The World Awaits… NHL Expansion: Who’s In… And Who’s Out

Mark Warner

July 17 2015

With the NHL Announcement on June 24th that it will begin accepting Official Applications for new franchises, speculation has run rampant on which cities would formally apply. This report on CBSSports.Com sums up the announcement:

     NHL commissioner Gary Bettman announced that the league’s board of governors has approved the opening of a formal expansion process. This does not necessarily mean the league will definitely expand, but this will allow the league to more formally gauge interest from various markets and explore all possibilities.Formal applications for expansion will start being accepted on July 6. They will have to be submitted no later than August 10

By “more formally gauge interest” we assume they mean collect the application fee from as many cities as possible. It is reported  to be 10 million dollars, 2 million of which is non-refundable.

         As first co-reported by thn.com and The Seattle Times last week, the price just to apply for a team is a minimum of $2 million. But wait, there’s more. Prospective owners are required to put down $10 million when they formally apply for a team. If they do not get a team, in a best-case scenario, they’d have $8 million returned to them.

This fee, and the cost of a franchise, which is reported to be variable by market, is certainly having its effects on who will apply.  The following is from a Sporting News article

Applying for an NHL expansion franchise will cost $10 million, an unidentified NHL source confirmed to the Seattle Times, not the $1 million that has been reported by media outlets in the U.S. and Canada. Additionally, $2 million of that fee is non-refundable, presumably a big enough number to prevent groups that might not be fully committed to the process from applying.

And this from THN.COM

 Conversely, Las Vegas wants in the NHL badly and the team will be owned by a billionaire, so the price tag there might be closer to $500 million, whereas Seattle, a place where the NHL would like to place a team, might be in the neighborhood of how much it would cost Quebec City to get a team.

Kansas City Out 

These fees have eliminated Kansas City, a city many thought would apply. As reported in the Kansas City Star, the likely ownership groups will not materialize.

     Lamar Hunt Jr., who owns the ECHL’s Missouri Mavericks, a minor-league hockey team that plays in Independence, called the NHL’s $500 million price tag for an expansion franchise “a ridiculously big fee,” and said that he is not aware of anyone in Kansas City who will make a push for a team.

“No, it’s not on my radar,” he said. “It’s not on this team’s radar, and it’s not on my radar.”

Cliff Illig, a billionaire and part of the ownership group of Sporting Kansas City, is also not involved with a bid for Kansas City, and does not know of anyone who is. “You could say that,” he said. “That’s certainly the truth.”

Seattle In AND Out 

With early reports out of the Pacific Northwest that two and possibly three  separate groups would be applying, excitement from the NHL To Seattle groups on social media was peaking.

In our conversation with Paul Rogers from the Seattle Sin Bin, the excitement appeared to be giving way to uncertainty, as the various groups around Seattle jockeyed for position. The Vegas Hockey Podcast show is quite interesting, give it a listen!

With yesterday’s reports on the SB Nation page SonicsRising detailing the withdrawal of Chris Hansen and the SODO Arena plan, as well as the mysterious Bellevue group, The Puget Sound NHL hopes rest squarely on the shoulders of  the Tukwila/Bartozek group. From Sonic Rising:

     A source involved from the Seattle effort said Friday the Coleman group had told the NHL it wanted to finalize the arena site before submitting an application. The same source also indicated Vancouver, B.C., native Coleman hoped to “fast track” the expansion process once a land deal is completed. Coleman’s camp, according to sources, also indicated it is still committed to bringing an NHL franchise to Seattle.

So, there is still optimism  in Seattle, but the initial excitement is turning into frustrated hope.

Las Vegas Still The Favorite

From the privately funded arena on schedule to open in the spring of 2016,  the ownership group privately paying any expansion/application fees, the very successful ticket drive, the lease agreement in place, everything points to an NHL expansion team starting play in Sin City for the 2017-18 season. As CBS Sports says:

       There is no market right now that appears as ripe for expansion as Las Vegas. They have the building — a 20,000-seat arena being built by AEG and MGM slated for completion in 2016. They have the ownership group — billionaire Bill Foley and Las Vegas magnates, the Maloof family. They even have had the season-ticket drive, for which they’ve received pledges well over the 10,000-ticket goal they set. People put down real-money deposits for a team that doesn’t exist yet. With all of that in mind, Las Vegas is No. 1 for expansion right now.

Quebec City Closing Strong

With the ownership group of Quebecor Media and their billions, the beautiful new Videotron Centre, and the apparent unraveling of things in Washington State, Quebec Cities bid to reignite the Nordiques flame is gaining steam. The Globe and Mail reported Quebecor’s intention:

     “Quebecor has consistently stated that its objective is to establish an NHL franchise in Quebec City and it intends to make every effort to achieve that goal,” the statement said. “Out of respect for NHL authorities and the process that has been established, Quebecor will maintain its policy of discretion as it proceeds.”

The fan-base is fanatical about hockey, something it holds above any other market applying for a team. With the city and province shifting from their political stand against financial help to the original Nords, to one where they jointly financed the new arena, all the questions appear to have been answered in Quebec.

The Long Shots

Portland, Toronto, Milwaukee, and Houston have all been linked to NHL rumors at one time or another recently. Each city has their pros and cons, but are viewed as secondary options.

Portland would be a great option if the Seattle groups can’t get an arena project approved. They have an NHL sized arena already. The problem there is lack of an interested ownership group. Paul Allen owns the arena and the NBA Trailblazers, and is not an enthusiastic hockey guy.

The lack of an arena seems to eliminate putting a second team in the greater Toronto area. The Maple Leafs and Sabres both have voiced proximity concerns.

Milwaukee is having their own political quagmire concerning a new arena and the NHL must be hesitant to enter another publicly  funded arena minefield.

Houston would create a nice local rivalry with the Stars, but doesn’t expand the league footprint the way the efforts of Seattle, Portland and Las Vegas would.

With the new deadline of June 20th looming and only Quebec City and Las Vegas believed to have submitted their bids, the hockey world waits with baited breath to see who else will join the expansion party. The more time passes, the more the pretenders are separated from the real contenders. In September, Gary Bettman and the NHL Board of Governors will announce the winners of the expansion lottery, if any. Stay tuned.

Follow us on Twitter and subscribe to our Podcast on iTunes for all the latest expansion news!

Advertisements

Seattle Arena Plans Turned Upside Down,NHL Timeline Shift to 2017-18 Comes Into Focus

Hello hockey fans, welcome to the blog! As always, thank you for taking time out to stop by. We appreciate all the support and feedback we have received, and look forward to more of the same! On tap for this post is what we believe to be the NHL timeline for expansion, and why the shift a few weeks back from a 2016-17 start up for Las Vegas to a 2017-18 date, allegedly.
NHL Expansion into the west has been rumored for a while now, with most now believing that the two front runners in the west are Seattle and Las Vegas. It’s kind of the worst kept secret since, well, Area 51. Everyone knew it was there, but the government said nope, nothing to see here. The same thing has been going on with the NHL. It wasn’t until As recently as April 21st that Comissioner Bettman acknowledged that he would report on the ticket drive results to the Board of Goveners. His comments here via CBC.Ca :

“What I’m hearing is that the season-ticket drive has gone and is going extraordinarily well,” Bettman said. “When we get to the [board of governors] meeting in June I will report to the board as to where things stand based on the expressions of interest and we’ll figure out then what, if anything, we want to do.”

Meanwhile in the Pacific Northwest, there is a decidedly different tone from the Commissioner, his comments here come from associated press reports:

“We believe there are substantial people interested in owning a franchise there, and I’m not surprised because I think it would be a great market for NHL hockey,” Bettman said. “But there’s a threshold issue which relates to the arena. … Somebody’s got to be in a position to execute. And as of this point, Seattle isn’t there yet. Obviously, if it gets to that point, and the interest from potential ownership continues, it will catch our attention.”

Also the Seattle Mayor believes the Commissioner is excited about the possibilities of a team in Seattle. Comments from King5.com.

As far as the NHL, Murray reiterated what he said through a press release earlier in the day, that the NHL and Bettman made it known to him that it would like to put a team in Seattle. That’s if the city had a NHL ready building to play in.

Seems like a decidedly different tone from Comissioner Bettman when discussing the two markets. Almost like he can’t believe how great things are going in Las Vegas and how hard Seattle is having to fight to get out of the ground. The “what, if anything” comment strikes us as almost intentionally designed to discourage.

What is now becoming obvious is that Las Vegas is leading the pack among suitors for an NHL franchise, and the league is struggling to find a dance partner for her.  What seemed like a good result for Seattle  when the EIS was submitted on May 7th has now seen the whole SODO MOA deal start to unravel, as reported by the Seattle Times:

“This deal’s just not doable, at least as it’s constructed today,” says Tim Burgess, the president of the Seattle City Council. “I wouldn’t say it’s dead. But we are not going to go ahead with this arena without substantial changes. And there are no plans right now for those.”

As things have progressed so well in Las Vegas, shockingly so to some, as expected by those who actually live here, the NHL appeared ready to expand into both markets for the 2016-17 season. So much so that Hockey Vision Las Vegas hinged their refund policy on the season tickets being sold to a franchise starting play in  the 2016 season. 

But, back on April 19th the air was let out of the balloon, somewhat. This report by ESPN.com writer Scott Burnside said the expansion process timeline could stretch to the 2017-18 season.

While there remains widespread belief within the hockey community that the NHL will become the first major professional sports league to put down stakes in the gambling mecca, it is now believed that the earliest a team would begin play is the 2017-18 season.

While previous reports had speculated the expansion announcement would come this June at the Board of Goveners meeting, the now expected timeline is an update on the ticket drive during the June meetings, followed by a vote in September, reported by Alan Snel from the Las Vegas Review Journal. 

… so the 2017-18 season is likely the earliest a prospective team in Las Vegas would start play in light of the NHL Board of Governors possibly voting on a Las Vegas franchise in September.

Curiously, on April 28th, just ten days prior to when the EIS study was due in Seattle, the reports coming out of the Northwest began of a new, privately funded arena project in the Seattle suburb of Tukwila, like this report on King5.com

On Monday, the City acknowledged that Ray Bartoszek, through a holding company, had expressed interest in building a privately financed arena in the area.The new documents reveal that Tukwila Mayor Jim Haggerton wrote a letter to NBA Commissioner Adam Silver, and NHL Commissioner Gary Bettman, back on November 14th, expressing the city’s interest in bringing the league’s to the City. In it, he referenced the group, led by Brown and Lee, that also includes NBA Legend Bill Russell:

So, with the Vegas timeline reportedly being pushed back a year becoming public just ten days prior to the Tukwila Arena plan being released, and that just ten days before the EIS report was due on the SODO site, the implications become clear. Especially when the new timeline for the Tukwila project is revealed. The expected completion date of that project if it goes forward? You guessed it, Fall 2017. 

This morning, ESPN’s Craig Custance reported that Ray Bartoszek is, as we suspected, the man behind the push to build a multi-purpose arena in Tukwila. Bartoszek, via his company RLB Holdings Sports and Entertainment, filed a code interpretation request with the city and is expected to file a SEPA application this Friday. The target date to open the arena is the fall of 2017.

The above quote comes from the Blog Sonics Rising. Since the newly public group has been quietly working with the City of Tukwila since at least May 2014, and the timing of the press reports, it’s not hard to speculate that there are at least some handshake deals in place with the Las Vegas and Tukwila groups. Especially with a billion dollars in franchise fees and a couple billion dollars in real estate development on the line. 

With today’s news that Chris Hansen’s SODO Plan is dead to the Seattle City Council in a hockey first scenario, and the Ray Bartoszek group apparently gaining traction in Tukwila, the shift from a 2016-17 start to a 2017-18 plan now seems to make sense. Unfortunately for Las Vegas, it seems. But we look at it from the perspective that getting a major league franchise in Las Vegas is long over due, and if we wait an extra year, that just gives Mr.Foley more time to make things better when they finally drop the puck.

As always, thanks for stopping by to share some time with us. You can follow us on Twitter or catch our show on ITunes. We are always ready to talk some hockey so drop in and say hi!

Mark Warner

VegasHockeyPodcast