What will Winnipeg’s stadium delay mean?

It's no secret that there have been construction issues with the Winnipeg Blue Bombers' new stadium almost since it was announced, with the team already shifting from opening it at the start of the year to targeting Sept. 9 to discussing a late-September opening. Still, Friday's news that the team won't be opening the new stadium until 2013 is stunning; while players like Jovon Johnson who weren't fans of moving mid-year will be happy, this is a concerning development for the organization, and one that will likely substantially hurt from a revenue perspective. It also may be seen as breaking a promise to fans. The Bombers are quite fortunate that they didn't demolish Canad Inns Stadium, as they'll still have an acceptable local place to play, but this still seems like a major setback for them and one that could have significant repercussions down the road.

The key to understanding why the time the Bombers move in to their new stadium matters comes from the specific terms of the stadium deal. Unlike many other CFL stadium deals, the Bombers are on the hook for $85 million, a massive 40 per cent portion of the total (stadium and attached recreational facility) costs here. Even more importantly, that's not money they actually have, but rather money they're borrowing from the provincial government, and it comes with a couple of critical dates. They have 45 total years to pay off the loan, which isn't bad, but if they pay the first $15 million by 2016, that portion is interest-free (which could lead to huge savings). However, in order to do that, they'd have to pay $3 million a year, and considering that $3.1 million was a record profit for Saskatchewan (generally seen as the most financially successful CFL club) in 2009, finding $3 million annually isn't easy for any CFL club. (For comparison, Winnipeg made a $2.3 million profit last season, which was a club record.) That task gets much harder when you're forced to play one of those seasons in an older stadium that will likely feature lower ticket prices, less suites and less naming-rights revenue.

Bombers' president and CEO Garth Buchko addressed the situation at a press conference Friday afternoon, and his remarks were notable. Buchko said that this kind of delay wasn't anticipated by the team.

"It was our intention that we were going to be playing at Investors Group Field at the beginning of this year," he said.

The continually-in-flux dates released by the club raise plenty of questions, as does Buchko's Jan. 27 comment that "We will not play again in Canad Inns Stadium," but Buchko said he was just passing along what he heard from the contractors.

"Everything we've relayed is based on the information we were given," he said. "I was asked a question, I sought info, I received info and I relayed it."

Buchko said the decision to abandon the prospect of playing at Investors Group Field this year came this week when the contractors told him dates still couldn't be locked down.

"They came back to me this week with an unpredictable timeline," he said. "At this point, I am not comfortable with anything but a certain date."

Buchko said general contractor Stuart Olson Dominion Construction is still on track for the September date they've been assigned, but the issue is that the stadium canopy (from another company) has been delayed.

"The canopy, because of a number of issues, is now about a month late," he said. "We can't play football unless we have a field and unless the canopy and the steel is completed."

Buchko praised Stuart Olson Dominion for their efforts.

"They have done yeomen's work," he said. "They have brought in extra people extra men to do the job."

He ascribed the issues primarily to rain and wind.

"We just can't battle the weather," Buchko said.

Of course, some rain and wind is to be expected in "Winterpeg," so a key question is if the initial timelines were always unrealistic. When quizzed about that, Buchko (who only took the Bombers' job January 5) didn't fully throw his predecessors under the bus, but he wasn't exactly completely defending them either.

"Yes, it's unfortunate, but for those who created the timelines, they must have had their reasons," he said.

This change could have notable financial implications for the Bombers, so Buchko spent much of his press conference playing those down. He discussed all the positive financial signs they're seeing (record store sales, record sponsorships, record season-ticket sales and 87 per cent ticket sales for a preseason game next week), and said 43 of the 46 companies that were set to buy suites at the new stadium this season will be buying a package at the old stadium, involving field-level hospitality tents. He said the sponsors understand why this happened and remain supportive of the club.

"Almost to a person, everyone understands this is a long-term partnership," he said.

Buchko expects fans will be understanding as well based on feedback he's received.

"We would like to once again thank Canada's best fans," he said. "They have told us 'Build it right, open it when it is 100 per cent ready.'"

However, if fans are unhappy, refunds are available. Buchko said the plan is to apply discounts based on playing this year at Canad Inns rather than Investors Group Field to fans' season-ticket packages for 2013. If fans are unhappy with that, they can get cash instead. He also said that the team would refund 2012 season tickets for those who only bought them because of the new stadium.

"If a season-ticket holder only bought a ticket to be in Investors Group Field and they're disappointed, we'll refund the money," he said.

If fans opt for 2012 refunds, though, they may risk losing their seats at Investors Group Field in 2013, which has some irked. Buchko wants to try and keep as many fans for this year as possible, though, and he said there will be extra measures, including additional concessions, taken to make Canad Inns a desirable venue this season.

"We're going to work hard to really make the fan experience great for the fans this year," Buchko said.

Still, even if most of the sponsors and fans stay onside with the change in plans, this is still going to carry substantial costs for the team, and that could be crucial given the short timeframe before interest will apply to their loan. Buchko said he doesn't know how significant the financial impact of the change will be just yet.

"To give you a number right now, I can't."

It's that number that's going to be the most important element of this story. Looking on the bright side, if Bombers' fans and sponsors stick with the team en masse through this, perhaps they'll be able to keep the damage to a minimum and remain on track to pay that $15 million by 2016. If the financial impact from this stadium change becomes a large number, though, that could be disastrous for the team in both the short term and the long run. The debate over where the Bombers will play this year may be over, but the drama around their financial picture is just beginning.