Coming to the Jan. 22 Executive Committee meeting:
A report about a major budget shortfall for the Winspear project, and potential next steps. The budget is $115.2 million, along with another $3 million in capital renewal work - for a total budget of $118.2 million. The Winspear has secured $81.8 million of funding, leaving a gap of $33.4 million.
"At the time grant funding from the City of Edmonton was approved the estimate for the Winspear expansion project was $53 million . This estimate was for a new 540 seat acoustic hall theatre, six multipurpose rooms and commercial space. Since then, the project has experienced significant cost escalations as a result of inflation and supply chain disruptions. Costs have also increased a result of design changes following the COVID-19 pandemic, space originally planned for day care and retail operations has been redesigned to support additional programming activities. In total, these items have resulted in a revised total cost estimate today of $115.2 million. In addition, the Winspear has identified that an additional $3.0 million is required to address capital renewal needs that have seen their timelines intersect with the expansion project, which brings their total revised cost estimate from $115.2 million to $118.2 million. The first round of project fundraising produced $71.8 million resulting in a funding shortfall of $46.4 million shown in the table below.
Winspear intended to address this funding shortfall by requesting an additional $12.8 million each from the federal, provincial, and municipal governments and $8 million from an additional community support campaign. $13.0 million has since been received, primarily from the provincial government approving an additional $12.8 million within their 2024 budget, which brings the total funding shortfall remaining to $33.4 million today ($30.4 million related to the expansion project, and $3.0 million related to capital renewal needs).
The Winspear has indicated there are no additional significant federal opportunities for which the project would be eligible and that additional community support fundraising has become increasingly difficult and competitive due to economic conditions and comes at a cost to other operational fundraising, which comes from the same donor pool. They hope to secure some additional funds through a top-up to existing federal funds (under $1 million), and an application has been made provincially under the Community Facility Enhancement grant program for funding related to the $3.0 million capital renewal project that was not part of the original expansion plan."
Options going forward include:
1. The city provides the entire #33.4 million needed;
2. The city provides a partial funding top-up;
3. Pause the project pending further funding as of fall 2025;
4. Stage the completion to allow for a component of the expansion to be funded at a later date, with priority given to programming and developing spaces that can return programming revenue. Specifically, it would be phased in this order of priority: a) Complete all Concert Hall side renovations; b) Develop Level 1 in expansion building, programming studios, and administration spaces; c) Complete parkade and plaza components; and d) Complete the Music Box. The Music Box would be phased last because it represents the most costly and complicated portion, and is an "appealing asset" for a fundraising campaign.
5. The city could loan interim financing to the Winspear until they can secure final financing.
The report has thorough analysis of the financial situation (including a detailed breakdown in a table of project expenses and funding sources), as well as strengths, weaknesses, and risks of the five potential next steps. I highly recommend giving it a read.
edmonton.taproot.news
