canadian Tourism Commission does not provide support for infrastructure development. The Provincial Ministry of Economic Development, Trade and Tourism indicated their awareness of the project, suggesting it could evolve into a useful model for private-public sector partnerships. However, they caution that significant levels of public funding may be unrealistic given the province s fiscal situation. B) Request the Planning and Property Department, with contribution from OTCA and OCEDCO, to develop a list of suitable sites in the downtown core for the Capital Centre Capital Project by 30 August Response: This task was completed in a number of steps. Since the minimum size for the main hall of the new convention facility is 100,000 sq. ft., step one was to select potential sites in the downtown core which could accommodate this, on or above ground. Ten downtown sites, including the KPMG report proposal and the existing Congress Centre were found. Three of the sites were very close to the Congress Centre, two were east of the Centre, one was to the north and three were west of the Rideau Canal. At the first meeting of the Steering Committee the ten sites were examined and site criteria selected. Site criteria were split into two lists, Strategic and Detailed, as outlined below. The Strategic Criteria are the essential factors a site must have, and were used to determine if a site was suitable for further consideration. All ten sites were tested against the Strategic Criteria. The Detailed Criteria would be used at the next level of analysis, and would only be applied to those sites which meet all the Strategic Criteria. Note that during this process the Steering Committee determined that the minimum floorplate needed to be increased from 100,000 sq. ft. to 150,000 sq. ft., to accommodate the main convention hall, banquet room and access areas on one level.

5 76 Strategic Site Criteria: Located in the downtown core so that amenities, restaurants, attractions and entertainment are within a short walking distance. This is essential for a successful convention facility in Ottawa-Carleton. Minimum footprint of 150,000 sq. ft. (can include air space over existing roads and buildings). Preferably have room for expansion. Weather-protected link to the Congress Centre. The shorter the distance the better. The lease for the Congress Centre runs to the year 2033 with renewal rights to Since the existing facility is well located and there is no practical reason for it to be abandoned, the issue becomes how best to link the new facility with the old. Linking would permit joint use of facilities (meeting rooms, kitchens, etc.) and joint administration/operation At least 2,000 quality hotel rooms less then 500 m from site (including rooms to be built in new hotel as part of the new facility). Weather-protected access from hotel rooms to the new facility. Proximity to the By Ward Market would be advantageous. The Committee determined that of the 10 sites, only four satisfied or could be made to satisfy the Strategic Criteria. These sites were all located close to the existing Congress Centre and the Westin, Chateau Laurier, Novotel and Les Suites cluster of hotels (1,433 rooms). One additional site, Major s Hill Park, was also selected for special consideration because of potential dramatic views overlooking the Ottawa River. The five short listed sites are briefly described below. The ten sites are shown on Figure 1. KPMG Report Proposal: This is the 255,000 sq. ft. site studied in the Capital Centre Capitale report and being promoted by Minto. It is located opposite the Rideau Centre, south of the Mackenzie King Bridge. Some of the DND Headquarters property and air rights over RMOC roads would be required to achieve the full 255,000 sq. ft. Four design options were presented in the KPMG report and additional options could be developed. This site could serve as a gateway to the downtown because it is very visible and situated where Nicholas Street, which operates as a major on/off ramp to the Queensway, enters the downtown core. There could be two pedestrian links to the Congress Centre, one under the Mackenzie King Bridge and one crossing above the bridge. The building would be adjacent to the University of Ottawa, which could benefit large university functions, provided the visual and community impacts on the university and surrounding residential areas are acceptable. Viking Rideau Lands: This site is immediately east of the Rideau Centre. It is currently used mainly for parking (surface and structure) and includes the five story Ogilvie Building at the corner of Rideau and Nicholas. The preliminary proposal is for a four story facility, integrated with the Rideau Centre, with a hotel above. The main convention rooms would be on the fourth floor, which would have an area of 173,000 sq. ft. The third floor would provide linkages for pedestrian access to the Congress Centre, Westin Hotel, and Novotel, and perhaps to a pedestrian bridge over the Rideau Canal to the National Arts Centre (and its 1,200 parking spots) and

6 77 Sparks Street. Viking Rideau representatives believe that a convention facility in this location would provide great mutual benefit with the Rideau Centre (which they own) and have suggested that a long term lease similar to the one they have for the Congress Centre would make the most sense for both parties. DND Headquarters: This site, immediately south of the Congress Centre, was examined for possible development or redevelopment. Staff were informed by DND that administrative personnel in the Ottawa-Carleton area are going to consolidated at the Colonel By Drive complex. DND is planning an extensive retrofit of the building This alternative should therefore not be considered further. Congress Centre Expansion: This would be an upper level addition to the existing facility, spanning over the Rideau Centre. Viking Rideau, owners of the Rideau Centre, have indicated that this is structurally possible. However, it would require the construction of large supporting columns through Eaton s, which is not desirable. There would also be logistical problems with respect to delivering display and other materials to this upper level. Viking-Rideau believes their other site to the east of the Rideau Centre is superior. Staff believes this option of an upward expansion should not be considered further. Major s Hill Park: A potential exists to build a dramatic facility under Major s Hill Park, which would have terraces and windows at the edge of the cliff overlooking the Ottawa River and Rideau Canal. Except for the construction phase, the complex would not reduce the amount of open space in the park and could perhaps include facilities to enhance the use of the park. However, the NCC has advised that Major s Hill Park is one of the pre-eminent cultural landscapes in the Capital and therefore the NCC can t accept to make the park available for the proposed project. Staff does not recommend that this option be pursued. Of the short list of five sites, the Steering Committee determined that only the KPMG report proposal and the Viking-Rideau lands merit further examination. These two sites should be subject to further evaluation with respect to the following Detailed Site Criteria, a performance evaluation of the above Strategic Criteria, and an analysis of the best financial and community impact on the Region. Additional information from the proponents would be required to complete this examination which would then result in a recommendation on a preferred site/proposal. Detailed Site Criteria: Ability of the site to include entertainment as part of the convention centre complex, such as retailing, restaurants and other attractions. Consider opportunities to develop or redevelop an unattractive site to improve the appearance of the core. Assess adequate/appropriate space for truck loading docks. Assess truck accessibility, with consideration of impact of truck movements on traffic flow. Assess truck route impacts on adjacent communities.

7 78 Consider the need for a marshalling yard for trucks within a few kilometres of the facility. Require direct access for charter buses, and proximity to OC Transpo service. Assess parking requirements and parking potential for each site (minimum of 800 spots according to KPMG). Determine natural site constraints, planning approval requirements, etc. Possibility of improving the pedestrian environment, (e.g. retailing at grade rather than blank walls). Sensitivity to surrounding uses, especially heritage buildings and residential areas. Visibility of site so that the facility can be a landmark feature. C) That the Planning and Property Department seek comments from the University of Ottawa with respect to the nature and scale of this project immediately adjacent to their campus Response: Contact was made with the University with respect to the specific site proposed in the Capital Centre Capitale report. The spokesperson indicated that the University is on record as generally being supportive of the project because there would be a synergy with the University. Discussions between the University and Minto have occurred, with Minto indicating a willingness to develop the project in harmony with the University s Master Plan. However, a complete assessment of the project by the University would require detailed design drawings. The University has submitted a list of design issues for the project, which can be used if terms of reference are prepared. A key issue is a desire for a pedestrian plaza between the facility and Tabaret Hall, with all traffic concentrated on Nicholas Street. A copy of the letter received from the University is attached as Annex C. CONSULTATION As noted above the key parties associated with an expanded convention facility have been contacted. In addition, letters have been received from Action Sandy Hall and the Ottawa LACAC commenting on issues related to integration with the neighbourhood and heritage buildings. These issues will be addressed in the next phase of work. Interested parties have been notified of the Committee meeting The City of Ottawa has representation on the Steering Committee.

8 79 FINANCIAL IMPLICATIONS The financial implications of an expanded convention facility are to be determined through further work. Approved by N. Tunnacliffe Planning and Development Approvals Commissioner Attach.(4)

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