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

[sneakytitz]

It’s a business….

One you’re sinking hundreds of millions into and bleeding tens of millions.

Note I’m not defending Meruelo here…. Just looking at it from his point of view.

Okay? I can't tell the government that I'm sorry I didn't pay on my sales tax or 941s because my business is hurting for money. Life and society is all about operating within rules; there are so many alternatives before you just blatantly violate the rules to save a buck. That is why so many business owners, small or large, get cross with the Feds - they think they can just violate the rules without recourse.

Now, apply the previous with a CBA. Penalties won't be as severe or swift, but they'll eventually come around.

Not paying outright is just a blacklist offense, which is why Marty apparently had to get involved.

 

[aqib]

Well they don't have an arena lol.

Biggest reason for it.

They had one before and still no one legit stepped up to buy them. Even when the price was $170 million and interest rates were a lot lower. Add to that you had Glendale paying them to pay there. Now the cost is $1 billion for the team and you have to pay for an arena. Let us say Muruelo gives up and the NHL opens it up for any bidder to buy the rights to the market at the same price. Why would someone buy it now if they wouldn't before?

 

[BKIslandersFan]

They had one before and still no one legit stepped up to buy them. Even when the price was $170 million and interest rates were a lot lower. Add to that you had Glendale paying them to pay there. Now the cost is $1 billion for the team and you have to pay for an arena. Let us say Muruelo gives up and the NHL opens it up for any bidder to buy the rights to the market at the same price. Why would someone buy it now if they wouldn't before?

If NHL was open to relocation then I am sure there would have been plenty of bidders.

Seems like NHL back then was pretty adamant about not letting them leave.

If you mean just local bidders keeping the team in Arizona, I mean of course. It was unsustainable whether you believe NHL can work in Arizona or not.

Glendale location was terrible and when they left Glendale they had no arena.

 

[TheLegend]

They had one before and still no one legit stepped up to buy them. Even when the price was $170 million and interest rates were a lot lower. Add to that you had Glendale paying them to pay there. Now the cost is $1 billion for the team and you have to pay for an arena. Let us say Muruelo gives up and the NHL opens it up for any bidder to buy the rights to the market at the same price. Why would someone buy it now if they wouldn't before?

Jerry Reinsdorf wasn't legit??

 

[GKJ]

It’s a business….

One you’re sinking hundreds of millions into and bleeding tens of millions.

Note I’m not defending Meruelo here…. Just looking at it from his point of view.

The hotels are still collectively bargained no matter what. They would get a grievance filed otherwise.

He sat in front of the cameras and said he doesn’t get to where he is by not paying bills.

 

[Ernie]

Question for the board......

If you are in the process of trying to turn around a franchise that's eternally losing money and are losing $50-60 million yourself annually..... is it wrong to start trying to control some costs (as in staying at Holiday Inn rather than the Ritz Carlton, or dining at Denny's instead of Lowe's Steakhouses) where you can??

OR just leave things the way they are and keep digging a deeper hole???

You do what's contractually required, such as pay your invoices and stay at the hotels that the CBA requires.

If you can cut costs elsewhere by all means go for it but not giving your coaches a printer seems highly counterproductive.

The issue isn't that Meruelo is cheap. It's that he's unethical. And if you can't afford the hole you're digging, exit.

 

[aqib]

Jerry Reinsdorf wasn't legit??

He didn't follow through did he?

 

[aqib]

If NHL was open to relocation then I am sure there would have been plenty of bidders.

Seems like NHL back then was pretty adamant about not letting them leave.

If you mean just local bidders keeping the team in Arizona, I mean of course. It was unsustainable whether you believe NHL can work in Arizona or not.

Glendale location was terrible and when they left Glendale they had no arena.

Fine Glendale was a bad location but someone could have bought the team for $170 million and gotten a few million a year from the city in arena management fees.
Now someone will have to pay $1 billion for the team and then build an arena for probably another billion. So you're telling me that simply moving across the valley is going to compensate for the the debt service on the extra $1.8B it's going to cost now vs what it would have cost in 2010?

 

[KevFu]

I mean supply and demand is a thing. Like Jersey discovered having the Meadowlands Arena and Prudential Center wasn't good anybody because there wasn't enough business for both. Nassau County was considering letting Las Vegas Sands take over the Nassau Coliseum site and possibly let them tear the arena down because there isn't enough business for both that and UBS.

So would a 3rd major league venue make sense in the Valley? If you figure all the tours attached to ASM are going to Glendale, what is going to be left after downtown?

Supply and Demand is a thing, but there's no metric for "bands who'd play that market if there was an arena available" to tell us how much demand for arenas there really are.

Your mention of NVMC vs UBS kinda ignores that when Barclay's opened, everyone said "Does New York need a THIRD arena?" and all three were in the top 75 of Billboard's highest-grossing venue lists for the next decade or so.

The supply of concerts and other things is far greater than we assume it to be. I've seen that HUGE musical acts will play Carnegie Hall, Hammerstein Ballroom which are like 3,500 and under; or Radio City Music Hall, which is under 6000. Usually sold out shows. As if someone like Radiohead couldn't sell 13,000 for NVMC if the Islanders weren't playing that night?

Musicians make more money from touring than record sales now because you can just listen to whatever you want whenever you want now. You'd just have more concerts selling 15 to 18 thousand tickets if there were more open dates at venues that big. (Hell, Billy Joel or Bruce Springstein could put NVMC into the Billboard Top 50 venues singlehandedly by saying "I'm gonna play every Friday, that cool?"

 

[Melrose Munch]

There are lots of billionaires want to own sports teams. You've got private equity, hedge fund, and tech guys buying up teams when they hit the market. That's why valuations have gone through the roof. Yet this franchise could only attract one clown after another. Look at everyone who has bought an NHL team since the Coyotes went into bankruptcy you have: Vinick in Tampa Viola in Florida, Chipman/Thomson in Winnipeg, Pegula in Buffalo, Stillman in St Louis, Blitzer/Harris in New Jersey, Foley in Vegas, Ledecky/Malkin for the Islanders, Bonderman/Bruckheimer in Seattle, Dundon in Carolina, Andlauer in Ottawa, and now Smith in Utah.
Now compare that to various people who have owned the Coyotes. Why is the NHL able to attract those guys to these other franchises but no one legit to the Coyotes. Now some of them like Chipman/Thomson, Pegula, Stillman, and Smith only wanted to buy teams in those particular markets. But again no one legit was willing to buy the Coyotes.

I totally agree. 100 percent. Makes me question how we get back to Phoenix.

 

[ponder719]

Question for the board......

If you are in the process of trying to turn around a franchise that's eternally losing money and are losing $50-60 million yourself annually..... is it wrong to start trying to control some costs (as in staying at Holiday Inn rather than the Ritz Carlton, or dining at Denny's instead of Lowe's Steakhouses) where you can??

OR just leave things the way they are and keep digging a deeper hole???

If it's a violation of the collective bargaining agreement, as the article stipulates, then yes. That is wrong. Save money in ways that don't do that.

 

[LT]

The whole unpaid/shorted hotel bills thing reeks of AM Jr trying to play businessman. He seemed to have way too big of a role in the organization anyway. Probably got told to cut costs and thought he could do it by doing what he sees on TV. Was more worried about impressing his dad than actually doing things correctly.

Would also explain why the franchise seemed to tank so rapidly. AM himself never seemed stupid enough to ruin the franchise and its arena prospects as quickly as it did. But his younger, much more inexperienced junior? Absolutely.

 

[aqib]

Supply and Demand is a thing, but there's no metric for "bands who'd play that market if there was an arena available" to tell us how much demand for arenas there really are.

Your mention of NVMC vs UBS kinda ignores that when Barclay's opened, everyone said "Does New York need a THIRD arena?" and all three were in the top 75 of Billboard's highest-grossing venue lists for the next decade or so.

The supply of concerts and other things is far greater than we assume it to be. I've seen that HUGE musical acts will play Carnegie Hall, Hammerstein Ballroom which are like 3,500 and under; or Radio City Music Hall, which is under 6000. Usually sold out shows. As if someone like Radiohead couldn't sell 13,000 for NVMC if the Islanders weren't playing that night?

Musicians make more money from touring than record sales now because you can just listen to whatever you want whenever you want now. You'd just have more concerts selling 15 to 18 thousand tickets if there were more open dates at venues that big. (Hell, Billy Joel or Bruce Springstein could put NVMC into the Billboard Top 50 venues singlehandedly by saying "I'm gonna play every Friday, that cool?"

No I am not ignoring that Barclays opened. I am saying that even NY maxed out at a certain number. For the NY area that number is 4: Prudential, Barclays, UBS, and MSG. Keep in mind there are also no college arenas worth anything in NY (St John's on-campus arena holds less than 6K. In the Phoenix area in addition to Footprint and Glendale you also have ASU's basketball arena and Vets Memorial that can host the smaller events.

Now just look at the numbers. If a new arena costs $1 billion and you finance it at 6% for 30 years. The debt service will be $72 million a year. So as bad of a location Glendale was, you're telling me that with this new arena they will get $72 million more in revenue? Not to mention the several million they could have gotten in arena management fees had they worked out a reasonable deal.

 

[Tawnos]

No I am not ignoring that Barclays opened. I am saying that even NY maxed out at a certain number. For the NY area that number is 4: Prudential, Barclays, UBS, and MSG. Keep in mind there are also no college arenas worth anything in NY (St John's on-campus arena holds less than 6K. In the Phoenix area in addition to Footprint and Glendale you also have ASU's basketball arena and Vets Memorial that can host the smaller events.

Now just look at the numbers. If a new arena costs $1 billion and you finance it at 6% for 30 years. The debt service will be $72 million a year. So as bad of a location Glendale was, you're telling me that with this new arena they will get $72 million more in revenue? Not to mention the several million they could have gotten in arena management fees had they worked out a reasonable deal.

Nassau Coliseum still exists, for now. So really the NYC area has 5.

 

[aqib]

Nassau Coliseum still exists, for now. So really the NYC area has 5.

1) Its been scaled down so that its no longer a major league venue. Its smaller than ASU basketball arena in capacity
2) The next event is a bridal expo at the end of June
3) They tried to let Las Vegas Sands to take over the site, so they are basically writing off the arena: Nassau County Approves 99-Year Lease for Las Vegas Sands Casino Around Nassau Coliseum

 

[CHRDANHUTCH]

1) Its been scaled down so that its no longer a major league venue. Its smaller than ASU basketball arena in capacity
2) The next event is a bridal expo at the end of June
3) They tried to let Las Vegas Sands to take over the site, so they are basically writing off the arena: Nassau County Approves 99-Year Lease for Las Vegas Sands Casino Around Nassau Coliseum

NVMC had basically been written off once UBS became reality..... the only tenant that remained there outside of the Islanders was the Nets G-League team.... (remember Brooklyn was originally the New York Nets)

 

[Tawnos]

1) Its been scaled down so that its no longer a major league venue. Its smaller than ASU basketball arena in capacity
2) The next event is a bridal expo at the end of June
3) They tried to let Las Vegas Sands to take over the site, so they are basically writing off the arena: Nassau County Approves 99-Year Lease for Las Vegas Sands Casino Around Nassau Coliseum

Right, that's why I said for now. Though I didn't realize they'd removed that many seats.

 

[aqib]

NVMC had basically been written off once UBS became reality..... the only tenant that remained there outside of the Islanders was the Nets G-League team.... (remember Brooklyn was originally the New York Nets)

I agree. My original point is that every area has a limit on the number arenas it supports. In New York apparently that limit is 4 major league arenas. There aren't really any college arenas of note (St John's on campus arena holds less than 6K). Chicago is 2 major league sized arenas and one college arena (DePaul). LA is 2-3 Major league arenas (we'll see what happens to the Forum once Intuit opens up) and a couple of college arenas. Yeah Vegas has a bunch but we know that Vegas is just different.

So given the size of the Phoenix market, I doubt if it can support 3 major league sized arenas on top of a college arena.

I totally agree. 100 percent. Makes me question how we get back tp Phoenix.

It would have to be further down the line when Footprint either needs another renovation or replacement and if Ishbia or whoever owns the Suns at that point wants a hockey team.

 

[Ciao]

They had one before and still no one legit stepped up to buy them. Even when the price was $170 million and interest rates were a lot lower. Add to that you had Glendale paying them to pay there. Now the cost is $1 billion for the team and you have to pay for an arena. Let us say Muruelo gives up and the NHL opens it up for any bidder to buy the rights to the market at the same price. Why would someone buy it now if they wouldn't before?

Maybe they see a good investment opportunity in the Phoenix market?

 

[BKIslandersFan]

Fine Glendale was a bad location but someone could have bought the team for $170 million and gotten a few million a year from the city in arena management fees.
Now someone will have to pay $1 billion for the team and then build an arena for probably another billion. So you're telling me that simply moving across the valley is going to compensate for the the debt service on the extra $1.8B it's going to cost now vs what it would have cost in 2010?

Who knows. I am not here telling you Coyotes will most certainly return anytime soon.

No I am not ignoring that Barclays opened. I am saying that even NY maxed out at a certain number. For the NY area that number is 4: Prudential, Barclays, UBS, and MSG. Keep in mind there are also no college arenas worth anything in NY (St John's on-campus arena holds less than 6K. In the Phoenix area in addition to Footprint and Glendale you also have ASU's basketball arena and Vets Memorial that can host the smaller events.

Now just look at the numbers. If a new arena costs $1 billion and you finance it at 6% for 30 years. The debt service will be $72 million a year. So as bad of a location Glendale was, you're telling me that with this new arena they will get $72 million more in revenue? Not to mention the several million they could have gotten in arena management fees had they worked out a reasonable deal.

Think the main reason preventing more arenas being built here is real estate.

 

[jkrdevil]

The whole unpaid/shorted hotel bills thing reeks of AM Jr trying to play businessman. He seemed to have way too big of a role in the organization anyway. Probably got told to cut costs and thought he could do it by doing what he sees on TV. Was more worried about impressing his dad than actually doing things correctly.

Would also explain why the franchise seemed to tank so rapidly. AM himself never seemed stupid enough to ruin the franchise and its arena prospects as quickly as it did. But his younger, much more inexperienced junior? Absolutely.

The family as a whole up to Sr.’s parents don’t have the best reputation in business / real estate circles.

 

[TheLegend]

He didn't follow through did he?

Bettman literally had his money in hand..... on a plane for California the day Moyes put the team in BK.

What he couldn't get was an arena lease deal worked out with Glendale because first, Balsillie's people leaked some details out in the BK proceedings, and the second time around someone within Glendale did. Reinsdorf didn't like negotiating in the media.

 

[aqib]

Bettman literally had his money in hand..... on a plane for California the day Moyes put the team in BK.

What he couldn't get was an arena lease deal worked out with Glendale because first, Balsillie's people leaked some details out in the BK proceedings, and the second time around someone within Glendale did. Reinsdorf didn't like negotiating in the media.

Yeah and then after bankruptcy when the NHL bought the team, what happened then? He kicked the tires and dropped out.

 

[aqib]

Think the main reason preventing more arenas being built here is real estate.

Stop it. There is a reason Meadowlands Arena closed and Nassau Coliseum is pretty much empty. If there was more demand St Johns or Manhattan would would have a bigger arena on campus.

Maybe they see a good investment opportunity in the Phoenix market?

Why would they see a good investment opportunity now when they clearly didn't see it before. They could have bought the team for $170 million and gotten millions of dollars a year from Glendale. Now they will spend $1 billion on the team AND build an arena on top of that?

 

[awfulwaffle]

Perhaps this is the best thing for the franchise. People can complain abount Muerelo all they want, but he holds all the keys to the return. If he follows through, gets this new arena and district built, I'd like to think that moving forward, as he has a basis for more revenue(the surrounding district), he can turn around and succeed as the owner. He has a completely fresh slate to deal with here. I'm optimistic. I know there are plenty of Coyotes fans out there that are completely done with him, and the team if he can bring them back. But end of the day, do you want hockey in Phoenix or not?

I know there are plenty of people out there that live in the valley that are fans of other teams, and would like to be able to go to their team's games locally instead of going to Vegas or LA I'm sure. This team was cursed from the start, and we saw it over time.

Best thing for AM to do, is hire a hockey mind that can run the team. I get it, he doesn't like public speaking, neither do I. That shouldn't be a reason to discredit him. There's been plenty of stories, sure, but those are easily fixable.