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BARF... it was a close one, could of gone either way. Can't afford to pay for emergency services but are willing to throw money into a proven loser.Nik the Trik said:The lease agreement gets approved 4-3 with the Mayor voting against it. Looks like at least five more years in the desert.
cabber24 said:BARF... it was a close one, could of gone either way. Can't afford to pay for emergency services but are willing to throw money into a proven loser.Nik the Trik said:The lease agreement gets approved 4-3 with the Mayor voting against it. Looks like at least five more years in the desert.
That's obviously debatable... projections are exactly that, projections. I wouldn't be surprised if they loose the 50M over 5 years and exercise their out clause and move the team. 50M and 5 years to move the team could end up being a great investment and it's easier then you think to manipulate financials to show a loss of 50M if they choose to.cw said:cabber24 said:BARF... it was a close one, could of gone either way. Can't afford to pay for emergency services but are willing to throw money into a proven loser.Nik the Trik said:The lease agreement gets approved 4-3 with the Mayor voting against it. Looks like at least five more years in the desert.
Because ... they'll have even less money to pay for emergency services if they don't do the deal.
It's simply the lesser of two evils.
cw said:Because ... they'll have even less money to pay for emergency services if they don't do the deal.
It's simply the lesser of two evils.
cabber24 said:That's obviously debatable... projections are exactly that, projections. I wouldn't be surprised if they loose the 50M over 5 years and exercise their out clause and move the team. 50M and 5 years to move the team could end up being a great investment and it's easier then you think to manipulate financials to show a loss of 50M if they choose to.cw said:cabber24 said:BARF... it was a close one, could of gone either way. Can't afford to pay for emergency services but are willing to throw money into a proven loser.Nik the Trik said:The lease agreement gets approved 4-3 with the Mayor voting against it. Looks like at least five more years in the desert.
Because ... they'll have even less money to pay for emergency services if they don't do the deal.
It's simply the lesser of two evils.
cabber24 said:That's obviously debatable... projections are exactly that, projections. I wouldn't be surprised if they loose the 50M over 5 years and exercise their out clause and move the team.
I'm not convinced a team that has done financially as poorly as they have can turn things around so quickly. The out clause worries me, Glendale is at the mercy of RCE. I'm not convinced RCE is sincere in keeping the team in Arizona.cw said:cabber24 said:That's obviously debatable... projections are exactly that, projections. I wouldn't be surprised if they loose the 50M over 5 years and exercise their out clause and move the team. 50M and 5 years to move the team could end up being a great investment and it's easier then you think to manipulate financials to show a loss of 50M if they choose to.cw said:cabber24 said:BARF... it was a close one, could of gone either way. Can't afford to pay for emergency services but are willing to throw money into a proven loser.Nik the Trik said:The lease agreement gets approved 4-3 with the Mayor voting against it. Looks like at least five more years in the desert.
Because ... they'll have even less money to pay for emergency services if they don't do the deal.
It's simply the lesser of two evils.
There's a little more going on that projections here. There's a very detailed history in the bankruptcy court on what has gone on financially. There's a guarantee that if Glendale loses more than the $6 mil per year, they'll pay it back before they leave town.
They needed $15 mil per year to break even and got it in this deal. To lose $10 mil more per year when the new CBA improved their situation with increased revenue sharing is quite a margin of error.
And the losses are tied to a team that is third party audited by the NHLPA and limited to a pretty tight (close to excellent in many respects) lease agreement - so there are real limits to the accounting gamesmanship that can be played because it's detailed pretty well in a 100+ page document.
If the Goldwater Institute leaves well enough alone and the US economy rebounds over those five years, there's a good shot they can survive. And that's the key. Long term, with the market growth projected for that area, I think they'll be fine and a better location than many of the smaller NHL markets. I've said it before: if I had to make a choice between a long term investment between the Sabres and the Coyotes, I'd invest in the Coyotes. It's getting over this rough patch and the damage from the bankruptcy that's the critical time. I think this new ownership and Bettman & the NHL feel similarly.
And if they pull this off, there is a great reward (roughly $100 mil) awaiting them in the increase of franchise valuation.
I agree, although it's going to cost RCE over the next 5 years there is likely money to be made on a move out of PHX.Nik the Trik said:cabber24 said:That's obviously debatable... projections are exactly that, projections. I wouldn't be surprised if they loose the 50M over 5 years and exercise their out clause and move the team.
Even if they do that the 30 million that the city's losses would be capped at over those five years seems like a fairly workable figure considering the alternative of letting the team leave. Rather than the sort of false reporting shenanigans that you're talking about I think that there are two slightly more pressing issues for me if I'm a Glendale resident:
1. That 30 million dollar guarantee in the event the out clause is used is one that would help but if the ownership group's projections are off and the city loses significantly more than the six million dollar a year figure right away the city will probably have to make immediate cutbacks in terms of services and raise taxes where they can. If the team then does move whatever amount they pay the team back wouldn't retroactively smooth over the damage that can do.
2. It doesn't seem likely to me that there's a figure that the city could lose over and above that six million a year that would change the almost certainly likely situation where paying the city for their excess losses would be enough of a penalty to change the fact that, five years from now, the Coyotes will be more valuable elsewhere then they would be in Phoenix. Unless the league has made promises that before those five years are up the demand for NHL franchises elsewhere would be met with expansion the Coyotes could be worth 500+ million dollars to someone in Quebec City or Markham or Seattle in that time and that would be a number that would be very hard to turn down.
Nik the Trik said:cw said:Because ... they'll have even less money to pay for emergency services if they don't do the deal.
It's simply the lesser of two evils.
As someone who watched what he could of the meeting it does seem like that was the idea put forth by the new ownership group and the NHL and glommed onto by the deal's supporters. I think it probably holds true. The alternate idea, that a separate arena management company could have found enough non-anchor tenant events to generate an approximate amount of revenue to the Coyotes, never seemed realistic in light of the competing arenas run by pretty well connected arena management firms.
Nik the Trik said:Besides, without the Coyotes what team would we joke about playing in front of nobody?
cw said:On the original deal, the city to some extent messed up and allowed themselves to be misled by Ellman & Moyes. But there's been a lot of scrutiny on this deal. All they're trying to do is save the taxpayers some money - to avoid the bigger losses if the team leaves vs the deal they've structured to reduce those losses if the team stays.
No matter which way they went, the taxpayers were going to lose. This deal gives them a fair chance to reduce their losses.
Britishbulldog said:Nik the Trik said:Besides, without the Coyotes what team would we joke about playing in front of nobody?
New Jersey Devils??...one of the Florida teams? It's time for those 3 to move or fold.
cabber24 said:I'm not convinced a team that has done financially as poorly as they have can turn things around so quickly. The out clause worries me, Glendale is at the mercy of RCE. I'm not convinced RCE is sincere in keeping the team in Arizona.cw said:cabber24 said:That's obviously debatable... projections are exactly that, projections. I wouldn't be surprised if they loose the 50M over 5 years and exercise their out clause and move the team. 50M and 5 years to move the team could end up being a great investment and it's easier then you think to manipulate financials to show a loss of 50M if they choose to.cw said:cabber24 said:BARF... it was a close one, could of gone either way. Can't afford to pay for emergency services but are willing to throw money into a proven loser.Nik the Trik said:The lease agreement gets approved 4-3 with the Mayor voting against it. Looks like at least five more years in the desert.
Because ... they'll have even less money to pay for emergency services if they don't do the deal.
It's simply the lesser of two evils.
There's a little more going on that projections here. There's a very detailed history in the bankruptcy court on what has gone on financially. There's a guarantee that if Glendale loses more than the $6 mil per year, they'll pay it back before they leave town.
They needed $15 mil per year to break even and got it in this deal. To lose $10 mil more per year when the new CBA improved their situation with increased revenue sharing is quite a margin of error.
And the losses are tied to a team that is third party audited by the NHLPA and limited to a pretty tight (close to excellent in many respects) lease agreement - so there are real limits to the accounting gamesmanship that can be played because it's detailed pretty well in a 100+ page document.
If the Goldwater Institute leaves well enough alone and the US economy rebounds over those five years, there's a good shot they can survive. And that's the key. Long term, with the market growth projected for that area, I think they'll be fine and a better location than many of the smaller NHL markets. I've said it before: if I had to make a choice between a long term investment between the Sabres and the Coyotes, I'd invest in the Coyotes. It's getting over this rough patch and the damage from the bankruptcy that's the critical time. I think this new ownership and Bettman & the NHL feel similarly.
And if they pull this off, there is a great reward (roughly $100 mil) awaiting them in the increase of franchise valuation.
cabber24 said:I agree, although it's going to cost RCE over the next 5 years there is likely money to be made on a move out of PHX.Nik the Trik said:cabber24 said:That's obviously debatable... projections are exactly that, projections. I wouldn't be surprised if they loose the 50M over 5 years and exercise their out clause and move the team.
Even if they do that the 30 million that the city's losses would be capped at over those five years seems like a fairly workable figure considering the alternative of letting the team leave. Rather than the sort of false reporting shenanigans that you're talking about I think that there are two slightly more pressing issues for me if I'm a Glendale resident:
1. That 30 million dollar guarantee in the event the out clause is used is one that would help but if the ownership group's projections are off and the city loses significantly more than the six million dollar a year figure right away the city will probably have to make immediate cutbacks in terms of services and raise taxes where they can. If the team then does move whatever amount they pay the team back wouldn't retroactively smooth over the damage that can do.
2. It doesn't seem likely to me that there's a figure that the city could lose over and above that six million a year that would change the almost certainly likely situation where paying the city for their excess losses would be enough of a penalty to change the fact that, five years from now, the Coyotes will be more valuable elsewhere then they would be in Phoenix. Unless the league has made promises that before those five years are up the demand for NHL franchises elsewhere would be met with expansion the Coyotes could be worth 500+ million dollars to someone in Quebec City or Markham or Seattle in that time and that would be a number that would be very hard to turn down.
lamajama said:cabber24 said:I agree, although it's going to cost RCE over the next 5 years there is likely money to be made on a move out of PHX.Nik the Trik said:cabber24 said:That's obviously debatable... projections are exactly that, projections. I wouldn't be surprised if they loose the 50M over 5 years and exercise their out clause and move the team.
Even if they do that the 30 million that the city's losses would be capped at over those five years seems like a fairly workable figure considering the alternative of letting the team leave. Rather than the sort of false reporting shenanigans that you're talking about I think that there are two slightly more pressing issues for me if I'm a Glendale resident:
1. That 30 million dollar guarantee in the event the out clause is used is one that would help but if the ownership group's projections are off and the city loses significantly more than the six million dollar a year figure right away the city will probably have to make immediate cutbacks in terms of services and raise taxes where they can. If the team then does move whatever amount they pay the team back wouldn't retroactively smooth over the damage that can do.
2. It doesn't seem likely to me that there's a figure that the city could lose over and above that six million a year that would change the almost certainly likely situation where paying the city for their excess losses would be enough of a penalty to change the fact that, five years from now, the Coyotes will be more valuable elsewhere then they would be in Phoenix. Unless the league has made promises that before those five years are up the demand for NHL franchises elsewhere would be met with expansion the Coyotes could be worth 500+ million dollars to someone in Quebec City or Markham or Seattle in that time and that would be a number that would be very hard to turn down.
Yep I think RCE is simply buying their way into the NHL fold and is prepared to accept the losses as the cost of membership until they can recoup in another market.
cw said:So we're talking about $240 mil minimum roughly to "join the NHL franchise owners club".
$240 mil would roughly buy any one of 17 of the 30 NHL teams now and in most of those cases, they'd have millions left over - it would be cheaper:
http://www.forbes.com/nhl-valuations/list/
And all they had to do was walk away from this deal which would have killed Phoenix and bid on a clean relocated franchise in Seattle/Kansas City/Quebec that would have all the start up headaches they would encounter if they moved there five years from now.
Nik the Trik said:cw said:So we're talking about $240 mil minimum roughly to "join the NHL franchise owners club".
$240 mil would roughly buy any one of 17 of the 30 NHL teams now and in most of those cases, they'd have millions left over - it would be cheaper:
http://www.forbes.com/nhl-valuations/list/
And all they had to do was walk away from this deal which would have killed Phoenix and bid on a clean relocated franchise in Seattle/Kansas City/Quebec that would have all the start up headaches they would encounter if they moved there five years from now.
The problem with that is that I doubt many of the teams that could be bought for 240 million have leases that could be broken easily or without significant penalty. If relocation is the ultimate goal then this deal might very well prove the easiest avenue for it.
Likewise if there is an expansion process there's every reason to think that the NHL would be looking for significantly more than 240 million dollars per franchise so that doesn't seem to be a more attractive proposition.
With all of that said, however, I'm not convinced that the people buying the Coyotes are definitely planning on moving the team in five years. I think, all things considered they'd much rather the Coyotes be a screaming success where they are and reap the benefits themselves with a very accommodating lease. However, I still think the Coyotes are going to have to be a pretty wild success for them not to be more valuable in Seattle or QC in five years time especially considering that the relocation fee and the giveback to the city could be factored into any subsequent purchase price. Especially if, as we're seeing in Seattle and Markham, the people they're selling to are planning on building a Westgate style business around a new team.