CXLVIII - Coyotes owner Alex Meruelo had 'productive' meeting with Phoenix mayor

[aqib]

Unless someone had the money and desire like Ballmer does for his Clippers to spend money to build an arena in AZ, it was an uphill climb from day 1.

AZ seems to have some major issues with their sports stadiums with the teams coming and asking for handouts.

Suns got $160 mill from PHX to reno Footprint and extended lease by 15 years to 2037. 13 years from now, see what happens.

Diamondbacks, looking for 9 figures as well for their ballpark.

And you have the NHL.

Ideal world, both NBA/NHL either under 1 owner so easier to deal with, or they work together like Mavs/Stars for a new arena. But, since Suns control Footprint, it's a step back to share with NHL team as separate owners.

Just curious, does anyone know (or can guess) how much would it cost if they wanted to make Footprint dual purpose?

 

[Tom ServoMST3K]

This just reeks of a Atlanta to WPG part II

IIRC here there was little to nothing surronding atlanta then boom. Totally similar situation

People in Winnipeg knew jan 1 - there was that weird leak in early Feb for SLC this time.

 

[StreetHawk]

Just curious, does anyone know (or can guess) how much would it cost if they wanted to make Footprint dual purpose?

I believe that the city offered to tear the arena down as that was a better option than trying to do a Seattle remodel. So, it's extremely expensive. Reno mostly cosmetic, vs structural to change the seating and angles. But, would need NBA/NHL to be under 1 owner since the NBA team has control over the arena, thus they would not want to share and give up a % of non sporting event revenues.

Also suns kicked in $80 mill so it was like a quarter bill reno.

 

[aqib]

The agreement I believe has a clause that the county can't contribute to a new arena that is within X miles of the Toyota Center. Probably also means that the county can't approve zoning for a private one either, but not sure on that.

NHL business wise, I doubt can survive on just game day revenues. Think every NHL club is the primary tenant, have same owner, or split evenly (ala Dallas).

That's why for the NHL to get into Houston, has to be with the Rockets owner basically. And if he doesn't want to pay what the NHL wants, they can't go to Houston.
Do any of your suggestions of Katy/Woodlands make sense for an arena location that is convenient for fans to get to?

From what I remember reading there was nothing about approving zoning and to be honest I don't know if zoning is a county or municipal decision.

As far as convenience goes, I have only been to Houston twice and that was in 2002. So I can't say what is or isn't a convenient location to get to. I only asked about Woodlands because its a different county and I only mentioned Katy because I literally can not name another suburb of Houston without looking it up.

Now you may ask, why I name Houston as a more lucrative option than Phoenix despite knowing so little about it, its because I know its big enough and as a strong enough economy to support a second major league arena and a mixed use entertainment district would do well economically.

 

[Tom ServoMST3K]

At the current moment..... Everywhere.

Even if Merulo came out himself and apologized to the fans, offered a feasible story that the NHL didn't give him much choice..... goes and wins the auction and builds the arena, people are not going to buy in.

If I were a local, blowing the Tempe vote would put him on very thin ice for me.

 

[GKJ]

If/when the Coyotes were to leave and come back, people won’t care who the owner is. If the hockey is good and the product is compelling, that’s all that will matter

 

[TheLegend]

Just curious, does anyone know (or can guess) how much would it cost if they wanted to make Footprint dual purpose?

To coin an old Anthony LeBlanc term..... "astrobucks"

There's been some ramblings of re-igniting the plan to replacing Footprint with a new arena on the site of current site of the convention center, which was first reported back when Glendale terminated the 15-year lease with IceArizona.

But there's a bigger problem to that. Phoenix faced a lot of public pushback for approving the upgrades to Footprint. They only avoided a public referendum on it because there were funds already earmarked for those improvements. A new arena would require a new vote..... and more than likely be exposed to a referendum. Plus they've recently reached out to the DBacks and Maricopa County to offer assitance in resolving the problems with Chase Field.

Unless of course, Matt Ishiba chose to build it himself and utilized the "theme park district" statutes.

 

[TheLegend]

If I were a local, blowing the Tempe vote would put him on very thin ice for me.

Oh that's a big part of it too.

 

[LT]

From what I remember reading there was nothing about approving zoning and to be honest I don't know if zoning is a county or municipal decision.

As far as convenience goes, I have only been to Houston twice and that was in 2002. So I can't say what is or isn't a convenient location to get to. I only asked about Woodlands because its a different county and I only mentioned Katy because I literally can not name another suburb of Houston without looking it up.

Now you may ask, why I name Houston as a more lucrative option than Phoenix despite knowing so little about it, its because I know its big enough and as a strong enough economy to support a second major league arena and a mixed use entertainment district would do well economically.

There are zero locations in Houston that are convenient to get to

Katy would not work. It's split between three counties (Harris, Fort Bend, Waller). Waller is too poor. Harris can't because of the Toyota Center lease. Fort Bend piggy backs off of Harris too much.

The Woodlands already has the Cynthia Woods Pavilion for events - I don't think there's much appetite for another arena or event center there.

There aren't any other locations outside of Harris County that are wealthy enough and close enough to a population center to support an arena night in and night out.

For the foreseeable future, it's Toyota Center or bust for a hockey team in Houston.

 

[bobbop]

The Scottsdale mayor has no standing in the Coyotes situation. He’s running for reelection and this gives him a nice piñata to whack. Some of the copy lines were good though, especially the one about the “rookie developer”.

There always been a concern that Mereulo’s biggest hurdle would be lining up the $3 Billion in financing to pay for this project. Money is expensive. Construction costs in Arizona have shot up like a rocket. There is a severe shortage of experienced craftsmen.

I’m sad because I tried very hard to do my small part to help the team. I met with two different owners and a team president to present marketing ideas. I brought two major sponsors to the Coyotes. No one seemed to care. The stunning lack of thoughtful management here is what doomed this team.

 

[bobbop]

If/when the Coyotes were to leave and come back, people won’t care who the owner is. If the hockey is good and the product is compelling, that’s all that will matter

“Hockey fans are hockey fans” — Jack Reilly

 

[aqib]

There are zero locations in Houston that are convenient to get to

Katy would not work. It's split between three counties (Harris, Fort Bend, Waller). Waller is too poor. Harris can't because of the Toyota Center lease. Fort Bend piggy backs off of Harris too much.

The Woodlands already has the Cynthia Woods Pavilion for events - I don't think there's much appetite for another arena or event center there.

There aren't any other locations outside of Harris County that are wealthy enough and close enough to a population center to support an arena night in and night out.

For the foreseeable future, it's Toyota Center or bust for a hockey team in Houston.

Like I said a couple of times that was just a hypothetical because it the only suburb I could name.

Is there any location within the county where someone could build an arena district? There isn't 100 acres somewhere?

 

[Ernie]

The Scottsdale mayor has no standing in the Coyotes situation. He’s running for reelection and this gives him a nice piñata to whack. Some of the copy lines were good though, especially the one about the “rookie developer”.

There always been a concern that Mereulo’s biggest hurdle would be lining up the $3 Billion in financing to pay for this project. Money is expensive. Construction costs in Arizona have shot up like a rocket. There is a severe shortage of experienced craftsmen.

I’m sad because I tried very hard to do my small part to help the team. I met with two different owners and a team president to present marketing ideas. I brought two major sponsors to the Coyotes. No one seemed to care. The stunning lack of thoughtful management here is what doomed this team.

Yeah, it seems like a very high risk project to finance. The Tempe project had the tax incentives to give it an advantage and was much more central, and even then Meruelo's financing was considered a weakness. I'm betting the league looked at everything that needed to come together to make an arena happen and didn't like the odds. The NHLPA threatening to turn this into a collective bargaining issue with a new CBA negotiation on the horizon was the impetus to finally pull the plug.

 

[Ernie]

If/when the Coyotes were to leave and come back, people won’t care who the owner is. If the hockey is good and the product is compelling, that’s all that will matter

The simple truth is there are so few Coyotes fans that it won't really matter if they are annoyed at Meruelo. A successful franchise there needs to create many times more fans than what exists currently.

On the other hand, Meruelo has burned any kind of goodwill he might have had in the community. Even if he had the ability to pull off building a new arena district (highly questionable), his pariah status is going to make this even more of an uphill battle.

 

[wpgallday1960]

Colour me sceptical that Mereulo could complete his proposed Phx project, covering all those costs on his own. Guy couldn’t keep up with his bills in Glendale, if memory serves. NHL would be correct in needing several milestones accomplished before he got the expansion franchise.

 

[LT]

Like I said a couple of times that was just a hypothetical because it the only suburb I could name.

Is there any location within the county where someone could build an arena district? There isn't 100 acres somewhere?

Oh there's more than enough land to go around. I'm sure someone could come up with that kind of plan.

But it would never survive getting through the legislative red tape and all of the political nonsense.

Sugarland has a dual ice rink (one of the only rink facilities in the city), is outside of Harris County, and has ample land. But I don't think Fort Bend Co. would risk pissing off Harris Co. by building something like that so close. I don't think Fort Bend could even help out financially anyway, they're not particularly wealthy either.

The Woodlands is the only other area outside of Harris that could maybe work, but again, they've already got a large concert venue. I doubt they have the appetite for something else.

Harris county is massive. It eats up most of the rest of Houston. There are three highway loops around the city, and the inner two are completely within Harris. I can't see an arena having any success outside of the middle loop. It'd just be too inaccessible and out of the way.

Theoretically? Sure. But you can say that about any number of cities. Especially Phoenix.

 

[cheswick]

People in Winnipeg knew jan 1 - there was that weird leak in early Feb for SLC this time.

John Shannon was reporting Arizona to Salt Lake City last summer.

 

[GKJ]

The simple truth is there are so few Coyotes fans that it won't really matter if they are annoyed at Meruelo. A successful franchise there needs to create many times more fans than what exists currently.

On the other hand, Meruelo has burned any kind of goodwill he might have had in the community. Even if he had the ability to pull off building a new arena district (highly questionable), his pariah status is going to make this even more of an uphill battle.

He obviously has poor connections within the community and municipalities, that will be a bigger factor than fans who are understandably and rightfully angry about it.

 

[MeHateHe]

Sixty eight threads later, this feels so anticlimactic somehow. If a move it is, how about we make it someplace more exotic, like Saskatoon? Does the ghost of Bill Hunter have any money?

 

[Headshot77]

I am not a Coyotes fan but I want to say first and foremost that I am sorry for all Coyotes fans. You guys and girls have my deepest sympathies. And anyone who is cheering your relocation is a grade A ****face and should check themselves.


That being said, after the devastating news yesterday I slept on it and wanted to really think about who is to blame for this 28 year experiment ending in failure.


I think Alex Meurelo has been lying to you guys since the Tempe vote failure. Quietly, behind the scenes, the Tempe vote was the last chance for this franchise. And when that failed I think the NHL had given up and started courting various groups for an Expansion/Relocation franchise.


It makes sense. The NHL wouldn't want a lame duck season in Phoenix, that could get really ugly. Likewise they also didn't want to rip them away after the season ended because then Coyotes fans wouldn't get the chance to say goodbye. All in all, it seems like making the announcement now seems like the least traumatic option as an outsider.


So what the NHL and AM do instead was lie to you for 78 games. Relocation has been plan A since Tempe failed all along. And I honestly don't blame them for doing so. You have owners with arenas that are relatively turn-key in Houston and SLC. Alex Smith had his **** together first so he got the team. IIRC the Toyota Center just got an ice plant not too long ago so I feel like they were scrambling to get ready for a team too.


The NHL wants Arizona. They still do. Honestly I think they did fairly right by the market by sticking it out for so long when everything indicated it was going south from the very beginning. I don't blame them for cutting bait now because of bad optics.


To me, the blame should be split three ways between Alex Meurelo, the NHL, and the residents of Tempe. AM has been a cheap bastard from the very beginning and did nothing but tarnish an already tarnished brand by getting kicked out of Glendale, not paying taxes, not paying employees, running a bare bones team, etc.


Which makes it all the more suspect that he all of a sudden promised to drop ~$3billion on this district. Drop $100 million on infrastructure. No Billionaire has EVER done that. They always get the city to pitch in for utilities and roads. It was always a pie in the sky scenario to expect this guy who has been such a meiser to suddenly make a face turn and spend all that coin. Especially when SLC just gifted Smith 900 million for a building. NHL Ownership doesn't want to make a habit out of paying their own way. THATS the biggest reason why the NHL cut ties.


There wasn't enough civic support in any municipality of the greater Phoenix area to bring this across the finish line. Glendale locked them out. Isbia didn't want to let them into his barn. Scottsdale's mayor didn't want the auction and subsequent development to happen. And Tempe residents literally voted to have a landfill instead of a hockey team. That's a failure of Meurelo to generate enough support for the Yotes, but that's also an indictment on the market and it's political leadership. Not enough people cared, and not enough of the right people cared.


The NHL failed the Yotes. Meurelo failed the Yotes. And Phoenix failed the Yotes. I hope they can get their full market reset and have a new arena and a new team in about 5 years. But I think this plan for AM to build it isn't gonna happen. Arizona doesn't need another full size arena when they already have two and a half. AM and the NHL can make all the vapid promises they want, but I don't think either party really believes that the vision is going to come to fruition. In all likelihood, AM takes his payday and either loses his land bid or wins it and builds just the profitable part (condos and mixed businesses)

 

[RayMartyniukTotems]

Colour me sceptical that Mereulo could complete his proposed Phx project, covering all those costs on his own. Guy couldn’t keep up with his bills in Glendale, if memory serves. NHL would be correct in needing several milestones accomplished before he got the expansion franchise.

Forget Expansion The Arizona-Phoenix experiment is done like yesterdays Dinner...Hello Houston...Hello San Diego seem like better cities to Expand in the US and course the best of them all Quebec City...I bet they'd sell out for the next 100 years if they returned to LA Belle Province

 

[bleedblue94]

how much is the league going to charge AM for the expansion fee if/when AZ is ready to roll with an arena suitable for nhl ?

I have absolutely ZERO doubt that the expansion fee is going to be locked at a dollar amount within the binding language of this sale contract. AM is not getting 1b out of the coyotes. The league is going to announce that to protect franchise values and inflate them further bc if they can claim that the coyotes sold for 1b then next expansion will be 1.5b.

That being said, the league is handling all of this so they can control the messaging. If they say AM is getting 1b that can be as simple as a 1b value through debt forgiveness, a locked expansion fee which save him X amount of money based on projections, hell they could even figure his annual projected losses into the amount and then claim it is a savings/income to him since he wont have to carry the losses while the new arena is developed. There are so many games the league can play with all of this by being the 100% intermediary between AM and RS. It isn't happening this way on accident.

RS will never know how much the league is actually "paying" AM for the team, he just knows he is going to have to pay the team 1.2b-1.3b to get the team from the league when this is all done.

 

[bleedblue94]

Here's my guess at how the deal breaks down. The numbers are basically guesses on my part.

1) AM trades the Coyotes to the NHL for a conditional expansion franchise. He gets to keep the team IP and records.

2) Smith buys the former Coyotes from the NHL for 1.3B. They would be considered a new team.

3) The NHL owners share .3B as a relocation fee. 1B is kept in trust as the potential expansion fee for the returning Coyotes.

4) AM has five years to build an arena for the return of the Coyotes.

5) If AM succeeds, he gets the expansion franchise and the NHL owners share the $1B.

6) If AM fails to build an arena, he gets all or part of the 1B as compensation for the Coyotes with the remainder being considered additional relocation money to be shared by the owners.

I think this is dead on, but I could see a strategic release of the money from the trust as AM hits certain landmarks on the way to the arena opening. The access to the money would help him through that building process. So if he wins the auction maybe 50m becomes available to him to help pay for the land, then when ground is broken for the arena 200m becomes available to that part of the project. The league can actually help AM get to where he wants to go, because by taking the team that are saving him from the annual operational losses and possibly the incurrence of more expenses to update/upgrade things for the players if the team was kept in Mullet.

 

[MaskedSonja]

*walks in* Hey so anything exciting happening? (To any mods this is Tinalera....yea its been awhile-I couldnt access my old acct guess it was an old email so I hope I didnt break any rules)

I was here when this whole Yotes business started, and thought Id come on back on what (possibly) might finally be ending.

So who's writing that book we were talking about?

 

[PCSPounder]

Just a thought here… while you get a bit tied up in current Arizona politics, please recognize the population growth that has happened. Including where it came from.

It may not be a majority from California, but it’s close. Similar is true in Portland, and pretty much everyone who’s polled a bit knows any stadium measure sent to voters tops out at about 35% support- and this in Nike country. I mention California because they’re more used to billionaires paying much more of the freight, because generally larger markets and said billionaires can make up the difference elsewhere.

I sincerely suspect that you could reverse the percentage of spending on the Tempe proposal… and maybe you move 2-4% of voters. That might beg a question or two about what Meruelo was thinking going into that, but it’s probably a waste of time mulling that over now.

I do think any future efforts require someone willing to pay for more stuff- and adds a wrinkle that gets some attention- than Meruelo could muster.