One source of revenue for Saskatoon’s upcoming $1.2 billion downtown event and entertainment district is on pause for up to six months because of economic and political uncertainty.
“This is a major business decision for the city,” said Dan Willems, the city’s director of technical services who has been leading the project. “So, a pause allows us to provide additional time to monitor and reassess the economic and political environment.”
Last summer, the city announced a framework agreement with Oakview Group, an American-based arena operator which runs 22 venues across Canada.
The 25-year deal with Oakview is expected to generate up to $170 million in revenue over the course of the deal.
Bringing the agreement to council has been a difficult process. After announcing the deal on August 7, 2024, Oakview representatives didn’t show up to the following committee meetings to answer questions the following week as they reviewed details. Oakview contacted the city in October to renegotiate some changes. The deal was ultimately agreed and finalized in mid-December.
Then, threats of numerous tariffs from the United States President Donald Trump ensued, in addition to parliament dissolving for a federal election later this month.
A report going to the city’s governance and priorities committee next week says administration would like to use additional time to monitor and “reassess the economic and political environment.”
“Any investment dislikes uncertainty, whether it’s public or private,” University of Regina economics professor Jason Childs said. “When uncertainty goes up, you tend to see people sort of stepping back and hitting pause. It’s a very rational, reasonable response.”
Childs said many groups, governments or projects dependent on government revenues are looking to pause or take a step back. With an election looming and daily changes to economics in the wake of tariff announcements, a city-building project like Saskatoon is hard to predict right now.
“You don’t want to make huge commitments when we don’t know what the future’s going to look like,” he said.
Childs said while Ottawa might have different priorities or fewer funds for a potential arena in Saskatoon, the provincial economy is expected to be hit hard by 100 per cent tariffs on canola oil, canola meal and peas from the Chinese government.
“For Saskatchewan, that tariff probably looms larger in some decision making and the potential revenues we’re likely to see. That said, delaying six months is sort of a wait and see tactic, right?” Childs said.
Another complication in bringing a framework deal before council is the provincial government’s direction to municipal governments to prioritize Canadian vendors or contracts as a goal of reducing American procurement.
Premier Scott Moe announced the move on March 5 as part of retaliatory actions in response to American tariffs.
Oakview Group is an American company with a Canadian subsidiary. The report says it isn’t sure how the procurement mandate will affect prices, but Willems said it’s difficult to completely remove American products completely.
“For example, Microsoft is embedded in just about every corporation around the world, right? So, there’s just limited other opportunities at this moment in time,” Willems said.
The governance and priorities committee meets on Wednesday.
