CXLVII - Is this the 'Final Countdown' in Arizona?

[PainForShane]

The Coyotes rent in Glendale was $500K annually, not sure where you're getting tens of millions.

Bottom line, Meruelo is no dope, he's acutely aware that the Coyotes can't turn a profit by themselves. His mistake was not buying Westgate when it was for sale.

Original figure includes both time horizon and taxes, context was we were talking in terms of a 20 year time horizon (because that's where Desert Diamond's projected 150m loss comes from), and I included taxes too. If you want to say something like "around a million a year" rather than "tens of millions" that's fine. Not sure the difference matters anyway.

Either way 100% agree with your point, like you said it's all about the arena ownership piece. Whether you define it as owning just the arena or the entire entertainment complex, clearly owning something in addition to just the Yotes is required, uncle Gary has publicly stated this many times as well. Let's see what sort of proposal comes through in the next six months

 

[aqib]

The issue was arrogance. They just assumed people would want them instead of realizing Glendale was doing the franchise a favor for years. It is just so funny that they shit on westgate and the arena (claiming they would buy it later to tear it down), and here we are with them now talking about making the same type of project in a different location.

IF they had actually developed westgate properly, do people from the area believe that the fanbase would have grown in that area? I understand most of their support comes from the valley, but with the proper development in and around westgate (even when meurelo bought the team) is it possible/likely that we aren't where we are today?

When you look at the original vision for Westgate (someone posted the model about 100 threads ago) the $180 million Glendale kicked in for the arena would have made sense no matter what happened to the Coyotes. I think if that had been built out like it was planned by 2009 I think Glendale would have been more likely to let the Coyotes go because they wouldn't need them to draw to Westgate. Balsillie offered them $50 million to not object to his bid.

 

[Ciao]

@awfulwaffle @PainForShane -- If the idea is to make money from investing in real estate, then why not just invest in real estate without blowing money on a money-losing arena and pro-sports franchise?

Maybe the money that would be lost there would be better saved, or spent elsewhere?

If the real estate project stands on its own, then why tie it to a boat anchor?

 

[Shwan]

It appears more likely the Diamondbacks are going to get out of the Bally's contract and leave the RSN with just the Coyotes as their only major content in Arizona.

MLB told the court that it is negotiating with pay TV operators covering the Phoenix area and beyond to set up a new channel to broadcast Diamondbacks games locally, much as the league did for the San Diego Padres when Diamond cut them loose from the Bally Sports regional sports networks system in May.

What's more concerning is that Direct TV filed a brief in court asking for relief in carriage fees should it actually happen.

“DIRECTV has notified (Diamond Sports) that it does not believe it should pay (Diamond Sports) for Diamondbacks content for the period following rejection,” DIRECTV’s motion states. “Otherwise, DIRECTV could be compelled to pay twice for the same content, a nonsensical and inequitable result. DIRECTV is hopeful that it can resolve this issue consensually with (Diamond Sports), but if the parties cannot reach an acceptable arrangement, DIRECTV may seek this Court’s assistance with resolving this dispute.”

I'm sure if this gets traction more providers like Cox and Dish will follow suit, which would likely lead the company to just fold the Arizona network.

Hopefully this doesn't lead to a Hawksvision 2.0 situation.

 

[awfulwaffle]

@awfulwaffle @PainForShane -- If the idea is to make money from investing in real estate, then why not just invest in real estate without blowing money on a money-losing arena and pro-sports franchise?

Maybe the money that would be lost there would be better saved, or spent elsewhere?

If the real estate project stands on its own, then why tie it to a boat anchor?

Because it's his toy - he's in elite company owning a sports team. He stated as much in his press conference, it was his goal to own a sports team. And, shockingly enough, it's his money to do what he wants with it. Why does it matter what he wants to do with his own money?

 

[LPHabsFan]

Because it's his toy - he's in elite company owning a sports team. He stated as much in his press conference, it was his goal to own a sports team. And, shockingly enough, it's his money to do what he wants with it. Why does it matter what he wants to do with his own money?

For the most part it doesn't. Having said that, just just because it's his own money doesn't mean it removes other peoples ability to criticize him for stupid decisions and ideas. However, even more than that, this whole Westgate 2.0 scheme wasn't just using his own money, which ended up being the biggest problem.

 

[Ciao]

Because it's his toy - he's in elite company owning a sports team. He stated as much in his press conference, it was his goal to own a sports team. And, shockingly enough, it's his money to do what he wants with it. Why does it matter what he wants to do with his own money?

I don't think anyone cares what he does with his own money. He could give it to the poor, buy Lamborghinis or throw it in the Pacific Ocean if he wants. It's his, to do with as he pleases.

So, why then does he need some kind of deal with a municipality or first nation? If he wants to build an arena -- and a bunch of commercial buildings and condos -- all with his own money, why doesn't he buy some land, get a site-plan approval and go spend whatever he wants to spend on whatever it is he wishes to own?

I rather suspect it's not all his own money, and the whole thing is probably a lot more complicated than that. Would it involve any sort of tax breaks, concessions or public financing for Meruelo to make his fortune here? If not, he could just do it on his own.

 

[Voight]

Just looking at this. Please keep in mind that the winnipeg jets now have VERY rich ownership who can do a lot that ownership groups from the coyotes were not able to do. When the coyotes played in the first decade in AZ , arenas were full of fans despite obstructions. What traditionalists do not get is that it takes time for hockey to grow in the area. AZ state now has D1 hockey and the AHL team is now in Tucson. (AZ is one of only 6 states that has the NHL, AHL and D1 college hockey) Things are happening in AZ when it comes to the sport of hockey whether you care to admit it or not. Good ownership would have prevented the original jets team from leaving in the 90's, and it was a good ownership that good winnipeg back a team. As much as you do not want to hear it, it is not just about markets but ownership groups. I believe for example that the washington commanders would have sold for a lot more than 6 billion if the Snyders were good owners. No one says washington is a bad football city-I grew up in the metro area during the super bowl years. But the team had to constantly remove seats from FED ex field as less fans went to games. See also donald sterling and the clippers. Look at what has happened in vegas with a good plan and ownership group regarding the golden knights. I will have a hard time believe phx is so much worse than vegas. I am sorry to tell people this, but ownership matters. An arena in tempe/scottsdale/mesa would be very feasible in y opinion. But someone needs to pay for it to get built which requires richer ownership than what the coyotes currently have-i.e. a vegas type owner who can finance everything privately. Ok-i am done,

These points kind of contradict each other.

Clippers. under Sterling had very little success in general yet he sold them for a record price (at the time it was the 2nd highest sale price in NA sports history), even with him being the worst owner in sports. Now part of that was Ballmer overpaying because he wanted to own a pro team but still.

I also disagree about your Commanders point. Snyders being poor owners had nothing to do with the sale price. Broncos (who have been much more successful in the last 20 years) were sold for $4.65bn in June of last year and Snyder sold his team for $1.4bn more than that not even a year later. NFL teams are goldmines yes, but I really dont think Snyder lost out on an extra couple hundred million (or more) due to him being a bad/poor owner.

 

[Voight]

Well, now we're just arguing for a completely different reason...

"Being a Front-Runner" and "NOT GIVING MONEY TO A INCOMPETENT OWNERSHIP" are two totally different things.

We can take PHX and NYI off the board and just look at the what happens to attendance when the word "bankruptcy" is even mentioned in other cities... like Dallas. Dallas has always been TOTALLY FINE/GOOD as an NHL market. They were involved in bankruptcy simply because Tom Hicks' holding company that owned the stars took debt to also buy Liverpool and re-organized the debt. Big drop in attendance solely because of headlines.

Look at the Penguins attendance during their bankruptcy headlines. Not good. The affect on attendance is horrific. But that doesn't matter because...



COVID proves that attendance is not as significant as fans think to the financial health of a team. MLB played a 60-game season with NO FANS with practically zero repercussions. Toronto took BY FAR the biggest financial hit because they were the ONLY TEAM to have to spend additional tens of millions to upgrade a stadium to play in 2020... and they raised payroll coming out of COVID... BY A LOT. No belt tightening whatsoever.



I didn't. I was flipping the "Fact/Truth" thing on the guy I quoted. I said it's NOT "Fact/Truth/100%/Fail.



I mean, if you're using Minnesota to try and say that Phoenix is a failed market, I really don't know what to tell you... the Wild replaced A TEAM THAT MOVED. So the Minnesota market didn't fail... they built a new arena and are totally fine as a market -- despite no deep playoff runs. Let's see a Phoenix Arena 9.7 miles from the center of the metro area and see what happens!

Maybe in other sports due to their TV deals but the in the NHL attendance is very important. Its the only league (out of the big 4) where half (or nearly half) of all revenue comes from ticket sales.

 

[bleedblue94]

@awfulwaffle @PainForShane -- If the idea is to make money from investing in real estate, then why not just invest in real estate without blowing money on a money-losing arena and pro-sports franchise?

Maybe the money that would be lost there would be better saved, or spent elsewhere?

If the real estate project stands on its own, then why tie it to a boat anchor?

bc these franchises are the gateway to public subsidies on those real estate projects. people keep saying the sens sold for 950m, they didnt. the sens AND the rights to development sold for 950m.

the franchises and the allure of them (status, jobs, ect) are the angle to the tax breaks and other "help" for developing these areas. more so, you can then show a loss on the franchise itself to offset the income from the development once it is up and running. it is a wonderful structure

 

[awfulwaffle]

I don't think anyone cares what he does with his own money. He could give it to the poor, buy Lamborghinis or throw it in the Pacific Ocean if he wants. It's his, to do with as he pleases.

So, why then does he need some kind of deal with a municipality or first nation? If he wants to build an arena -- and a bunch of commercial buildings and condos -- all with his own money, why doesn't he buy some land, get a site-plan approval and go spend whatever he wants to spend on whatever it is he wishes to own?

I rather suspect it's not all his own money, and the whole thing is probably a lot more complicated than that. Would it involve any sort of tax breaks, concessions or public financing for Meruelo to make his fortune here? If not, he could just do it on his own.

For the most part it doesn't. Having said that, just just because it's his own money doesn't mean it removes other peoples ability to criticize him for stupid decisions and ideas. However, even more than that, this whole Westgate 2.0 scheme wasn't just using his own money, which ended up being the biggest problem.

How many businesses move to a new area WITHOUT incentives? There's a reason why Amazon and other companies(Tesla) move their production facilities and headquarters to certain municipalities. Because they are provided with financial incentives. It wouldn't be a smart business move(funny enough people are criticizing him) to just build an arena and a "district" without looking for such financial incentives. ESPECIALLY since it was going to be built with his own money.

 

[jonathan613]

These points kind of contradict each other.

Clippers. under Sterling had very little success in general yet he sold them for a record price (at the time it was the 2nd highest sale price in NA sports history), even with him being the worst owner in sports. Now part of that was Ballmer overpaying because he wanted to own a pro team but still.

I also disagree about your Commanders point. Snyders being poor owners had nothing to do with the sale price. Broncos (who have been much more successful in the last 20 years) were sold for $4.65bn in June of last year and Snyder sold his team for $1.4bn more than that not even a year later. NFL teams are goldmines yes, but I really dont think Snyder lost out on an extra couple hundred million (or more) due to him being a bad/poor owner.

If you were to compare what the clippers sold for versus what the LAKERS would go for, i believe that the difference would be a few billion. LA is a factor, but what makes the difference between the teams is had jerry buss as an owner, and that was a contributing factor to the lakers success on the field.

Regarding Washington, yes the commanders would have sold for a lot more i believe if he had been able to succeed in building a stadium. The team would also have been worth more if the redskins had an elite QB such as mahomes or burrow. When ovechkin is on the caps, and when lebron was on the cavs, those teams have higher valuations. Snyder certainly lost money based on potential indemnification issues, which were of his own making.

 

[Voight]

If you were to compare what the clippers sold for versus what the LAKERS would go for, i believe that the difference would be a few billion. LA is a factor, but what makes the difference between the teams is had jerry buss as an owner, and that was a contributing factor to the lakers success on the field.

Regarding Washington, yes the commanders would have sold for a lot more i believe if he had been able to succeed in building a stadium. The team would also have been worth more if the redskins had an elite QB such as mahomes or burrow. When ovechkin is on the caps, and when lebron was on the cavs, those teams have higher valuations. Snyder certainly lost money based on potential indemnification issues, which were of his own making.

Lakers are a worldwide brand much like the Yankees, Cowboys and Manchester United are. Not a good idea to compare them to Clippers. Obviously they would sell for more, they are arguably the most successful franchise in NBA history. Clippers didn't come to LA until the early 80s so the Lakers had a 20 year head start.

Even with a lack of any success, Sterling still sold them for more than any other NBA team (at the time).

RE Washington thats fine if you believe that but its probably not true. Snyder got a record price for them. I dont think he lost out on any money. New stadium or not, NFL teams are cash cows and he literally set a record for a sports team sale. As I said previously Denver sold for $1.4bn less despite being more successful and speaking of stadiums, they have one thats just. over 20 years old.

 

[LPHabsFan]

How many businesses move to a new area WITHOUT incentives? There's a reason why Amazon and other companies(Tesla) move their production facilities and headquarters to certain municipalities. Because they are provided with financial incentives. It wouldn't be a smart business move(funny enough people are criticizing him) to just build an arena and a "district" without looking for such financial incentives. ESPECIALLY since it was going to be built with his own money.

Anyone else confused? You said he can do whatever he wants with his money. Now you're saying he's not doing this project with his own money and it would be stupid of him to not take some money from whatever level of government since everyone does it. Which lane are we supposed to be in?

 

[awfulwaffle]

Anyone else confused? You said he can do whatever he wants with his money. Now you're saying he's not doing this project with his own money and it would be stupid of him to not take some money from whatever level of government since everyone does it. Which lane are we supposed to be in?

He's not taking money, he's getting tax breaks. Same as any other company or business that moves their buildings to a new area. The arena and district was going to be built with his money. I don't know how else to explain it to you.

 

[awfulwaffle]

So would it be called TED 1.5? 2.0? The Remix? What about Westgate 3.0 (if we assume that TED was Westgate 2.0)?

Changing the verb doesn't really change the overall point, which is clearly lost on you. You can't have it both ways. Either he is paying for it using completely private funds and therefore we should be able to "let him do whatever he wants" or he's doing what every "smart" business does and extract money from the government in whatever form you decide to call it.

Either way, people were calling bullshit on the project from the beginning and it turns out that they (we) were right all along. Or at worst, more right than wrong

I wonder what other predictions will turn out to be accurate when all the dust is settled?

The fact that you think you were right about the project, just shows there's no point anymore in trying to debate you on this.

 

[LPHabsFan]

The fact that you think you were right about the project, just shows there's no point anymore in trying to debate you on this.

That's ok. It's that type of comment along with what I've seen recently of your posts that confirms my belief that you do seem more suited to Coyotes "conversations" on F40 or the main board rather than here on the BoH forum.

 

[Shwan]

It's a day that ends with Y, so the Coyotes are "evaluating their options" regarding the probable loss of their current broadcasting contract.

"We are fully aware of the developments regarding Bally Sports Arizona. The Arizona Coyotes remain under contract with Bally Sports Arizona, and remain hopeful that the network will continue to broadcast our games this season. Nonetheless, we will continue to evaluate all of our options, as needed, and will ensure that our great fans across the Valley are able to watch our games this fall. We will have no further comment until we have news to announce."

 

[Fatass]

It's a day that ends with Y, so the Coyotes are "evaluating their options" regarding the probable loss of their current broadcasting contract.

So no local tv? Do they have radio broadcasts of their games at least?

 

[jonathan613]

Lakers are a worldwide brand much like the Yankees, Cowboys and Manchester United are. Not a good idea to compare them to Clippers. Obviously they would sell for more, they are arguably the most successful franchise in NBA history. Clippers didn't come to LA until the early 80s so the Lakers had a 20 year head start.

Even with a lack of any success, Sterling still sold them for more than any other NBA team (at the time).

RE Washington thats fine if you believe that but its probably not true. Snyder got a record price for them. I dont think he lost out on any money. New stadium or not, NFL teams are cash cows and he literally set a record for a sports team sale. As I said previously Denver sold for $1.4bn less despite being more successful and speaking of stadiums, they have one thats just. over 20 years old.

Do you believe then that teams net worth has very little to do with the efforts of a teams owner? If the clippers had done well in la when the came in the 80's and the lakers had failed miserably on the court, do you think they would fetch the same prices if someone wanted to buy them that they would fetch currently?

Except for Montreal, every city that lost an MLB team since 1950 has gotten a team back. Were those cities (milwaukee, washington, seattle,-might be missing 1 or 2) bad markets because they lost teams? Or did they have bad ownership?

If they were bad markets, then they should not have stable teams now. If the coyotes had someone like steven cohen at the helm, they could build an arena privately. I get that you do not think however that doing that would have any effect on the teams ability to succeed in AZ.

 

[Shwan]

So no local tv? Do they have radio broadcasts of their games at least?

I don't doubt they can get another TV contract, the issue is that Diamond/Bally is in this mess because of their very generous contracts so whatever deal the Coyotes end up getting will be considerably smaller. It'll be another revenue stream drying up for the team when they already are in the hole ~$10M for last year.

The Ideal scenario here is the judge following suit with the D-backs and Suns and having Diamond pay the team their 2023-2024 fee before letting them terminate the agreement and giving them the ability to shut down Bally's Arizona, then the Yotes get another contract. This would provide a revenue bump for the team for this upcoming season at least.

 

[Tom ServoMST3K]

ugh - This just sucks for the team.

If it weren't for bad press, they wouldn't have any press at all.

In a season where you're trying to convince the world that you're not a lame-duck franchise, this won't be helping.

 

[Voight]

Do you believe then that teams net worth has very little to do with the efforts of a teams owner? If the clippers had done well in la when the came in the 80's and the lakers had failed miserably on the court, do you think they would fetch the same prices if someone wanted to buy them that they would fetch currently?

Except for Montreal, every city that lost an MLB team since 1950 has gotten a team back. Were those cities (milwaukee, washington, seattle,-might be missing 1 or 2) bad markets because they lost teams? Or did they have bad ownership?

If they were bad markets, then they should not have stable teams now. If the coyotes had someone like steven cohen at the helm, they could build an arena privately. I get that you do not think however that doing that would have any effect on the teams ability to succeed in AZ.

Depends. In the case of Snyder no, because the NFL is a cash cow as I said and even though he wasn't the worlds best team owner that wasn't going to hamper his ability to get an insane ROI. I don't know why you seem to think he got less money in the deal than he should've. Literally beat the previous record NFL price by almost $1.5bn and set a world sports team sale record. If you happen to have any reputable sources on this, please share them.

 

[mouser]

So no local tv? Do they have radio broadcasts of their games at least?

Diamond Sports has yet to file with the bankruptcy court to cancel the Coyotes contract or liquidate the Arizona RSN. Until that happens the team is in somewhat of a bankruptcy court limbo over TV coverage.

The MLB Diamondbacks contract was voided by the bankruptcy court (at Diamond's request), allowing them to sign with a different partner. The NBA Suns contract was expiring and Diamond Sports declined to match their new tv contract. The NHL Coyotes still have an active contract with Diamond Sports and Diamond Sports still has active contracts to operate the Arizona RSN.

My guess is the AZ RSN will cease to exist and the Coyotes end up with a new OTA TV deal before the start of this season. But we have to wait and see how the Diamond Sports bankruptcy plays out till then.

 

[aqib]

Diamond Sports has yet to file with the bankruptcy court to cancel the Coyotes contract or liquidate the Arizona RSN. Until that happens the team is in somewhat of a bankruptcy court limbo over TV coverage.

The MLB Diamondbacks contract was voided by the bankruptcy court (at Diamond's request), allowing them to sign with a different partner. The NBA Suns contract was expiring and Diamond Sports declined to match their new tv contract. The NHL Coyotes still have an active contract with Diamond Sports and Diamond Sports still has active contracts to operate the Arizona RSN.

My guess is the AZ RSN will cease to exist and the Coyotes end up with a new OTA TV deal before the start of this season. But we have to wait and see how the Diamond Sports bankruptcy plays out till then.

I think they will try to resell the rights and/or sell the network.

Way back in 2001 when PSINet went bankrupt (I was with the firm that was advising on it, although I wasn't on that specific case) they tried to resell the naming rights but for whatever reason were unsuccessful