Memberships and usage are up at Servus Credit Union Place, according to the city’s third-quarter report, but the facility has hit a wall for future growth.
That’s the assessment presented this week to city council by general manager of community and protective services Chris Jardine.
“We’ve penetrated the easy part of the market. Any growth now is going to be harder,” Jardine said.
Based on the usage recorded through the end of September, the facility is projected to lose $736,000, on revenues of $7 million.
The average number of monthly memberships was 7,143 in the first three quarters of 2010. That’s a three per cent jump over last year but on par with 2008. Paid day admissions grew to 105,400, a 38 per cent jump over 2008. Fitness centre usage increased by 27 per cent since 2008.
“The memberships have plateaued,” Jardine said.
The key to the facility’s future is the fitness centre. It’s been viewed as undersized from the day Servus Place opened in 2006 and it’s the part of the building that could attract more of the “fickle market” needed to improve the facility’s bottom line.
The initial cost estimate for expansion is $5 million.
Coun. Cathy Heron has researched similar facilities and the only one she found that makes money is one in Calgary that doesn’t give price breaks to any user groups, she said.
She isn’t recommending that Servus Place adopt that model but said the day will come when council will have to get serious about expansion.
“It’s the fitness centre that will make money,” she said. “Probably not this year, but very soon in the future, if we can invest some money in there, we would get [closer] to breaking even,” she said.
“People will be upset if we throw more money at Servus Place right now for fitness equipment, but I don’t think they understand that’s where the profit’s going to come from.”
She doesn’t expect the facility to ever break even. Neither does Jardine.
But Mayor Nolan Crouse isn’t thinking that way.
Crouse said he’s happy the facility has improved from losing more than $2 million a year to less than $1 million, but he’s not accepting that Servus Place should be viewed as a city-subsidized facility in perpetuity.
“It’s never been acceptable because the plebiscite was based on a break-even proposition,” he said.
The facility opened in 2006. Council proceeded with the project after a 2004 plebiscite found 55 per cent of voters were in favour.
When it comes to accessing “the next big chunk of revenue” for Servus Place, Crouse accepts that upgrading the fitness facility is the way to get there but he isn’t eager to spend $5 million.
“I don’t feel good that you have to spend that kind of money to get to break even. It just doesn’t sit well with me,” he said.
“There’s not enough cash in the kitty to be planning this in the next three or four years.”
