If Melnyk gives the ok for buyouts/retain salary, do you forgive him?

[Tnuoc Alucard]

Why is this so hard to understand?

An owner has to spend money to make money.

To have a proper business it means losing money before you make any. You have to put in money. The more money you put, the greater chance of higher revenue.

Where does the money come from? Obviously the owner. If he wants to make money, he has to make the investment.

So Melnyk has $38,166,666 USD in his pocket, his money, not money made from any profits generated from the Senators, his own personal money.


So, how long does does it take, before he gets a ROI from his laying out of
$38,166,666 USD ?

Or, how does he generate the extra revenue to get his ROI on the
$38,166,666 USD.??

 

[Tnuoc Alucard]

Now is the best time to sell the team. The arena got approved which means the teams value has/will go up overnight.

If he sells now he doesn't have to put a dime into construction but still benefits from the added value of the team.

Didn't we already explain this to you in another thread?

How could you possibly know when is the "best time" sell his team? Are you suggesting he will make more profit now, than 10 years from now?



You seem to forget he enjoys owning the team, and is not going to sell it. And IF he's as "cheap" as some people suggest he is, why in the world would he sell the team today, when it will be worth so much more in a decade, after Phase one in completed, the Arena is completed, the team is generating more revenues than is is today, and will for the next four years (approximately) while it operates in Kanata.


Selling the team today, would be "selling low", selling the team after a few seasons in Lebreton will be selling "high".


Why didn't Daryl Allan Katz sell the Oilers the instant he confirmed the deal to build the new Arena in Edmonton?

According to your logic that would have been "the best time to sell the team" right??

I wonder if the Oilers are worth more now, than when they had a few seasons left to play in their old Arena?????


Construction started in March 2014 for their new Arena, so to compare that to when the Senators new Arena might start being Constructed ......... let's conservatively say March 2020, or two years before Construction started in Edmonton .......So in 2012 The Oilers were worth (according to Forbes) $225 M, and shot up (overnight) to $400 M in 2013 .......... and when the Oilers began play, in their new Arena for the 2016-17 season the team was valued at $520 M in 2017.



These number would seem to suggest that if the Oilers were valued at $225 M two years before their New Arena started construction, and Last year were worth almost $3 M more, then perhaps you have no clue as to how teams gain value when a new Arena is one the horizon.


Melnyk would be an idiot if he took your advice, and sold the team today, and lost out big time on the future value of the Senators, once they begin play in Lebrton Flats.

 

[BatherSeason]

And IF he's as "cheap" as some people suggest he is

Not sure why this needs to be repeated to you again but, he was the one that said they have made cuts EVERYWHERE in Hockey Ops.

HE ADMITTED HE WAS CHEAP. And no, I will not provide you proof.

 

[Micklebot]

How could you possibly know when is the "best time" sell his team? Are you suggesting he will make more profit now, than 10 years from now?



You seem to forget he enjoys owning the team, and is not going to sell it. And IF he's as "cheap" as some people suggest he is, why in the world would he sell the team today, when it will be worth so much more in a decade, after Phase one in completed, the Arena is completed, the team is generating more revenues than is is today, and will for the next four years (approximately) while it operates in Kanata.


Selling the team today, would be "selling low", selling the team after a few seasons in Lebreton will be selling "high".


Why didn't Daryl Allan Katz sell the Oilers the instant he confirmed the deal to build the new Arena in Edmonton?

According to your logic that would have been "the best time to sell the team" right??

I wonder if the Oilers are worth more now, than when they had a few seasons left to play in their old Arena?????


Construction started in March 2014 for their new Arena, so to compare that to when the Senators new Arena might start being Constructed ......... let's conservatively say March 2020, or two years before Construction started in Edmonton .......So in 2012 The Oilers were worth (according to Forbes) $225 M, and shot up (overnight) to $400 M in 2013 .......... and when the Oilers began play, in their new Arena for the 2016-17 season the team was valued at $520 M in 2017.



These number would seem to suggest that if the Oilers were valued at $225 M two years before their New Arena started construction, and Last year were worth almost $3 M more, then perhaps you have no clue as to how teams gain value when a new Arena is one the horizon.


Melnyk would be an idiot if he took your advice, and sold the team today, and lost out big time on the future value of the Senators, once they begin play in Lebrton Flats.

The value shot up from the forbes valuation which would have been done late 2012 prior to the city coming to terms on a deal for a new arena to 400 m in late 2013 after the city came to terms on a new deal. It stayed pretty flat from that point (shot up a bit once construction started in 2014). The 2017 numbers likely reflect a market adjustment thanks to the expansion fee to Vegas which was orders of magnitude larger than prior expansion fees, 6 times what Columbus paid; I wouldn't expect that to happen again, whoever gets the next expansion team will not be paying 6 times what Vegas.

The 2016 forbes valuation of 445 would already have reflected any increase because they were playing in a new arena by the time it came out, so you should be comparing 400 to 445, about an 11% increase over 3 seasons, not 400 to 520.

 

[NorthCoast]

So Melnyk has $38,166,666 USD in his pocket, his money, not money made from any profits generated from the Senators, his own personal money.


So, how long does does it take, before he gets a ROI from his laying out of
$38,166,666 USD ?

Or, how does he generate the extra revenue to get his ROI on the
$38,166,666 USD.??

You're totally right. He has two options:

A) You operate totally within the budget even if that means making player moves, cutting internal budgets, etc that make you less competitive, but lower costs to ensure that any losses are recouped over time. This requires zero personal risk but might mean you are less competitive.

B) You believe that there is a much greater chance of winning over the next 5-7 years if you spend on the buyouts. Winning means playoff revenue's to the tune of 3 million per game. Factoring in costs the team probably has to make the playoffs most years out of the next 5-7 years or go on a few long runs in order to recoup the 38 mil. Much more risk, but more competitive.

Now 38 mil is a lot and i'm not sure i would take on that risk either. But I think people see this as an example of an overall trend. There are Zero Risk owners that make money, and there are Risk Tolerant owners that sometimes lose money and sometimes make a lot of money.

My guess is that his recent failures in bio-start-ups have probably made him pretty risk averse, and you have to admit that a lot of his statements about the finances seems to indicate that the team will only go as far as the budget allows within that fiscal year. ie: there is no long-term plan to invest in the team now with future Stanley Cup Finals revenues in mind. (Lebreton aside, but again, would be curious to see how much of his own money is in play)

Now maybe there is some investment going on behind the scenes where he is taking on this personal risk in order to make the team more competitive. But as has been outlined int he thread, if this is the case they sure could do a better job highlighting it to the fans. Because rightly or wrongly, Zero personal risk is perceived as Zero passion for winning.

And really, it's kind of hard to say that you are as passionate to win if it comes with the caveat "so long as I have nothing to lose".

 

[coladin]

IF YOU WANT TO MAKE MONEY YOU NEED TO SPEND MONEY. You quoted my post saying that.

If Melnyk ponied up some cash, and the absolute numbskulls in the Sens marketing department actually got the word out about it, that would generate a lot of buzz. There's no buzz for the Sens right now except for the draft this summer, and that's a LONG ways off.

Melnyk himself admitted that they are running a bare bones operation. That's such a downer for fans to hear. Spend a bit of money and let the whole damn hockey world know that you're hiring some scouts, or adding someone to the front office. Hire Chris Neil to a player development role. Boom. Money being spent. Excitement generated, and those are relatively small hires in the grand scheme of things but it will show the fans that he's actually committed to a Cup and not just committed to minimizing his losses.


One thing that is for sure in Ottawa is that people soak up every ounce of news about the team. Start getting some positive news out there, damnit. It's not hard. Say that Melnyk is giving Dorion the green light to make sure that the core players get signed this summer. Boom. Excitement generated and speculation on Mrlnyk being too cheap to sign Karl and Stone is put to rest...and amazingly, that doesn't even cost anything! Well, that's not true. The cost is however much the social media intern gets paid to write a tweet in French and English, and the however much it costs to tell Bruce Garrioch about it too. Boom. The whole damn city knows that the team is committed to the core players and to moving forward as a competitive team.

But nope. None of that will happen.

The bare bones operation doesn't bother me one bit. We have our star players. We have a stacked prospect pool. If ever there was a time for bare bones operation, now would be that time. How it actually makes people depressed is beyond me. This fan doesn't care. Many want to focus on the negative I guess.

Melnyk is spending money. Many criticize him for not spending it wisely, but he is spending it. Personally, I was "buzzing" after a stunning playoff run with incredible memories. The fan base responded with an epic drop off in attendance. Well done, Ottawa!

This is a miserable season, and this city as usual is probably the least tolerant fan base in the NHL. They feel "entitled" to players like Karlsson and Stone and assume it is their right to have them here. It doesn't work that way. I don't for a second believe that when Karlsson and Stone are signed longterm that ANYTHING changes with season tickets. I don't believe in the city's ability to properly support this team. I bet that the TV ratings will be off the charts though.

Even Ken Warren today hinted at it in his article. I am not going anywhere and I will go watch the games to support and cheer for the players. I don't cheer Melnyk, but I get that many choose not to separate the two.

 

[coladin]

That's not the way it works.

A business needs to EARN customers. Customers do not need to throw their wallets at a company to deserve a good product.

And I thought they EARN the customers by playing well like last year and in the playoffs. Any other ideas for a hockey club to EARN fans? Because no one showed up in October. For no damn reason.

 

[Zorf]

They did nothing to maintain momentum from last season. Where was the marketing? Where was the season ticket push? Where were the billboards with Karlsson's face on them telling us to get tickets?

People in this day and age have the memory of goldfish. It's straight to the next shiny thing. Sens just assumed that fans would come back and took everything for granted. You can't do that. You can't take your foot off the gas, ever.

 

[Micklebot]

They did nothing to maintain momentum from last season. Where was the marketing? Where was the season ticket push? Where were the billboards with Karlsson's face on them telling us to get tickets?

People in this day and age have the memory of goldfish. It's straight to the next shiny thing. Sens just assumed that fans would come back and took everything for granted. You can't do that. You can't take your foot off the gas, ever.

Yeah, fans were hyped about the run, and then the team lost Methot to the expansion, didn't pay the fairly low price Dallas did to re-aquire him, failed to replace him with an appropriate UFA, did nothing to replace MacArthur (who they apparently knew wouldn't pass the physical well in advance), tarped off 1500 seats.

Sure, they earned some customers with the playoff run. It seems as though they lost a lot with all the other stuff though.

It probably doesn't help that as great as our run was, a lot of the media and talk was that we had everything fall into place, and it was less us being a good team that could repeat, and more just catching lightning in a bottle. The fact is hope sells, and if the narrative is that what happened was an anomaly, you don't get the same level of hope instilled in the fan base as you would if it was seen as a bunch of our players reaching new levels. Additionally, there was lots of uncertainty around how Karlsson would look after surgery, and with him being credited with being the driving force behind our run, that hurts more.

 

[Tnuoc Alucard]

The value shot up from the forbes valuation which would have been done late 2012 prior to the city coming to terms on a deal for a new arena to 400 m in late 2013 after the city came to terms on a new deal. It stayed pretty flat from that point (shot up a bit once construction started in 2014). The 2017 numbers likely reflect a market adjustment thanks to the expansion fee to Vegas which was orders of magnitude larger than prior expansion fees, 6 times what Columbus paid; I wouldn't expect that to happen again, whoever gets the next expansion team will not be paying 6 times what Vegas.

The 2016 forbes valuation of 445 would already have reflected any increase because they were playing in a new arena by the time it came out, so you should be comparing 400 to 445, about an 11% increase over 3 seasons, not 400 to 520.

So do you agree with the poster I was debating with, who claims "right now is the best time to sell the Team, and make a huge profit"??

Or what I was suggesting, that the Team would be worth a lot more after a season or two in Lebreton, and the profit would be a whole lot bigger than it would be today?

Feb 2018 or Feb 2026?

 

[Tnuoc Alucard]

They did nothing to maintain momentum from last season. Where was the marketing? Where was the season ticket push? Where were the billboards with Karlsson's face on them telling us to get tickets?

People in this day and age have the memory of goldfish. It's straight to the next shiny thing. Sens just assumed that fans would come back and took everything for granted. You can't do that. You can't take your foot off the gas, ever.

Just wondering, were there "Billboards" in the past, other than on the side of the CTC?

Don't seem to remember seeing any in the past, but that could be that I keep my eyes on the road.

Besides, would Billboards be the way to go? Social media seems to be the flavour of the day.

Also, has anyone ever heard of any or all of these promotions??

Contests And Promotions

I've heard of three of the eight.

 

[Micklebot]

So do you agree with the poster I was debating with, who claims "right now is the best time to sell the Team, and make a huge profit"??

Or what I was suggesting, that the Team would be worth a lot more after a season or two in Lebreton, and the profit would be a whole lot bigger than it would be today?

Feb 2018 or Feb 2026?

What I'm saying is the biggest increase was immediately following the city agreeing to build a new arena. It shot up from ~250 to 400. The first year of playing in the arena did relatively nothing to the trend in the Forbes valuation and it a colossal mistake to credit the jump in 2017 to having played in the new arena for a year or two rather than the game changing expansion fee charged to Vegas. My suspicion is that waiting a year or two after opening the new arena would result in typical growth, not explosive growth like one might expect based on the agreement in principal to build a new arena.

 

[Spartachat]

So do you agree with the poster I was debating with, who claims "right now is the best time to sell the Team, and make a huge profit"??

Or what I was suggesting, that the Team would be worth a lot more after a season or two in Lebreton, and the profit would be a whole lot bigger than it would be today?

Feb 2018 or Feb 2026?

If Melnyk wants to hold on to the team to make a bigger profit down the road then fine. Just stop complaining about the fans in Ottawa and threatening to move to team, and try to make the team competitive even if it means spending to the cap sometimes. If he is having cash flow issues there are other more capitalized buyers out there.

It is like feeling sorry for the guy that has a 5 million dollar house in Toronto that he bought for only 1 million, but has cash flow issues paying for the remaining mortgage.

 

[Nac Mac Feegle]

Just wondering, were there "Billboards" in the past, other than on the side of the CTC?

Don't seem to remember seeing any in the past, but that could be that I keep my eyes on the road.

Besides, would Billboards be the way to go? Social media seems to be the flavour of the day.

Also, has anyone ever heard of any or all of these promotions??

Contests And Promotions

I've heard of three of the eight.

Considering the massive uncertainty with the costs of just the ground cleanup, and the uncertainty with the light rail and all the delays....safest time to get out is now. Ottawa isn't exactly built on the best ground. A lot of issues come up with major builds in this city (not to mention what would happen if we accidentally dig up yet another graveyard in this town). The fastest, easiest, guaranteed profit is to sell before they get into digging up that contaminated ground.

Oh, and promotions are meaningless when no one knows about them. You admitted yourself you only heard of three of eight.

 

[coladin]

They did nothing to maintain momentum from last season. Where was the marketing? Where was the season ticket push? Where were the billboards with Karlsson's face on them telling us to get tickets?

People in this day and age have the memory of goldfish. It's straight to the next shiny thing. Sens just assumed that fans would come back and took everything for granted. You can't do that. You can't take your foot off the gas, ever.

But half the posters here don' t even bleeping go...and you want billboards???

Fans took their foot off the gas. They are not blameless, and it is not all on the owner either. There could be more advertising, but there also could be better fans.

 

[Sens of Anarchy]

But half the posters here don' t even bleeping go...and you want billboards???

Fans took their foot off the gas. They are not blameless, and it is not all on the owner either. There could be more advertising, but there also could be better fans.

Look ... Part of the "Fan of the Year" award agreement is not criticizing other fans.

 

[coladin]

Yeah, fans were hyped about the run, and then the team lost Methot to the expansion, didn't pay the fairly low price Dallas did to re-aquire him, failed to replace him with an appropriate UFA, did nothing to replace MacArthur (who they apparently knew wouldn't pass the physical well in advance), tarped off 1500 seats.

Sure, they earned some customers with the playoff run. It seems as though they lost a lot with all the other stuff though.

It probably doesn't help that as great as our run was, a lot of the media and talk was that we had everything fall into place, and it was less us being a good team that could repeat, and more just catching lightning in a bottle. The fact is hope sells, and if the narrative is that what happened was an anomaly, you don't get the same level of hope instilled in the fan base as you would if it was seen as a bunch of our players reaching new levels. Additionally, there was lots of uncertainty around how Karlsson would look after surgery, and with him being credited with being the driving force behind our run, that hurts more.

I and many others thought Claesson was going to continue his stellar play. Harpur too.

If fans chose not to buy tickets for your reasons, well, doesn't speak much to the commitment of the fans. So we all have to be 100% happy with any and all moves? Gee, I guess no one will go to a game in Ottawa I guess.

Why you upset they tarped seats? Judging by attendance it seems to be a moot point doesn't it.

 

[coladin]

Look ... Part of the "Fan of the Year" award agreement is not criticizing other fans.

Could care less...Ken Warren did it, and everyone knows except people here that fans are not doing enough. A lot of articles are out there too. This isn't just me saying it.

During a playoff run is when you move next year's tickets. When I saw the empty seats in the playoffs i knew what that meant. No one was signing up , no matter the playoff run. And I knew that this year was going to be worst than last year.

 

[Tnuoc Alucard]

What I'm saying is the biggest increase was immediately following the city agreeing to build a new arena. It shot up from ~250 to 400. The first year of playing in the arena did relatively nothing to the trend in the Forbes valuation and it a colossal mistake to credit the jump in 2017 to having played in the new arena for a year or two rather than the game changing expansion fee charged to Vegas. My suspicion is that waiting a year or two after opening the new arena would result in typical growth, not explosive growth like one might expect based on the agreement in principal to build a new arena.

So by using that logic, Melnyk, if he had any thoughts on selling the team, and making a reasonable profit, it would have happened by now.

 

[Tnuoc Alucard]

If Melnyk wants to hold on to the team to make a bigger profit down the road then fine. Just stop complaining about the fans in Ottawa and threatening to move to team, and try to make the team competitive even if it means spending to the cap sometimes. If he is having cash flow issues there are other more capitalized buyers out there.

It is like feeling sorry for the guy that has a 5 million dollar house in Toronto that he bought for only 1 million, but has cash flow issues paying for the remaining mortgage.

Most people now realize that his so called rant in December, was mainly posturing for the NCC negotiations. Yeah he could have been a little more tactful, but we don't know what stage of the negotiations were at, and what the issues were, and we'll never know. But suffice it to say that the deal announced on the 25th looked pretty good from Melnyk's perspective, so perhaps the rant helped in that regard, at the expense of some thin skinned fans.

 

[Tnuoc Alucard]

Considering the massive uncertainty with the costs of just the ground cleanup, and the uncertainty with the light rail and all the delays....safest time to get out is now. Ottawa isn't exactly built on the best ground. A lot of issues come up with major builds in this city (not to mention what would happen if we accidentally dig up yet another graveyard in this town). The fastest, easiest, guaranteed profit is to sell before they get into digging up that contaminated ground.

Oh, and promotions are meaningless when no one knows about them. You admitted yourself you only heard of three of eight.

Melnyk's deal for Lebreton Flats, is that he's paying Fair Market value for the land, less the cost of the clean up.

No uncertainty there if you ask me.

The LRT is going to be up and running at some point this year, and Melnyk's group is not expected to put a shovel in the ground for at least 18 months, most likely more.

The LRT will not be an issue in any way.

If the Land is valued at 500 Million and it costs 600 million to clean it up, the NCC pays him 100 Million .......... the price to him is fixed, or cost certainty if you want to use a hockey term.

Other than funding the cost of the Arena, I expect the rest of development will be sub contracted out, again at agreed on costs, passing any cost issues onto the bidders.... just like the City did with LRT.

I don't see the risk that you do, in regards to Melnyk's group .........it's a pretty good deal for them.

 

[Tuna99]

Most people now realize that his so called rant in December, was mainly posturing for the NCC negotiations. Yeah he could have been a little more tactful, but we don't know what stage of the negotiations were at, and what the issues were, and we'll never know. But suffice it to say that the deal announced on the 25th looked pretty good from Melnyk's perspective, so perhaps the rant helped in that regard, at the expense of some thin skinned fans.

Thank you for this post demonstrating how stupid Melnyck is.

If his goal was to posture for the NCC, but he ended up instead pissing off his fanbase and the NHL, AND at he same time weakening his position with the NCC by having the community turn on him based on his ‘move’ comments - what goal was accomplished besides a PR firm in Toronto getting a new client??

 

[Nac Mac Feegle]

Melnyk's deal for Lebreton Flats, is that he's paying Fair Market value for the land, less the cost of the clean up.

No uncertainty there if you ask me.

The LRT is going to be up and running at some point this year, and Melnyk's group is not expected to put a shovel in the ground for at least 18 months, most likely more.

The LRT will not be an issue in any way.

If the Land is valued at 500 Million and it costs 600 million to clean it up, the NCC pays him 100 Million .......... the price to him is fixed, or cost certainty if you want to use a hockey term.

Other than funding the cost of the Arena, I expect the rest of development will be sub contracted out, again at agreed on costs, passing any cost issues onto the bidders.... just like the City did with LRT.

I don't see the risk that you do, in regards to Melnyk's group .........it's a pretty good deal for them.

LRT will be an issue until all phases are complete. It's great having an LRT station right at the arena...but that means diddly if there is no corresponding LRT station at the extreme ends of the city for fans to use.

Again, you have no clue how the price of the land is calculated (and it is a lease, not outright selling of the land). You also have no clue how the building developmetn will be structured. stop pretending you know what's going on when you clearly don't.

 

[Tnuoc Alucard]

Thank you for this post demonstrating how stupid Melnyck is.

If his goal was to posture for the NCC, but he ended up instead pissing off his fanbase and the NHL, AND at he same time weakening his position with the NCC by having the community turn on him based on his ‘move’ comments - what goal was accomplished besides a PR firm in Toronto getting a new client??

Again, none of us know how the negotiations were going between the NCC and the Melnyk group last year.

But I've heard some commentators suggest now, that the deal has been struck for Lebreton, that his rant back in December looked more like posturing to gain the upper hand in the negotiations ......... and some comparisons were made with the Flames negotiations with the City of Calgary, before last year's Mayoral elections.

You can call Melnyk stupid all you want, but today he is sitting in pretty good situation visa vie his deal with the NCC for Lebreton Flats, where he's not really going to be paying for the cost of the remediation of the contaminated soil, as it will be all deducted from the cost of the land .......... that's not stupid in my books.

As far as your assertion that he "pissed off the fanbase, I see little evidence of that, except for a very small vocal minority that are more pissed of at everyone else not jumping onto their band wagon.

In the long run this will all be forgotten, and there will be packed houses once the Senators begin play in Lebreton Flats.

 

[Tnuoc Alucard]

LRT will be an issue until all phases are complete. It's great having an LRT station right at the arena...but that means diddly if there is no corresponding LRT station at the extreme ends of the city for fans to use.

Again, you have no clue how the price of the land is calculated (and it is a lease, not outright selling of the land). You also have no clue how the building developmetn will be structured. stop pretending you know what's going on when you clearly don't.

You seem to be a little under informed. The LRT and ALL of it's stations (for phase one) will be completely constructed and operational at some point this year .......... well before a single shovel full of earth is dug for the New Arena ........ that will be located between two LRT stations that go into complete operation this year.

The Majority of Home Games are on week days (Mon-Fri) and the 100,000 people who commute to the downtown core every workday are already in close proximity to Lebreton Flats, they'll most likley leave their cars parked at their work place and go to the "game" if they have tickets, and if they use OC Transpo to get to work, they'll go to the game after work, and return home via OC Transpo.

Don't see why seem think the LRT has to be at the extreme ends of the City for people to get to and from Lebreton Flats.......... as I said, 100,000 people already commute every workday to the downtown core, where Lebreton Flats is pretty much located???

Also, until the further phases of the LRT are built, buses will connect with the existing "end of the lines" of the LRT. This is not a problem for the 100,000 who commute today, and it's won't be in 4 or 5 years from now.


Also, I and everyone else, besides you I guess, have a "Clue" as to the value of the land, and how it is calculated........... as it was reported in all the local media outlets on Jan 25. The actual dollar figure is not important, as Melnyk's group has agreed to whatever that figure is, if even it's an estimation today, the deal is signed, sealed and delivered.

The cost of the soil remediation is going to be deducted from the cost of the land.

Anyone with a modicum of understanding of how real estate development ventures like this are structured, know how they are put together and are flushed out over the projected two decades.


But don't take my word for it, read some of the media reports.


NCC, RendezVous strike LeBreton Flats deal

A major condition of the agreement is that RendezVous LeBreton will pay full market value for the land. The NCC will subtract the amount it costs to clean up the contaminated soil — expected to be in the tens of millions of dollars — from the final purchase price, though no figures have been agreed to.

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