Coyotes still owe rent for 2019/2020 UPD - Post #217 (Reconciled)

[robertocarlos]

There is another article stating that the Coyotes lose $50 million per year, and have $300 million in debt from previous losses. So to say they are catching up is erroneous, when in fact it is revenue sharing, and borrowing keeping them from bankruptcy. The Jets model is a little more difficult to grasp. They do get revenues from other properties, casino revenues, and management of the arena, which changes the bottom line. Without playoff revenue the Jets are not a profitable team, but with it they usually are. Those losses for 2019 are probably a result of being a Cap ceiling team, because of injuries and an unsuccessful run at the Cup. The losses for this year, as indicated by another poster are around $1 million, while I believe the Coyotes are still bleeding, missing payroll, arena payments, laying off staff, etc. A tale of two cities, one that can survive and one that can't.

How can the Jets survive with no fans and no arena concerts?

 

[voyageur]

How can the Jets survive with no fans and no arena concerts?

That's an interesting take too. Those owners that are operating their own arenas will take a bigger hit than the ones who don't. I guess the government insures part of it, Chipman is still financing debt, selling vehicles, and Thomson still has a healthy fortune.

 

[Oddbob]

Are you just not familiar with Alex Meruelo, his business history, or anything he's done at the head of the Coyotes organization over the past year. I highly suggest you read about him, you definitely need it.

What is keeping them there is the potential to become a team like Dallas, where they are a fairly popular team in a huge metro area. An organization like that makes more money than any Canadian hockey market not named Toronto or Montréal. That isn't Bettman's pride. That is realizing market potential. Alex Meruelo saw it and is well on his way to fulfilling it.

The Coyotes aren't popular, far from it. If they were they wouldn't be having such massive money issues!

 

[objectiveposter]

lol@ anyone trying to compare this coyotes mess of a franchise to winnipeg. The Jets have the richest owner in Canada. Whats not included in the Forbes numbers are all the other perks the Jets get from the city and province. They get millions a year in slot machine revenue to pay for the debt on the arena. They also pay no property tax on the arena and get all of the parking and other arena generated revenue. The team was bought for 170 million canadian and it now worth over 400 milion american. The arena is also one of the busiest in north america.. located downtown. Jets are a very stable team with stable ownership... the exact opposite of the coyotes who have dollar store owners and an arena located in the middle of nowhere losing eight figures every year.

 

[Stumbledore]

lol@ anyone trying to compare this coyotes mess of a franchise to winnipeg. The Jets have the richest owner in Canada. Whats not included in the Forbes numbers are all the other perks the Jets get from the city and province. They get millions a year in slot machine revenue to pay for the debt on the arena. They also pay no property tax on the arena and get all of the parking and other arena generated revenue. The team was bought for 170 million canadian and it now worth over 400 milion american. The arena is also one of the busiest in north america.. located downtown. Jets are a very stable team with stable ownership... the exact opposite of the coyotes who have dollar store owners and an arena located in the middle of nowhere losing eight figures every year.

Since your name says you're objective, I did a little a sleuthing and found out just how accurate you really are.

"Richest owner in Canada". David Thompson's wealth is private but was usually listed, pre-Covid, at $27.5 billion. The Business Insider in November, 2019, listed him as worth $38.9 billion. He's generally regarded as the 17th richest person on the planet.

"Millions a year in slot machine revenue." As of February, 2020, "an estimated $5.5 million worth of revenue from 140 gaming machines at the Shark Club at Cityplace mall".

"They also pay no property tax". In 2019, the Jets got "a break in property tax estimated at $931,000."

"Get all of the parking and other arena generated revenue." The Jets do not get any parking revenue, but they do get "a business-tax refund pegged at $249,000 last year and the ability to collect $8.1 million worth of entertainment taxes on events at the arena."

"The team was bought for 170 million canadian". The team was bought for $110 million and paid an additional $60 million relocation fee.

"Now worth over 400 million american". As of February, 2020, valuations of the team range from $420 million to $662 million, American

"The arena is also one of the busiest in north america." The rankings for busiest are invariably based on number of tickets and/or people in the venue, hence the larger arenas will always predominate. Based on event ticket sales, the Jets arena in 2018 placed 27th busiest arena in the world and 19th in North America. According to the Bell MTS Centre publicity, it booked 330 events in 2018 placing it as the 7th busiest arena in North America.

As for your opening statement "lol at anyone trying to compare this coyotes mess of a franchise to winnipeg", I heartily agree.

 

[TheWhiskeyThief]

Since your name says you're objective, I did a little a sleuthing and found out just how accurate you really are.

"Richest owner in Canada". David Thompson's wealth is private but was usually listed, pre-Covid, at $27.5 billion. The Business Insider in November, 2019, listed him as worth $38.9 billion. He's generally regarded as the 17th richest person on the planet.

"Millions a year in slot machine revenue." As of February, 2020, "an estimated $5.5 million worth of revenue from 140 gaming machines at the Shark Club at Cityplace mall".

"They also pay no property tax". In 2019, the Jets got "a break in property tax estimated at $931,000."

"Get all of the parking and other arena generated revenue." The Jets do not get any parking revenue, but they do get "a business-tax refund pegged at $249,000 last year and the ability to collect $8.1 million worth of entertainment taxes on events at the arena."

"The team was bought for 170 million canadian". The team was bought for $110 million and paid an additional $60 million relocation fee.

"Now worth over 400 million american". As of February, 2020, valuations of the team range from $420 million to $662 million, American

"The arena is also one of the busiest in north america." The rankings for busiest are invariably based on number of tickets and/or people in the venue, hence the larger arenas will always predominate. Based on event ticket sales, the Jets arena in 2018 placed 27th busiest arena in the world and 19th in North America. According to the Bell MTS Centre publicity, it booked 330 events in 2018 placing it as the 7th busiest arena in North America.

As for your opening statement "lol at anyone trying to compare this coyotes mess of a franchise to winnipeg", I heartily agree.

People keep forgetting that David Thompson is a limited partner and Chipman is the managing partner. Paper losses for the Jets can be used by True North to cover profits elsewhere, but cash flow issues that go above a reserve fund will have to be covered y capital calls, something they would likely dilute Chipman.

 

[Stumbledore]

How can the Jets survive with no fans and no arena concerts?

Very easily. Check out post #80.

 

[Stumbledore]

People keep forgetting that David Thompson is a limited partner and Chipman is the managing partner. Paper losses for the Jets can be used by True North to cover profits elsewhere, but cash flow issues that go above a reserve fund will have to be covered y capital calls, something they would likely dilute Chipman.

Sorry, I'm confused as to your point. I've written, negotiated, and read hundreds of partnerships in my day and all of them are limited. It's a term expressing debt liability with regards to the quantum of investment.

For clarity, the Winnipeg Jets are one property of 78 assets held by True North Sports and Entertainment. David Thompson owns Osmington Incorporated. Osmington is liable for up to 18% of TNSE real property debt.

For greater clarity, as president of Megill-Stephenson holding company, Mark Chipman bought out the remaining partners in TNSE. He also owns the Birchwood Group of car dealerships and the Longboat Development Corporation real estate group. In 2018, his net worth was listed as $515 million.

I've posted repeatedly in many threads about the issue of backing up claims and cite authorities and posters who deny any and all evidence, so I personally don't care what you want to believe or reject. The point can be stressed, however, that any cash flow issues will have little effect on "diluting" Mark Chipman.

 

[Pandemonia]

Not to get into the Endless Circular Debate about who you trust as sources and backing-up opinions and rejecting evidence, but ....

I think Forbes has been shown to be significantly inaccurate a sufficient number of times that their credibility has taken a hit since they were purchased by the Whale Group in Hong Kong.

"Forbes is often wrong" Fixed it for ya.

 

[Yukon Joe]

@Silver Moose @TheWhiskeyThief I don't know that I can trust either one of you when neither of you know how to spell the name of David Thomson (no "P"), 3rd Baron of Fleet!

 

[robertocarlos]

I have no confidence in billionaires who get their hair cut at home. Alone.

 

[Ernie]

If Chipman is worth $515m and is the majority owner of the Jets and of Bell MTS Place, those two assets make up the majority of his net worth. That would make it hard to come up with any shortfall funded from his other assets.

However, I'm pretty skeptical of the whole premise of a cash call. I believe the Jets should have access to the league's low interest line of credit. If the Coyotes made it as long as they did without a cash call (because none of the owners could have afforded one), then I doubt the Jets would be forced to.

 

[robertocarlos]

Here's how most people go broke. Slowly at first and then all at once.

 

[TheLegend]

If Chipman is worth $515m and is the majority owner of the Jets and of Bell MTS Place, those two assets make up the majority of his net worth. That would make it hard to come up with any shortfall funded from his other assets.

However, I'm pretty skeptical of the whole premise of a cash call. I believe the Jets should have access to the league's low interest line of credit. If the Coyotes made it as long as they did without a cash call (because none of the owners could have afforded one), then I doubt the Jets would be forced to.

IA had a cash call once. Don’t remember the actual specifics but I do recall Daryl Jones mentioned on his Twitter account having to write the check for his portion of it.

But that was the only occurrence I can remember.

 

[Stumbledore]

@Silver Moose @TheWhiskeyThief I don't know that I can trust either one of you when neither of you know how to spell the name of David Thomson (no "P"), 3rd Baron of Fleet!

Right you are! And how embarrassing that I never noticed.

I'm on meds and am waging a losing battle against my spell checker which continually provides alternate word endings that I do not want but am too lazy/inept to overpower.

Whiskey will have to come up with his own excuses ...

 

[MNNumbers]

Right you are! And how embarrassing that I never noticed.

I'm on meds and am waging a losing battle against my spell checker which continually provides alternate word endings that I do not want but am too lazy/inept to overpower.

Whiskey will have to come up with his own excuses ...

Whiskey usually carries its own excuses...

 

[Major4Boarding]

What the hell is that? I'd like to get the "unparaphrased" version

 

[Ernie]

LOL yeah paying the players is a business relationship that has undermined the success of the franchise. Without that expense they wouldn't be losing money at all!

Is it that hard for them to admit that they having cash flow issues?

 

[BLNY]

Landlord be like ...

 

[Mightygoose]

Sounds like an admission that despite being worth 2 billion, there's only so much $$ Mr. Meruelo is willing to sink into this. The affects of Covid is the real possibility of no/limited fans next season he's reaching that ceiling much sooner than he anticipated. Buyer's remorse starting to kick in.

Can't the league's LOC help the team meet the expenses for at least this past season while he tries to negotiate something for the next one?

 

[Stumbledore]

Now that Judge Baum has retired, I wonder who's the next in line to draw the potential bankruptcy case?

 

[Pandemonia]

Whiskey usually carries its own excuses...

Smartest comment I've read all day !!!

 

[93LEAFS]

lol@ anyone trying to compare this coyotes mess of a franchise to winnipeg. The Jets have the richest owner in Canada. Whats not included in the Forbes numbers are all the other perks the Jets get from the city and province. They get millions a year in slot machine revenue to pay for the debt on the arena. They also pay no property tax on the arena and get all of the parking and other arena generated revenue. The team was bought for 170 million canadian and it now worth over 400 milion american. The arena is also one of the busiest in north america.. located downtown. Jets are a very stable team with stable ownership... the exact opposite of the coyotes who have dollar store owners and an arena located in the middle of nowhere losing eight figures every year.

Bolded is a bit of a stretch. Compare it to any NBA/NHL arena in a major city and it likely is pretty far behind, especially when it comes to Revenue. Scotiabank Arena, Staples, MSG, Wells Fargo Center, TD Garden, Little Cesar's Arena, American Airlines Center, etc likely blow it out of the water revenue wise. They see more big concerts and their 2nd tenent is an NBA team, not an AHL team.

 

[93LEAFS]

What the hell is that? I'd like to get the "unparaphrased" version

They are broke, so they need to "re-negoiate" deals that are likely already below market.

 

[Stumbledore]

Bolded is a bit of a stretch. Compare it to any NBA/NHL arena in a major city and it likely is pretty far behind, especially when it comes to Revenue. Scotiabank Arena, Staples, MSG, Wells Fargo Center, TD Garden, Little Cesar's Arena, American Airlines Center, etc likely blow it out of the water revenue wise. They see more big concerts and their 2nd tenent is an NBA team, not an AHL team.

I tried to address this earlier in post #80 and probably did a poor job.

In gist, various associations rank the "busiest arenas" not by the number of tickets sold, the importance of the artists, the size of the concerts, the ego of the cities, or the revenue they generate, or whatever. They rank them on how many events they hold, but they have all sorts of definitions and algorithms which enter into it. Don't ask me to explain it because I don't understand it.

A few places said that the Bell MTS Centre ranked 7th busiest in North America about 2-3 years ago. My closing comment on post #83 is also pertinent.