The mayor of St. John's says the numbers have been crunched and landing a National Basketball League of Canada franchise is a "good deal" for the capital city.
Dennis O'Keefe said 1,500 is the all-important number when it comes to keeping the risk low for taxpayers.
"If we get an average attendance of 1,500 people to a game, then that would be our break-even point. Anything above and beyond this would be a plus," he told CBC Radio's St. John's Morning Show Tuesday.
"We would hope to be up around 2,000 or 3,000 people per game. Now, that might take a while to achieve, but certainly on a very practical level, getting 1,500 people down to a basketball game is very achievable."
Corporate sponsorships are key
O'Keefe explained the risk is centred more around "core revenue," meaning corporate partnerships rather than attendance.
That means the City of St. John's must sell corporate sponsorships. Otherwise, O'Keefe acknowledged, the taxpayer subsidy to St. John's Sports & Entertainment, which operates Mile One, could increase.
But O'Keefe said he expects selling those sponsorships to be a lot easier now.
"That's what makes it so important to have an anchor tenant. If there's no anchor tenant, then you have a building that's empty … and it would be very, very difficult to sell, obviously, sponsorships in a building that is empty of events for that period of time," he said.
O'Keefe said there will be 20 regular-season home games — possibly another 10 more for playoffs — and the term of the deal is for five years.
Ticket and advertising revenue will go to the team, according to O'Keefe. He said there are also numbers that can't be easily calculated but will hopefully boost business.
"This will have an enormous impact on the downtown and go some ways to filling the gap left by the departure of the IceCaps," he added.