Minor Hockey Leage Arenas
Quote: pacomartin
I wonder if these places have any sort of business model.
They concoct the model and then talk themselves into
thinking it will work, with no basis in reality. Seen
small business owners do this all the time. They invent
a scenerio thats based on wishful thinking and then
believe their own BS.
baseball team does. Hockey is exciting.
Quote: MoscaWilkes-Barre built our arena with 100% private money, and it has been a godsend to the area. The key is keeping it filled with events and filled with people, and the management here is great at doing both. The place turns a decent profit, and is crucially important to our quality of life. Stuff happens there, people go there, it's great.
It's not minor league hockey that I have a problem with. It's unrealistic expectations. I realize that WB arena is hugely successful.
The 8500 seat Wilkes-Barre/Scranton Arena cost $44 million in 1999 ($5200 per seat). The 10,500 Hershey Bears arena cost $65 million in 2002 ($6200 per seat). These sums are reasonable and can be supported by enthusiastic fans of minor league hockey, supplemented with concerts and other special events.
The Allentown Arena per seat cost rivals the $30K per seat cost of Yankee Stadium; one of the most expensive in the world for any stadium for any sport in any country. Financing is going to be $15 million a year for 30 years.
I said the same thing when Goldman Sachs bought the Stratosphere and three other casino properties for $1.3 billion. What possible scenario were you imagining where these decrepit properties could pay back that kind of investment? Shortly afterwards, the US government had to bail out GS.
I've no idea what Allentown plans, but surely it's more than semi-pro hox. Once you start breaking up the financing into all these different events, plus the parking for them, plus the concessions for them, maybe it starts to make some sense...
Quote: FaceI've no idea what Allentown plans, but surely it's more than semi-pro hox. Once you start breaking up the financing into all these different events, plus the parking for them, plus the concessions for them, maybe it starts to make some sense...
Of course, there are other sources of revenue (not just basketball). I don't expect this Arena to be open for 42 home games, and shuttered the rest of the time. But it takes time to book and fill the arena. Plus there is competition with other larger arenas.
That's why I compare it to other arenas, and see how they cope. The Adirondack Phantoms are playing in a 33 year old venue that cost $3million when it was built. The city managers of this small New York town are probably not under a lot of pressure to book dozens of other events, since the civic center was payed for a long time ago.
For instance the small City of Harrison NJ (near Newark NJ) has three different train lines that end either in the city limits or within a mile or two. The city itself is an old factory town. Since they have such good connection to New York city and a large Latino population, they were persuaded to float bonds to build one of the most modern soccer stadiums in the world. On March 20, 2010 the Red Bull arena at a cost of $200 million with a capacity for 25,000 seats opened ($8K per seat). They were hoping it would be the stimulus for further development of their industrial area. So far, the promise has not become reality, and they are laying off their policeman and fireman to make the interest payments.
The most expensive stadium in the world (on a per seat basis) is the new Yankee Stadium in the Bronx. It cost $1.5 billion and has 50K seats (or $30K) per seat. In order to pay for the massive interest payments they can cater to a luxury crowd that will pay ultra premium to watch a baseball game swathed in corporate comfort. You also have tiers of service, so that people will pay premiums for better service. To the old timers, they miss the plain old egalitarianism of going to a baseball game on the subway.
The Allentown arena is costing more than the Red Bull Arena and it only has 8500 seats. It is located where you currently buy your crack cocaine when your supply runs low. The murder rate within a mile of there is roughly 20-25 people per year. It has no trains, and is a good 100 miles from Manhattan. So with a per seat cost close to Yankee Stadium, you need a lot of monster truck rallies.
That's why you need business plans and not a lot of talk about miracle improvements in the local economy (vis a vis Revel Casino). When there is a huge deficit than you can't just go on the Hallelujah Chorus.
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The Philadelphia Flyers were the major league parent club to the Hershey Bears minor league hockey team in the 1980's and 1990's. When Philadelphia decided to replace the Spectrum with a new arena (now called the Wells Fargo Center) in the summer of 1996, they formed a new minor league Hockey team (Philadelphia Phantoms) to play in the old Spectrum arena. The team was successful, but when the venue got to old, Philadelphia declined to build them a new venue. They sold the team who moved them to an old arena in upstate New York until they could get a new arena. The team has been living in the wilds 50 miles north of Albany. There are rabid hockey fans up there, but there just isn't a lot of people.
The Philadelphia Flyers play in the WF Center (cost $210 million in 1996), but so do Philadelphia 76ers (NBA), Philadelphia Wings (NLL), the Philadelphia Soul (AFL), the Villanova Wildcats (NCAA) (Part time) , along with dozens of concerts a year. In fact it is one of the busiest arenas in the nation. This arena seats 20,000 people.
Now Allentown is going to build an 8500 seat arena for over $200 million with one solid tenant. This same team was thrown out of Philadelphia where they had a loyal fan base built up over 13 years because no one thought it was economical to build them a venue.
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My bigger point is these projects where you never see a projection sheet that tells you how much money they think they can make from such and such efforts. You always here things in the abstract. Now a lot of time the projections are widely optimistic, but when nobody will even put them to paper, then you usually have a problem in the making.
It is empty and has not been used in a few years.
Seattle is still paying for the Kingdome. It no longer exists.
In this case, no one sees any solid projections (based on the above comment about no one putting them on paper) and yet they are willing to spend big league money for a minor league sport. When there are projections, they tend to be wildly optimistic and out of touch with reality. They don't count ups and downs in the economy; they just count a constantly increasing revenue stream.
I like pro sports but I say that we should let the owners build their own stadiums and they can profit or loss from their investment. They will look at it as a business and make a decision where to build and play. I can live with that. Sure, give them tax breaks and incentives, but let them build it. The facilities might be a little toned down if built at their own expense or they might even use older facilities. Who cares? I can sit in an old stadium or a minimally designed place for a few hours if you are putting a good product out there (and have reasonable concession prices!!). I'm going to the GAME not the ARENA!!
Governments are not typically ran as businesses; they mostly fail miserably when they are in business.
Quote: RonCIn this case, no one sees any solid projections (based on the above comment about no one putting them on paper) and yet they are willing to spend big league money for a minor league sport. When there are projections, they tend to be wildly optimistic and out of touch with reality. They don't count ups and downs in the economy; they just count a constantly increasing revenue stream.
In the government it's called "plan for success".
The shame is that minor league sports have been a godsend for smaller cities. Done right, they add to community spirit, and allow a family to actually go see a sports event without breaking the bank. Allentown PA already has a very successful minor league baseball team. The 8200 seat (1800 standing room) venue cost $50 million to build, parking is $3 and the cheapest standing room tickets are $7 with seats as low as $10. So it costs the same as first run movie on a weekend.
The baseball park has an empty field next to it. But instead they spent $30 million just clearing a section in center city to build a $200 million plus 8500 seat arena for minor league hockey. As you said, this is big league money.
Vegas has a similar size arena at the Orleans casino that cost $85 million to build (open 9 years). They have boxing and minor league ice hockey along with special events like rodeos.
Now granted minor league hockey would have a smaller economic impact. But I would venture to guess it's just as important to a small city, relaitively speaking.
Quote: pacomartinIn the government it's called "plan for success".
I'd like to know how many "plans for success" have been successful!!
Quote: vendman1To play devils advocate a little. I think you could argue that public financing of stadiums/arenas is actually one of the smarter uses of government money. The long term economic impact of a well placed sports venue probably well exceeds the cost of the facility in the long run. For example, most juristictions generate tax revenue from ticket sales. Not to mention additional revenue from any restaurants/bars/hotel rooms etc. in the area. I live in Baltimore and the economic impact of Camden Yards (built for the Orioles in 1992 at a cost of 105mil.) and M&T Bank Stadium (built for the Ravens in 1998, cost about 300mil), have greatly exceeded their upfront costs. The entire west side of Downtown Baltimore has undergone a major rennisance all due to the draw the stadiums provide. The area has new hotels, residential and commercial development that I'm postive wouldn't exsist without those stadiums. This doesn't take into account the hard to measure boost in civic pride and/or general boost that a metro area experiences with the added 'cahce of pro, or big time college sports.
Now granted minor league hockey would have a smaller economic impact. But I would venture to guess it's just as important to a small city, relaitively speaking.
Orioles Park holds 45,971 according to one web site I found. The cost per seat if it was $105 million to build was $2,284.
M & T holds 71,008 (again, just found on web search). The cost per seat if it was $300 million to build was $4,225.
They are talking $30,000 per seat for this venture.
I am sure that there are some examples where public financing has worked--I just think that, as owners want more and more luxuries that make the owner more money and cost the government entity more--the equation is way out of whack. I think the reason Houston owes so much on the Astrodome is due to renovations for the Oilers before they abandoned town. Perhaps if the stadium deals were reasonable, as both the Baltimore locations were, and land acquisition costs were not too high, it might work.
This article from 2009 says that there was still a debate over the success of even those two parks...which I believed were highly successful):
http://thedailyrecord.com/2010/09/12/18-years-later-still-a-debate-over-success-of-oriole-park/
Quote: RonCOrioles Park holds 45,971 according to one web site I found. The cost per seat if it was $105 million to build was $2,284.
M & T holds 71,008 (again, just found on web search). The cost per seat if it was $300 million to build was $4,225.
They are talking $30,000 per seat for this venture.
I am sure that there are some examples where public financing has worked--I just think that, as owners want more and more luxuries that make the owner more money and cost the government entity more--the equation is way out of whack. I think the reason Houston owes so much on the Astrodome is due to renovations for the Oilers before they abandoned town. Perhaps if the stadium deals were reasonable, as both the Baltimore locations were, and land acquisition costs were not too high, it might work.
This article from 2009 says that there was still a debate over the success of even those two parks...which I believed were highly successful):
http://thedailyrecord.com/2010/09/12/18-years-later-still-a-debate-over-success-of-oriole-park/
Good Points...yes I suppose at some point the cost of the facility could way exceed it's ability to justify that cost, and certainly $30,000 per seat sounds ridiculous. Maybe this particular project is not a good one. I think we can all agree that any government funded project is capable of being a cost overunning boondoggle.
Quote: vendman1Good Points...yes I suppose at some point the cost of the facility could way exceed it's ability to justify that cost, and certainly $30,000 per seat sounds ridiculous. Maybe this particular project is not a good one. I think we can all agree that any government funded project is capable of being a cost overunning boondoggle.
Allentown's arena authority Thursday approved selling $233.7 million worth of bonds to build its downtown hockey arena complex. City officials stressed that all the numbers are estimates subject to change before the bond sale closes next month, but the publicly owned arena portion of the complex is projected to cost $179.5 million. Another $54.2 million is being spent to build parking garages and the shells for the seven-story office building and seven-story hotel to be built by privately owned by City Center Investment Corp.
Even using the smaller number of $179.5 million is over $21,000 per seat. I think that number is a little misleading since it cost almost $30 million to clear the site.
If a minor league hockey seat costs $6K per seat to build, and you can sell a season ticket for $800 per year, then you can probably run a profitable operation considering parking, food and beverage sales, and a steady stream of concerts and other uses for the arena throughout the year. When it costs over $18K per seat, you should be talking about a major league team (usually basketball).
The Wells Fargo Center in Philadelphia (whose construction was directly responsible for creating the Phantoms minor league hockey team) cost $210 million for close to 21,000 fans for basketball. That is $10K per seat. Even allowing for 16 years of inflation it is roughly $15K per seat. But it has two huge major league teams, Philadelphia Flyers (NHL) and Philadelphia 76ers (NBA) along with multiple other sports and events. It is one of the busiest arenas in the world.
Allentown is Pennsylvania's third city, but it is a distant third to Philadelphia and Pittsburgh. It dreams of recognition beyond Billy Joel's song "Allentown" which was a homage to broken dreams in dying industrial cities.
Allentown is not Baltimore. Baltimore already had an Inner Harbor that had been an attraction. We would often eat and stay down there before or after games at Memorial Stadium. There were a few nice hotels and restaurants in the area well before they decided on further development. I don't think Allentown has much of an attraction in place if things haven't changed drastically since I visited there years ago.
If these projects were looked at as business deals (even if you could monetize the "touchy feely stuff" like civic pride and quantify the exact economic impact), how many of them would get done?
How much has that Merchant Banker spent in lining up "experts" so far?
How many of those ticket prices are commercially reasonable now versus Tax-writeoffs or business tie-ins?
Most stadiums are expensive, used very little, expenses, not profit centers, to the municipality, etc. Hockey? Ain't no different than birdwatching. If you build an expensive environment people will come do it, but how many do you really think will come to watch hockey games?
Quite a shame, as was pointed out, minor league sports are a great deal. I still remember my days in Rochester. Various times I saw the hockey team play. Parking was $5-7, but once I got there so early (left from work) that I found a spot right across the street from the arena and parked fee. Once I knew a building 3 blocks away and paid $1 for evening parking. Yes, $1! The walk was not much different in distance than the monster-parking-lots at some big arenas. Seats right behind the glass? $18 in 1999-2002. $10 for three of the greatest prime-rib sandwiches on earht (Red Osier.) Beer reasonable.
The best part was it was as enjoyable as the NHL games I have been to!
You could take a family for <$100 if you didn't get our top-tier seats. I mainly got them just to say I sat the row behind the glass just once in my life. I know there are better views elsewhere. Now, if they added $10 per seat to pay for a premium arena I doubt I would have gone. Kill me more on food and beer and I won't be back. Nothing they could do about parking with such a downtown arean, but bump that to $10 and again, I will stay home or find other entertainment.
If arenas were such a good deal, owners would clamor to own them. In a bigger city you can fill an arean 300 times a year. In Rochester I was in conversations with people and insisted you could fill it 150 times a year, 3 days a week, if you booked the right acts and marketed form Syracuse to Buffalo. Allentown could do similar, but IMHO they are still crazy to build such a grand place.
Perhaps there is some involvement form the, you know, good ol boys?
Quote: AZDuffmanPerhaps there is some involvement form the, you know, good ol boys?
My mother says that as well. Someone has to be making money here.
The minor league baseball team that is affiliated with Philadelphia Phillies located to a stadium in an industrial park in Allentown 4 years ago. The stadium cost $50 million for 8100 seats ($6200 per seat) and is very popular. Since normally sports venues are built close to each other to share parking, the expectation was that a similarly priced hockey arena would be built on the empty field next door.
The industrial cities in this region are getting a huge percentage of the Latino population from Bronx and Brooklyn as the pre WWII housing goes for very cheap. Center City Allentown is over 50% Latino now. Many people felt that building a 1/4 billion sports themed arena and hotel complex in the center of the city is an attempt to return it to its European roots.
Newark and Harrison NJ dream of the big leagues as well. They have about 6 different sports venues. They are 20-22 minutes by train and $2 from the World Trade Center, so they are hoping to become the World Trade Center of Jersey. Everybody dreams that sports will pull them into the big league of economics.
To some extent Jersey City pulled it off after 9/11. The argument was it is a 2 minute train ride in a tunnel under the Hudson River, why be a target? I think ten high rise condos went up in the years since 9/11.
Quote: pacomartinAllentown PA is trying to get a minor league hockey team called the Adrindocks Phantoms: see Phantoms Ticket Prices (top season tickets are $790). They are currently playing in a venue that costs $3m to build 33 years ago. Allentown is spending more than most cities spend on professional basketball arena to build a hockey arena. Finance costs will be $15.3 million per year for an 8500 seat arena. Even if you get $1000 per seat in revenue, that is $8.5 million per year. That is before you have paid any team expenses or salaries. What kind of business plan can accomodate that shortfall? Ten thousand dollar pizzas?
The Save-on-Foods Memorial Centre (crappy name, okay venue) hosts 7400 folks, at a cost of $4,00 a seat. It was home to the minor hockey "Salmon Kings" which pretty much failed to get the required number of bums on seats, but now hosts the Junior Hockey WHL Victoria Royals (yeah, someone needs to do better names), and that seems to be going along very well. Junior Hockey is bigger than minor hockey (at least bigger than the ECHL is, AHL vs. WHL would be a closer match up).
Plus the concerts and stuff will keep things ticking along.
Quote: AZDuffmanI think Allentown is so close to NY/PHI that the local politicians either have some sort of evny or keep saying, "what if!"
Allentown is getting close to the smallest of the 4 biggest cities in NJ.
1 Newark Essex 278,154
2 Jersey City Hudson 247,597
3 Paterson Passaic 146,199
4 Elizabeth Union 124,969
With the new Panasonic office building going up in Newark, the smaller industrial cities are hoping to move partially into the big leagues.
Quote: AZDuffmanI still remember my days in Rochester. Various times I saw the hockey team play. Parking was $5-7, but once I got there so early (left from work) that I found a spot right across the street from the arena and parked fee. Once I knew a building 3 blocks away and paid $1 for evening parking. Yes, $1! The walk was not much different in distance than the monster-parking-lots at some big arenas. Seats right behind the glass? $18 in 1999-2002. $10 for three of the greatest prime-rib sandwiches on earht (Red Osier.) Beer reasonable.
The best part was it was as enjoyable as the NHL games I have been to!..............
The hated Rochester Americans. Thugs .. goons .. (The view from an old Binghamton Rangers fan)
It's all good now though. Go Carolina Hurricanes :-D -- Well, assuming there is even any hockey this year. Is anybody offering lines on whether or not the NHL plays this year? How about an over/under on the number of games missed?
Quote: FinsRuleThere will be hockey this year. I say they get all the games in. Maybe the first 5-6 games need to be rescheduled.
I hope there is NHL. Lock outs mean the WHL gets crazy popular, and I hate going to the arena on sell out nights. Takes far too long in the beer lines.
Quote: RaleighCrapsThe hated Rochester Americans. Thugs .. goons .. (The view from an old Binghamton Rangers fan)
It's all good now though. Go Carolina Hurricanes :-D -- Well, assuming there is even any hockey this year. Is anybody offering lines on whether or not the NHL plays this year? How about an over/under on the number of games missed?
Cleverest name I thought was Albany River Rats. They called me to sponsor the team as I was in pest control. If I was independent I would have jumped at it, as a corporate to even ask was useless. Never saw them play.
Batavia Muckdogs clever for MLB. They even license that since you cannot trademark an animal name across all sports, but what is a Muckdog?
Quote: AZDuffmanCleverest name I thought was Albany River Rats. They called me to sponsor the team as I was in pest control. If I was independent I would have jumped at it, as a corporate to even ask was useless. Never saw them play.
Batavia Muckdogs clever for MLB. They even license that since you cannot trademark an animal name across all sports, but what is a Muckdog?
The River Rats became the Charlotte Checkers. A couple of the ECHL players I watched move to the Rats. I would love AHL hockey in this town, but Juniors seems to be the way it goes in Canada (just compare the number of AHL franchises with the number of Junior franchises).
Mind you, I'd prefer Detroit returns the franchise they took in the 20's, but given the prices Canadian NHL teams can charge, it'll be cheaper to fly down to watch the Kings play.
Quote: RaleighCrapsThe hated Rochester Americans. Thugs .. goons .. (The view from an old Binghamton Rangers fan)
I was an undergraduate in upstate NY when they made this movie about violence in minor league hockey. I remember Paul Newman coming to the local hockey arenas.
Slap Shot has a nonstop barrage of profanity and raunchy action sequences.
Quote: pacomartinI was an undergraduate in upstate NY when they made this movie about violence in minor league hockey. I remember Paul Newman coming to the local hockey arenas.
Slap Shot has a nonstop barrage of profanity and raunchy action sequences.
I try to watch it at least once a year...it is one of my favorite hockey movies!!
The funny thing about "goons" (from knowing some NHL ones personally over the years) is that they are some of the nicest guys off the ice.
Somebody gets hurt in the morning skate, and we can have a replacement player here before game time.
|Edit: I see thecesspit beat me to this information.
Quote: RonCThe funny thing about "goons" (from knowing some NHL ones personally over the years) is that they are some of the nicest guys off the ice.
Rob Ray frequents our haunts so often, he doesn't even garner much attention. He's just one of the guys, real down to earth, and very active in community events.
I'd have to think the same couldn't be said of Probert, but sadly, I never got a chance to meet him.
Thread derail:
Went to a game one night, and it was our most hated opponent. In the pregame skate as the teams were skating along the center red line (the teams are skating in opposite directions) one guy stuck out a skate and kneed the other team's player, right at center ice. Talk about a donnybrook ! Almost everyone on the ice got into a scrap. We are talking the WHOLE roster. So 18 or so players from each team.
Some guys were just jersey tugging, but quite a few were throwing serious punches. Because it was prior to the game start, the referees would not get involved. They did come out on the ice to record information, but they would not get involved. It went on for probably 10 minutes before the boards opened up, and a couple dozen police and fireman came out on the ice (the fire station was next door to the Arena). Still took another 10 minutes to get things settled down.
I don't remember any more details, if anybody was ejected before the game started, or even how many players took part in the game. But I sure remember that fight. Minor league hockey. Gotta Luv it !
Quote: FaceRob Ray frequents our haunts so often, he doesn't even garner much attention. He's just one of the guys, real down to earth, and very active in community events.
I'd have to think the same couldn't be said of Probert, but sadly, I never got a chance to meet him.
I should have phrased it differently...MOST of them are nice.
There are always exceptions!!
Quote: thecesspitThe River Rats became the Charlotte Checkers. A couple of the ECHL players I watched move to the Rats. I would love AHL hockey in this town, but Juniors seems to be the way it goes in Canada (just compare the number of AHL franchises with the number of Junior franchises).
One of the venues I compared the Allentown Arena with is the Time Warner Center where the Charlotte Checkers play. The limited seating for hockey cost $18.5K per seat (construction cost) when it opened 7 years ago. But the primary tenant is still the NBA team, the Charlotte Bobcats (where seating is increased by over 30% from hockey).
But as extra activities, the arena hosts events like the Democratic convention and dozens of high profile concerts plus NCAA finals for March Madness.
The smaller venue in Allentown and the much less desirable city will be hard pressed to compete with the Charlotte arena. Charlotte is a major air hub, while Allentown has barely ten destinations from it's airport (all domestic within 1000 miles).
Quote: pacomartinOne of the venues I compared the Allentown Arena with is the Time Warner Center where the Charlotte Checkers play. The limited seating for hockey cost $18.5K per seat (construction cost) when it opened 7 years ago. But the primary tenant is still the NBA team, the Charlotte Bobcats (where seating is increased by over 30% from hockey).
But as extra activities, the arena hosts events like the Democratic convention and dozens of high profile concerts plus NCAA finals for March Madness.
The smaller venue in Allentown and the much less desirable city will be hard pressed to compete with the Charlotte arena. Charlotte is a major air hub, while Allentown has barely ten destinations from it's airport (all domestic within 1000 miles).
Allentown has a yearly fair that used to draw decent crowds for headliner concerts--not sure how that has done recently, but they had decent acts the last time I saw ads for the fair. They also have been the home of Drum Corps International Eastern Classic for decades--I attended it in 1979 or so and it is still there.
With events like that, I can see them supporting a reasonably priced small arena but the costs of this one will be very hard to recoup even if you count all of the "touchy feely" money used to justify these things. They can host mid-level concerts, the circus, and other events but I don't think the kind of money is in those to pay the bill.
Quote: RonCQuote: pacomartinI was an undergraduate in upstate NY when they made this movie about violence in minor league hockey. I remember Paul Newman coming to the local hockey arenas.
Slap Shot has a nonstop barrage of profanity and raunchy action sequences.
I try to watch it at least once a year...it is one of my favorite hockey movies!!
The funny thing about "goons" (from knowing some NHL ones personally over the years) is that they are some of the nicest guys off the ice.
As an aside: RonC, have you seen Goon? It is an AWESOME hockey movie. Better than Slap Shot, IMO, which is saying a LOT, Slap Shot is one of the best sports movies.
