CXLIII - UPDATED 6/3 - Coyotes arena deal takes next step after Tempe council votes to open negotiations

[TheGreenTBer]

Bettman doesn't get to decide... Any any time between changes of owners the BOG could pulled the plug... they DIDN'T



Even if this project is a no go the team is still not moving since that lease at ASU is 3 years with a 4 year option and there would be time to go to a plan B.

I find it unlikely that the Tempe project will go unfunded given that we got to this point. I think they'll find a way to work it out. Whether or not the NHL would have been OK with ASU as a temporary venture without Tempe on the horizon is conjecture.

 

[gstommylee]

I find it unlikely that the Tempe project will go unfunded given that we got to this point. I think they'll find a way to work it out. Whether or not the NHL would have been OK with ASU as a temporary venture without Tempe on the horizon is conjecture.

NHL has no choice. they can't block it.

 

[TheLegend]

I find it unlikely that the Tempe project will go unfunded given that we got to this point. I think they'll find a way to work it out. Whether or not the NHL would have been OK with ASU as a temporary venture without Tempe on the horizon is conjecture.

It’s been coming out more and more Meruelo had a plan B ready to go had Tempe decided not to pursue the proposal further.

It wouldn’t have required moving 120 acre feet of soil either. Saving him months of build time.

But I believe he went with Tempe because it gives him the most ROI over any other option he might have had.

 

[Dirty Old Man]

You mean there were other points in the rest of that illiterate word salad?

weak. get a new writer.

 

[TheLegend]

weak. get a new writer.

I think he was referring to the OTHER guy.

(At least I hope he was )

 

[TheGreenTBer]

NHL has no choice. they can't block it.

I didn't intend to imply they could block it or not.

It’s been coming out more and more Meruelo had a plan B ready to go had Tempe decided not to pursue the proposal further.

It wouldn’t have required moving 120 acre feet of soil either. Saving him months of build time.

But I believe he went with Tempe because it gives him the most ROI over any other option he might have had.

I also find it hard to believe that he didn't at the very least explore the idea of Plan B's as well.

Either way, they have a clear path forward to focus on now, all the other stuff is just noise.

 

[aqib]

Right. A League "30-year no movement" requirement sounds like a big deal, but really isn't.

Virtually no one leaves before their (first) lease is up, unless it's because the same people who gave the team the lease are the ones who will hold the lease at a new facility. If they do leave before the lease is up, it's a year or two max. With a pretty steep buyout.

If the Coyotes get a new arena, which they own and operate, they're going to stay in that facility for 30 years unless a catastrophic situation occurs (i.e. building is destroyed by fire/plane crash; or like WW3).

And lots of you pining for the Coyotes to move will freak out about that for a while, but teams with good lease/arena situations are healthy.

The NHL cosigned the Oilers lease with Edmonton guaranteeing an NHL team would be in the arena for the duration of the lease. Something similar could be negotiated here.

 

[aqib]

Well, living here, there ain't no way GLENDALE's former NHL arena was really competing with the Suns Arena or the Coyotes Arena. Not when I have to take a day off from work to attend an event in Glendale and have lightrail access to the Suns/DBacks where I can pay $4 for a train instead of find parking, and sip concealed booze on the way there and sober up on the way back.

Tempe Arena vs Suns Arena is a legit concern, I suppose. But hardly. This time of year is when they'd be competing for acts; and there's only 21 events booked in the Suns Arena that aren't NBA/WNBA/Arena games through from now until the end of the year.

There's 6 million people in the market. Any touring event is either not having a problem doing 18,000 a night in Downtown and 1-2 nights later Tempe or vice-versa, OR is big enough to do 40,000 one night in Chase Field.

It's the medium-sized "one-off" events that they'll fight for. And again, it's a market of 6 million people, with 25 venues over 5000. They probably have plenty of THINGS they could host and don't. What are they afraid of losing, the IceCapades?



Is this based on anything other than the Coyotes' dispute with their former arena in Glendale?

You're telling me if your favorite band/singer is performing in Glendale you wouldn't take the half day if that's the only time they are in the Phoenix area? If Mariah Carey was performing within a 5 hour drive of where I live you can bet my wife will insist we get there.

If there is demand for 2 shows in the Phoenix they won't do them in separate venues. They won't undergo the expense of tearing down and reassembling the stage/set to move 10 miles away. Not to mention that arenas will be managed by different event companies so that would be directing shows to particular arenas.

 

[OG6ix]

You're telling me if your favorite band/singer is performing in Glendale you wouldn't take the half day if that's the only time they are in the Phoenix area? If Mariah Carey was performing within a 5 hour drive of where I live you can bet my wife will insist we get there.

If there is demand for 2 shows in the Phoenix they won't do them in separate venues. They won't undergo the expense of tearing down and reassembling the stage/set to move 10 miles away. Not to mention that arenas will be managed by different event companies so that would be directing shows to particular arenas.

One concert is not the same as 41 home games. It's a lot to ask - just ask Expos fans about the Olympic stadium and that was closer and easier to get to than Gila River from the east valley. Sporting arena's need to be in densly populated arenas - the exception is football which has a handful of games/events.

 

[awfulwaffle]

One concert is not the same as 41 home games. It's a lot to ask - just ask Expos fans about the Olympic stadium and that was closer and easier to get to than Gila River from the east valley. Sporting arena's need to be in densly populated arenas - the exception is football which has a handful of games/events.

Bingo. If the Coyotes only played on Saturdays, they'd be much better off. But they play on weekdays, and families aren't going to be as willing to drive home, get the kids, drive out to glendale, then get home at about 10:30-11

 

[aqib]

One concert is not the same as 41 home games. It's a lot to ask - just ask Expos fans about the Olympic stadium and that was closer and easier to get to than Gila River from the east valley. Sporting arena's need to be in densly populated arenas - the exception is football which has a handful of games/events.

I was responding to KevFu's comment that Gila River Arena wouldn't be able to compete for concerts vs Tempe and downtown. Glendale decided they were better off just doing whatever concert/special event business they can get instead of hosting the Coyotes.

 

[TheLegend]

I was responding to KevFu's comment that Gila River Arena wouldn't be able to compete for concerts vs Tempe and downtown. Glendale decided they were better off just doing whatever concert/special event business they can get instead of hosting the Coyotes.

They can’t operate like that.

They still owe ~$120 million on the original bonds and are ready to sink another $50 million into it.

Their “analysis” from a consultant they hired told them they would need 20 top tier concerts to replace losing 41 Coyotes games. Right now they have thirteen dates scheduled for the remainder of the year and roughly half we’re rescheduled events postponed from the last two years.

There’s only three events scheduled through March of 2023. All this in spite of having the last year knowing they no longer had to worry about blocking off 200 days for the Coyotes (per Frau Clarkonomics).

 

[aqib]

They can’t operate like that.

They still owe ~$120 million on the original bonds and are ready to sink another $50 million into it.

Their “analysis” from a consultant they hired told them they would need 20 top tier concerts to replace losing 41 Coyotes games. Right now they have thirteen dates scheduled for the remainder of the year and roughly half we’re rescheduled events postponed from the last two years.

There’s only three events scheduled through March of 2023. All this in spite of having the last year knowing they no longer had to worry about blocking off 200 days for the Coyotes (per Frau Clarkonomics).

We're they losing money hosting the Coyotes since all they were getting was $500K in rent and had the operational expenses of converting to ice from whatever else was there?

Is ASM continuing to manage the arena and weren't they outdrawing the Suns arena in the years before the bankruptcy?

 

[MNNumbers]

If the question is: What about GRA (which it shouldn't be, because it's not part of the Coyotes future in any way any more)?...

Then....Before the BK the Coyotes had management rights, and yes, in general, the arena in Glendale was competitive with the one downtown. But, as Legend has said many times....that's not enough for this market, and the real problem was the recession, which killed the momentum of Westgate, and led to Ellman splitting the Westgate development off from the hockey team. (Moyes would have been much better off never to have touched the NHL.) So, Moyes, the owner, was losing money in spite of having arena management rights.

After the BK, the NHL didn't really manage the arena at all, because they convinced Glendale CC to finance the hockey losses (25M/yr for 2 years), and that cost the arena its momentum.

When the team was for sale, and people were looking at IA, Glendale put out an RFP for arena managers, and one of the companies (which has since merged with another one) proposed an agreement without hockey, which would ahve been much better for the city. And, which, in hindsight, might have saved the arena as a profitable entity. {Essentially, if the team had left the market at that point, not only would the city have been off by at least 20M dollars (10M for each of the first 2 years of IA) PLUS perhaps lots more millions in arena management since.} {Point 2 on this....there would be no competing arena proposed in Tempe because the NHL would already be gone.}

However, since the BK, and IA managing the place for 3 years, the arena lost all its booking momentum, and has suffered since.

I wish Glendale well. I think the NHL and IA took them for a ride, and while not everything they have done has been completely straightforward, to me they are more victim than villian. But I think they have a tough spot, and I believe their best bet is probably something like what they are doing, and moving to a model which gives them advantages in the case of some genres of entertainment, because it's clear that they lose if they are trying to compete on a level field.

 

[aqib]

If the question is: What about GRA (which it shouldn't be, because it's not part of the Coyotes future in any way any more)?...

Then....Before the BK the Coyotes had management rights, and yes, in general, the arena in Glendale was competitive with the one downtown. But, as Legend has said many times....that's not enough for this market, and the real problem was the recession, which killed the momentum of Westgate, and led to Ellman splitting the Westgate development off from the hockey team. (Moyes would have been much better off never to have touched the NHL.) So, Moyes, the owner, was losing money in spite of having arena management rights.

After the BK, the NHL didn't really manage the arena at all, because they convinced Glendale CC to finance the hockey losses (25M/yr for 2 years), and that cost the arena its momentum.

When the team was for sale, and people were looking at IA, Glendale put out an RFP for arena managers, and one of the companies (which has since merged with another one) proposed an agreement without hockey, which would ahve been much better for the city. And, which, in hindsight, might have saved the arena as a profitable entity. {Essentially, if the team had left the market at that point, not only would the city have been off by at least 20M dollars (10M for each of the first 2 years of IA) PLUS perhaps lots more millions in arena management since.} {Point 2 on this....there would be no competing arena proposed in Tempe because the NHL would already be gone.}

However, since the BK, and IA managing the place for 3 years, the arena lost all its booking momentum, and has suffered since.

I wish Glendale well. I think the NHL and IA took them for a ride, and while not everything they have done has been completely straightforward, to me they are more victim than villian. But I think they have a tough spot, and I believe their best bet is probably something like what they are doing, and moving to a model which gives them advantages in the case of some genres of entertainment, because it's clear that they lose if they are trying to compete on a level field.

I've said many times Glendale would have been better off taking Balsillie's offer of $50 million to support his bid. Failing that they shouldn't have paid $25 million to cover 2010 losses. Failing that they shouldn't have done it again in 2011. Then agreeing to IA's deal was also ridiculous.

As far as booking momentum goes, I am not sure I agree. Once you get a manager who can bring shows they should be able to book out the arena. Its not like a big band is going to go "oh no. If I am going to perform in Phoenix it better be downtown!"

 

[TheLegend]

If the question is: What about GRA (which it shouldn't be, because it's not part of the Coyotes future in any way any more)?...

Then....Before the BK the Coyotes had management rights, and yes, in general, the arena in Glendale was competitive with the one downtown. But, as Legend has said many times....that's not enough for this market, and the real problem was the recession, which killed the momentum of Westgate, and led to Ellman splitting the Westgate development off from the hockey team. (Moyes would have been much better off never to have touched the NHL.) So, Moyes, the owner, was losing money in spite of having arena management rights.

After the BK, the NHL didn't really manage the arena at all, because they convinced Glendale CC to finance the hockey losses (25M/yr for 2 years), and that cost the arena its momentum.

When the team was for sale, and people were looking at IA, Glendale put out an RFP for arena managers, and one of the companies (which has since merged with another one) proposed an agreement without hockey, which would ahve been much better for the city. And, which, in hindsight, might have saved the arena as a profitable entity. {Essentially, if the team had left the market at that point, not only would the city have been off by at least 20M dollars (10M for each of the first 2 years of IA) PLUS perhaps lots more millions in arena management since.} {Point 2 on this....there would be no competing arena proposed in Tempe because the NHL would already be gone.}

However, since the BK, and IA managing the place for 3 years, the arena lost all its booking momentum, and has suffered since.

I wish Glendale well. I think the NHL and IA took them for a ride, and while not everything they have done has been completely straightforward, to me they are more victim than villian. But I think they have a tough spot, and I believe their best bet is probably something like what they are doing, and moving to a model which gives them advantages in the case of some genres of entertainment, because it's clear that they lose if they are trying to compete on a level field.

Don’t think I could answer any better than that.

I will add one thing though. When kdb209 was a regular poster to the megathread he had access to Pollstar listings.

I remember on more than one of those lists where GRA was outdrawing Footprint handily after it opened. You could attribute that to it being a brand new venue, but as you said they lost momentum and haven’t recovered since.

They did make some gains on Footprint coming out of the pandemic this past year. But now with the Coyotes gone, despite what some people might think, it puts a big hole into their overall revenues. They will save money not having to run a ice plant 8-9 months out of the year but that ice system represents millions in investment and needs to be maintained year round.

 

[MNNumbers]

Don’t think I could answer any better than that.

I will add one thing though. When kdb209 was a regular poster to the megathread he had access to Pollstar listings.

I remember on more than one of those lists where GRA was outdrawing Footprint handily after it opened. You could attribute that to it being a brand new venue, but as you said they lost momentum and haven’t recovered since.

They did make some gains on Footprint coming out of the pandemic this past year. But now with the Coyotes gone, despite what some people might think, it puts a big hole into their overall revenues. They will save money not having to run a ice plant 8-9 months out of the year but that ice system represents millions in investment and needs to be maintained year round.

Just exactly what revenues does Glendale lose because of the Coyotoes not being there? I thought the team got everything from game nights?

If I am right, then the loss is only in the monetary gains from what is spent in Westgate. Not the arena at all. Or, an I missing something here?

 

[TheGreenTBer]

I know literal

Bingo. If the Coyotes only played on Saturdays, they'd be much better off. But they play on weekdays, and families aren't going to be as willing to drive home, get the kids, drive out to glendale, then get home at about 10:30-11

Not to go OT, but this was exactly the problem for me going to Panthers games when I lived in Miami (granted, I am not a Panthers fan but w/e.)

I was in Coral Gables, and worked on Key Biscayne. Commuting from Key Biscayne->Coral Gables->What-basically-amounts-to-the-Broward-County-Everglades on a weeknight is nigh on impossible. That's the traffic direction (i.e. outbound), and since 1) the MDC-Broward-PBC metro area is essentially one VERY long, thin strip sandwiched between the Everglades and the Atlantic Ocean; and 2) freaking EVERYONE in Florida drives to get from Point A to Point B, the commute is dreadful during a weeknight. Sitting in traffic in a cool climate is one thing, sitting in traffic when the sun is a nuclear inferno of death like it is in FL and AZ is another thing entirely.

I only went to 1 weeknight Panthers game the entire time I was there. Never made that mistake again. Weekends were fine.

 

[Stumbledore]

weak. get a new writer.

It grieves me deeply that my posts don't meet your exacting literary standards.

I think he was referring to the OTHER guy.

(At least I hope he was )

I was, but Dirty Old Men often miss important context in this board.

 

[KevFu]

You're telling me if your favorite band/singer is performing in Glendale you wouldn't take the half day if that's the only time they are in the Phoenix area? If Mariah Carey was performing within a 5 hour drive of where I live you can bet my wife will insist we get there.

If there is demand for 2 shows in the Phoenix they won't do them in separate venues. They won't undergo the expense of tearing down and reassembling the stage/set to move 10 miles away. Not to mention that arenas will be managed by different event companies so that would be directing shows to particular arenas.

I think you're kind of backing up my point with that. Mariah ain't playing Gila River Arena multiple nights to sell 35-40 tickets total; she could just play at Chase Field and sell 45,000 tickets per show (like Elton John is doing) or the Cardinals stadium in Glendale, selling 60,000 tickets (like Taylor Swift did last time).

You'd drive to Glendale to see the ONE stop show at the Cardinals stadium. But if a concert tour is picking ONE 18,000 seat venue to play in the Phoenix Metro area, they are picking the Suns arena or new Tempe Arena, or that amphitheater in Scottsdale over Gila River every single time, provided they are available; because the other three are in the population center and Glendale isn't.

I was responding to KevFu's comment that Gila River Arena wouldn't be able to compete for concerts vs Tempe and downtown. Glendale decided they were better off just doing whatever concert/special event business they can get instead of hosting the Coyotes.

There's obviously more to "events" than just concert tours. My overall point is that each arena needs to have events in them to make money; and there's ample amount of events that can be in an arena at any given moment and "Competing" with each other for marquee events is a make-believe problem.

If an artist is large enough that the four 18,000-seat venues are COMPETING over who gets to host them, then chances are that artist can play and would rather play Chase Field downtown, selling more tickets at a better location than playing at GRA, Tempe, or Scottsdale.

"Competing for events" is something people said about New York when Barclays and UBS were opening.. "Does New York Metro really need FIVE venues that big?" And that was a dumb take to have because in addition to the 5 sports venues, there were also about 30 other non-sports venues you can put 15000+ people into for a concert/show, and there's plenty of events for all of them because the market is big.

Phoenix has 5.8 million people in the metro area. Most events are for a niche audience of 15,000. 15,000 people is 0.24% of the market. Adding another place trying to sell tickets to 0.24% of the market isn't a problem.

 

[Llama19]

What to look for with Coyotes and Tempe Negotiations

https://www.bizjournals.com/phoenix/news/2022/06/06/what-to-look-for-in-arena-negotiations-between-tem.html

 

[KevFu]

I'm happy the league works hard to keep the teams in place as best they can. At the same time there is some markets that just don't work and it's not just hockey. Miami, Atlanta and Phoenix are bad sports markets

Bad sports markets and "don't work" are too different things. In a small closed group like a sports league, someone is going to be last at everything; and being last doesn't mean it isn't viable.

You mention Miami, Atlanta and Phoenix are bad sports markets. Because those teams don't draw. But by the same metrics, the entire West Coast are bad sports markets. Everywhere with nice weather is a bad sports market.

List the best sports markets. They're all cold in the winter where people stay inside and watch basektball and hockey on TV, and follow along with baseball transactions.

You want to tell me that Los Angeles is a GOOD sports market compared to BOS, NY, PHI when they lost two NFL teams and went decades without replacements? If the Giants and Jets left New York at the same time, there'd overthrow NFL headquarters.

Hell, the Dodgers and Giants DID leave New York, and New York rallied. William Shea got rejected for NL expansion in the winter of 1958, put together a competing league (CBL) that forced the NL and AL to come up with an agreement; and they announced expansion teams by August of 1960. It took them 33 months to get a replacement team (and they HAD the Yankees the entire time).

Bad sports markets can be perfectly healthy.

 

[stealth1]

Bad sports markets and "don't work" are too different things. In a small closed group like a sports league, someone is going to be last at everything; and being last doesn't mean it isn't viable.

You mention Miami, Atlanta and Phoenix are bad sports markets. Because those teams don't draw. But by the same metrics, the entire West Coast are bad sports markets. Everywhere with nice weather is a bad sports market.

List the best sports markets. They're all cold in the winter where people stay inside and watch basektball and hockey on TV, and follow along with baseball transactions.

You want to tell me that Los Angeles is a GOOD sports market compared to BOS, NY, PHI when they lost two NFL teams and went decades without replacements? If the Giants and Jets left New York at the same time, there'd overthrow NFL headquarters.

Hell, the Dodgers and Giants DID leave New York, and New York rallied. William Shea got rejected for NL expansion in the winter of 1958, put together a competing league (CBL) that forced the NL and AL to come up with an agreement; and they announced expansion teams by August of 1960. It took them 33 months to get a replacement team (and they HAD the Yankees the entire time).

Bad sports markets can be perfectly healthy.

IMO it's not just cause of the weather being nice is the reason they are bad. The amount of transplants in those cities is a big reason. LA is a bad market too. Bad sports markets can work when the teams win. The problem is when they don't.

 

[TheLegend]

Just exactly what revenues does Glendale lose because of the Coyotoes not being there? I thought the team got everything from game nights?

If I am right, then the loss is only in the monetary gains from what is spent in Westgate. Not the arena at all. Or, an I missing something here?

Ticket surcharge. Remember that couldn’t be touched or else invoke the wrath of the Goldwater Institute.

Sales tax revenues. The projections of the analysis they paid for projected those attending a top tier concert would spend up to twice the amount of money than hockey fans.

 

[MNNumbers]

What to look for with Coyotes and Tempe Negotiations

https://www.bizjournals.com/phoenix/news/2022/06/06/what-to-look-for-in-arena-negotiations-between-tem.html

Paywall

Ticket surcharge. Remember that couldn’t be touched or else invoke the wrath of the Goldwater Institute.

Sales tax revenues. The projections of the analysis they paid for projected those attending a top tier concert would spend up to twice the amount of money than hockey fans.

Sales tax revenues means....."On everything that people spend elsewhere, not just in the arena", correct?

Ticket surcharge....If you have tickets, what was the surcharge?

Thanks.