It could cost up to $600 million to build a new multi-purpose arena in east Victoria Park to replace the Saddledome.

Michael Brown, the head of the Calgary Municipal Land Corporation (CMLC), told a city council committee Friday afternoon the price range for a new 20,000 seat arena would be $550 million to $600 million.

Brown said that figure is based on the building concept provided by the Calgary Sports and Entertainment Corporation (CSEC).

Some renderings of the building were unveiled earlier this year. CSEC, company that owns the Calgary Flames, Calgary Stampeders and Calgary Roughnecks, paid an architectural design firm in Detroit for the conceptual drawings.

CMLC has met with cost consultants and talked with major contractors about the project to reach the estimate.

Brown said the cost estimate does not include the cost of city-owned land in Victoria Park.

'Strong number'

CMLC delivered the $245-million new Central Library last month approximately $10 million under budget. Brown said he expects it can stay in the $550 million to $600 million range on the arena project.

This conceptual drawing of a new hockey arena in Victoria Park is from the Calgary Sports and Entertainment Corporation, which owns the Calgary Flames. Although Mayor Nenshi doesn't know when we be able to return to big gatherings of 20,000 people, he believes it will be sooner rather than later. (Rossetti/Calgary Flames)

"I'm very confident that we can deliver a really good building for the citizens of Calgary as well as for the Calgary Sports and Entertainment Corp for that number. It's a strong number," he said.

Brown said the building the Flames have in mind "is not over the top but it's definitely not the bottom of the barrel either."

When asked for comparable buildings, he cited the Little Caesar's Arena in Detroit, which opened last year, and the Capital One Arena in Washington D.C. He added it would not just be bigger than Rogers Place in Edmonton but also better.

Follow the money

How to pay for a new building is far from determined.

City council's events centre committee heard on Friday the city has three options to pay for major projects like an arena.

City manager Jeff Fielding said the city has $300 million in cash that's available.

It can take on new debt for a major new community project.

The city can also use money from the community revitalization levy which comes from tax revenues generated in the Rivers District, which includes Victoria Park.

Talk about a new arena to replace the Scotiabank Saddledome, which opened in 1983, has been swirling for years.

Negotiations between the city and the Flames ownership on a new arena fell apart in 2017.

The head of CSEC, Ken King, said at that time the city's contribution toward a $550-million arena was far short of what the team's owners wanted.

NHL commissioner Gary Bettman has referred to the Saddledome as a "grand old building" with a great roofline but has also called it an "old, antiquated, inefficient building".

Economic impact study

The committee heard that Calgary Economic Development has commissioned Ernst and Young to do an economic impact study on the development of an entertainment district.

It will look at similar districts in Edmonton, Columbus, Ohio and Nashville, Tennessee.

Mayor Naheed Nenshi suggested the company also look at districts in Denver and Washington, D.C.

He suggested the study should break down the possible economic benefits of three projects being considered in Calgary's entertainment district, including an arena, an expansion of the BMO Centre and a major renovation of Arts Commons.

"What are the returns of each one, social and economic and how do we put those together as well in the whole thing?" asked Nenshi. "That's the core question for me."

Council is hoping that putting down public money in Victoria Park will be the catalyst for other long-awaited developments in the area and generate revenue.

"Will retail and some hotel development along with some residential carry the day?" said Nenshi.

Councillor feels Calgary needs a win

Coun. Jeff Davison, who chairs the event centre committee, said he thinks Calgarians will be excited by some decisions.

"We believe this city needs a win. I firmly believe this city needs a great vision and so that's what we're proposing in this district," said Davison.

As for actual negotiations with CSEC, Davison said they've only had "high-level conversations" on the vision of the entertainment district and the city's negotiating team has not been appointed yet.

The economic impact study will come back to city council in January.

Council is expected to discuss a major projects list on Jan. 28, 2019 and prioritize the projects.