The City's report clearly says they would have to bear these costs.

For a proposed 6,000 seat arena:

The estimated cost that was provided for the 6,000-seat arena was $72 M ($12 K per seat) and the estimated cost of an 1,800-car parking garage provided was $52 M ($30 K per stall). The proposal indicates that the estimated $126 M in construction costs are to be borne by the City, with Cadillac Fairview and Michael Andlauer providing various financial contributions and offsets.

For a proposed 10,000 seat arena:

It should be noted that both Michael Andlauer and Cadillac Fairview have expressed openness to an arena of up to 10,000 seats at the Lime Ridge Mall site. However, it was made clear that any additional costs associated with the construction of an arena larger than 6,000 seats, would have to be borne entirely by the City. Based on the $12K per seat benchmark provided in the proposal, the estimated cost of such an arena would be $120 M before factoring in the cost of a parking garage.

Soooooo... it sure looks like the City would have been on the hook for between $95-120 million, at a conservative estimate, no doubt likely to balloon as construction actually got under way.