The Coyotes pay the equivalent of $5 in rent right now. They're going to go from being paid $15 million to play in one of the nicest arenas in the league to being paid nothing to play in a 12.5k decrepit barn that needs significant renovations just to be passable? How?
The team isn't being payed to play there. They are being paid to manage the arena. The deal is a loser for Glendale, but you're very much simplifying the issue. The team is sharing millions in revenue from all the events held there with the city of Glendale and is responsible for the operations and booking aspects of running the arena. Glendale gets all or most of the parking under the current arrangement, I believe. None of those conditions need necessarily exist at the Vet.
Again, I'd be shocked if this turned out to be the best option for the team. But if the commission looks and says, "You know we could use the catalyst to do the needed renovations, and we would have a guaranteed event for over 246 games to help offset the costs at the same time", they might decide they are open to a generous agreement.
You make big decisions by doing your homework. It costs almost nothing to say, "What would this take to make sense for you? Because this is what we would need for it to make sense for us. Are we close?"
If the overall cost was lower over a 3 yr period than Talking Stick, then maybe they figure it's worth a suboptimal building. After all, you've got all the limited view seating at Talking Stick, and the terms of the lease there weren't very favourable last go around.
It costs you nothing to ask a few questions. Why
wouldn't they ask around? If nothing else you might be making some leverage for yourself elsewhere.