Treadmills, elliptical bikes, foosball tables and even baseball caps with magnetic sunglasses are on display at the Taipei World Trade Centre Nangang Exhibition Hall.
The April 29-May 2 TaiSPO -- Taipei International Sporting Goods Show -- has drawn 385 manufacturers, including 147 in the lucrative fitness equipment sector.
Taiwan counted more than $1 billion of exports in sporting goods in 2009, including $405.25 million in exercise and fitness equipment. Brands like Johnson Health and SportsArtFitness are exhibiting the latest in treadmills with screens that transform the exercise machine into a virtual reality tool. Johnson’s products include a screen that offers images of the Olympic National Forest in Washington State, for example.
The Lausanne, Switzerland-based World Federation for the Sporting Goods Industry used the occasion to stage its first manufacturers’ forum in Taiwan.
Thursday, April 29, 2010
One foot in front of the other
Former Adidas executive vice-president and director Michel Perraudin pinch-hit for Frank Dassler, the general counsel for Adidas and part of the famed German sporting goods clan. Perraudin was the World Federation for the Sporting Goods Industry president from 2004-2007. Now a private consultant, he serves on the board of the Lausanne, Switzerland-based WFSGI.
Here's what he had to tell the media at the Taipei International Sporting Goods Show April 29 about how the industry is evolving.
“There is a shift now from working conditions to environment, to green products. This is something that is going to stay with us. Puma announced a couple of weeks ago that they would get rid of the outdoor boxes and replace the boxes with bags that are totally recyclable.
“You now have the bio-cotton which is coming, natural fibres which are evolving. However it is interesting, if you make an ecological balance between natural fibres and synthetic fibre, the synthetic fibre has strangely enough a better ecological balance than the natural fibre.
"If you were to decide tomorrow to replace all the synthetic fibres through wool or cotton, it could not happen. Our world would not have enough surface to generate all this and feed the population.
“Recyclable material is used for outsoles, to do sporting surfaces, playgrounds, it is obviously something where innovations will continue to evolve.
“However, there is one truth which is inescapable, the consumer at the end of the day until now in the vast majority of the cases is not buying because it’s ecological, but is buying because of the price, because of the look or the perceived quality of the product. It’s only up to now a minority of consumers that are making a buying decision which is based on ecological considerations.
“What is driving the industry is style and innovation, innovation on the hardware side. When we talk about footwear, it’s more innovation in the fabrics than it is innovation in technology. The footwear industry has not seen many technological innovations in the last 20 years. Nike is still using air, Asics still using gel. No real revolution in the footwear side of things. Much more development on the fibre side, the fabrics of the apparel side.”
Here's what he had to tell the media at the Taipei International Sporting Goods Show April 29 about how the industry is evolving.
“There is a shift now from working conditions to environment, to green products. This is something that is going to stay with us. Puma announced a couple of weeks ago that they would get rid of the outdoor boxes and replace the boxes with bags that are totally recyclable.
“You now have the bio-cotton which is coming, natural fibres which are evolving. However it is interesting, if you make an ecological balance between natural fibres and synthetic fibre, the synthetic fibre has strangely enough a better ecological balance than the natural fibre.
"If you were to decide tomorrow to replace all the synthetic fibres through wool or cotton, it could not happen. Our world would not have enough surface to generate all this and feed the population.
“Recyclable material is used for outsoles, to do sporting surfaces, playgrounds, it is obviously something where innovations will continue to evolve.
“However, there is one truth which is inescapable, the consumer at the end of the day until now in the vast majority of the cases is not buying because it’s ecological, but is buying because of the price, because of the look or the perceived quality of the product. It’s only up to now a minority of consumers that are making a buying decision which is based on ecological considerations.
“What is driving the industry is style and innovation, innovation on the hardware side. When we talk about footwear, it’s more innovation in the fabrics than it is innovation in technology. The footwear industry has not seen many technological innovations in the last 20 years. Nike is still using air, Asics still using gel. No real revolution in the footwear side of things. Much more development on the fibre side, the fabrics of the apparel side.”
Towards a no-sweat world
While it took western countries took two centuries to go through an industrial revolution, former Adidas executive vice-president Michel Perraudin says China is amid a 20-year industrial revolution.
Low wages and high productivity are China's hallmark and the reason why the biggest brands source their goods from mainland factories. Many of those factories can trace their heritage to Taiwan, where Asia’s top sporting goods companies are exhibiting their wares at the Taipei World Trade Centre through May 2 at TaiSPO -- the Taipei International Sporting Goods Show.
The convention kicked off April 29 with the World Federation for the Sporting Goods Industry’s 2010 manufacturers’ forum.
Executives from major retailers and brands spoke to an audience of manufacturers representing companies from Taiwan, Hong Kong and mainland China.
The world may be a long way from being sweatshop-free, but the international campaigns by various non-governmental organizations have made the issue of working conditions in sportswear factories top-of-mind among both consumers and the WFSGI.
Here's what two executives had to tell the manufacturers.
Intersport International Corp. business unit manager Markus Rist:
“No matter the size of the brand, it’s a requirement of the market that you have to fulfill. It’s not only a trend, it’s an absolute given fact. We are forced to comply with those unique regulations... the EU, the U.S., every market has more and more regulations. The sole objective of those regulations is to protect the consumer. This is nowadays so sensitive that nobody wants to burn his fingers. If you want to be a supplier to any of us, it’s a minimum requirement that you have to be able to fulfill and guarantee.
Vice-president of sourcing, quality and logistics New Balance Jim Sciabarrasi:
“The biggest issue that we have seen in the small manufacturer is a reluctance to embrace the compliance requirements. The requirements are not costly. For example, many small manufacturers believe the best scenario is to work many, many hours a week, but a very basic compliance requirement is to limit the amount of hours a week. When that happens, productivity goes up because quality goes up and there’s less retraining of workers who leave the small factory because they don’t like the life of working every single day, so many hours... The productivity more than makes up for the other requirements.”
* * * * *
One of the world’s biggest athletic footwear makers is Taichung, Taiwan-headquartered Pou Chen Group. The 1969-founded company uses its home base for research and development. It’s forecasting production of 250 million pairs of shoes in 2010, up 50 million from 2009, for brands like Adidas, Nike, Reebok, New Balance, Rockport, Asics, Timberland and Puma. PCG and subsidiary Yue Yuen Industrial Holdings have a workforce of 400,000 people at factories in China, Indonesia, Vietnam, Bangladesh, Mexico and the U.S. PCG claims it makes one-in-seven pairs of branded shoes in the world.
PCG, by its sheer size, has been criticized by various non-governmental organizations for treatment of workers. Corporate social responsibility executive Eric Chi claimed the company has made progress with ventilation fans and air conditioning in factories, daycare centres and “spiritual consulting centres”, birthday parties for employees and ergonomic furniture “to reduce the fatigue and exhaustion of employees.”
Low wages and high productivity are China's hallmark and the reason why the biggest brands source their goods from mainland factories. Many of those factories can trace their heritage to Taiwan, where Asia’s top sporting goods companies are exhibiting their wares at the Taipei World Trade Centre through May 2 at TaiSPO -- the Taipei International Sporting Goods Show.
The convention kicked off April 29 with the World Federation for the Sporting Goods Industry’s 2010 manufacturers’ forum.
Executives from major retailers and brands spoke to an audience of manufacturers representing companies from Taiwan, Hong Kong and mainland China.
The world may be a long way from being sweatshop-free, but the international campaigns by various non-governmental organizations have made the issue of working conditions in sportswear factories top-of-mind among both consumers and the WFSGI.
Here's what two executives had to tell the manufacturers.
Intersport International Corp. business unit manager Markus Rist:
“No matter the size of the brand, it’s a requirement of the market that you have to fulfill. It’s not only a trend, it’s an absolute given fact. We are forced to comply with those unique regulations... the EU, the U.S., every market has more and more regulations. The sole objective of those regulations is to protect the consumer. This is nowadays so sensitive that nobody wants to burn his fingers. If you want to be a supplier to any of us, it’s a minimum requirement that you have to be able to fulfill and guarantee.
Vice-president of sourcing, quality and logistics New Balance Jim Sciabarrasi:
“The biggest issue that we have seen in the small manufacturer is a reluctance to embrace the compliance requirements. The requirements are not costly. For example, many small manufacturers believe the best scenario is to work many, many hours a week, but a very basic compliance requirement is to limit the amount of hours a week. When that happens, productivity goes up because quality goes up and there’s less retraining of workers who leave the small factory because they don’t like the life of working every single day, so many hours... The productivity more than makes up for the other requirements.”
* * * * *
One of the world’s biggest athletic footwear makers is Taichung, Taiwan-headquartered Pou Chen Group. The 1969-founded company uses its home base for research and development. It’s forecasting production of 250 million pairs of shoes in 2010, up 50 million from 2009, for brands like Adidas, Nike, Reebok, New Balance, Rockport, Asics, Timberland and Puma. PCG and subsidiary Yue Yuen Industrial Holdings have a workforce of 400,000 people at factories in China, Indonesia, Vietnam, Bangladesh, Mexico and the U.S. PCG claims it makes one-in-seven pairs of branded shoes in the world.
PCG, by its sheer size, has been criticized by various non-governmental organizations for treatment of workers. Corporate social responsibility executive Eric Chi claimed the company has made progress with ventilation fans and air conditioning in factories, daycare centres and “spiritual consulting centres”, birthday parties for employees and ergonomic furniture “to reduce the fatigue and exhaustion of employees.”
Friday, April 16, 2010
Peacock plucked in Vancouver
Speaking of NBC, the Peacock network lost $223 million on its Vancouver 2010 coverage, according to the April 16-released quarterly report.
That’s $27 million better than the worst-case scenario, but $23 million worse than the original $200 million estimate of GE CEO Jeff Immelt.
NBC paid $2.2 billion for the Vancouver/London package in 2003 when the advertising market was rosier. A not-so-funny thing happened on the way to Vancouver, called the recession. The last time the Olympics were in a North American time zone was Salt
Lake 2002 when NBC made a $70 million profit.
The Games did bring $800 million in revenue to GE and the ratings were 14% higher than Turin 2006.
ESPN/ABC and FOX are readying to bid for Sochi 2014 and Rio de Janeiro 2016. Will NBC match their offers? s
That’s $27 million better than the worst-case scenario, but $23 million worse than the original $200 million estimate of GE CEO Jeff Immelt.
NBC paid $2.2 billion for the Vancouver/London package in 2003 when the advertising market was rosier. A not-so-funny thing happened on the way to Vancouver, called the recession. The last time the Olympics were in a North American time zone was Salt
Lake 2002 when NBC made a $70 million profit.
The Games did bring $800 million in revenue to GE and the ratings were 14% higher than Turin 2006.
ESPN/ABC and FOX are readying to bid for Sochi 2014 and Rio de Janeiro 2016. Will NBC match their offers? s
Scranton 2010
I don’t know how much it costs to get your product mentioned on The Office.
That's because the going rate was censored from a document obtained under Freedom of Information. But it did reveal the cost of the British Columbia Olympic tourism campaign on NBC was $17.255 million.
The You Gotta Be Here campaign starred Michael J. Fox, Sarah McLachlan and Steve Nash. I revealed that it also included a product placement on The Office.
The Feb. 11 episode began with Michael Scott calling a Vancouver hotel to confirm a reservation for the Olympics. The Office also produced a web-exclusive video with a special song about Canada in general and B.C. in particular.
This is the new normal, folks. Because of digital video recorders, commercials are being skipped and advertisers’ money is being wasted. The only way to ensure bang for the buck is by being inside the content.
That's because the going rate was censored from a document obtained under Freedom of Information. But it did reveal the cost of the British Columbia Olympic tourism campaign on NBC was $17.255 million.
The You Gotta Be Here campaign starred Michael J. Fox, Sarah McLachlan and Steve Nash. I revealed that it also included a product placement on The Office.
The Feb. 11 episode began with Michael Scott calling a Vancouver hotel to confirm a reservation for the Olympics. The Office also produced a web-exclusive video with a special song about Canada in general and B.C. in particular.
This is the new normal, folks. Because of digital video recorders, commercials are being skipped and advertisers’ money is being wasted. The only way to ensure bang for the buck is by being inside the content.
No peeking: VANOC hiding finances until the fall
VANOC has stopped issuing quarterly reports, which is contrary to the pledge made in November 2002’s Multiparty
Agreement. It said, should Vancouver win the Games, the organizing committee “will provide the parties with quarterly updates to the business plan within 60 days after the end of each quarter of each fiscal year, including forecasts of revenues and expenses."
CEO John Furlong said the rapidly shrinking VANOC workforce has no time to do reports anymore. Its last was for the quarter ended Oct. 31, 2009. The next and final report is coming in October.
“We’re in a completely different frame of mind, we’re trying to reconcile everything, we don’t have the time for that now,” he said after an April 16 Vancouver Board of Trade speech. “We need to get everything sorted out, you’ll get a full final report.
“We’re down to the smallest team we can have, we need to get out of business so that we have the best financial legacy that we can. Our team is infinitely smaller, we don’t have the resources we had through the Games to do that.”
The Games were a creative success that looked spectacular on TV. Even Mother Nature allowed the sun to shine for several days. But VANOC isn’t willing to let the sun shine on its financial figures until the fall. Until then, we can only speculate on the size of the International Olympic Committee and British Columbia government bailouts to make the books balance.
When we peel back the curtain, we’ll find that the recession made this the least successful Games since Montreal 1976.
Agreement. It said, should Vancouver win the Games, the organizing committee “will provide the parties with quarterly updates to the business plan within 60 days after the end of each quarter of each fiscal year, including forecasts of revenues and expenses."
CEO John Furlong said the rapidly shrinking VANOC workforce has no time to do reports anymore. Its last was for the quarter ended Oct. 31, 2009. The next and final report is coming in October.
“We’re in a completely different frame of mind, we’re trying to reconcile everything, we don’t have the time for that now,” he said after an April 16 Vancouver Board of Trade speech. “We need to get everything sorted out, you’ll get a full final report.
“We’re down to the smallest team we can have, we need to get out of business so that we have the best financial legacy that we can. Our team is infinitely smaller, we don’t have the resources we had through the Games to do that.”
The Games were a creative success that looked spectacular on TV. Even Mother Nature allowed the sun to shine for several days. But VANOC isn’t willing to let the sun shine on its financial figures until the fall. Until then, we can only speculate on the size of the International Olympic Committee and British Columbia government bailouts to make the books balance.
When we peel back the curtain, we’ll find that the recession made this the least successful Games since Montreal 1976.
Saturday, April 3, 2010
Coming atcha in 3-D!
Why did I not line-up with the masses at the VANOC asset sale in Delta?
The 200,000 items were bought by the provincial government as part of its bailout of VANOC and Games-used high definition TVs were listed at $199 for Sharp 19-inch and $499 for Panasonic 40-inch.
HD TV is a relatively new innovation in North America and it will already be obsolete by this Christmas when 3-D high definition TVs will be among the must-have items.
In fact, 3-D is the next revolution in movie and TV experience. You can thank Fox and its Avatar. We've come along way from Dr. Tongue's 3-D House of Stewardesses.
NCAA Final Four games are being offered in select movie theatres around the United States in 3-D.
An April 3 match between Manchester United and Chelsea was shown in 1,000 pubs around the United Kingdom in 3-D. Sky TV, which is owned by Fox, will offer a 3-D channel with English Premier League soccer matches to 2 million homes this fall.
Coming this June - in time for the FIFA World Cup - is ESPN's 3-D network. Only in the United States? Pity.
Broadcasters and film producers have solved two problems with 3-D. It'll allow them to generate new revenue with premium ticket and subscription prices from viewers who want a better experience. 3-D also gets them one step ahead of counterfeiters. Hardware makers like Panasonic, Sony, LG and Samsung are also salivating at the potential for the next generation of the boob tube.
Panasonic's pavilion at the Vancouver 2010 Winter Olympics showcased Olympic ceremony footage in 3-D. Vancouver's Olympics were the first Winter Games in full high definition from the source. Sadly, they will also be remembered as the last of the 2-D broadcast era.
The 200,000 items were bought by the provincial government as part of its bailout of VANOC and Games-used high definition TVs were listed at $199 for Sharp 19-inch and $499 for Panasonic 40-inch.
HD TV is a relatively new innovation in North America and it will already be obsolete by this Christmas when 3-D high definition TVs will be among the must-have items.
In fact, 3-D is the next revolution in movie and TV experience. You can thank Fox and its Avatar. We've come along way from Dr. Tongue's 3-D House of Stewardesses.
NCAA Final Four games are being offered in select movie theatres around the United States in 3-D.
An April 3 match between Manchester United and Chelsea was shown in 1,000 pubs around the United Kingdom in 3-D. Sky TV, which is owned by Fox, will offer a 3-D channel with English Premier League soccer matches to 2 million homes this fall.
Coming this June - in time for the FIFA World Cup - is ESPN's 3-D network. Only in the United States? Pity.
Broadcasters and film producers have solved two problems with 3-D. It'll allow them to generate new revenue with premium ticket and subscription prices from viewers who want a better experience. 3-D also gets them one step ahead of counterfeiters. Hardware makers like Panasonic, Sony, LG and Samsung are also salivating at the potential for the next generation of the boob tube.
Panasonic's pavilion at the Vancouver 2010 Winter Olympics showcased Olympic ceremony footage in 3-D. Vancouver's Olympics were the first Winter Games in full high definition from the source. Sadly, they will also be remembered as the last of the 2-D broadcast era.
Canucks' tri-centennial not legit
The Vancouver Canucks are a marketing juggernaut and have cornered the market as the number one professional sports property. They have made General Motors Place the number one destination and Canucks' games the number one local TV draw.
Not so difficult to achieve with little competition, except for outdoor sports and recreation. The Canucks are Vancouver's only connection to a big continental sports league during dark and stormy winters. The sport is Canada's national winter pastime. Many Vancouverites are from points east of the Rockies where hockey is life. Just wait until 2011 when the Vancouver Whitecaps enter Major League Soccer and challenge the Canucks for the finite pool of ticket and sponsor money available in this market. You will quickly witness why Canucks' owner Francesco Aquilini was bidding against Greg Kerfoot for an MLS franchise.
The Canucks will be celebrating their 300th consecutive home sellout April 3 when the Minnesota Wild visit. I'm a stickler for statistical honesty and I won't be sending the Canucks a 300-candle cake.
Only the beancounters inside 800 Griffiths Way know how many tickets have been sold and distributed over the last 299 games.
I do know that on March 15, 2007 -- when the Canucks beat St. Louis 3-2 in overtime -- there were 18,325 tickets scanned by GM Place staff at the arena entries. The NHL scoresheet falsely reported the arena was at 18,630 capacity and that was also the attendance figure announced in the arena. I asked Canucks Sports and Entertainment for comment but never got a response.
The 18,325 figure comes from a Bunt and Associates study for the City of Vancouver's Olympic transportation office. The same report said 16,653 season ticket holders attended the game. Capacity was increased to 18,810 with the Best Buy Club for the 2009-2010 season.
The Canucks' average $62.05 ticket price is third highest in the NHL -- a portion of that revenue is shared with the league's struggling southern franchises including the Phoenix Coyotes. But most of the money stays here to support a franchise that still hasn't delivered a Stanley Cup to its fans after almost 40 years.
Fans love the franchise too much. One could argue it doesn't have the incentive to make a Cup run because the organization is not desperate for revenue. Cup-winners like Tampa Bay, Carolina and Anaheim were. The proliferation of spring concert tours and big events like the Ultimate Fighting Championship fill GM Place dates and keep the Aquilinis flush with cash.
Not so difficult to achieve with little competition, except for outdoor sports and recreation. The Canucks are Vancouver's only connection to a big continental sports league during dark and stormy winters. The sport is Canada's national winter pastime. Many Vancouverites are from points east of the Rockies where hockey is life. Just wait until 2011 when the Vancouver Whitecaps enter Major League Soccer and challenge the Canucks for the finite pool of ticket and sponsor money available in this market. You will quickly witness why Canucks' owner Francesco Aquilini was bidding against Greg Kerfoot for an MLS franchise.
The Canucks will be celebrating their 300th consecutive home sellout April 3 when the Minnesota Wild visit. I'm a stickler for statistical honesty and I won't be sending the Canucks a 300-candle cake.
Only the beancounters inside 800 Griffiths Way know how many tickets have been sold and distributed over the last 299 games.
I do know that on March 15, 2007 -- when the Canucks beat St. Louis 3-2 in overtime -- there were 18,325 tickets scanned by GM Place staff at the arena entries. The NHL scoresheet falsely reported the arena was at 18,630 capacity and that was also the attendance figure announced in the arena. I asked Canucks Sports and Entertainment for comment but never got a response.
The 18,325 figure comes from a Bunt and Associates study for the City of Vancouver's Olympic transportation office. The same report said 16,653 season ticket holders attended the game. Capacity was increased to 18,810 with the Best Buy Club for the 2009-2010 season.
The Canucks' average $62.05 ticket price is third highest in the NHL -- a portion of that revenue is shared with the league's struggling southern franchises including the Phoenix Coyotes. But most of the money stays here to support a franchise that still hasn't delivered a Stanley Cup to its fans after almost 40 years.
Fans love the franchise too much. One could argue it doesn't have the incentive to make a Cup run because the organization is not desperate for revenue. Cup-winners like Tampa Bay, Carolina and Anaheim were. The proliferation of spring concert tours and big events like the Ultimate Fighting Championship fill GM Place dates and keep the Aquilinis flush with cash.
Friday, April 2, 2010
Stadium casino deal: more questions than answers
British Columbia Premier Gordon Campbell and B.C. Pavilion Corporation chairman David Podmore gave themselves a pat on the back March 26 for finding some revenue to pay for the $563 million B.C. Place Stadium renovation.
Less than a week later, the deal began to look rather underwhelming.
Paragon Gaming announced March 26 that it planned to build a $450 million casino and hotel complex in a parking lot west of the stadium. The land was put up for lease by PavCo, the taxpayer-owned Crown corporation that operates B.C. Place.
The stadium closes April 4 and the air-supported fabric roof will be deflated May 3. A $458 million retractable roof will be applied in time for the stadium to reopen in summer 2011. The B.C. Lions will play in a temporary stadium at Empire Field in 2010.
Tourism minister Kevin Krueger, whose ministry is responsible for PavCo, told a budget hearing on Wednesday that Paragon was among just two bidders that responded to the request for proposals in spring 2009. He refused to name the runner-up. The B.C. Liberal government has a problem with credibility and transparency, so skeptics will wonder if there was really a runner-up. But I'll give Krueger benefit of the doubt for now.
Could the tiny response to such a lucrative opportunity be because banks are reluctant to lend to developers who do not own the land they are building on? That is the basic reason behind the City of Vancouver bailout of Vancouver Olympic Village developer Millennium. Wall Street hedge fund subsidiary Fortress Credit Corporation took the risk that no mainstream bank wanted to and then walked away when the recession hit.
Paragon has a 70-year lease at $6 million annually. It'll be adjusted for inflation after 10 years. PavCo wants to sell the name of the stadium, more advertising inside, book more events and lease more land. The business plan and financing formula, however, are shrouded in secrecy. Both Campbell and Podmore told me that it won't be published. Cabinet secrecy is the reason. The government doesn't trust taxpayers (shouldn't it be the other way around), so you and I are unable to learn about the most-expensive stadium renovation in Canadian history.
Krueger also confirmed that T. Richard Turner phoned him to discuss the Paragon proposal. Turner is a director of VANOC, chairman of ICBC, former chairman of the B.C. Lottery Corporation and frequent donor to the B.C. Liberals. He is a minority shareholder in Paragon's Canadian subsidiary which operates Edgewater Casino at the Plaza of Nations in downtown Vancouver.
Krueger said Turner “called me to make sure that I knew that the retractable roof was if not a deal-killer, at least Paragon wouldn't be able to make the same proposal that it had made to (PavCo), and that was our only conversation.”
PavCo CEO Warren Buckley claimed Turner did not participate in negotiations or influence the content of the lease. But the optics are certainly odd.
Why is PavCo relying on a casino company part-owned by a friend of the Premier when the Vancouver Whitecaps' ownership group and B.C. Lions' owner David Braley have deep pockets and stand to gain because of the renovations? This is, after all, a government that privatized B.C. Rail and has entertained all manner of partnerships with the private sector.
The governing Liberals were dead-set against gambling expansion when they were the opposition and the NDP was considering "Monaco-style" casinos in the 1990s. A B.C. Medical Association study called Stepping Forward: Improving Addiction Care in British Columbia was published. It says alcoholism and gambling addiction are more prevalent in B.C. than drug addiction. An estimated 159,000 people in B.C. are addicted to gambling -- that's more people than attended the opening and closing ceremonies of the 2010 Winter Olympics and the men's gold medal hockey game!
Until Campbell and Podmore realize they're playing a high stakes game with taxpayers' money and taxpayers deserve transparency, I will wonder if this is another Fast Ferries or Convention Centre scandal waiting to happen.
Less than a week later, the deal began to look rather underwhelming.
Paragon Gaming announced March 26 that it planned to build a $450 million casino and hotel complex in a parking lot west of the stadium. The land was put up for lease by PavCo, the taxpayer-owned Crown corporation that operates B.C. Place.
The stadium closes April 4 and the air-supported fabric roof will be deflated May 3. A $458 million retractable roof will be applied in time for the stadium to reopen in summer 2011. The B.C. Lions will play in a temporary stadium at Empire Field in 2010.
Tourism minister Kevin Krueger, whose ministry is responsible for PavCo, told a budget hearing on Wednesday that Paragon was among just two bidders that responded to the request for proposals in spring 2009. He refused to name the runner-up. The B.C. Liberal government has a problem with credibility and transparency, so skeptics will wonder if there was really a runner-up. But I'll give Krueger benefit of the doubt for now.
Could the tiny response to such a lucrative opportunity be because banks are reluctant to lend to developers who do not own the land they are building on? That is the basic reason behind the City of Vancouver bailout of Vancouver Olympic Village developer Millennium. Wall Street hedge fund subsidiary Fortress Credit Corporation took the risk that no mainstream bank wanted to and then walked away when the recession hit.
Paragon has a 70-year lease at $6 million annually. It'll be adjusted for inflation after 10 years. PavCo wants to sell the name of the stadium, more advertising inside, book more events and lease more land. The business plan and financing formula, however, are shrouded in secrecy. Both Campbell and Podmore told me that it won't be published. Cabinet secrecy is the reason. The government doesn't trust taxpayers (shouldn't it be the other way around), so you and I are unable to learn about the most-expensive stadium renovation in Canadian history.
Krueger also confirmed that T. Richard Turner phoned him to discuss the Paragon proposal. Turner is a director of VANOC, chairman of ICBC, former chairman of the B.C. Lottery Corporation and frequent donor to the B.C. Liberals. He is a minority shareholder in Paragon's Canadian subsidiary which operates Edgewater Casino at the Plaza of Nations in downtown Vancouver.
Krueger said Turner “called me to make sure that I knew that the retractable roof was if not a deal-killer, at least Paragon wouldn't be able to make the same proposal that it had made to (PavCo), and that was our only conversation.”
PavCo CEO Warren Buckley claimed Turner did not participate in negotiations or influence the content of the lease. But the optics are certainly odd.
Why is PavCo relying on a casino company part-owned by a friend of the Premier when the Vancouver Whitecaps' ownership group and B.C. Lions' owner David Braley have deep pockets and stand to gain because of the renovations? This is, after all, a government that privatized B.C. Rail and has entertained all manner of partnerships with the private sector.
The governing Liberals were dead-set against gambling expansion when they were the opposition and the NDP was considering "Monaco-style" casinos in the 1990s. A B.C. Medical Association study called Stepping Forward: Improving Addiction Care in British Columbia was published. It says alcoholism and gambling addiction are more prevalent in B.C. than drug addiction. An estimated 159,000 people in B.C. are addicted to gambling -- that's more people than attended the opening and closing ceremonies of the 2010 Winter Olympics and the men's gold medal hockey game!
Until Campbell and Podmore realize they're playing a high stakes game with taxpayers' money and taxpayers deserve transparency, I will wonder if this is another Fast Ferries or Convention Centre scandal waiting to happen.
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