Ownership Cluster**** Thread: NHL and GJ, Put Up or Shut Up!
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01-27-2013, 03:21 AM
Join Date: Dec 2002
Location: 48th State
Originally Posted by
Some quotes from council members. Some positive outlook from Yotes management. Still not a lot.
“For the life of me, I can’t figure why, if everything is lined up, if he’s got the money in hand, why would he postpone this? That’s the only thing I haven’t been able to figure out,” Weiers said. “What would be the purpose of delaying it?”
Great question Jerry.
Okay. Let's do the math. Pretend that the Coyotes really do lose $30 million a year. I have my doubts about that claim and where the losses stem from (Moyes) but for the purposes of these calculations, let's run with it. With a $15 million subsidy right up front, you are halfway to even. If you go off what other similar arenas generate per seat, it isn't hard to calculate some numbers for Jamison. Pepsi Center does ~$5,700. They were #10 at what I looked at. US Airways was #21, so go with $2,500 per seat.
$2,500 per seat is roughly a cool $43 million pocketed by Jamison. Add in the subsidy and he is at $57 million, less maintenance and all that. Even if the Coyotes lost $30 million year over year, he still should come out ahead. This isn't all that different from the arrangement in Florida. The Panthers lose money, but the contract to run the arena is lucrative so the ownership comes out ahead. I'm pretty sure their subsidy, if it exists, pales in comparison. Naming rights are due up in 2016. The team is doing markedly better on the ice, and the valley is recovering. The new CBA increases the amount of revenue sharing for teams. If the NHL kept Phoenix where it is and expanded to QC and Seattle, the pie gets even bigger. It's not inconceivable that GJ turns it around with little more than basic competency and a decent team on the ice. On the high end, he makes bank.
There's actually a decent case for this, numerically. It's just whether or not investors see it as a worthwhile alternative (risk wise) to other investments and instruments. You are at the mercy of the market when you don't have the raw capital to finance the deal personally.
His *very* qualified statements do not have me optimistic.
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