New Track in Calgary

[Gamman]

Re: New Track in Calgary

I know a lot about this. I didn't go to the meeting, but I am in the same camp as rss. I really hope it gets done. 5 years is optomistic. I know some land developments for housing in a 100% welcomed area. 4 years before subdivision.

My personal opinion is it will never happen in Calgary or rockyview unless they do a fantastic professional job. That = $$$$$$!$$$$$$$$$$$. 4-5 months of use, and you have to pay for land? Very difficult.

I wish them all the luck in the world.

[Deuce]

Re: New Track in Calgary

No track min 5 years most likely never as gov't is involved.

5 years! That's ridiculous.

It shows you how much this city cares about a race track. They've known for years that Race City was going bye-bye and had plenty of time to work on this over the years, get interested parties together, sign deals, and make an announcement at the end of last year. F*#kin' H*ll!

I hope you're wrong. There's no way I'm waiting 5 years for another Race City. Grrrrrr....

[R-Audi]

Re: New Track in Calgary

One thing I heard was a proposal to take over an old private airstrip in Viking Ab...not sure if that actually went anywhere or not.

[RSS]

Re: New Track in Calgary

The 3 options i had heard about where a piece of land actually in Calgary (it was to small though) one to the west of the City (The most likely one) and a deal with a private airport developer that wanted to add a race track to there planned facility.( I think it was near Airdrie)

[cam_wmh]

Re: New Track in Calgary

One thing I heard was a proposal to take over an old private airstrip in Viking Ab...not sure if that actually went anywhere or not.

Are you sure? Viking is an hour east of Edmonton.

[R-Audi]

Re: New Track in Calgary

Came from someone who was a driving instructor...

[btimbit]

Re: New Track in Calgary

apparently the target is spring 2014. not sure on the legitimacy of the info though

http://forums.beyond.ca/st/353925/update-from-marcs/

[Tuna]

Re: New Track in Calgary

Perhaps not Viking but Vulcan? There used to be fairly vibrant drag racing community down there.

[Ur0Drivr]

Re: New Track in Calgary

Heard that Cardel is somehow involved. They might have partners already lined up.

[RSS]

Re: New Track in Calgary

O the money and partners have been in place for over 2 years now the budget was 20-30 million but getting them off there asses and working is another thing.

Cardel was the partner for the airport addition option i had mentioned earlier near Airdrie i believe.

[Gamman]

Re: New Track in Calgary

the vulcan strip is being rebuilt. Its almost 100% gravel. It could be the next top gear track. Has potential.

here is my response on another forum. Its not totally coherent, not getting much sleep, building the website before Driven.

I really wish them luck.

The trouble is three fold. Money, Zoning and business model.
*Disclaimer, I hope that none of the information below is currently in the business model. I did not go to the marks meeting, and am sorry if any of the propositions below are any way shape related to the current business model. I am purely speculating as someone who worked on the finances of the old track.

Money
Are you going to tell me that someone with 10-20m is willing to take or get a substandard return on investment to get a track done? Or hold it for 5 years for zoning and planing. The only way it will happen is with a super enthusiast plowing retarded money into it. Ok, lets say mr. moneybags enthusiast completely ignores all the financial advise, and wants to invest mega bucks into planning and zoning, and holding on for 4-6 years. ok, money loss, lets say you generate some $ from it while you wait. No loss on a yearly basis (no holding costs after you purchase it). Now, lets say you ignore that you could have put your money in a GIC. They are only 3% or whatever. Ok. Now he has to hold multi million $ worth of land. Ok, you are rich. What is money? I want a track. Ok, so, now you have to hire planners (maybe you have them on staff), and get them to design, and negotiate with the MD or city. Ok, no easy task, but now you have to spend serious money (more than people can imagine) and get a decision where the outcome is uncertain.


Lets say, magically it gets built on budget (the asphalt and buildings part). He has plowed tons of money and time into it. Holding costs are enormous, so are land costs. But, he wants it at any cost. So,now its built, and it cost 10-20-30m. And he is happy. Now what, lets rent the track out. For how much? Guess what? He just spent $10m (notice, I am picking the lowest possible number again here), a lowly 10% return means he will need $1m/yr (no business should ever shoot for this, they will go under from unforseen things). There are 5 months of sun here. lets say 6. That is $180k/ month. Ok, 3 tracks (guessing drag, road and oval or a second road), so each needs to make $60k per month. 30 days = $2k per day. Oh wait, the other profit centre. Because of the so easy profits of something else, every track needs to make half as much. $1k per day. 3 events a day, $333 per track event rental to cover just the costs of the land and buildings. No insurance, no labour, no operating costs, no property or income taxes, and a 10% return on your money. Currently, Canadian Oil Sands dividend is almost 6-8%. And that is as close to no risk as it gets. Ok, lets pretend 1 that he is willing to only make 10%, 2 $10m is all it costs for a world class facility (or even not one, with 3 tracks), 3 the three tracks can all rent out at 100% capacity (I love racing in the rain and snow in May, I have. All 3 of us.) 4 the profit centre pays for half of the costs all year long. This still means a track rental for 1/3 of the day is $333. In the realm of reasonable, but not anywhere close to current race city costs.

I know a doctor that didn't road race because Jay at TT raised his fees from 190 to 225. What if a track evening was 300? I know I would go but I know a lot of guys wouldn't as much. But we just assumed 100% utilization for 6 months.
Ok, so lets say the financing, and financial side of the equation is almost exactly like race city. But now we have 3 individual tracks to rent and make money on. And lets say they all are affordable, and fully booked. I have made some massive assumptions, but lets say they all get fairy dust and happen. Read on.

Paving. All the other crews will say they can do it. No, they can't. I won't go into detail.
Here is something else to think about. We live in cold country, and there are what is called frost heaves, from the freeze thaw cycle. Unless you have a huge proctor rating, and ignore that settling will occur. Ok, lets say you get a 99% proctor rate (compaction), which I don't think anyone uses in Calgary, they use 97 if I recall, its been about 5 years. That is still 1%, lets use the best possible number. Over 12-24" of fill, how much is that? .12 to .2 of an inch. Thats not the right math, but you get the idea. Ok, lets say that the land/road never settles (have you seen the roads in the new neighbourhoods? Have you built a new house? They recommend you don't put grass down due to the settling for a year or two. That is done close to the same level the road will be. Encouraging. But its ok to put down $5m of asphalt and drive 200kph on it. The yearly maintenance costs will be large OR the front end paving/road works costs will be huge. Either way $ = $ to us to spend on racing. Lets say we ignore all that now, and move onto the next topic.

business model
I was at the prior to the most recent marcs meeting, not the good one where everyone was sworn to secrecy. I heard some info about the new one. I feel sorry for everyone involved, or gets involved. I have offered my services which commercial real estate owners pay for, but no one has even responded to me. Why would they? They got rich by not listening to people like me. I wish them well. When you are a super rich guy (like top 50 or 100 in Calgary), there are really only 49-99 other people who's opinion matter to you. Everyone else's opinion doesn't matter. It makes sense. I hope they are right, and I am wrong.

Zoning will not happen quickly. How are you going to get something approved that NO one but the special interest group wants? Let me use an example. MD of Rockyview turned down a shopping centre. A shopping centre in a farm field on the trans canada, near the springbank airport, but close to the city. 100-160 acres or so of new big box. Almost everyone wants a shopping centre. People in the area opposed it, which I totally understand. However, counselors are supposed to help balance growth, development and its constituents. its a shopping centre on the highway. It would bring taxes and services. Seriously? I talked to a counselor a few years ago from the area, and "THEY WERE STILL UPSET WITH CALLAWAY PARK". I spit my drink on the table when he said that. Our meeting was suddenly cut short. No freaking chance a noisy race track with hooligans will get approved in the west. If they hated a shopping centre which they all would shop at, lets get serious, none of them will be car enthusiasts. I hope that I am wrong, and they are right. Notice the date. 2010.
http://www.cochraneeagle.com/2010/05...k-development/

God, I hope I am wrong, how many times have I just said that? 10? I put about 5,000 miles on the road race track in the last 3 years, and I miss it dearly. But I won't be. I get paid to not be wrong and analyze risks and finances.

[RSS]

Re: New Track in Calgary

Some good points but the money is not all private the city is contributing if there is a place for the Police to train (Driving) as well as a gun range of all things. It is planned to be a multi-use facility (Outdoor Shows/ Concerts/ Racing etc) as well as having buisness on site to generate lease income this allows the city to contribute money with out being yelled at for wasting money on a couple crying racers. The city had land that it was already to give to the group to start the track but it was deemed to small to build all of the facilities they wanted so it was turned down (This was land ready to go inside the city) i couldn't believe it either.

The paving part you are 100% on. I love when people complain that Art didn't keep dumping money into Race City on the track and off it he knew it was going away as the old mayor said he would take it away no matter what. So why waste millions paving and painting on something that was going to be taken away at any time.

I think Jay had the best chance at getting a track done (Badlands) but the fact his wife found out about his girlfriend kind of put an end to all that.

The other thing you are 100% on is the track rates are going up no matter what gets built the only reason we had it good was Art wasn't wasting money on improvements so all he did was try and break even near the end.

Edit: The Facility has to be a non for profit enterprise to get funding from the city that is why Art is not involved as he said he would build another track if they got him land the city refused.

[Gamman]

Re: New Track in Calgary

Wow, some of that stuff is news to me. If some of that is the case, some of my math begins to make sense. I was just talking about how it has to be almost a city non for profit type thing. But really, city putting $ for richer types to blow their ferrari up is going to be a tougher sell than the new saddledome. But it should be easier (safety courses etc).

Gerry

[RSS]

Re: New Track in Calgary

I think the way they sell it is that they are only donating the money for shared facilities and the ones they can use for training etc. Then the rest is private investment but it has to be all run and organized by volunteers/racing governing bodies etc.

But to my knowledge there are more than a couple ways this can go down with the city without just a track facility or one of those multi use grounds etc. It all depends on what plan they all pick.

On a side note i just received a questionnaire from the racing governing body on what facilities we would like to see at the new track and priorities of things that are going to be built. So it worries me that they don't have a plan in place for what they are going to build and when.

But it does say the track is just north of Calgary so it seems they have choose a location.