The location for a new 15,000-seater indoor arena in Cardiff has been identified.
After evaluating a number of possible locations across the city, Cardiff Council has selected a 30-acre site, that covers its existing headquarters building at County Hall and the nearby Red Dragon Centre at Atlantic Wharf, in Cardiff Bay, as its preferred location in a project that would bring hundreds of thousands of new high spending visitors into the city and wider Cardiff Capital Region each year.
A new indoor arena, at an indicative cost of £100m, has long been identified by the authority as the biggest missing piece in the city’s infrastructure offer; enhancing its current strong retail and leisure offer in the city centre and Cardiff Bay, as well as the Principality Stadium for major sporting and concert events.
The council will now work up a more detailed planning and business case for the ambitious project, in a development that could see its existing County Hall building remaining, with an arena and related commercial developments on its existing surface car park area, as well as that of the Red Dragon Centre.
But in a move that would increase the commercial footprint of the project, where work on an arena could start in two years time, the council also has the flexibility to move to a new HQ elsewhere in the city.
A potential six acre site at Callaghan Square, which is owned by the Welsh Government, could be the location for such a project - as part of larger hub for public sector organisations in the city.
Councillor Russell Goodway confirms deal
Cabinet Member for Investment and Development, Cllr Russell Goodway confirmed that the indoor arena is a key priority for the new county administration elected in May 2017 as reflected in the administration’s policy document Capital Ambition.
He explained that the delivery of an indoor arena for the Welsh Capital was a long-standing commitment but progress had stalled in recent years.
He said that the June 2017 statement made by Welsh Government Cabinet Secretary Ken Skates in which he said “having a multi-purpose arena in Cardiff is crucially important not only to Cardiff but for Wales” was greatly encouraging and that in subsequent discussions Welsh Government and the Council had agreed to work together to make it happen.
Cllr Goodway said: "Cities is where the future is being built. Cities are the economic dynamos where over 80% of global GDP is generated and they compete with one another for inward investment and jobs. If Cardiff wants to compete with other major cities then, to succeed, it needs the necessary infrastructure to secure our future and a multi-purpose indoor arena will be one of the key components of Cardiff’s future economic success.
"This cabinet report marks a key milestone in the delivery of a longstanding ambition but, more than that, it reflects how investment in these key assets can underpin the delivery of much needed solutions to other challenges facing the city. Traffic and transport is a major challenge for people living in and visiting Cardiff.
"A viable, high quality public transport service needs regular paying passengers. The ability to attract 15000 visitors to the city on a regular basis who arrive either at the city limits and use park and ride facilities or by train in the city centre and need to get to the Bay will provide the passenger numbers which will help make the dream of a metro system a reality and expedite the completion of the Eastern Bay Link Road. It will also generate the visitors needed to sustain other visitor attractions in the city.
"The professional assessment concludes that for a wide variety of reasons, the preferred location for the arena is in the vicinity of Atlantic Wharf. It supports our development aims for the city and offers the maximum opportunity to help create a revitalised visitor destination place in the Bay which connects directly to existing facilities at the Oval Basin and Mermaid Quay."
It is also understood that the council is in talks with the owner of the Red Dragon Centre, British Airways Pension Fund, with a view to it becoming a possible financial backer of the arena complex.
This could potentially see the Red Dragon Centre leisure facility, which includes a cinema, being incorporated into the scheme. This would see its existing surface car park forming part of the arena project.
The Atlantic Wharf site is three times bigger than the other locations assessed by Cardiff Council, which included land at Callaghan Square and Dumballs Road, Cardiff Arms Park and the existing Motorpoint Arena by building a much larger arena to replace the existing facility.
It also considered County Hall and the Red Dragon Centre as separate standalone locations.
Business Secretary Ken Skates recently stated that it was crucially important” for Cardiff to have a bigger arena to attract more major events to the city and Wales.
Discussions between the council with the Welsh Government over the public sector funding element of the proposed arena are continuing, including allowing the authority to commit more of its own financial resources.
This could see it recycling funding currently invested through the city’s enterprise zone to support its construction.
While subject to the final business plan, it is envisaged that capital costs would require an upfront contribution of around 50% from the public sector.
However, that could be recouped over the long-term from the rents of commercial tenants in the arena, as well as from the chosen arena operator. There will also be revenue opportunities from associated multi-storey car parking and a potential naming rights deal for the arena itself.
Ancillary development would also provide a financial return. The council could explore taking an agreed percentage from concert and event ticket sales at the arena.
The existing Motorpoint Arena, which is operated by Live Nation, currently only has capacity for 7,500 spectators. A significant commercial success since it opened in 1993, it is estimated to make a £29m gross value added contribution to the regional economy each year.
However, in recent years, a number of larger arenas have been built around the UK, which has meant that Cardiff has not been able to exploit a growing and lucrative market for concerts and events targeting more than 10,000 spectators.
An option for a new 15,000-seater arena at the Motorpoint Arena site in the centre of the city was rejected, as it would have meant finding a temporary home during a two year construction period.
However, Live Nation could become the operator of a new arena.
And this could potentially see the existing Motorpoint Arena making way for a new mixed-use development scheme, which would be even bigger it the adjoining buildings and surface car park owned by property development firm Rapport is included. As the council owns the freehold interest in the site, this could see a significant contribution being made towards the cost of a new arena.
The authority has ruled out seeking a funding contribution from the £1.2bn City Deal for the Cardiff Capital Region.
Instead the major infrastructure project for the city from the deal will be a £40m contribution for the much needed redevelopment of Cardiff Central railway station for it to cope with increasing passenger numbers that will accelerate once the core Valley Lines into the capital are electrified.
And, public transport access to the arena would be significantly enhanced by a light rail or tram route from Cardiff Central to Cardiff Bay, in a next phase of the south Wales Metro project.
