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The Business of Hockey Discuss the financial and business aspects of the NHL. Topics may include the CBA, work stoppages, broadcast contracts, franchise sales, NHL revenues, relocation and expansion.

Phoenix CXXIX: I buy you out, you don't buy me out

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Old
06-29-2017, 01:59 PM
  #76
Boris Zubov
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Originally Posted by CHRDANHUTCH View Post
if that was the case, folks, they would've had stayed in PHOENIX
So please enlighten us...what's the point you're trying to make? Cause from where I'm sitting, hockey doesn't work financially in Arizona. New arena, new location, or even a new owner doesn't alter the underlying issue, not enough people in the region care about the team.

The TV ratings have proven that low attendance isn't the fans speaking with their wallets. It's just an overall lack of interest. Not saying there aren't some really passionate fans, but from a strictly business POV, it's a complete failure. If this was any other industry, the building would've been shuttered 15 years ago.

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06-29-2017, 02:10 PM
  #77
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Originally Posted by WildGopher View Post
Maybe. But the mood of elected officials, at least as reflected by the reaction of the legislature to the Worsley arena bill, seems to be a lot less enthusiastic these days. Add the fact that the Phoenix area has two perfectly serviceable arenas, and you wonder if anything more than a modernization of Talking Sick for basketball will happen.

You just have to ask if there aren't too many arenas. I'm in Milwaukee for business, and outside my hotel room is the old arena the NBA's old Milwaukee Hawks used; in the block to the north is the Bucks' Bradley Center; and in the block north of that, construction is well progressing on the Bucks' new arena. Really? Three arenas? Seeing the three lined up in a row like that really visually shows how we've gone off the rails using taxpayer dollars to fund these buildings for others to make money, and then replacing them when they're still viable venues.

Admittedly, the Bucks put a good chunk of money in for the construction, and I credit them for that. But would the Coyotes? I just don't think they have the will, or even the ability, to contribute much. Fans love their sports, but I think taxpayers are getting tired of being taken for this ride every 20-25 years.
Here is a link to a picture of those three side-by-side arenas...

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06-29-2017, 02:15 PM
  #78
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That looks like a serious make work project.

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06-29-2017, 02:29 PM
  #79
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Originally Posted by cbcwpg View Post
That looks like a serious make work project.
Well...Wisconsin is a top 10 state but not necessarily for a ranking to be proud of...

I guess when you're in that kind of condition...voting for arena projects may seem to be a good idea at the time...

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06-29-2017, 02:32 PM
  #80
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At least in Milwaukee they are using Milwaukee brand tools....


And, I am still confused by Hutch as well....

I can't understand, Hutch, what exactly you think will happen? Or, what needs to happen? Please don't comment on what I said. Please just directly tell me what is the solution.

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Old
06-29-2017, 02:42 PM
  #81
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Originally Posted by Boris Zubov View Post
Your optimism is commendable, but you still haven't come up with a solution to their biggest problem. What do they do in the interim while they wait 4-5 years minimum before that joint arena is constructed? Who funds the losses? Will Barroway be able to sustain another $100M waiting for that to happen?

Obviously none of us know anything for certain, but I couldn't be as positive as you seem to be given the circumstances.
GRA/TSA, rising assets are easy to lever.

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06-29-2017, 02:43 PM
  #82
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Originally Posted by Fairview View Post
That is your take. What I heard Borrowaway and GB both say was that they were not willing to stay in Glendale without a clear path forward. How long would they be willing to wait? If Sarver doesn't move, and just decides to wait, then there will be no clear path in Arizona for about 5 years. No arena announcement during that time is quite possible.
Sarver will go to the reservation with 100% of the revenue in a heartbeat(as would the Coyotes) rather than 50% of revenue in a downtown building, especially if they would have to contribute $$ to any construction.The reservation will give them more bang for their buck.
The dual use arena is a last resort for both teams.
Not willing to stay at GRA talk was window dressing.

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06-29-2017, 02:49 PM
  #83
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Originally Posted by Llama19 View Post
Looks like there is room to the right to build a fourth arena in about 20 years as well. Just knock down that parking structure.

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06-29-2017, 02:50 PM
  #84
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Originally Posted by cobra427 View Post
Not willing to stay at GRA talk was window dressing.
If that's window dressing, then why doesn't Barroway just extend the lease? Just a 3-5 year term with no out clauses, remove the year to year status.

That will give him more than enough time to work on complete a new arena deal and bridge it to when it gets built.

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06-29-2017, 02:53 PM
  #85
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Originally Posted by JimAnchower View Post
Looks like there is room to the right to build a fourth arena in about 20 years as well. Just knock down that parking structure.
And just keep building them one by one each on to the north. Eventually they'll be far enough from Chicago's franchise territory limit and their expansion will be in time for the 2491-92 season!

#longtermplanning

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06-29-2017, 02:54 PM
  #86
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Not willing to stay at GRA talk was window dressing.
For what?

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06-29-2017, 02:56 PM
  #87
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Originally Posted by Mightygoose View Post
If that's window dressing, then why doesn't Barroway just extend the lease? Just a 3-5 year term with no out clauses, remove the year to year status.

That will give him more than enough time to work on complete a new arena deal and bridge it to when it gets built.
Wow, what a great idea, No worries goose I`m sure Andy has tony in a back room negotiating that deal with the COG as we speak!

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06-29-2017, 03:00 PM
  #88
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Originally Posted by cobra427 View Post
GRA/TSA, rising assets are easy to lever.
Rising assets?

Most arenas are depreciating in value...which is why they want new ones...

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06-29-2017, 03:06 PM
  #89
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I'm trying to cut away from my inclination to argue, and be more analytical here.....

There is one piece of this puzzle that has been brought up, and it intrigues me....The current year-by-year lease with Glendale.

These are my thoughts about that....

a) I believe that Glendale would be more than happy to have a firm extension in place at current rates.

b) I believe the fact that, instead, we have a year-to-year auto renewal says that the Coyotes organization, up until now, has not wanted anything more than a year-to-year lease.

c) Now the question is: Why not? I can think of 2 reasons. Please comment or add other reasons if you wish....

First reason: There really is a good chance of playing the relocation card, and they don't want to be locked in if they have to do that. For example, right now, this franchise is portable in May of 2018.

Second reason: They have every intention of agreeing with someone (PHX, tribes, anyone...) on a new arena. And, the threat of relocation is the only real negotiating leverage they have. In this way....were they to sign a 3-yr extension at GRA, then PHX, or tribes, or whoever, could easily think, "They are going anywhere for 3 years. No reason to talk to them no...." Whereas, if there is no firm extension, then whoever NEEDS to talk now, or they could be gone....

Anyone want to chime in?

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Old
06-29-2017, 03:08 PM
  #90
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Quote:
Originally Posted by cobra427 View Post
GRA/TSA, rising assets are easy to lever.
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Originally Posted by Llama19 View Post
Rising assets?

Most arenas are depreciating in value...which is why they want new ones...
Llama, surely if you have considered cobra's posting history, you know that's not what he means. He means that the team is a rising asset. So, staying in market, with losses, is offset by rising franchise value.

You and I might disagree, but you know that's what he means.

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06-29-2017, 03:13 PM
  #91
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Originally Posted by Boris Zubov View Post
So please enlighten us...what's the point you're trying to make? Cause from where I'm sitting, hockey doesn't work financially in Arizona. New arena, new location, or even a new owner doesn't alter the underlying issue, not enough people in the region care about the team.
I agree with the conclusion, but not with the underlying implication of cause. This is not the case because hockey CAN'T work in Arizona - it is only the case because the Coyotes have been anemic at best for most of their existence here. It's like the hockey equivalent of a Pabst Blue Ribbon or Zima.

Quote:
Originally Posted by Boris Zubov View Post
The TV ratings have proven that low attendance isn't the fans speaking with their wallets. It's just an overall lack of interest. Not saying there aren't some really passionate fans, but from a strictly business POV, it's a complete failure. If this was any other industry, the building would've been shuttered 15 years ago.
You know, it's funny... I was talking online the other day with some of my automotive industry pals, and we were talking about the Chrysler K car platform in the 1980s. Chrysler was on the brink of ruin when they introduced the K platform. I well remember how toxic their brand was for so many years... only fools and crazy people bought Dodges.

Chrysler then introduced the K platform. The cars were ugly as hell and dull as dirty dishwater. But they were cheap to build and allowed Chrysler to share parts and processes across various types of car, from sedans to minivans. Automotive purists turned their noses up at the cars, but it became apparent in hindsight that the K platform saved Chrysler's bacon. They were eventually bought out by Daimler-Benz and now have a great industry reputation for their cars, vans, and trucks.

I guess my point is that there is something salvageable in nearly every type of ruin. It just takes the right type of minds and planning. Whether the Coyotes have that in Andrew Barroway is at best a tossup, and I still remain convinced that the team's future in Arizona is almost certainly short-lived. Buuuuuuuut... if Chrysler could survive by hunkering down and putting up with ugliness for a while in order to satisfy a longer-term goal, it could work for NHL hockey in Arizona.

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06-29-2017, 03:20 PM
  #92
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Originally Posted by MNNumbers View Post
I'm trying to cut away from my inclination to argue, and be more analytical here.....

There is one piece of this puzzle that has been brought up, and it intrigues me....The current year-by-year lease with Glendale.

These are my thoughts about that....

a) I believe that Glendale would be more than happy to have a firm extension in place at current rates.

b) I believe the fact that, instead, we have a year-to-year auto renewal says that the Coyotes organization, up until now, has not wanted anything more than a year-to-year lease.

c) Now the question is: Why not? I can think of 2 reasons. Please comment or add other reasons if you wish....

First reason: There really is a good chance of playing the relocation card, and they don't want to be locked in if they have to do that. For example, right now, this franchise is portable in May of 2018.

Second reason: They have every intention of agreeing with someone (PHX, tribes, anyone...) on a new arena. And, the threat of relocation is the only real negotiating leverage they have. In this way....were they to sign a 3-yr extension at GRA, then PHX, or tribes, or whoever, could easily think, "They are going anywhere for 3 years. No reason to talk to them no...." Whereas, if there is no firm extension, then whoever NEEDS to talk now, or they could be gone....

Anyone want to chime in?
That is a good questions and I agree that keeping a year to year lease keeps the premise of threatening to relocate.

However, I don't know of any other case where a lease renews mid-season...maybe there is but I'm not aware of it. Having it renew towards the end of the season or in the off season allows teams to gain leverage by making it time sensitive without a lame duck partial season.

My question on leverage on relocation then goes to those parties.

How can the city of Phoenix feel the pressure of the team moving? They don't play in the city and no risk of losing a tenant.

How can the tribe feel any pressure? If the team leaves, they can build one for the Suns, a smaller one for concerts etc....or they don't need an arena at all for their development as enough studies are out there that they don't generate new business in the region.

They can threaten the state since the Coyotes are already in Arizona but that tactic didn't seem to be too effective.

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Old
06-29-2017, 04:11 PM
  #93
Boris Zubov
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Originally Posted by The Feckless Puck View Post
I agree with the conclusion, but not with the underlying implication of cause. This is not the case because hockey CAN'T work in Arizona - it is only the case because the Coyotes have been anemic at best for most of their existence here. It's like the hockey equivalent of a Pabst Blue Ribbon or Zima.

You know, it's funny... I was talking online the other day with some of my automotive industry pals, and we were talking about the Chrysler K car platform in the 1980s. Chrysler was on the brink of ruin when they introduced the K platform. I well remember how toxic their brand was for so many years... only fools and crazy people bought Dodges.

Chrysler then introduced the K platform. The cars were ugly as hell and dull as dirty dishwater. But they were cheap to build and allowed Chrysler to share parts and processes across various types of car, from sedans to minivans. Automotive purists turned their noses up at the cars, but it became apparent in hindsight that the K platform saved Chrysler's bacon. They were eventually bought out by Daimler-Benz and now have a great industry reputation for their cars, vans, and trucks.

I guess my point is that there is something salvageable in nearly every type of ruin. It just takes the right type of minds and planning. Whether the Coyotes have that in Andrew Barroway is at best a tossup, and I still remain convinced that the team's future in Arizona is almost certainly short-lived. Buuuuuuuut... if Chrysler could survive by hunkering down and putting up with ugliness for a while in order to satisfy a longer-term goal, it could work for NHL hockey in Arizona.
Funny you should mention Zima. I was in Total Wine the other day & there was a huge display of Zima as a special release. Nostalgic or not, nothing could get me to drink that crap. Ewwww.

PBR on the other hand is just as gross, but in a completely different way. However, it caught on with the Hipsters in the late 90s & essentially made it a mainstream brand.

Tying those two thoughts together, maybe that's what the Yotes need. A bunch of East Village hipsters to move to the Valley of the Sun & create a tipping point for hockey. Couldn't be worse than the marketing plan IA had the past 4 years.

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06-29-2017, 04:22 PM
  #94
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Not willing to stay at GRA talk was window dressing.
.... window dressing?.... too bad that instead of taking after Warhol or whomever they instead took after the Blues Brothers. 74 Dodge Monaco with the "Squad Car" options... 440 Magnum.... Gary, Andrew, Tony & Nicky Woods did a real nice job of the window dressing @ Glendale/Westgate/GRA... taking everything & everyone out just like Jake & Elwood... Dixie Square Mall in Harvey Illinois. Pretty impressive. Total chaos, destruction... How they turn that around no idea, not unless they give up the ghost of a new building elsewhere & do a side deal with AEG, talk them into funnelling ALL revenues from concerts, events etc their way, making up for it elsewhere throughout the league in giving AEG "special considerations". Dealing with it entirely in-house, put their money where their mouths are at. Internal solutions available if serious about retaining the market.... Man-Up. Stop looking to get on the Dole when your perfectly capable of working out a solution, fixing the mess they themselves created.


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06-29-2017, 04:32 PM
  #95
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You just have to ask if there aren't too many arenas. I'm in Milwaukee for business, and outside my hotel room is the old arena the NBA's old Milwaukee Hawks used; in the block to the north is the Bucks' Bradley Center; and in the block north of that, construction is well progressing on the Bucks' new arena. Really? Three arenas? Seeing the three lined up in a row like that really visually shows how we've gone off the rails using taxpayer dollars to fund these buildings for others to make money, and then replacing them when they're still viable venues.
The old one only holds around 10,000 and the other one is being torn down once the new one is finished so it's not like all three are still going to be there or ever be in use at the same time.

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06-29-2017, 05:31 PM
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.... window dressing?.... too bad that instead of taking after Warhol or whomever they instead took after the Blues Brothers. 74 Dodge Monaco with the "Squad Car" options... 440 Magnum.... Gary, Andrew, Tony & Nicky Woods did a real nice job of the window dressing @ Glendale/Westgate/GRA... taking everything & everyone out just like Jake & Elwood... Dixie Square Mall in Harvey Illinois. Pretty impressive. Total chaos, destruction... How they turn that around no idea, not unless they give up the ghost of a new building elsewhere & do a side deal with AEG, talk them into funnelling ALL revenues from concerts, events etc their way, making up for it elsewhere throughout the league in giving AEG "special considerations". Dealing with it entirely in-house, put their money where their mouths are at. Internal solutions available if serious about retaining the market.... Man-Up. Stop looking to get on the Dole when your perfectly capable of working out a solution, fixing the mess they themselves created.
your posts cannot be gulped, they must be savoured.

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06-29-2017, 07:24 PM
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Originally Posted by Mightygoose View Post
If that's window dressing, then why doesn't Barroway just extend the lease? Just a 3-5 year term with no out clauses, remove the year to year status.

That will give him more than enough time to work on complete a new arena deal and bridge it to when it gets built.
At this point..... creating (or locking) a 3-5 year commitment is useless other than to assure there will be another 20-30 chapters worth of megathread shmoozling.

They will not get any different terms than they do now at GRA. So why waste spending even more money on something that won't give you a better return??

The lease automatically renews itself unless they, or the arena manager chooses to end it. And with AEG managing the arena they have a friendly working partner in AEG and don't have to deal with a city council that can change it's course like a drunken sailor.


Quote:
Originally Posted by MNNumbers View Post
I'm trying to cut away from my inclination to argue, and be more analytical here.....

There is one piece of this puzzle that has been brought up, and it intrigues me....The current year-by-year lease with Glendale.

These are my thoughts about that....

a) I believe that Glendale would be more than happy to have a firm extension in place at current rates.

b) I believe the fact that, instead, we have a year-to-year auto renewal says that the Coyotes organization, up until now, has not wanted anything more than a year-to-year lease.

c) Now the question is: Why not? I can think of 2 reasons. Please comment or add other reasons if you wish....

First reason: There really is a good chance of playing the relocation card, and they don't want to be locked in if they have to do that. For example, right now, this franchise is portable in May of 2018.

Second reason: They have every intention of agreeing with someone (PHX, tribes, anyone...) on a new arena. And, the threat of relocation is the only real negotiating leverage they have. In this way....were they to sign a 3-yr extension at GRA, then PHX, or tribes, or whoever, could easily think, "They are going anywhere for 3 years. No reason to talk to them no...." Whereas, if there is no firm extension, then whoever NEEDS to talk now, or they could be gone....

Anyone want to chime in?
Nope.... you covered what I said just above.

Except..... the portability label would kick in Jan. 1 2018, if one of the parties notifies the other they're ending the lease.


Last edited by TheLegend: 06-29-2017 at 07:32 PM.
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06-29-2017, 07:36 PM
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your posts cannot be gulped, they must be savoured.
... yeah, well, we Southern Ontario Boys... what can you say?.

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06-29-2017, 08:44 PM
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At this point..... creating (or locking) a 3-5 year commitment is useless other than to assure there will be another 20-30 chapters worth of megathread shmoozling.

They will not get any different terms than they do now at GRA. So why waste spending even more money on something that won't give you a better return??

The lease automatically renews itself unless they, or the arena manager chooses to end it. And with AEG managing the arena they have a friendly working partner in AEG and don't have to deal with a city council that can change it's course like a .
Will agree that the terms wouldn't change by locking in but it will show that Barroway is actually going to give the new arena search a go. They'll need a few years to bridge between the buildings anyways so why not put the time in?

This would go allot further to a commitment than upgrading the roster or just saying they're 'commited to Arizona'.....do or do not

Otherwise why would any future sponsor or prospective season ticket holder would want to buy in if the owner won't?

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06-29-2017, 09:02 PM
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Originally Posted by MNNumbers View Post
I'm trying to cut away from my inclination to argue, and be more analytical here.....

There is one piece of this puzzle that has been brought up, and it intrigues me....The current year-by-year lease with Glendale.

These are my thoughts about that....

a) I believe that Glendale would be more than happy to have a firm extension in place at current rates.

b) I believe the fact that, instead, we have a year-to-year auto renewal says that the Coyotes organization, up until now, has not wanted anything more than a year-to-year lease.

c) Now the question is: Why not? I can think of 2 reasons. Please comment or add other reasons if you wish....

First reason: There really is a good chance of playing the relocation card, and they don't want to be locked in if they have to do that. For example, right now, this franchise is portable in May of 2018.

Second reason: They have every intention of agreeing with someone (PHX, tribes, anyone...) on a new arena. And, the threat of relocation is the only real negotiating leverage they have. In this way....were they to sign a 3-yr extension at GRA, then PHX, or tribes, or whoever, could easily think, "They are going anywhere for 3 years. No reason to talk to them no...." Whereas, if there is no firm extension, then whoever NEEDS to talk now, or they could be gone....

Anyone want to chime in?
Pretty much my thoughts. They are doing this to keep all avenues open. Keeping year to year means they will never be locked into a threat of "nowhere to play next year". That way they keep new arena options open, and I think barroway is watching Seattle very closely over the next few years to see an arena gets built or not. I've come to the conclusion yotes will not relocate east at all. NHL seems determined to not allow that "extra" team. A team Seattle? No problems.

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