Sierra Planning and Management Velodrome - Town of Milton

Velodrome Business Plan – Town of Milton 51
The results of the analysis include the assumption that normalised operations are achieved in Year 2. In
year 1, there is a limit on the achievement of potential revenues owing to the requirement for
management to increase efficiency, learn on the job, develop and refine the marketing of the facility and
work to resolve scheduling conflicts between the track and the in-field. To reflect this eventuality,
revenues in year 1 are discounted by 15%, while 100% of facility expenses are maintained.
Scenario 1, as a worst case scenario is unlikely to be realized. Part of the reason for its relative highly
deficits is not only reduced revenues from track, but also the leasing of fitness space to a tenant-operator
rather than engaging in the operation of the fitness centre itself. Given the Town is in the business of
operating fitness centres, and scenarios 2 and 3 assume this, the gap between the worst case scenario 1
and scenarios 2 and 3 can be reduced by operating the fitness centre in scenario 1.
Scenario 2 represents the most likely financial performance scenario and is based on moderate
assumptions with regard to both the revenues achieved from track and infield, but also with regard to track
compatibility issues, revenues from events, and providing food concession operations to the private sector.
In addition, labour costs in particular are raised to reflect the need for specialist employment skills
associated with the Velodrome.
Scenario 2 also reflects a modest approach to the amount of leasable tenant and retail space that can be
achieved within the existing building envelope. Scenario 2 returns a deficit in year 2 of $116,000.
Scenario 3 mirrors Scenario 2 with the exception that it reflects the impacts of incremental improvements
in track revenue arising from a moderate increase in achievable track rental rate, moderately higher share
of gate revenues from events, and lower conflict between uses in the building.
7.4.2 COMMUNITY LEGACY FACILITY INCLUDING LAURIER UNIVERSITY
The results of the financial analysis of projected operating revenues and expenses which include Laurier
University are presented below.
Business Plan | January 2012
Sierra Planning & Management
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