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Glendale, NHL trying to close Phoenix Coyotes deal with Jamison group
I've always said that this is a likely stipulation on the sale, it only goes through based on a successful drive. Maybe not to 13k, but to some more sustainable pricing level and STH base.
Will be interesting to see if it happens.
They would need at least 13k tickets at an 80 average to stand a chance at breaking even. They will not sell 50 Luxury suites at $200k, They have to rent the arena, and at that kind of ticket price how much are you going to be able to charge for parking, concessions, ect ect.
There are so many other revenue streams they don't have to tap into making them a very gate driven team.
Gate revenue needs to at least come close to covering team payroll. Currently the yotes sit at 55million in salary, if they could sell 13,000 season tickets at $80 average that would give them an automatic gate revenue of 1040000 per game for a total of 43,680,00 in gate revenue leaving them 11,320,000 shy of covering team salaries let alone the cost of hockey operations, arena lease, ect ect. If NHL prices are a tough sell, how are they going to sell concessions and parking?
Without a substantial season ticket base paying NHL prices regardless of the one ice product. (Love the team like you do your wife and kids UNCONDITIONALLY) they are doomed to fail. It is basic a math. Jamison knows this, so does the NHL.
Like I said in a few other threads, not saying a deal is impossible but anyone expecting someone to strut in and say heres 200 Million dollars without commitment from the fans or some way to minimize losses is crazy. It is not going to happen. And with the recent COG meltdown and the knowledge the COG tap is dry does anyone really think this can all happen in a month?
I think the notion that AZ is not a hockey market, while accurate when compared to "traditional" markets may hold some truth
That said, I also think it could become a successful market as other "non-traditional" markets have proven.
Take a look at San Jose or Nashville; these markets are not traditional hockey markets yet they have turned into successful franchises
Why? When one pairs them against other nontraditional markets, the common denominator is the ownership behind the team.
Ownership plays a tremendously large role, and that is what eventually leads to success or failure in my opinion.
Sure the market plays a role too; but with respect to nontraditional markets the ownership plays a much larger role
The biggest problem the Coyotes face is not that they will never be a strong franchise (a belief I do not submit to) but rather that they are stuck in a catch 22: they've had weak ownership which resulted in them never becoming or having a strong presence in their current market (not enough buzz created over the years) and as a result they've become a money losing model, so any potential owners who could make it work or at least have the gall to make it work are turned off by the potential mess that has resulted from the legal perspective and thus ownership is ultimately avoided or not pursued
so now the Coyotes fans are left hoping someone can come and collect the scraps when the situation is just dire. Someone like Jamison is a prime candidate to turn things around in Phoenix: He both understands the game and the nontraditional market structure, but because so many people are turned off by the situation and what comes with it (understandably so) it turns away potential investors
Its unfortunate for Coyotes fans if that turns out to be true, which I also think will happen (I don't see the team staying another year sadly)
But I do not believe Phoenix is "forever lost" and "will never be a hockey market"
I think its possible. People who don't are ignorant to how franchises can be made successful.
Its not Phoenix fans' fault they've never had the proper people running the team, and it will not be their fault if (and perhaps when) the team eventually moves.
Good luck to Phoenix, but whatever happens, happens. If the team relocates to QC, the idea of a stable franchise is no doubt more attractive to the NHL than expansion teams, no matter what the NHL says publicly.
But if the team stays, I hope that an owner who can manage the growing pains can finally make the team work there. I think this is very possible. It just needs the right owner.
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Ownership plays a tremendously large role, and that is what eventually leads to success or failure in my opinion.
Sure the market plays a role too; but with respect to nontraditional markets the ownership plays a much larger role
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But I do not believe Phoenix is "forever lost" and "will never be a hockey market"
I think its possible. People who don't are ignorant to how franchises can be made successful.
Its not Phoenix fans' fault they've never had the proper people running the team, and it will not be their fault if (and perhaps when) the team eventually moves.
I agree with you. But there is the fact, that to me, and many others seems so unreal.
Last 3 seasons the team has been under leagues ownership and since day 1 the league wanted to find a buyer. I trust them when they say they worked hard and are still working hard to find a buyer.
But lets be honest. Since Phoenix went under leagues ownership there has been Wallstreet scandal, 2/3 of the world's economic forces (countries) have experiences financial crisis (USA being in the list)...and it was just the tip of the iceberg.
Now, tell me why there was no owner 3 years ago, just before the big financial bubble breakdown and that today, when world's economy is still strugling with cash, there suddenly will a deeper than deep pockets guy ready to buy a team, an arena and everything in 10miles radius around it, in a country still not back to pre 2009 financially ?
mod delete
Last edited by LadyStanley: 04-12-2012 at 09:57 PM.
Reason: ot
It's more likely than not now that this will happen. When Gary wants something done, it gets done.
Book of the NHL, Gospels of Gary, verse 04:12:
And then the holy Bettman spoke: ''Thy foul Québecois shall not take thee Coyotes! For my name is the Comissioner! And my will shall be done!'' And so He created out of thin air the many millions required for someone to buy the Coyotes. And He casted down the foul creatures from Québec down in the shadows where they belonged... Never to be seen again...
Seriously now, he's tried for 3 years. Why would he succeed now? Three days from the likely deadline? And he works for the owners, I doubt they'll take a loss.
No, he tried his best, but I think it's too little, too late!
And then the holy Bettman spoke: ''Thy foul Québecois shall not take thee Coyotes! For my name is the Comissioner! And my will shall be done!'' And so he created out of thin air the many millions required for someone to buy the Coyotes. And he casted down the foul creatures from Québec down in the shadows where they belonged... Never to be seen again...
Seriously now, he's tried for 3 years. Why would he succeed now? Three days from the likely deadline? And he works for the owners, I doubt they'll take a loss.
No, he tried his best, but I think it's too little, too late!
Gary never quits. That's why he's been trying for 3 years. He wants to be able to announce that the Coyotes are staying while they're still playing in the playoffs. If they end up moving, it's going to happen quickly again.
Three groups are involved, Glendale likes the Jamison bid the best, and he's been involved for a while now, people just assume there were enough road blocks since it hasn't happened yet, and mum is the word on relocation bids even though we've supposedly passed the point where the league claimed they were going to start looking around. That's because they're not looking, because they don't need to - they know the team is staying put.
They've said that if they have to move the team, that they have to do it sooner than they did with Atlanta (hence the deadline). We're basically one year short of when the league decided it was pulling the plug on Atlanta, and just needed to hammer out the deal with Atlanta Spirt and True North. That was happening for a few weeks before Darren Dreger insisted it did.
The deadline is only to force everything to fall into place. Jamison likely feels he is close enough and is waiting for that point to pass, which will pass when no one realizes it. This is because he (and everyone else) knows that regardless of "deadlines" if Bettman feels he's close with a prospective owner to stay in Phoenix, then there is no deadline, he'll bang it out until it's done, cut whatever losses he has to, be as condescending as possible with the media for doubting him yet again, and make sure he and the new owner (presumably Jamison) look like heroes in the process.
I'm not saying this is 100%, but go back through Bettman's tenure as Commish. When Gary wants something done, no matter how many if's, and's or but's you throw at him, it gets done. Period.
This so-called imminent deal is simply designed to appease Scrugg's impatience of a sale to be made by the NHL. In a few weeks time it will be seen that nothing has changed
They would need at least 13k tickets at an 80 average to stand a chance at breaking even. They will not sell 50 Luxury suites at $200k, They have to rent the arena, and at that kind of ticket price how much are you going to be able to charge for parking, concessions, ect ect.
There are so many other revenue streams they don't have to tap into making them a very gate driven team.
Gate revenue needs to at least come close to covering team payroll. Currently the yotes sit at 55million in salary, if they could sell 13,000 season tickets at $80 average that would give them an automatic gate revenue of 1040000 per game for a total of 43,680,00 in gate revenue leaving them 11,320,000 shy of covering team salaries let alone the cost of hockey operations, arena lease, ect ect. If NHL prices are a tough sell, how are they going to sell concessions and parking?
Without a substantial season ticket base paying NHL prices regardless of the one ice product. (Love the team like you do your wife and kids UNCONDITIONALLY) they are doomed to fail. It is basic a math. Jamison knows this, so does the NHL.
Like I said in a few other threads, not saying a deal is impossible but anyone expecting someone to strut in and say heres 200 Million dollars without commitment from the fans or some way to minimize losses is crazy. It is not going to happen. And with the recent COG meltdown and the knowledge the COG tap is dry does anyone really think this can all happen in a month?
Never going to happen. 2012-13 prices indicate otherwise. The majority of the lower bowl is priced at $50.00 a ticket and the majority of the upper bowl at $18.00.
It could take 7-10 years to get the tickets in line with anything close to break even. Sticker shock would scare away most fans in a still recovering economy.
Never going to happen. 2012-13 prices indicate otherwise. The majority of the lower bowl is priced at $50.00 a ticket and the majority of the upper bowl at $18.00.
And thats the face value...but my buddy, who goes to Phoenix all the time for work says you can pick-up lower bowl tickets, from the box office, a few minutes before the game for twenty bucks most nights.
And thats the face value...but my buddy, who goes to Phoenix all the time for work says you can pick-up lower bowl tickets, from the box office, a few minutes before the game for twenty bucks most nights.
That's the big unknown. Even if the NHL gets Jamison to buy the team, the fans in Phoenix don't comprehend the price tickets MUST go up for this team to break even. They are in for a shock and what happens when those increases come? Will they pay or stay home?
Some will pay for sure, but maybe the team will just have to have gradual increases each year of 5% to ease people into the real cost.
That's the big unknown. Even if the NHL gets Jamison to buy the team, the fans in Phoenix don't comprehend the price tickets MUST go up for this team to break even. They are in for a shock and what happens when those increases come? Will they pay or stay home?
Some will pay for sure, but maybe the team will just have to have gradual increases each year of 5% to ease people into the real cost.
No question that a new Coyotes owner will have to be prepared to suffer some significant losses in the near term. Beyond the very low ticket revenue, it seems unlikely that the team can remain at the same level of competitiveness with such low salary costs. It would be rather risky for a new owner to think that they will not need to raise salary expenditures to keep the team competitive. If the team hits the skids for a few years, it might be difficult to increase attendance and ticket prices, as will be needed to put the team on good financial footing.
Like I said in a previous thread the Coyotes will extend their life-line if the are really successful in this year's playoffs, if the hawks win the series, I really don't see how a new owner will get really interested.
And thats the face value...but my buddy, who goes to Phoenix all the time for work says you can pick-up lower bowl tickets, from the box office, a few minutes before the game for twenty bucks most nights.
wrong.
That's the full STH price.
The ticket prices are not where they need to be for the team to be financially stable but lets not exaggerate the situation either.
the league will not drop the price of 170 millions. It will create a very wrong FIRST, for future sales of nhl teams. Plus ,there's no way the league will be stupid enough to accept a small garanty of 2-3 years stay in phoenix.....they want a 25-30 year garanty that the new owner would keep the team in Glendale.....which no intelligent human being wants to do, when losing 25 millions a year.......hopefully this nightmare of hockey in the desert with 5000 thousands fans in the stands will finish soon.....for the good of the NHL, move this to Quebec City!!!!!
Like I said in a previous thread the Coyotes will extend their life-line if the are really successful in this year's playoffs, if the hawks win the series, I really don't see how a new owner will get really interested.
If I'm understanding your post correctly, I'm not really seeing a correlation here to be honest. Anyone with + $150 million to invest is likely not worried too much about a playoff series and a couple of weeks in time. I think they are thinking 10 - 30 years down the road.
The ticket prices are not where they need to be for the team to be financially stable but lets not exaggerate the situation either.
That would be the average ticket price to the season ticket holder. Face value would be higher. That is exactly where the tickets need to be for any hope of financial stability. At the current average PAID attendance at the games you would need to triple that number. Also you would need at least 2000 game day walk ups.
The point behind the post is to show the economics of it. That is why every lease attempted with the COG has been tried to mask some form of huge subsidy as does this one.
Coyotes fans don't believe they can hit the break even mark, how could anyone logically believe any of this current hype to be real.
Lets say a new owner can start the turn around. You have 3 to 5 ( this time frame comes from Coyotes fans as the time needed with solid ownership and a decent on ice product)years until break even, so your still incurring losses. You have made nothing back towards the initial investment, and incurred further losses of 30-50 million at 10 Million a season.
5 Years in your in the red to the tune of 220 Million. After the 5 year period you start to see a turn into some profitability. Lets say the team generates 10 million in revenue. With no interest incurred on the debt it is still 22 years before recovering the initial investment.
Jamison will be long gone before he makes a dime. This just is not going to happen.
the league will not drop the price of 170 millions. It will create a very wrong FIRST, for future sales of nhl teams. Plus ,there's no way the league will be stupid enough to accept a small garanty of 2-3 years stay in phoenix.....they want a 25-30 year garanty that the new owner would keep the team in Glendale.
NHL terms in franchise sales nominally include a 7 year no-relocate clause.
The real thing that keeps teams from relocating is their arena lease. NHL has never condoned franchises breaking their leases.
Detroit and Phoenix are the only franchises without a "long term" lease. (Plus the Islanders' lease expires in 2015.)
I find the protracted discussion about the Phoenix market to be bizarre.
If the market were viable, the asset would draw interest, there would be an offer, and subsequently, a transaction. The availability of the asset has existed since September of 2009. The lack of transaction is undeniable, non-debatable, irrevocable factual evidence that the market considers the Coyotes untenable.
As such, the highest probability is that the NHL has already completed a transaction with Quebecor and the Jamison “bid” is nothing more than a gimmick to inflate playoff revenues. The next highest probability is that the NHL is still negotiating with Quebecor and utilizing the Jamison “bid” as leverage in that negotiation. The lowest probability is that Greg Jamison has assembled a team of investors that desires to purchase the Coyotes and continue team operations in Glendale.
Like I said in a previous thread the Coyotes will extend their life-line if the are really successful in this year's playoffs, if the hawks win the series, I really don't see how a new owner will get really interested.
As I and others have said, the success of the Coyotes in the playoffs has absolutely no bearing on this team being sold or not to someone willing to keep it local.
Let's assume that Jamison is the buyer. Jamison, the NHL, and Mr. Beasley have been most likely talking for months about buying the team. And that process, if it is going to be finalized, must be getting down to the short strokes by now. It's not as if Jamison is sitting there saying " let's see how the Coyotes do in this years playoffs before I buy ". Has nothing to do with it. You are buying a team for the long term and past success has no relation to future long term success.
Does the fact that Phoenix Coyotes have made the playoffs make this troubled franchise any more attractive to a prospective purchaser?
“It's a testament to [general manager] Don Maloney and [head coach] Dave Tippett and the players that the team has been this competitive and this strong on the ice. It's nice to see for the fans in Arizona. But it's more complicated than just the team's performance. I think it makes it at first blush more attractive, but it's much more complicated from a business and financial standpoint than just how well the team is playing at any particular time.” -- Bettman
As I and others have said, the success of the Coyotes in the playoffs has absolutely no bearing on this team being sold or not to someone willing to keep it local.
Let's assume that Jamison is the buyer. Jamison, the NHL, and Mr. Beasley have been most likely talking for months about buying the team. And that process, if it is going to be finalized, must be getting down to the short strokes by now. It's not as if Jamison is sitting there saying " let's see how the Coyotes do in this years playoffs before I buy ". Has nothing to do with it. You are buying a team for the long term and past success has no relation to future long term success.
Does the fact that Phoenix Coyotes have made the playoffs make this troubled franchise any more attractive to a prospective purchaser?
“It's a testament to [general manager] Don Maloney and [head coach] Dave Tippett and the players that the team has been this competitive and this strong on the ice. It's nice to see for the fans in Arizona. But it's more complicated than just the team's performance. I think it makes it at first blush more attractive, but it's much more complicated from a business and financial standpoint than just how well the team is playing at any particular time.” -- Bettman
Which is why all the speculation on the board is just that, speculation. It makes good posts, and better press, but the idea of a few second round sellouts changing the nature of the negotiations is just ludicrous.
If the market were viable, the asset would draw interest, there would be an offer, and subsequently, a transaction. The availability of the asset has existed since September of 2009. The lack of transaction is undeniable, non-debatable, irrevocable factual evidence that the market considers the Coyotes untenable.
And lets be honest, if you were to spend 100+M on sports team in a market, you can allow yourself to spend up to 1M on experts who will study the said market for you, even more if your contractual obligation to that market would be 7 years.
So we can assure that if there is a buyer, that buyer knows what and how he can make a 100M investment worth a 200M in 7 years.
And lets be honest, if you were to spend 100+M on sports team in a market, you can allow yourself to spend up to 1M on experts who will study the said market for you, even more if your contractual obligation to that market would be 7 years.
So we can assure that if there is a buyer, that buyer knows what and how he can make a 100M investment worth a 200M in 7 years.
I believe that it's called "turning around a distressed asset."
So we can assure that if there is a buyer, that buyer knows what and how he can make a 100M investment worth a 200M in 7 years.
The fringe offers by Hulsizer, Reinsdorf, and Ice Edge already demonstrate how a potential owner would stabilize profits: subsidies from Glendale.
However, Hulsizer also demonstrated that navigating the laws of Arizona and satisfying the constitutional watchdogs is an extremely difficult task. And that was when Glendale had a bond rating and reserve funds that enabled them to participate in the transaction.
* Edit *
I would like to add that none of this is a reflection on fans of the team. The components that make the Coyotes untenable are much more to do with market saturation of franchises and venues which lowers margins and causes corporate fatigue. Putting the blame, as it were, of the franchise failure at the feet of the fans is entirely misguided.
Last edited by CasualFan: 04-13-2012 at 12:28 PM.
Reason: *
