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Metro Seattle: NHL, NBA and Arena - Part III (post #217 - arena announcement 2/16)

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Old
02-18-2012, 03:17 PM
  #726
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Originally Posted by Nuclear SUV View Post
That helped some, but I credit the Sounders ownership group who purposely went after the hardcore soccer fan base. Many MLS teams try courting families while the Sounders went right for the diehards. The built the organization like a club and got the fans involved from the start. Sounder fans can even fire their GM.
Yeah, that's one thing I will give the Sounders *spits in disgust* credit for. Whitecaps originally came out and said they were going to use Seattle as the model for atmosphere, then pulled a 180 and went the family route while trying to muzzle our supporters as much as possible.

Much like the soccer team, if Seattle can market an NHL team correctly, but also have the NBA team treat them like a partner, not a ticket rival, I don't see how this couldn't be a success.

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02-18-2012, 03:35 PM
  #727
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Originally Posted by MoreOrr View Post
And in either case, both teams are going to have to play out of an old arena for at least a couple of Seasons.
Key Arena is to NBA what La Colisee Pepsi is to NHL... a rather old building where the league previously had a team, somewhat on the small side, but perfectly servicable as a temporary site, as long as it sells out, and there's a decent regional TV deal.

But for an NHL team, Key Arena is financial insanity. Let's assume they sell out all 11,000 hockey seats (including the 2,000 partially obstructed view seats). Let's assume that Seattle can charge an average of $70 per seat , which is getting close to Winnipeg territory ($82 per seat). Let's compare their gate versus Winnipeg, assuming 45 regular+exhibition+playoff games per season.
  • Winnipeg $82 per seat * 15,000 seats * 45 games = $55,350,000
  • Seattle $70 per seat * 11,000 seats * 45 games = $34,650,000
Even with wildly optimistic assumptions, Seattle gets $20,700,000 per year less gross gate revenue than Winnipeg per year. The Jets owners also own all the MTS Center revenue streams, plus nearby hotel and restaurant properties. The best the Seattle NHL franchise could hope for would be a 50/50 concessions split with the NBA franchise, if that. Plus I don't see them getting the same sweetheart lease that Glendale handed out. And even sellout crowds won't qualify the NHL team for full revenue sharing (14,000), assuming that the "large market" clause doesn't pre-emptively disqualify Seattle.

Hansen negotiated an abysmal agreement, regarding the NHL team must play in Key Arena until the new arena is built. The most charitable explanation is that he didn't have a clue about NHL finances. 3 seasons in Key Arena is easily going to cost $75 million in red ink before the new arena opens. The only sane response by the NHL is to award a franchise commencing play in the fall of 2015. This is a win-win...
  • The arena gets its tenant
  • The NHL owner doesn't drop $75 million or more in red ink
  • The NHL has flexibility regarding which team goes to Seattle, or an expansion team if everybody's healthy


Last edited by knorthern knight: 02-18-2012 at 07:35 PM. Reason: $75 MILLION, not $75
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02-18-2012, 04:02 PM
  #728
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^^ You neglect to look at the bigger financial picture. Firstly the Key is temporary. Secondly, "regional sports networks are generally among the most expensive channels on a cable television lineup, due to the expense of rights to the local sports they carry."

The Seattle NHLers would have at worst a one third share of a new RSN, from which revenues would be available on day one.

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02-18-2012, 04:52 PM
  #729
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Originally Posted by knorthern knight View Post
Key Arena is to NBA what La Colisee Pepsi is to NHL... a rather old building where the league previously had a team, somewhat on the small side, but perfectly servicable as a temporary site, as long as it sells out, and there's a decent regional TV deal.

But for an NHL team, Key Arena is financial insanity. Let's assume they sell out all 11,000 hockey seats (including the 2,000 partially obstructed view seats). Let's assume that Seattle can charge an average of $70 per seat , which is getting close to Winnipeg territory ($82 per seat). Let's compare their gate versus Winnipeg, assuming 45 regular+exhibition+playoff games per season.
  • Winnipeg $82 per seat * 15,000 seats * 45 games = $55,350,000
  • Seattle $70 per seat * 11,000 seats * 45 games = $34,650,000
Even with wildly optimistic assumptions, Seattle gets $20,700,000 per year less gross gate revenue than Winnipeg per year. The Jets owners also own all the MTS Center revenue streams, plus nearby hotel and restaurant properties. The best the Seattle NHL franchise could hope for would be a 50/50 concessions split with the NBA franchise, if that. Plus I don't see them getting the same sweetheart lease that Glendale handed out. And even sellout crowds won't qualify the NHL team for full revenue sharing (14,000), assuming that the "large market" clause doesn't pre-emptively disqualify Seattle.

Hansen negotiated an abysmal agreement, regarding the NHL team must play in Key Arena until the new arena is built. The most charitable explanation is that he didn't have a clue about NHL finances. 3 seasons in Key Arena is easily going to cost $75 million in red ink before the new arena opens. The only sane response by the NHL is to award a franchise commencing play in the fall of 2015. This is a win-win...
  • The arena gets its tenant
  • The NHL owner doesn't drop $75 or more in red ink
  • The NHL has flexibility regarding which team goes to Seattle, or an expansion team if everybody's healthy
What about the following additional revenue streams for a Seattle franchise:

- revenues from regional network
- corporate sponsorships as well as purchases of luxury suites (Seattle has many large brand-focused corporations (Microsoft, Amazon, Starbucks, AT&T, etc.) to tap into. I'm presuming more so than Quebec...)

Those wouldn't be insignificant, and I'd be there's more potential from those revenue streams than there would be for a Quebec franchise.

Regarding revenue sharing, you can bet if a franchise is relocated to Seattle, there'd be a temporary exemption on the 14K minimum requirement while this franchise plays in Key Arena.

And what are you basing this $25m/season loss on? You're not making your rationale clear.

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02-18-2012, 05:00 PM
  #730
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There's also the Tacoma Dome, which holds more than Key Arena, if the renovations were to be green lit.

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02-18-2012, 05:20 PM
  #731
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Originally Posted by knorthern knight View Post
Key Arena is to NBA what La Colisee Pepsi is to NHL... a rather old building where the league previously had a team, somewhat on the small side, but perfectly servicable as a temporary site, as long as it sells out, and there's a decent regional TV deal.

But for an NHL team, Key Arena is financial insanity. Let's assume they sell out all 11,000 hockey seats (including the 2,000 partially obstructed view seats). Let's assume that Seattle can charge an average of $70 per seat , which is getting close to Winnipeg territory ($82 per seat). Let's compare their gate versus Winnipeg, assuming 45 regular+exhibition+playoff games per season.
  • Winnipeg $82 per seat * 15,000 seats * 45 games = $55,350,000
  • Seattle $70 per seat * 11,000 seats * 45 games = $34,650,000
Even with wildly optimistic assumptions, Seattle gets $20,700,000 per year less gross gate revenue than Winnipeg per year. The Jets owners also own all the MTS Center revenue streams, plus nearby hotel and restaurant properties. The best the Seattle NHL franchise could hope for would be a 50/50 concessions split with the NBA franchise, if that. Plus I don't see them getting the same sweetheart lease that Glendale handed out. And even sellout crowds won't qualify the NHL team for full revenue sharing (14,000), assuming that the "large market" clause doesn't pre-emptively disqualify Seattle.

Hansen negotiated an abysmal agreement, regarding the NHL team must play in Key Arena until the new arena is built. The most charitable explanation is that he didn't have a clue about NHL finances. 3 seasons in Key Arena is easily going to cost $75 million in red ink before the new arena opens. The only sane response by the NHL is to award a franchise commencing play in the fall of 2015. This is a win-win...
  • The arena gets its tenant
  • The NHL owner doesn't drop $75 or more in red ink
  • The NHL has flexibility regarding which team goes to Seattle, or an expansion team if everybody's healthy
How do you know QC wouldn't run into the same thing?
BTW, the 11k capacity you're talking about is for unobstructed seats. While it still isn't ideal, there are almost 4k seats that they can sell for, hypothetically, 20 bucks or less, that are obstructed view, like the Coyotes did, before Glendale opened.

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02-18-2012, 05:21 PM
  #732
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Originally Posted by chasespace View Post
There's also the Tacoma Dome, which holds more than Key Arena, if the renovations were to be green lit.
The Dome is out of the picture for now. Hansen's agreement with the City requires that Key be used as the temporary venue for the NBA & NHL Teams until the new arena opens.

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02-18-2012, 05:44 PM
  #733
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Originally Posted by beenhereandthere View Post
How do you know QC wouldn't run into the same thing?
BTW, the 11k capacity you're talking about is for unobstructed seats. While it still isn't ideal, there are almost 4k seats that they can sell for, hypothetically, 20 bucks or less, that are obstructed view, like the Coyotes did, before Glendale opened.
But that is a horrible way to market a new team in a new league to a new market. Not seeing a net is a great way to fall in love with Hockey....

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02-18-2012, 06:19 PM
  #734
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The Dome is out of the picture for now. Hansen's agreement with the City requires that Key be used as the temporary venue for the NBA & NHL Teams until the new arena opens.

Key Arena should be the temporary venue, but that doesn't mean they could play a couple of games at Safeco Field and a handful at the Tacoma Dome.

My dream scenario would be:

- pre-season games in Spokane and Portland
- 31 Key Arena games
- 2 Safeco Field games in November vs. Van and Det
- 8 games at Tacoma Dome

Keep in mind Seattle U. plays their games at Key Arena as well, so the Tacoma option can keep the schedule from getting too congested at Key Arena.

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02-18-2012, 06:25 PM
  #735
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Originally Posted by Nuclear SUV View Post
Key Arena should be the temporary venue, but that doesn't mean they could play a couple of games at Safeco Field and a handful at the Tacoma Dome.

My dream scenario would be:

- pre-season games in Spokane and Portland
- 31 Key Arena games
- 2 Safeco Field games in November vs. Van and Det
- 8 games at Tacoma Dome

Keep in mind Seattle U. plays their games at Key Arena as well, so the Tacoma option can keep the schedule from getting too congested at Key Arena.
The City might agree to Safeco - but I doubt they would agree to the Dome unless they were compensated for lost tax revenue from Key.

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02-18-2012, 06:29 PM
  #736
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There is a lot of uncertainty regarding the key arena. The only thing people know is that is was redesigned for basketball and it does not have an ideal hockey configuration. I have been to hockey games there and yes it is odd but it is doable on an interim basis.

Quote:
Originally Posted by Wikipedia
It has a seating capacity for basketball games of 17,072,[3] ice hockey games and ice shows 15,177, end-stage concerts is 16,641, and center-stage concerts and boxing 17,459. Risers hold 7,440 on the upper level and up to 7,741 on the lower level, with luxury suites adding another 1,160 seats.
...
The court was lowered 35 feet (10.5 m) below street level to allow for 3,000 more seats. The doors opened on the newly renovated arena on October 26, 1995. The sightlines, however, benefitted the SuperSonics at the expense of the junior Thunderbirds, with a scoreboard that was significantly off-center in a hockey configuration.
ice hockey games and ice shows 15,177

The Key Arena website concurs with these facts... Most picture with hockey show the upper bowl covered over which looks like even less space.

Any obstructed seats will be really cheap to help with their attendance and get the casual follower to the games.
Attached Images
File Type: png key arena hockey.png‎ (200.7 KB, 22 views)

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02-18-2012, 06:30 PM
  #737
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The City might agree to Safeco - but I doubt they would agree to the Dome unless they were compensated for lost tax revenue from Key.
I don't think Seattle is so petty that they would kill a massive investment in the city over a handful of games. I am sure the city is willing to work things out to make sure it works out. They are well aware that the NHL is a very tight fit at Key Arena.

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02-18-2012, 06:36 PM
  #738
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I don't think Seattle is so petty that they would kill a massive investment in the city over a handful of games. I am sure the city is willing to work things out to make sure it works out. They are well aware that the NHL is a very tight fit at Key Arena.
100% disagree... every game that is moved to Tacoma takes away thousands to millions of lost local revenue in Seattle. I can see the Seattle NHL team playing 1 preseason game in each Spokane & Portland but not all either. It sounds like the temp venue will have to be the Key and only the Key unless a deal could be arranged for some games in Safeco which I doubt would happen due to the open stadum, mild temperature and wet atmosphere that we have.

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02-18-2012, 06:43 PM
  #739
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The City might agree to Safeco - but I doubt they would agree to the Dome unless they were compensated for lost tax revenue from Key.
The Tacoma dome would require a significant investment to support hockey again. There is currently no ice plant. It wouldn't make any sense to invest in hockey specific improvements for just 8 games.

The City of Tacoma doesn't really want to see the Tacoma Dome go the way of the King Dome. They had a proposal a few years back and invested some money in a feasibility study to do a major renovation on the T-Dome that would have cost close to $45M. I don't know if anything has come out of that, but renovations certainly have not been approved and do not seem to be pending.

The City of Tacoma would love a private entity to invest $30 - $40M in to Tacoma dome to modernize the seating, concourses and amenities - not specific to hockey, but that would allow 15,000 to 17,000 for hockey. This would keep the T-Dome viable as an events venue for the next 20 years.

So, if a Seattle owner were willing to cost-share on the renovations to the Tacoma Dome, it might prove to be more cost effective than losing $25M / year operating out of Key Arena.

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02-18-2012, 06:52 PM
  #740
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The Tacoma dome would require a significant investment to support hockey again. There is currently no ice plant. It wouldn't make any sense to invest in hockey specific improvements for just 8 games.

The City of Tacoma doesn't really want to see the Tacoma Dome go the way of the King Dome. They had a proposal a few years back and invested some money in a feasibility study to do a major renovation on the T-Dome that would have cost close to $45M. I don't know if anything has come out of that, but renovations certainly have not been approved and do not seem to be pending.

The City of Tacoma would love a private entity to invest $30 - $40M in to Tacoma dome to modernize the seating, concourses and amenities - not specific to hockey, but that would allow 15,000 to 17,000 for hockey. This would keep the T-Dome viable as an events venue for the next 20 years.

So, if a Seattle owner were willing to cost-share on the renovations to the Tacoma Dome, it might prove to be more cost effective than losing $25M / year operating out of Key Arena.
Tacoma Dome Prospective Renovation update from Sept 2011:
“It would cost significantly more” than the $45 million sought for upgrades in an unsuccessful 2006 ballot measure, Henson said.

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02-18-2012, 07:31 PM
  #741
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100% disagree... every game that is moved to Tacoma takes away thousands to millions of lost local revenue in Seattle.
How much lost potential revenue do we lose with no NHL or NBA team? They would be stupid to insist on a totally unsustainable arrangement.

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02-18-2012, 08:01 PM
  #742
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How much lost potential revenue do we lose with no NHL or NBA team? They would be stupid to insist on a totally unsustainable arrangement.
How much potential revenue does Levin (or whoever owns the NHL Team) gain by playing 8 games at the Dome - with add'l costs, reducing Key income (advertising, sponsorships,etc) by 20%, and likely pissing off a good chunk of your STH base.

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02-18-2012, 08:10 PM
  #743
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@gbakermariners: For all u Seattle NHL fans, I'm gonna do a live video check of the street market for tickets in Phoenix. Watch screen. http://t.co/1HFORh4I

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02-18-2012, 08:16 PM
  #744
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How much lost potential revenue do we lose with no NHL or NBA team? They would be stupid to insist on a totally unsustainable arrangement.
Political leadership in king county generally tend to make stupid decisions. Already they are having some issues because some think the bond funds need to be used for other projects

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02-18-2012, 08:41 PM
  #745
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@gbakermariners: For all u Seattle NHL fans, I'm gonna do a live video check of the street market for tickets in Phoenix. Watch screen. http://t.co/1HFORh4I
Thanks for the link to this, superdeluxe. I'll tell you, it seems as if the Seattle reporters who are down covering the Mariners in Peoria found themselves with a nice opportunity to cover this aspect of the arena situation in Seattle. First, Chris Egan last night on NWCN and now Baker this evening.

BTW, a question for any Phoenix fans reading this: Baker in his blog writeup which is featured with this video claimed the Stars are, in his words, a "pretty good draw" and yet, when you watch this video, it doesn't seem to be the case at least with respect to the scalpers and how much they're offering for these seats. So the question for all of you is - is Baker correct in his assertion?

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02-18-2012, 08:43 PM
  #746
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Originally Posted by tank44 View Post
ice hockey games and ice shows 15,177
At one point, Wikipedia had both 15,177 and 11,000 in the same article. They've at least gotten it down to 1 number now, namely 15,177.

Quote:
Originally Posted by tank44 View Post
The Key Arena website concurs with these facts... Most picture with hockey show the upper bowl covered over which looks like even less space.
That's the problem. Sure you can get 15,177 into the building in a hockey configuration, but a few thousand of them (in the south end) will have to watch the game on the scoreboard screen. May as well stay home and watch it on TV. As for the pictures with hockey, look at the photo at the very bottom of post #5 of this thread. The entire south end is shut down, which cuts it down to 11,000 of which a couple of thousand are still partially obstructed.

I'll give Levin's number the most credibility, because I assume that he's been doing due diligence towards getting a team into Seattle. An article on KING5's website says
Quote:
I think it could work. It could be a good temporary building, says Don Levin, who has been mentioned as a potential Seattle NHL Owner. But he acknowledges the challenges, There are only 9,000 non-obstructed seats. Everything else is obstructed view. Im not sure you sell them for much. Key Arena seats just over 11,000 for Hockey.

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02-18-2012, 09:39 PM
  #747
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Originally Posted by superdeluxe View Post
Political leadership in king county generally tend to make stupid decisions. Already they are having some issues because some think the bond funds need to be used for other projects
Some people think that those bonds are coming from tax payers.

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02-18-2012, 10:04 PM
  #748
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Just saw that surrey is only 110 miles from Seattle and that going ticket prices for today's game was 300$ for lower bowl. I think seattle tickets would be much easier to come by. And realized that surrey has more than 450k population! And I thought it was just a burb to Vancouver, any new owner has to and try to appeal to those on waiting lists or those of fans of other teams that would go see their favorites in Vancouver now has another option

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02-18-2012, 10:07 PM
  #749
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Some people think that those bonds are coming from tax payers.
Yup, they are concerned of loss of tax revenue from the property but fail to see the $$$$$ coming in from this deal

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02-18-2012, 10:15 PM
  #750
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Originally Posted by superdeluxe View Post
Yup, they are concerned of loss of tax revenue from the property but fail to see the $$$$$ coming in from this deal
And they don't look at the deal prior to making comments.

http://www.king5.com/sports/Concerns...139597503.html

I-91 doesn't apply to what King County provides into the project only what Seattle provides.

How much the 200m is split between City and County has yet to be decided.

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