Long screed incoming, been busy trying to follow this and deal with heaps of non-hockey stuff that's come up at the same time:
I ultimately blame the NHL for their absolute lack of foresight in how they put the team in Phoenix. There was zero set-up for the team to make a profit without a proper arena in place from the start. They shot themselves in the foot telling Phoenix hockey wasn’t coming anytime soon when they built America West Arena, and then they threw the team here as an afterthought when Minnesota said it wasn’t enough time to get set-up. The whole history of the Coyotes has been a distressed asset stanching the losses while the owner somehow comes up with the funds to finance a new arena.
It's a problem that has cascaded into a more expensive problem owner after owner as debt rings up and the arena problem remains. The only solutions have been property developers, one of which disassociated with the team so he didn’t have pay for the loss leader part. No other potential owners want to pick up a distressed asset that's laden with debt and one that has killed most fan interest and then also put up the funds for a new arena. Why would they when they could go to a new market that gets a honeymoon period to bolster the coffers while paying off a new facility.
In some part you can see the league learned because they don’t put teams in new markets without giving them proper footing anymore, yet still the Coyotes are denigrated as having received more breaks from the league than anyone else, as if fans should be grateful for the league approving of putting the team in a completely uneconomic position from even before their start. If they hadn’t been so cheap from the start, the market could have been given time to properly set up a foundation that would have let them thrive. Instead, they throw handouts here and there to the team over the years as if it can fix the fundamental issues they ignored from the start.
You don't get these poor owners without the league utterly failing to vet them and utterly failing to do their due diligence on moving to a new market.
I also highly suspect that the NHLPA has a stronger role in the move. With the CBA coming up in the next couple years, I suspect they were going to make this be an issue for the owners where the owners were going to have to accommodate the players to put up with this. They basically were giving the players an additional bargaining chip, and by taking action ahead of time, they’ve reset the negotiations ahead so they could pull that extra percent or two which they seemingly think outweighs the cost of paying Meruelo and losing a full expansion payment to Utah.
I don’t have much hope for Meruelo as too much is coming out about how poorly he ran things business-wise. I figured the team was having losses, but it sounds like they were far more massive than I’d really thought. If that’s the case, I could see why Meruelo may have micromanaged to such a degree. He likely knew he couldn’t do this with his other businesses because they need to stay separate and continue being profitable. This one needs to be isolated so it doesn’t take everything down with it.
If the team was going to struggle with actually increasing the payroll when we needed it in the next couple of seasons to continue along on the proper team trajectory, then I can somewhat understand why he’s sold and insisted on the right to retain. To properly continue the rebuild into the next stage, he needs the arena district set-up first, and he knew we’d have to start selling off assets and perpetuating the rebuild until that came.
Additionally, with the large payout from the league, he should now have the capital to build it. If he had issues with funding the team and the arena at the same time, now he doesn’t have to cover 2 sets of bills. If he’s to pay back that amount in 5 years, then with a district set-up that can produce income, he will be much more likely to get additional investors and to be able to borrow as he has something much more tangible to point to for lenders.