Senators owner gives up on building arena, sues development partner instead

When last we checked in with Ottawa Senators owner Eugene Melnyk back in April, he’d won a discounted deal to get land and development rights for a new downtown arena project at LeBreton Flats, but was stalling on actually starting building it because he called it a “tremendous risk.” And if you had “sue your development partners” next on your Eugene Melnyk bingo card, you’re a winner!

While people involved in the LeBreton negotiation have accused Melnyk of being the roadblock to landing a final development deal, Melnyk’s lawsuit claims he was kept in the dark about [Trinity Developments’ John] Ruddy’s development interest at 900 Albert St., across from the Bayview LRT station and near LeBreton Flats…

The lawsuit says Melnyk hired PricewaterhouseCoopers to look into the residential market and found the massive project at 900 Albert would “destroy the viability of the LeBreton project outright.” The market, according to the lawsuit’s description of the report, couldn’t support both projects.

That certainly sounds like Melnyk being a roadblock — “we don’t to build housing with our partner because they’re also building housing elsewhere” is a strange argument, especially since Ruddy would be effectively shooting himself in the foot as well. The Ottawa Citizen cites “three sources with direct knowledge of the negotiations” (without saying which side they’re on) as alleging that the Senators owner is just trying to get out of paying for an arena, while indicating that “no one is quite sure what Melnyk’s end-game is on LeBreton Flats.” Presumably by “no one” they didn’t include Melnyk himself, though given the man’s behavior so far, it’s always possible he has no idea what he’s doing either.

Whether this is good news or bad news for Ottawa residents depends on whether a developer can now be found for the site whose plan is something other than “get rights to the land, sit around complaining until someone else pays to build on it,” but presumably that won’t be too hard. It’s probably bad for Senators fans, who will have to keep shlepping out to the existing arena way out of town for games (or not, which has more often been the case), but that’s still arguably better than paying once for tickets and again for an arena with tax money, as seemed to be Melnyk’s goal.

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5 comments on “Senators owner gives up on building arena, sues development partner instead

  1. Yeah, typical Melnyk.

    Ruddy’s company (Trinity Dev) develops property for a living… and they do it really successfully. The notion that – via his proposed partnership with Melnyk – Ruddy would have to forego any or all other developments apart from the LeBreton Flats project is simply ludicrous.

    Many people are musing about how much cash Melnyk could actually free up to be a partner in this venture and whether or not that might be the real reason behind him being a (but not necessarily the only) roadblock in this discussion. Maybe he figures he can sue his partners, then settle for $450m or so, then call the (former) partners up and offer to use the $450m settlement to fund his portion of the development….

    I’ll mention once again that any tax dollars going toward the arena (or other aspects of the development) will not be even partially raised through income taxes on Melnyk himself as he is non-resident and does not pay income or property taxes personally in Canada.

    Isn’t that the ultimate hubris? Demanding taxpayer funding for your development when you do not pay income tax in the country in which it is located….

  2. #MelnykOUT used the team to call for people to check their suitability for organ donations to save him from death…which makes his use of twitter bots attacking people who use #melnykOUT seem mundane.

  3. I know there’d be no way to tell this based on most of the reporting over time on this project, but two things:

    – LeBreton Flats isn’t downtown. All this new arena (which was never going to get built) would have done is get the team *closer* to downtown.
    – the existing arena isn’t way out of town. It’s in Ottawa, just out in the west end and beyond where the historical city limits were.

    1. Navi: You are correct, the arena is on the west end of Kanata, some 25km from ‘downtown’ Ottawa (which is east of Kanata).

      As both communities have grown, the theoretical distance between the corporate limits of each has shrunk…. but nothing changes the distance from where the arena was built to where most of the Ottawa fans live.

      LeBreton flats is ideally placed between downtown Ottawa and Hull, with easy access from Gatineau, Vanier and the Glebe. Transit connections are also quite simple, unlike the present location.

      This is not to say that I think tax dollars should go to it, but there’s no question it’s a better location for development – residential, commercial or sporting/rec.

      You may have to pan in or out on this, but the linked map shows the relative location of the present arena (lower left) and Ottawa itself (upper right). LeBreton flats is the ‘sandy’ looking area just NW of the hwy 36 indicator or just SW of downtown.


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