Las Vegas, Quebec City file NHL expansion applications

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Las Vegas, Quebec City file NHL expansion applications

Post by Fran » Wed Jul 22, 2015 3:07 pm

Surprised no Seattle.


http://www.sportsnetwork.com/merge/tsnf ... ?id=836578

Owners in Quebec City and Las Vegas were the only ones to submit NHL expansion applications before Monday's deadline, the NHL confirmed Tuesday.

The NHL said it received requests from and sent applications to 16 different groups or individuals. The league sent out the applications on July 6.

"The deadline for filing an application and proceeding in the NHL expansion process was last night," the league said in a release. "We can confirm that we have received two applications: one from Bill Foley for a franchise in Las Vegas, Nevada, and one from Quebecor for a franchise in Quebec City, Quebec.

"Our purpose, in initiating the expansion process in the manner we did, was not only to explore the possibility of admitting new members to the NHL but also, at the outset, to set realistic guideposts to distinguish between bona fide expressions of interest (i.e., those which have at least substantial ownership capabilities and an arena or the realistic possibility of an arena) from those indications of potential interest which were, at best, merely hopes or aspirations. Apparently, only Mr. Foley and Quebecor have the confidence in their ability to secure an arena and suitable ownership capability to move forward with this process.

"We now intend to focus exclusively on the two expansion applications that have been submitted in accordance with the previously announced process. The process we have outlined for qualified applicants includes at least two more stages of documentation submission. We will provide no further updates until there is something substantive to announce."

Last month, NHL commissioner Gary Bettman said that the league is opening an expansion review process to consider whether to add new franchises to its 30- team league.

The NHL doesn't anticipate adding any teams before the 2017-18 season.

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Post by Pounder » Wed Jul 22, 2015 8:27 pm

The Seattle story is becoming clear.

Hedge fund guy named Chris Hansen buys land near Safeco Field and CenturyLink Field, wants to build an arena, wants money from the city of Seattle to help get it done. Wants to bring back the Sonics. Says he might bring an NHL team as well.

Seattle passed Initiative 91 several years ago, maybe before the wake of the Sonics leaving IIRC. The city cannot simply give Hansen money because of I-91. Basically denies public funds for arenas without guaranteed ROI. Or something akin to this.

City and Hansen hammer out a deal. Seattle arranges a "loan" paid back with ticket surcharges to circumvent I-91. This plan already has withstood a court challenge FWIW.

MOU says Hansen must get an NBA team first. Hansen goes hard after the Sacramento Kings. NBA gets what they want, a new arena proposal in downtown Sacramento. Hansen funds a petition effort to put the arena to a vote, tried to hide the fact that he did this, then was humiliatingly forced to go public. Hansen tried to sabotage an effort masterminded by the mayor of Sacramento aka former NBA all star point guard Kevin Johnson. Now that's a facepalm-worthy moment.

So Hansen has carried on like he still matters. He doesn't. He crossed the NBA at a place and time where he damn well shouldn't have done it.

The NHL was working with Hansen until they realized that Hansen was trying to now sit on the arena effort until the next NBA team came by; it is said that the city wanted more private money in the proposal if the NHL came first. Eh, maybe the city really asked for this. Hard to tell. So the NHL called on some of their close rich friends. Ray Bartoszek (nearly bought the Coyotes to move a few years ago) volunteered to try to have an arena built elsewhere. There were also interests trying to get something in downtown Bellevue. Bellevue was always kind of intransigent. Bartoszek has in process in place in Tukwila, but it appears he's looking for more investors and can't find them, so he didn't submit a bid. Supposedly, he's still going through the arena process... and the Coyotes are still in Arizona.

A Houston group mentioned that the bid package sought only bids of $500 million or more. The bidding timeline was accelerated immediately out of the gate. So the process looks like one of two things (if not both): a coronation where the league always knew it would be Quebec and Las Vegas, or a deflection of attention from the compounding train wreck in Arizona. Not that there aren't good reasons for a high bid, just that I have to wonder if Bill Foley can ever make money in Las Vegas spending that much on a franchise and not having full control of revenues (theoretically) in MGM's under construction arena on the Strip.
Last edited by Pounder on Wed Jul 22, 2015 8:29 pm, edited 1 time in total.
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Post by nksports » Thu Jul 23, 2015 3:24 am

I'm surprised Kansas City didn't jump into this, but at the same time, they seem to be content to use the Sprint Center for concerts and college basketball.

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Post by Pounder » Thu Jul 23, 2015 5:36 am

[quote=""nksports""]I'm surprised Kansas City didn't jump into this, but at the same time, they seem to be content to use the Sprint Center for concerts and college basketball.[/quote]

They're making more than they're spending with Sprint Center. Not much profit, but not a loss. If they get an NHL anchor tenant, said tenant will want all the ancillary revenues and probably get a significant percentage of that. Then the city won't make money.

Or the alternate explanation is that KU basketball is the anchor tenant in two arenas.

Meanwhile, from what I can glean in Portland, no media even tried to ask Paul Allen's holding company if they so much as asked for a bid package. Any discussion about NHL expansion got wrapped into Rob Manfred's naming Portland for MLB expansion. As if.
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Post by Pounder » Thu Jul 23, 2015 10:54 pm

And now...

http://www.azcentral.com/story/news/loc ... /30571819/

Dispute resolved with a two-year agreement which the CITY can terminate after ONE year.

First off, just let that sink in for a second. City telling team to pound sand instead of the other way around is indeed rare. Something to behold... temporarily, of course. Not a full win. The Coyotes would have to commit a serious self-immolation to actually stay now. Once Glendale voted their intent to cancel the lease, the Coyotes have to had concluded that they must leave.

This gives Ray Bartoszek (and maybe the other possible bidders in Seattle) a little time to come together on a better bid.

OR

Here's Portland's cheap in.

OR, maybe

the Suns start talking new arena (for which rumors are emerging) and truly incorporate hockey this time. That'll probably take more than 2 years, however.

Or maybe a surprise in the CTZ pops up, but that would be a serious surprise at this point.
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Post by SWSAM » Fri Jul 24, 2015 3:33 am

If you add Las Vegas and Quebec City, an Eastern Conference team is going to have to go back to the Western Conference. I'm very surprised only two applications were submitted. If you think about it, this is the first multiple team expansion in a Big Four league in almost two decades -- the NHL was the last to award multiple franchises in 1997, MLB in 1995, and the NFL and NBA in 1993. Considering the price of the Thrashers was $230 million four years ago, I wonder if the $500 million expansion fee is a deterrent.

Regarding the Coyotes situation, there was a follow up editorial in the Arizona Republic today:

http://www.azcentral.com/story/opinion/ ... /30596563/

The Suns have been pushing for major renovations on their current arena for at least a couple of years. At least since the Coyotes issue flared up, so have the rumors about demolishing the south end of the Phoenix Convention Center and building a new arena. That site is across the street from Chase Field and sits on the light rail line.

I think the powers-that-be in Phoenix will make this happen. The city owns the arena, and they own the Convention Center. The biggest concern is will the Suns be willing to split the revenue streams with the Coyotes.

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Post by Pounder » Fri Jul 24, 2015 6:06 pm

[quote=""SWSAM""]I'm very surprised only two applications were submitted. If you think about it, this is the first multiple team expansion in a Big Four league in almost two decades -- the NHL was the last to award multiple franchises in 1997, MLB in 1995, and the NFL and NBA in 1993. Considering the price of the Thrashers was $230 million four years ago, I wonder if the $500 million expansion fee is a deterrent.[/quote]

Don't be surprised. While there have been rumors of expansion for years, is it any accident that the NHL made the expansion call, set a quick deadline, and even shortened that almost immediately? That did the following things:

- Distracted from Glendale

- At least attempted to shut up people in places like Hamilton and Hartford who are otherwise clamoring for the Coyotes (or maybe the Panthers or Hurricanes). Where's your owner? (Never mind that most owners saw the $$ amount and $$ requirements just to bid and the short timeline and probably quietly told the NHL to pound sand)

- Give the appearance of "here's the owners who actually have the money, therefore they're stable, therefore they add value to OUR franchises as well."

- In other words, this was meant to push up the sale value of the Coyotes. Apparently, they have $200 million in debt, and the NHL has taken on most of it. Last winter, the rumored going sale price was $170 million. IOW, didn't even cover the debt. Having two parties willing to pay $500 million for an expansion means (for them) hopefully pushing the Coyotes over the hump.

......... BTW, if you do the math on the debt the NHL has taken on, you pretty much realize that this means the current Coyotes ownership is a bit of a scam. The league really still owns that team. Announcing a sale is possibly what prompted Glendale to agree to paying $15 million a year in the first place, something Glendale just couldn't afford. Hence what got some city councilors voted out, leading to where we are now. It does make me wonder if I'd really want the NHL in Portland, BTW.
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Post by Renandpat » Fri Jul 24, 2015 6:33 pm

[quote=""SWSAM""] I wonder if the $500 million expansion fee is a deterrent.
[/quote]

Duh! The combined (US/Canada) national TV money for each NHL team is less than $25M/year. A local TV deal for hockey in a new US market is still pennies.

The ROI is miniscule.

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Post by Pounder » Fri Jul 24, 2015 8:14 pm

[quote=""Renandpat""]Duh! The combined (US/Canada) national TV money for each NHL team is less than $25M/year. A local TV deal for hockey in a new US market is still pennies.

The ROI is miniscule.[/quote]

The NHL pounced quite immediately upon, all things, the Clippers saga.

Folks, we have a Ballmer Bubble. Good luck with keeping that from getting popped.
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Post by SWSAM » Sat Jul 25, 2015 5:31 am

Meanwhile, the Milwaukee Bucks sold for $550 million with a guaranteed $575 million buyback price if there's no arena deal done.

At least for the $550 million, you get an established infrastructure with a great coach and a nucleus that can contend in the next few years. Oh, and that NBA TV deal kicking in next year.

Bettman would be better off selling what he's smoking. The revenues off that might top the NHL TV deal fivefold.

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