Rent reduced for Riders, early budget items approved by Regina Council
3h ago
Council retroactively slashed $1.33 million in rent owed by the Roughriders.
The YMCA in Regina is facing serious financial troubles and could go under unless it makes some tough decisions.
It’s operating an annual deficit which is expected to be at $4.4 million over the next five years. It’s also dealing with a projected negative cash flow of $1.95 million over the same period. If no significant changes are made, the YMCA will become insolvent within 12 months.
In a release, the YMCA said all efforts have been made to find efficiencies within the current operations. It has asked for advice from engineers, banks, lenders, lawyers and real estate appraisers while reviewing the condition of its buildings and viability of its programs and services.
The YMCA is spending more than it brings in and doesn’t expect revenues to offset expenses beyond the five-year window. Its reserves are empty and membership remains flat or declining.
The future does not look bright for the downtown location on 13th Avenue. The aging building is the most immediate challenge for the YMCA, operating with a projected deficit of $2.8 million over the next five years.
One of the options the YMCA is considering is the closure and sale of the downtown facility. The building is at the end of its life and requires $12 million in capital costs to bring it to modern standards or $35 million to replace it. The YMCA said those costs exceed its resources and cannot be financed.
The YMCA acknowledged that the childcare services at its downtown location are an important need in the community but it is investigating the market value of the property in case it needs to sell the asset.
Another other option is to close the east location on Victoria Avenue, which is leased. Closing the facility before the lease ends in two years would require about $430,000 per year to uphold contractual obligations. While membership numbers are stable at this location, it faces tough competition while surrounded by the many other gyms located in the east end.
The northwest facility on Rochdale Boulevard is in the best situation of the three in the city. It’s operating with a positive bottom line.
The building and land are owned by the YMCA and are in good condition. About 40 per cent of the YMCA’s membership visits the northwest location, which has a large number of childcare spaces that contribute well to its financial position.
The YMCA is considering several options which includes the sale and lease back of the northwest facility. It’s also exploring additional bank financing and a strategic capital campaign while scouring for any other efficiencies to stay afloat. The board expects to make a decision in early summer.
The issues faced by the YMCA in Regina are similar to those being dealt with by the Moose Jaw YMCA.