Another team and pro sports league appears ready to use the eagerness of Seattle and investor Chris Hansen for a new arena to help an existing franchise score a deal. This time it is the NHL, which has owned the Phoenix Coyotes since 2009 and is trying to leverage Seattle’s arena urgency into a new deal for the distressed franchise in suburban Glendale.
Mayor Mike McGinn, in a statement Sunday, acknowledged that a representative of Hansen, the Seattle native whose bid for the NBA Kings was rejected by David Stern and league owners in May, introduced him two weeks ago to potential investors in an NHL team, who also met with several members of the city council. The mayor said he also spoke with Commissioner Gary Bettman last week.
“Our message to all parties has been the same: We believe we can support an NHL team as a tenant at KeyArena, and as a potential tenant of a new arena, subject to all parties reaching agreement on terms,” McGinn said in the statement. “As recent news reports indicate, it appears the NHL is taking the new ownership proposal seriously. But we also know from experience that it may be some time before an NHL team is located in Seattle, as the home city for the Phoenix Coyotes is working to keep them.
“We will keep the public informed as we learn more about the possibility of the NHL in Seattle.”
CBC’s “Hockey Night in Canada” reported Saturday (video here) that if the Glendale city council cannot reach a deal with prospective buyers to keep the team in town by July 2, the NHL will sell the the club for $220 million to other bidders — Ray Bartoszek, 47, and Anthony Lanza, 46. The pair bid unsuccessfully for a big share of the New York Mets in 2011.
If the purchase and relocation work, reports say that former nine-time NHL all-star and current NBC analyst Jeremy Roenick would run the hockey operations department.
In a recent visit to Seattle after his NBA bid was voted down, Hansen acknowledged talking to NHL people and seemed more open to a hockey-first idea, primarily because it would activate the MOU while the politicians who signed off on it remain in office.
“The NBA in our case is first for us, because we put the equity into the arena and would like to purchase an NBA team,” Hansen told KJR radio. “We don’t have mental free time to own a hockey team. If there was an owner of a team who wanted to relocate and move (before an NBA team), I’m sure it could be done. We’d have to know how they would invest in the arena project.
“The city/county (memorandum of understanding) probably could be reconstructed, but that’s not my decision. I think there’s big interest from a lot of people in hockey. A lot of owners view Seattle as a great market. We’d had some discussions, and have to see how we would get along and be partners.”
How McGinn plans to make the Key viable as a two- to three-year temporary home for NHL hockey is unclear. Because the building was remodeled in 1995 for basketball only, the sightlines for the bigger floor required for the NHL limit seating to about 11,000.
The smallest building in the NHL is the MTS Centre in Winnipeg, which seats 15,015 for the Jets. The Jets charge the second-highest ticket prices in the NHL, an average of $90, with lower bowl tickets ranging from $117-$200. The season was a complete sellout for the Jets, who were the Atlanta Thrashers until the club moved in 2012.
The average NHL ticket price in 2012-13 was $61. The NBA’s average ticket price is $51.
In a lockout-shortened season of 24 home games, the Coyotes drew 13,923, second-lowest in the NHL and 81 percent of capacity at Jobing.com Arena. The smallest attendance belonged to the New York Islanders (13,306), who will play one more season Nassau Coliseum on Long Island before moving in 2014-15 to Barclays Center in Brooklyn. The Chicago Blackhawks led the NHL with an average crowd of 21,775, said to be 110 percent of capacity.
Attendance is a more important factor in the NHL than any other major pro team sport in North America because the league lacks a lucrative national U.S. TV contract, and so depends much more on gate revenues.
The Coyotes have survived to this point only because Glendale has provided the team a $15 million annual subsidy to operate the arena. Any potential buyer of the franchise wants to keep all or most of the subsidy in place. But Glendale, as with many Sun Belt cities, is under severe financial pressure because of decreased tax revenues following the 2008 recession.
The NHL took ownership of the team in bankruptcy in 2009. But now that the league has a new collective bargaining agreement following a lockout that ended in January, Bettman and other NHL executives are eager to bring the Coyotes’ ward-of-the-state situation to an end.
Bettman said last week that “stuff is gonna happen” if a June 25 meeting of the Glendale city council doesn’t produce major progress on a lease deal with an NHL-selected buyer, Renaissance Sports and Entertainment, a group led by Canadian investment banker George Gossbee and Anthony LeBlanc, former vice president of Blackberry manufacturer Research in Motion. The offer is said to be $170 million, but Glendale politicians are reportedly uncomfortable because the offer is much more borrowed money than equity, and the bidders seek a five-year escape clause.
The NHL Board of Governors is scheduled to meet June 27. In his state-of-the-sport press conference before the Stanley Cup finals, Bettman threatened Glendale in much the same manner as Stern threatened Sacramento with the loss of the Kings when the initial efforts to match Hansen’s offer fell short.
Bettman worked for the NBA from 1981 to 1993, rising to third in command, before taking the NHL commissioner’s job. He has studied under Stern, the master manipulator. Bettman finds in Seattle the same thing Stern found — leverage, in the form of an eager, relatively wealthy marketplace with an aggressive arena investor who has a political deal in hand.
Stern used Seattle as a way to prod Sacramento politicians and business people into funding a new arena deal that kept the Kings, which included a $258 million public subsidy.
Bettman is now attempting the same thing. There are differences, however. Bettman bears no personal ill will toward Seattle and the league already owns the franchise (no Maloof family to extricate). The Phoenix marketplace has NFL, NBA and MLB teams and a Division I college in Arizona State, so the Coyotes are the fifth ticket in town and would not be missed nearly as much as the Kings in Sacramento.
Another factor lending a little credence to a potential Seattle relocation was that the Vancouver Canucks wanted to place their American Hockey League affiliate in KeyArena but was denied by the NHL, according to the Hockey Night story. The team is in Utica, NY.
But Hansen’s arena plan still has to clear a hurdle in Seattle — an environmental impact statement that will consider the complaints of SoDo neighbors about the impacts of traffic with a third sports venue. The draft review is expected in August, and there is a likelihood of lawsuits by opponents if SoDo’s drawbacks aren’t taken seriously in the council vote on the EIS information.
Hansen’s original plan in the memorandum of understanding with the city and King County calls for an NBA franchise to be acquired before public funds can be used to break ground on a new arena. McGinn’s statement of support Sunday suggests that a rewrite of the MOU to accommodate the NHL first is at least plausible, but such a rewrite is subject to city council approval.
McGinn is also in a busy campaign for re-election in a crowded field, and is apt to say whatever will improve his electability. It is a matter of speculation whether the SoDo MOU is a help or a hurt to his campaign in Seattle, where skepticism about public funding of pro sports facilities has always run deep, and was roiled by the in-house NBA politics that thwarted Hansen.
The arrival of a competing bid for the Coyotes ratchets up the pressure on Glendale, which is all by Bettman’s design. Many things have to happen suddenly, because the NHL is eager to publish its 2013-14 schedule by July 1, and the mayoral primary in Seattle is in August.