Phoenix CXXXVII - and the band plays on

[TheLegend]

Truth...

From the article, if their equity was 'essentially' doubled...then Gosbee, who put in $35 million, got back the most at $70 million...and the rest of the bunch, who supposedly all put in equal shares of about $1 million apiece...made $2 million...barring any other additional 'expenses'...

So the “truth” is.... in spite of all those crushing losses they reportedly had, they made money on the deal.

Plus.... in spite of all their mistakes along the way, the NHL got to grow the game significantly in a non-traditional market

 

[jonathan613]

If I am the NHL, I do not allow a sale of the team if the group buying the team does not have an actionable arena plan. While I strongly believe in hockey in Arizona, no more cheap owners can be allowed to purchase the team. Also any purchase must be such that all current debt the team owes is taken care of.

 

[Fairview]

So the “truth” is.... in spite of all those crushing losses they reportedly had, they made money on the deal.

Plus.... in spite of all their mistakes along the way, the NHL got to grow the game significantly in a non-traditional market

It is like the NHL is running a pyramid scheme, and it is looking more and more like Borrowaway might be the last one in the pyramid, though

 

[TheLegend]

It is like the NHL is running a pyramid scheme, and it is looking more and more like Borrowaway might be the last one in the pyramid, though

Always possible. But I doubt it.

 

[Dirty Old Man]

I buy a restaurant. I lose money every year but the real estate goes up. I sell the restaurant and make money, despite losing money every single year. How is this possibility so difficult to comprehend?

 

[Fairview]

I buy a restaurant. I lose money every year but the real estate goes up. I sell the restaurant and make money, despite losing money every single year. How is this possibility so difficult to comprehend?

And at some point, as the restaurant continues to lose money, the continuing real estate value increases will no longer exceed the negative value of the business( restaurant) What happens at that point is that, realizing the restaurant numbers are not great enough to sustain business, the “ going out of business sign” goes up and another type of business gives it a shot.
It could be that we are at that point. Borrowaway has been trying for a few years now, with no one willing to invest, it may be time to put up the “ going out of business sign” ... relocation time. It is , as you say, a business.

 

[Dirty Old Man]

It could be that we are at that point.

Or .....not. That's just the thing ....there is this little crew here who, despite their protestations to the contrary and claims of lack of bias, seem to want to believe "the worst" of any situation in this saga, and will spin any bit of information to meet that opinion. Very "fake news-y" if you ask me.

 

[Fairview]

Or .....not. That's just the thing ....there is this little crew here who, despite their protestations to the contrary and claims of lack of bias, seem to want to believe "the worst" of any situation in this saga, and will spin any bit of information to meet that opinion. Very "fake news-y" if you ask me.

Fair enough. You were the one who used the business angle. This saga is far far away from following normal business progression. Team would be gone long ago.

 

[GuelphStormer]

Fair enough. You were the one who used the business angle. This saga is far far away from following normal business progression. Team would be gone long ago.

exactly.

it's clear that the league itself has been floating this franchise for a decade now. the babysitters owners have been making operational decisions but they've not been covering shortfalls. and at this point, its quite legitimate to suggest that operational losses have far surpassed any increase in franchise value.

 

[Acesolid]

I buy a restaurant. I lose money every year but the real estate goes up. I sell the restaurant and make money, despite losing money every single year. How is this possibility so difficult to comprehend?

I dont see many people disagreeing with what you just said.

The problem is that this is in no way a sustainable business model.

And that the good times (this ridiculous speculative sports team bubble) wont go on forever. I just dont see it surviving the next recession.

Sports team values wont keep going up exponentially forever. A business losing tens of millions every year simply isn't worth 500 million dollars! And even a sports team doing quite well and making like 50-100 millions in profit every year isn't worth 1.5 to 2 billion dollars like some people are valuating/buying them!

It's funny you mentioned Real Estate as an exemple... because I feel sports teams value will face their "2007-2008 mortgage crisis"-like reckoning sometime in the next 3-7 years, whenever the next recession hits.

 

[TheLegend]

I dont see many people disagreeing with what you just said.

The problem is that this is in no way a sustainable business model.

And that the good times (this ridiculous speculative sports team bubble) wont go on forever. I just dont see it surviving the next recession.

Sports team values wont keep going up exponentially forever. A business losing tens of millions every year simply isn't worth 500 million dollars! And even a sports team doing quite well and making like 50-100 millions in profit every year isn't worth 1.5 to 2 billion dollars like some people are valuating/buying them!

It's funny you mentioned Real Estate as an exemple... because I feel sports teams value will face their "2007-2008 mortgage crisis"-like reckoning sometime in the next 3-7 years, whenever the next recession hits.

The one slight problem with the real estate analogy is there’s comparative finite number of sports teams available. There’s a lot of value placed with exclusiveness on its own. It does defy common sense to some degree, but it’s something that can’t be ignored either.

I’m not inclined to do it at the moment but a study of where values of teams were both pre and post recession is probably in order here??

 

[BattleBorn]

The one slight problem with the real estate analogy is there’s comparative finite number of sports teams available. There’s a lot of value placed with exclusiveness on its own. It does defy common sense to some degree, but it’s something that can’t be ignored either.

I’m not inclined to do it at the moment but a study of where values of teams were both pre and post recession is probably in order here??

I did a cursory one based on MLB teams when I first read the post. There's just too much of a difference involved for market in baseball so I didn't go too much further since I didn't want to write three paragraphs over something I don't really care about.

Reinsdorf's initial Chicago White Sox investment has gone up in value 80x since the early 80s. Detroit sold for four times as much as the White Sox a decade after Reinsdorf's purchase. I don't know if Detroit started going into the tank by the early 90s, so I didn't know if that was a strong market situation or not.

Without looking too much more, I'm very confident in saying that the odds of finding someone that purchased an NFL/MLB/NBA/NHL over the past 50 years, held it for a decade or more prior to selling, and lost money are very slim. Even if you include year to year operational losses.

 

[Glacial]

I did a cursory one based on MLB teams when I first read the post. There's just too much of a difference involved for market in baseball so I didn't go too much further since I didn't want to write three paragraphs over something I don't really care about.

Reinsdorf's initial Chicago White Sox investment has gone up in value 80x since the early 80s. Detroit sold for four times as much as the White Sox a decade after Reinsdorf's purchase. I don't know if Detroit started going into the tank by the early 90s, so I didn't know if that was a strong market situation or not.

Without looking too much more, I'm very confident in saying that the odds of finding someone that purchased an NFL/MLB/NBA/NHL over the past 50 years, held it for a decade or more prior to selling, and lost money are very slim. Even if you include year to year operational losses.

Detroit's a bit counterintuitive. The city underwent significant urban decay over a span of decades (starting around 1950 IIRC), although it seemed like only in the 2000s with urban explorers and internet pics of around Detroit and inside book depositories, old grand train stations, etc, did everyone outside the area see the staggering level of decay. Population crashed. At 2010 census, it was around what it was in 1915. Despite all of that, the metro area has thrived. It's held its position as a media market (indicating the people are going from city to suburbs or those who leave the metro are exceeded by those who are arriving in the suburbs), its core industry is still fairly strong (Ford, GM, Chrysler).

Tigers got Comerica Park in 2000, Lions Ford Field in 2002, Red Wings Little Caesars Arena in 2017. The Pistons went to the Palace of Auburn Hills in 1988, the Lions went to the Pontiac Silverdome in 1975, both now in the city again. There was a partial exodus for a while, leaving just the Red Wings & Tigers in the city, but now all 4 teams are back in the city proper. Point is, even among all the decay, the Tigers & Lions still saw the city as feasible to remain in around the turn of the century.

So, the metro area still had a lot of money & economy in it despite the core city crumbling away (and being the epicenter for the ash-destroying bug from China) and the city was still feasible for some teams to remain in or relocate back into from the suburbs.

 

[Tom ServoMST3K]

If I am the NHL, I do not allow a sale of the team if the group buying the team does not have an actionable arena plan. While I strongly believe in hockey in Arizona, no more cheap owners can be allowed to purchase the team. Also any purchase must be such that all current debt the team owes is taken care of.

the NHL can't afford to be picky at this point.

I wouldn't be surprised if they were just emailing Powerball winners trying to find an owner at this point

 

[Fairview]

the NHL can't afford to be picky at this point.

It's at the point I wouldn't be surprised if they were just emailing Powerball winners trying to find an owner at this point

I think that they might even confirm ownership if the investor can prove that he has bought a ticket for the next Powerball draw. Based on the lofty standards set by approving Ice Clowns and then Borrowaway, if you have a pulse and are interested in the team, you are golden. With such low standards, and over 2 years of searching, the true value of the team is becoming more evident by the day

 

[TheLegend]

the NHL can't afford to be picky at this point.

I wouldn't be surprised if they were just emailing Powerball winners trying to find an owner at this point

I will say this.....

Had I hit that $1.5 billion Mega Millions draw last year ($850M cash value) there would have been a few jaws on the floor around here.

 

[Tom ServoMST3K]

I will say this.....

Had I hit that $1.5 billion Mega Millions draw last year ($850M cash value) there would have been a few jaws on the floor around here.

I think you would've been the best owner in franchise history.

Not a high bar to reach, but still

 

[Fairview]

I think you would've been the best owner in franchise history.

Not a high bar to reach, but still

I think that we should make sure that Bettman/Borrowaway are aware of Legend's interest in the team, just to see how long it would take before an unnamed NHL source, close to the team, announces that there is yet another potential suitor for the team.

 

[Tom ServoMST3K]

I think that we should make sure that Bettman/Borrowaway are aware of Legend's interest in the team, just to see how long it would take before an unnamed NHL source, close to the team, announces that there is yet another potential suitor for the team.

"A local ownership group has expressed interest in the club.

They're headed up by a fan of the franchise, and have really thought about their arena plan."

 

[Fairview]

"A local ownership group has expressed interest in the club.

They're headed up by a fan of the franchise, and has really thought about his arena plan."

They are in the due diligence phase, but sources close to the team expect the deal to close before the start of the season or before the end of 2019 or by the AllStar break or the end of the season or during the 2020 Draft...etc etc etc..it's a very complicated transaction

 

[Stumbledore]

I dont see many people disagreeing with what you just said.

I can't speak for anyone else on here, but if I see a post which I disagree with followed by another post that accurately refutes it, then I deliberately withhold adding my disagreement. Particularly when the original refutation is succinctly worded.

I'm suspecting that others on here are of similar ilk. Otherwise the board fills up with "me too" and "yeah, what he said" and nobody wants to see that.

Perhaps HFBoards needs to provide us with a "disagree" or "dislike" button.

Just one moose's opinion...

 

[Bookie21]

They are in the due diligence phase, but sources close to the team expect the deal to close before the start of the season or before the end of 2019 or by the AllStar break or the end of the season or during the 2020 Draft...etc etc etc..it's a very complicated transaction

Exactly like the posters around here who have been predicting the demise of this team for the last decade and a half......it's always the same old..next season is the last, ownership can't afford to keep the team here etc etc. Bad predictions will continue, that is a guarantee around here. The demise will always be a fortnight away

 

[yukoner88]

"A local ownership group has expressed interest in the club.

They're headed up by a fan of the franchise, and have really thought about their arena plan."

This sounds like Edmonton when Katz was making his bid to but the Oilers.....

On HFOIL, We started to suffer ground hog day syndrome in 2019 and man alive it's getting strong

 

[Fairview]

Exactly like the posters around here who have been predicting the demise of this team for the last decade and a half......it's always the same old..next season is the last, ownership can't afford to keep the team here etc etc. Bad predictions will continue, that is a guarantee around here. The demise will always be a fortnight away

It is not only the posters on this board that hold that opinion. It is apparently the belief of a large percentage of the team’s local fan base as well. It has been used as one of the factors in the team’s lack of support. Also, the relocation rumours are fueled partly by info coming from the NHL side of things. Statements from Bettman that the team cannot remain permanently at GRA,the team must have a new venue to remain in the market(with nothing happening on that front for 2+years now) or from Borrowaway stating that if we cannot secure a new venue, we will have to have a“discussion” about what will happen next. These statements coming from supposedly the market’s strongest advocates, would not instill much confidence in the future of the team in Arizona.
Add to that an ownership group that refuses to extend their lease for anything longer than 1 year at a time, even though it would take much longer than one year to negotiate, finance and construct a new arena.

 

[TheLegend]

It is not only the posters on this board that hold that opinion. It is apparently the belief of a large percentage of the team’s local fan base as well. It has been used as one of the factors in the team’s lack of support. Also, the relocation rumours are fueled partly by info coming from the NHL side of things. Statements from Bettman that the team cannot remain permanently at GRA,the team must have a new venue to remain in the market(with nothing happening on that front for 2+years now) or from Borrowaway stating that if we cannot secure a new venue, we will have to have a“discussion” about what will happen next. These statements coming from supposedly the market’s strongest advocates, would not instill much confidence in the future of the team in Arizona.
Add to that an ownership group that refuses to extend their lease for anything longer than 1 year at a time, even though it would take much longer than one year to negotiate, finance and construct a new arena.

Easy for the “local fanbase” to have that train of thought when you’ve had ten years worth of doom and gloom and predictions of relocations shoved down your throat by the national AND local media.

Statements from Bettman et al have been used on this board for everything from calling it a negotiation ploy to “absolute proof hockey doesn’t belong in the desert.” The biases run deep... all the way down to the cheeky references of “The Ice Clowns” or Andrew Barroway as “Borrowaway”.

Yet.... this year the team had it’s best attendance figures in nearly ten years. With TV viewership up (even exceeding the Suns for most of the year) and corporate sponsorships up.