REAL CEO predicts hefty loss in 2021, wants $8M boost to borrowing limit

The CEO and president of the Regina Exhibition Association Ltd. (REAL) says he's bracing for another tough year in 2021.

“We're anticipating a loss of about $1.5 million in 2021, and I think we're already wrong with that guess,” Tim Reid said.

Early forecasts from REAL, which operates the grounds at Evraz Place, including Mosaic Stadium, the Brandt Centre and the International Trade Centre among others, indicate it will operate at 25 per cent of its normal capacity until August and at 75 per cent in August and the rest of 2021.

“We'll re-forecast early in the next year, but we're anticipating it'll probably be a little worse than that,” Reid said.

The ability to gather in significant numbers will dictate when REAL is able to return to some kind of normalcy. That's why at an upcoming meeting of the city's executive committee, REAL is looking to up its borrowing limit from $13 million to $21 million per year.

To manage costs, maintenance and the current operations at REAL properties, Reid said it's the only way for the not-for-profit to stay afloat.

“The best approach until we fully understand the consequence of the pandemic on our business is to expand our borrowing ability,” Reid said.

REAL is owned by the city, which means its money rolls into city coffers, and any money borrowed has to be approved by the city.

Barry Lacey, executive director financial strategy and sustainability with the city, said since April, the city has been working with REAL to restructure its borrowing ability.

Back in the spring, Lacey said, “when COVID was still new,” there was a lot of uncertainty as to how the pandemic would affect REAL.

“They continue to have cash flow challenges, so looking forward over the next year this report is looking at providing assistance to REAL,” Lacey said.

In simple terms, Lacey said the debt expansion is “basically to ensure they have enough cash on hand to pay their bills.”

REAL is still offering services — chiefly to the Saskatchewan Health Authority for flu shots and COVID testing — in addition to renting ice space at the Co-operators Centre and field time at the Affinity plex Indoor Soccer Centre.

“They have significantly scaled down and taken steps to reduce their costs, but they still need to maintain their facilities,” Lacey said. “They need to be able to access additional cash to pay the bills.”

Public health orders mean REAL cannot hold large events such as concerts, sports or trade shows that brings in money for the not-for-profit corporation.

Reid said the projected losses for 2020 are going to be closer to $5 million than the $7 million that initially was projected.

Mayor Sandra Masters previously sat as a board chairwoman with REAL and will remove herself from the discussion and vote on the report according to city staff.

Executive committee will consider the amendment to the existing bylaw on Dec. 9.