Arizona Coyotes owner Anthony LeBlanc made his long-awaited announcement yesterday about new arena plans, and it’s that: He’s picked a site, but he’s not saying where it is. Seriously:
Coyotes president and CEO Anthony LeBlanc said Thursday afternoon that the team has chosen a site for its new arena and is working through the legal documentation of the real estate agreement.
LeBlanc declined to provide any other details, or name the site.
This is officially the weakest non-announcement ever, especially since there’s no way even to know if he’s telling the truth about having settled on a site. (I suppose the people he’s working out the real estate agreement with know, but if he later switches to another site before revealing what it is, how will anyone on the outside tell?) Technically, it’s an announcement in advance of tonight’s NHL draft, which is what LeBlanc promised, but it’s still not much more than waving a piece of paper in the air and claiming it has specifics on it.
It’s still pretty likely that the report from earlier this week is correct and LeBlanc is aiming for a site in Scottsdale that’s part of the Salt River Pima Indian Reservation, but it’s also possible that he isn’t, or that he is but he’ll change his mind later if a better offer comes along. I’ve been saying for a while that LeBlanc’s best leverage here is to get a bidding war going among various Phoenix-area governments, and it sure looks like he’s trying to drag that war out as long as possible.
I’m liking this concept of the games being played at a “secret location.” Reminds of the 1990s when the Rolling Stones were supposed to play a concert at a secret club in Chicago. We ran all over town. Looked for hints in band names, like “The Hot Rocks,” and “The Dark Prince,” but in the end, there was no concert, and there will probably be no arena.
I live in AZ. Coyotes fans are eating this up – they believe every word. Reminds me of this scene from Cheers:
https://m.youtube.com/watch?v=kD1JSFb5Atc
It’s in Flagstaff, right? Portland?! Seattle?!?
Getting colder.
Neil,
Seeing there was no actual announcement of a ‘real site’, could it be the Coyotes are using the ‘ACME Locate Anywhere Kit’ ?
It would help in this if Bettman…or for that matter, an actual ADULT with some backbone, would step up and stop this musical chairs crap. Or take over the franchise (this has been done before) and in turn, place them in a city, with a more situation. I know, a logical approach here is out of line in team ownership….but there is always a first time.
This is perfectly logical from the perspective of maximizing the value of your franchise, though! Buy low, become a free agent, shop around in hopes that someone will come up with a blank check — it’s the same playbook that got us the Washington Nationals.
Point taken….
But in the case of the Nationals, they have…at least on the field…made the gaming of the system worth the headaches. They are competitive and that makes the fans [who show up] happy. As for the money they are ‘making’ , I will bow to your expertise on that, Neil.
Now with the above said..one still had to wonder why no one has told the Coyotes that the joke is getting old and the headaches are not welcome. At least in Phoenix. There may be others who want to play this version oh whack-a-mole…and maybe…..shudders….make the team viable.
If the problem you have with the Coyotes is that they suck at hockey, I expect that will be remedied eventually. If it’s that they suck at paying their payroll without tapping the public treasury, I’m less hopeful.
It’s a mixture of both….but more on the end of the fact that they are not stable overall.
The team improvements will happen in time, assuming they bring in folks who really know player development. As for the finances…no argument there. The owner needs to wise up, that he has worn out the welcome mat…which is now in shreds. I get WHY this is happening, after all the Phoenix metro area wants to show they are a REAL major market, with teams in the 4 majors. But this has come with some rotting baggage in same.
One has to wonder if the Coyotes experiment ends up a failure and they leave, will the NHL try this again in the land of the Sun Devils. Seeing that happened in Atlanta…and we all know what a success those were…..for Calgary and Winnipeg.
Maybe it’s in Glendale, right next to Westgate. And he is too embarrassed to say so.
On a serious note, Neil, maybe you can help me out here. I was arguing with a friend that a move wouldn’t even help the Coyotes.
Rudimentary numbers. The Coyotes average about 13,500 fans per game last year with an average ticket price of about $45. Which means their ticket revenue was $24.9 million.
Now, let’s say they build this new stadium. And they make it hold 18,500 people – about 1,000 more than NHL average. And they raise the average ticket price by $10. Now, if they were to sell out every game, the ticket revenu would be about $41.7 million, or $16.8 million more than they are doing. Of course, you would have to remove the $15 million that Glendale is giving them, and they are only getting $1.8 million extra.
Now, I realize that the increased fans will mean increased revenue from concessions, souvenirs, and parking, but I also didn’t factor in that the team doesn’t actually keep every dime of the ticket money, that there will be added expenses, both in support staff, players and marketing. So I’m not really sure how much the revenue would increase, but I’d imagine all things considered, it wouldn’t increase enough to save a team that was losing money even when they were being given $15 million. And I was very generous with my numbers; there’s no way the Coyotes will be able to sell out an 18,500 seat arena (probably won’t even build it that big) with ticket prices that high.
I have always argued that the Coyotes problems aren’t that they are two far from downtown Phoenix, it’s that they are too close to downtown Phoenix. Market can’t sustain this team, no matter where they’re located.
Thoughts? You know a lot more about this stuff than I.
They’ll get more than ticket revenue from a new arena if it’s successful — there’s all those added pulled-pork sandwiches they’ll sell. But yeah, I agree that they’re going to have a tough time doing much better than the deal they walked away from in Glendale. And that’s even before figuring out how to pay to build the damn thing, which is why I 100% expect they won’t be offering to do so.
Thanks. I figure it this way: if they build an arena that seats 17,500 – the nhl average – they would need to see out the place every night and each fan extra fan (4,000 per game) would need to generate $91 in profit – not revenue – for them to make the $15 mil that Glendale was giving them. Not likely.
But they have much of the fan base convinced that the location of the arena is the only thing keeping this team down, so who knows?
Can I ask where you get the Coyotes revenue numbers from? Are these independent numbers or NHL released figures?
I believe the 13,500, but based on their history (and even considering the genuine improvements over the NHL operated periods and before) I do not believe the average ticket price is $45.
The last year for which I have “real” numbers for the Coyotes is some time ago, but shows they generated a total of $16m in gate receipts, with an average ticket price in the $25 range.
Bettman once told a national tv audience that the Coyotes losses were “Nowhere near” the $40m Jerry Moyes had claimed. When the NHL ran the franchise, they lost $38m and $36m on operations in two seasons, not counting any of the capital loss incurred through the eventual sale (the sale price announced was not what the owners effectively paid after adjustments).
I got them from the Forbes valuations:
http://www.forbes.com/teams/arizona-coyotes/
Shows that the team had operating expenses of -$4.5 million for 2014-15 season, and that was with the City of Glendale kicking in $15 million. Also says that the average ticket price was $45.
So that’s $19.5 million right there that they have to make up.
Also, they had the lowest payroll in the league that year. With the salary floor being $54,000,000 for the, or about $3-$4 million more, but if they want to sell out every game, they’re going to have to raise that number.
And that’s just operating expenses. They had an out clause in the lease with Glendale that if they lost $50 million after five years, the lease was done. According to reports, they lost between $16 and $32 million in year one. And that was with subsidies.
Now, they do get a boost from the $16 million for the expansion team. But losing that $15million is going to be hard to replace in a city that only supports winners.
Thanks.
The operating income number seems reasonable after adjustments (like the $15m annual donation from the taxpayers of Glendale… not counting the $6-8m the arena bonds still cost the taxpayers obviously…)
I think Forbes calculates average ticket price the same way teams do… we have three tiers of pricing, so average them all and hey, presto!
I’d love to know what the average cash price for tickets sold (not comp’d or deep discounted by resellers) was.
My guess would be a lot closer to $30 than $45 based on their losses.
I’d bet LeBlanc does have a plan:
-Somebody else pays to build the arena, such as The Taxpayers (just like last time)
-Somebody else pays to maintain the place (just like last time)
-Somebody else pays the Coyotes to play there (just like last time)
-The Coyotes sell more tickets, hot dogs and beers, all at higher prices, and get to keep the Scottsdale vs Glendale Loot Differential
I always said I was happy not to be a Glendale resident, but now, as a Scottsdale resident, I’m worried. This is just the kind of crap our local pols take to like flies.
How does it work when it’s on reservation land? Can they still ask for cash and/or tax breaks from Scottsdale, or would it have to be county/state?
Very Interesting: ???
http://arenadigest.com/2016/06/23/is-quebec-snub-open-invite-for-new-seattle-nhl-team/
I heard they were zeroing in on ASU as the arena site. Now supposedly they will pay more than half the costs. Now with the escalating cost of building new arenas being $400 million+ they would be committing over $200 million for new facility. Now I am sure Glendale would be more than happy to sell them the current arena for nothing more than what is currently owed on it (my guess is about $110 million). Wouldn’t that make more sense?