Are the Devils in bankruptcy trouble? UPD: Chambers to pay $25m to exit?

Marv4Life

Registered User
Mar 5, 2006
3,421
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Minnesota
To bring us up to speed, what are the lease terms for the arena between the city and NJD?

20-year lease.

If the arena manager is counting on the Nets to achieve profitability, what will they do when that team moves to its own home in Brooklyn?
The Nets are just a bonus. The arena was the 3rd highest grossing place in the US only behind MSG and Staples(which does not include sporting events from anchor tenants): http://newyork.cbslocal.com/2011/06/25/newarks-prudential-center-number-3-in-the-us-industry-publication-finds/
Initially, as per reports from last February, it was my understanding Vanderbeek wanted to sell his 47% stake; now he's looking at buying Chambers out?
That was false reporting. VBK never wanted to sell, it was Chambers. VBK had an interest in buying and according to a team journalist the two are closer to a deal getting done.
 
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njdevil26

I hate avocados
Dec 13, 2006
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Clark, NJ
While I agree with you & countless others that the NYPost is far from reliable, a quick read, Im somewhat confused here. Initially, as per reports from last February, it was my understanding Vanderbeek wanted to sell his 47% stake; now he's looking at buying Chambers out?. :help:

That's the report that was refuted. There was a BS report out there that the Devils only signed Kovalchuk to get the attention of the Russian billionaire that bought the Nets and have him buy out Vanderbeek. That's the report that many MANY people have proven to be untrue. So don't think anything of that.
 

BLONG7

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Oct 30, 2002
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EXACTLY. They continue to sexually assault fans when it comes to ticket prices. They were advertising a new "tiered" price plan that would make games more affordable to fans. Once they rolled it out, I almost threw up looking at it. The CHEAPEST price level is the same exact prices for last year. Then there are two higher levels that raise prices.

The Devils had the top four corners of the arena with 10$ seats for the first three years. They weren't available to season ticket holders and you had to go to the box office on the day of the game to get them. Now they are gone. The CHEAPEST games (Tues, Wed, against Carolina, Florida and the like) are now 20$. They go up to 30 and I think 35 for games against the Rangers/Flyers/Penguins. Fri/Sat/Sun games are now upper tier so they are more expensive.... it's horse **** frankly. The team took a huge dump last year and really embarrassed themselves and the fans. So they repay the fans' loyalty by raising ticket prices significantly AGAIN. I love the players on the team but I hate the management I really do.



Think THIS is fair for a team struggling with attendance?

1112singlemapprice.jpg
Raising prices only works when the demand is high, and obviously it's not for Devils games...they should make it more reasonable for the average fan and families, and then maybe they would get more butts in the seats.....high prices, and a venue that's not full doesn't make sense...
 

Fugu

RIP Barb
Nov 26, 2004
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20-year lease.


The Nets are just a bonus. The arena was the 3rd highest grossing place in the US only behind MSG and Staples(which does not include sporting events from anchor tenants): http://newyork.cbslocal.com/2011/06...umber-3-in-the-us-industry-publication-finds/

That was false reporting. VBK never wanted to sell, it was Chambers. VBK had an interest in buying and according to a team journalist the two are closer to a deal getting done.

Do you know how the ownership of the Arena Mgt company is set up? When these figures about the NJD value are tossed about, I am assuming that's not inclusive of the arena mgt company--- or is that the 'parent' and the NJD are one of its pieces?
 

Fugu

RIP Barb
Nov 26, 2004
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Here's the Forbes blurb on NJD revenues and valuation:


The skinny

The Devils have taken over running the Prudential Center from AEG Facilities for non-hockey events and will have the New Jersey Nets of the NBA as tenants for at least two seasons. This should help the Devils increase revenue. But the investors who own the team are heavily leveraged and the Devils have been ousted in the playoffs during the first round each of the past three seasons. A rich cable deal with MSG enabled the Devils to turn a profit last season despite the early playoff ouster.

Site lists gate receipts at $38 million for 2009-10, which seems fairly low. Total revenue, net of revenue sharing (and NJD cannot qualify to receive, iirc) is estimated at $104 million. That should be enough to among the better-heeled teams in the league. That leaves the debt servicing.

How much do they get from MSG?


http://www.forbes.com/lists/2010/31/hockey-valuations-10_New-Jersey-Devils_313149.html
 

Marc the Habs Fan

Moderator
Nov 30, 2002
98,470
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Longueuil
I am in shock after seeing that Devils ticket prices grid. That's crazy.

My god, the Habs have lower prices for basically all comparable seats from what I can tell.
 

DavidL

Registered User
Dec 29, 2010
48
1
Expensive tickets and their conservative style of play is the reason why attendance is so low.

Aside from the expensive tickets, food and parking, the majority of the Devils fan base are suburban families. It's tough to get out to a week night game when the kids have to go to school the next day.
 

kdb209

Registered User
Jan 26, 2005
14,870
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How much do they get from MSG?

A quick google comes up with no definitive answers - but it appears that the Devils signed a 20 year extension with MSG in 2004 that paid ~$25M/yr. This puts it roughly in the ballpark with the Isles lucrative cable deal.

I don't know if its a good sign or a bad one when HF Boards threads come up as the top search results.

Devils extend television deal with Msg..

NYIsles1 said:
Devils extend television deal with Msg..

http://www.nj.com/sports/ledger/index.ssf?/base/sports-1/1099981871317990.xml

Devils shun Mets, re-up with MSG

In a blow to the Mets' plan for a regional sports network, the Devils yesterday announced a 20-year deal to keep the team's games on the MSG Network and Fox Sports Net New York.

Financial terms were not disclosed, but officials on both sides said the deal will give the Devils substantially more than the roughly $8 million rights fee the team was to receive this season.

In the past fans have complained when Devils games were broadcast on the Metro Channel, which is only available on Cablevision-owned systems. But Lamoriello said MSG and FSNY, which is owned by Cablevision, assured him that will no longer happen.


Local Broadcast Revenue Thread

It was mentioned in an article around the opening of their arena two years ago, but the Devils receive on average 25 million a year from MSG. It is a long deal so it is probably like the Isles deal where it is worth more as it goes on, but again the average works out to about 25 million.
 

coolstorybro

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Jul 2, 2006
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“Today’s New York Post story is inaccurate. The notions that the Devils are facing bankruptcy or that “the Devils have told their banks to get lost†are patently untrue. The Devils value their relationship with their banks and are confident a refinancing will be completed shortly. As stated previously, ownership is close to finalizing an agreement that would lead to a buyout of Brick City’s share of the company. The organization is also pleased to report that new season ticket sales are up 130% over last year and last week’s on-sale for single game tickets were 260% above last year’s similar period. Finally, the start of training camp was incorrectly reported in the article as tomorrow, in fact, training camp starts on Friday for the rookies and Saturday for the veterans.â€

http://blogs.northjersey.com/blogs/...hat_team_is_facing_bankruptcy_patently_untrue

haters keep hating though
 
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MaskedSonja

Registered User
Feb 3, 2007
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A quick google comes up with no definitive answers - but it appears that the Devils signed a 20 year extension with MSG in 2004 that paid ~$25M/yr. This puts it roughly in the ballpark with the Isles lucrative cable deal.

I don't know if its a good sign or a bad one when HF Boards threads come up as the top search results.

Devils extend television deal with Msg..




Local Broadcast Revenue Thread


Just shows HF boards is THE PRIME destination for your business of hockey answers! ;)
 

DavidL

Registered User
Dec 29, 2010
48
1
I've have been die-hard Devils fan for 20 years. But in this economy with gas, food and every price going up, uncertainty of the job, wife going to college, kids taking piano, swimming... lessons and the best seat in the house with the HDTV, I don't think we will be going to any Devils game soon.
 

MayDay

Registered User
Oct 21, 2005
12,661
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Pleasantville, NY
The Devils do have a beautiful arena, but every time I've gone the attendance has been very low.

They need to lower ticket prices or do whatever else they need to do to get more people to those games.

Sometimes I wonder if part of the reason for the Devils' and Isles' struggles at the gate may be because three hockey teams in one metro area is just too many to be sustainable in the long term, even in a metro area as big as greater New York.
 

MaskedSonja

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Feb 3, 2007
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Formerly Tinalera

New Jersey

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I'm not a hater in any way shape or form, but do you have links for reputable sites citing this information?

I guess I'm old school, to me a blog is just someone's opinion. I will also say that NYPost is not that much better for fairness sake.


I'm waiting to see some more "legitmate" sources for EITHER side of the story.

The blog is written by the Devils' beat writer for the Bergen Record, and he stated that word straight from the team is that they aren't facing bankruptcy.
MOD
 
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MoreOrr

B4
Jun 20, 2006
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My question still remains the same... How many teams need to be struggling financially before the League finally decides that increasing the Salary Cap every year isn't a good idea? I feel sure that if things continue as they have been, then eventually we're going to see a Season where the League sees a desperate need to lower the Cap, something I don't think will be so easily done, unfortunately; but they'll have put themselves in that situation, and perhaps the fans too if there are many more teams that can't hold on or if there's another lockout.
 

Strong Island

Registered User
Jun 6, 2004
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Long Island, NY
I'm not a hater in any way shape or form, but do you have links for reputable sites citing this information?

I guess I'm old school, to me a blog is just someone's opinion. I will also say that NYPost is not that much better for fairness sake.


I'm waiting to see some more "legitmate" sources for EITHER side of the story.

Tom Gulitti is as legitimate a source as you will find. Fire and Ice is a blog in name only.
 

kdb209

Registered User
Jan 26, 2005
14,870
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I'm not a hater in any way shape or form, but do you have links for reputable sites citing this information?

I guess I'm old school, to me a blog is just someone's opinion. I will also say that NYPost is not that much better for fairness sake.


I'm waiting to see some more "legitmate" sources for EITHER side of the story.

Uhh - NorthJersey.Com is the online site of the Bergen Record and Tom Gulitti is the Devils' beat writer.

It doesn't get more reputable than that as far as the Devils are concerned.
 

kdb209

Registered User
Jan 26, 2005
14,870
6
Tangentially related - I came across this NY Times Slap Shots piece by Chris Botta from 2010 (which I don't recall being posted here back then):

http://slapshot.blogs.nytimes.com/2010/12/17/daly-says-n-h-l-revenue-sharing-may-change/

December 17, 2010, 12:23 pm
Daly Says N.H.L. Revenue Sharing May Change
By CHRISTOPHER BOTTA

According to N.H.L. deputy commissioner Bill Daly, the league’s system of sharing revenue with lower-profile teams in large markets will likely change in the next collective bargaining agreement. In the C.B.A. that was negotiated in 2005, it was decided that teams in markets with television households of 2.5 million or more would not qualify for revenue sharing. As a result, the Islanders, New Jersey Devils and Anaheim Ducks are on the outside looking in.

“It’s probably a technicality, although it’s an intentional technicality of how the revenue sharing was originally constructed under the C.B.A.,” Daly said in an interview with SNY Point Blank, when asked about the Islanders’ status as a large-market franchise. “The concept was that, if your team plays in a large media market, and certainly the Islanders reside and play in a large media market — probably the largest in the world — that you should not qualify for revenue sharing in part because of what your local media rights opportunities are.”

...

“We have certainly heard from the Islanders and others over the years as to why that provision may be unfair in their circumstances,” said Daly. ” Revenue sharing is something we have collectively bargained with the union. We have a collective bargaining agreement coming up in a year and a half, and I suspect the revenue sharing model is something that’s going to be looked at closely. There may be changes.”

Daly said teams such as the Islanders, Devils and Ducks accepted their status when the current agreement was completed five years ago. “Since then, they’ve had different points of views,” said Daly. “Those are all things we have to throw in the mix when we negotiate the next time.”

In other words - Since Wirtz is dead we can scrap that rule.
 

MayDay

Registered User
Oct 21, 2005
12,661
1,146
Pleasantville, NY
My question still remains the same... How many teams need to be struggling financially before the League finally decides that increasing the Salary Cap every year isn't a good idea?

I thought the salary cap was locked in as a certain percentage of league revenues, as per the CBA?

It's not like the league is just sittinga round deciding, "hey, let's raise the salary cap again this year!" If revenues keep going up (and they have), then so does the cap.
 

GAGLine

Registered User
Sep 17, 2007
23,324
19,063
I am in shock after seeing that Devils ticket prices grid. That's crazy.

My god, the Habs have lower prices for basically all comparable seats from what I can tell.

I have no idea of the cost of living in Montreal, but in New Jersey it's pretty high, particularly near New York City. I wouldn't say that NJ fans are any less affluent than NYR fans. Many Ranger fans live in New Jersey, myself included. It's simply that they have less fans overall and can't support that high of a ticket price.

I never really understood why the devils moved to Newark. Maybe that was the only choice on the table, but a move to Hoboken would have made far more sense.
 

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