Phoenix LXXII: Send in the Clowns
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02-28-2013, 07:23 PM
Join Date: Nov 2009
Location: Bay Area, CA
Originally Posted by
If the team was $90 million + that GJ lease? Line out the door. Step right up for your subsidized risk-free shot at owning an NHL team. But it's not priced like that, and no lease will ever be that good again.
Based on Sherwood's comments, I could see an offer of $13MM annual AMF for up to 12-years. That's pretty similar to the annual amount in the expired JIG lease. But I doubt it will inspire much interest.
I also think there is an strong argument that the Coyotes were essentially free to anyone who wanted to operate them in Glendale. I defer to the numbers guys for all the NPV corrects and such. I also acknowledge that the contracts would not be specifically structured in this manner, but if you sketch it out:
- The NHL cultivated a $300MM+ fund transfer from Glendale to JIG.
- JIG/NHL would likely be able to structure those funds as payment for the franchise.
- JIG would then only need the $100MM or so revolver to operate the team and arena. They couldn't get it done.
When the BOH forum suggests that the NHL will not budge on the sale price, that may be true. But it is only part of the story. The NHL didn't just hang an absurd price tag on the team. The league created a mechanism to offset the entire inflated price, provided someone was willing to pay to operate the team in Glendale. There were no takers.
The core problem, from the leagues perspective, continues to be that many southern franchises are essentially debt riddled disasters. Quality investors have very little interest in these opportunities, none in most cases. There isn't a line out the door for any of these franchises. As Gary Bettman wrote back when they were shopping the Coyotes pre-bankruptcy, before any of this $170MM stuff "no one seems excited about a team losing 40mm."
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