Edmonton mayor says Oilers would draw fewer fans in Seattle
Edmonton's mayor says if the Oilers are serious about trying to relocate the NHL team to Seattle, good luck drawing fans in the Pacific Northwest.
"The Oilers have sold out what 150 to 200 games in a row [in Edmonton]," Stephen Mandel said in a TV interview Tuesday morning.
"In Seattle you have football, baseball, if they get an NBA team [then it will be pro basketball], college football, college basketball, and then hockey. I'm not sure you're going to sell out 18,500 seats a game or 18,300 seats a game there at $8,000 US a season ticket."
Mandel was commenting on Oiler brass, including team owner Daryl Katz, visiting with Seattle officials Monday night to discuss relocating the team to that city.
In a news release, the team said it has no choice but to review other options.
"After more than four years of trying to secure an arena deal and with less than 24 months remaining on the Oilers' lease at Rexall Place, this is only prudent and should come as no surprise," said the team statement.
Mandel, however, pointed out that the latest impasse is the result of new demands made two weeks ago by the Oilers. Those demands include millions of dollars more in concessions from taxpayers on top of an arena that is already being funded mainly by taxpayers and by a ticket tax.
"We thought we had a deal a year ago in October, and now we don't have a deal," said Mandel.
"We need to know what the Katz Group wants ... We don't know what that is."
Mandel said talks are ongoing between the Oilers and city officials, but reiterated he wants the affair settled one way or another by the city council meeting on Oct. 17.
"We've had some meetings [with the Oilers] and they were moving along, we thought, productively," said Mandel.
"One week Mr. Katz says how important the Oilers are to Edmonton and vice versa and then they're off in Seattle. I don't know. Time will tell what ends up happening."
Katz's Monday visit came on the same day that Seattle city council approved hedge-fund manager Chris Hansen's plan for a US$490-million arena that both sides hope will be home to an NBA and NHL team. Seattle lost its NBA team, the Sonics, to Oklahoma City in 2008.
However, NHL commissioner Gary Bettman downplayed the threat of the Oilers moving to Seattle in a statement released Tuesday.
"We continue to believe that an arena deal is achievable, and with a new arena there should be no reason to have any doubts about the future of the Oilers in Edmonton," Bettman said.
The Seattle talks sparked a firestorm of outrage on Twitter and in online letters to the editor from Oiler fans. Fans and hockey commentators say Seattle is an empty threat given that Katz says he needs all profits from the arena in Edmonton but would be second banana to an NBA franchise in Seattle.
Many simply vented, some calling for a boycott of the Rexall pharmacies owned by the reclusive billionaire.
Others harshly assailed Katz, a noted philanthropist, as an "extortionist," "a greedy business thug," and "jerkstick."
Some compared him to former Oilers owner Peter Pocklington, a figure still vilified in Edmonton more than a decade after his departure.
In 1997, after years of threats to move the Oilers, Pocklington offered the club to NBA owner Les Alexander, who planned to relocate it to Houston. A clause in the arena lease deal allowed a group of local owners to buy the team and keep it in the Alberta capital.
Katz Group officials in recent years have rattled the relocation sabre by visiting officials in Hamilton and Quebec City.
"How to Lose Friends and Alienate People: from White Knight to Peter Puck II in a few short years, the Katz Group story," read one Tweet.
"Same team, different owner. Same con job," said another letter writer.
Some online writers had fun with the story. One suggested the team be renamed the Seattle Lattes, with the coffee bean printed over the oil drop on the team's logo.
Another Tweeter put up a clip of up "The Empire Strikes Back" featuring the menacing velvety-baritoned Darth Vader telling Lando Calrissian: "I am altering the deal. Pray I don't alter it any further."
Kickstarting the process
Pray, the deal has been altered numerous times by Katz.
To kickstart the process, Katz promised to put up $100 million toward the arena.
But in 2010 he said the $100 million would not go to the arena but to surrounding commercial development. When council and the public objected, Katz returned to the original promise of $100 million for the arena.
Last October, when council and the Oilers struck the current deal for the $450-million arena (which is now at $475 million), the deal was changed again. The Oilers would not put up $100 million for construction, but would pay $5.5 million a year for three decades in lease payments.
In return, the Oilers would keep all revenues from Oiler games, trade shows, concerts, and other events at the new arena for 11 months out of the year. Concession sales alone are estimated at $20 million a year.
The team would also get naming rights for the rink (valued between $1 million and $3 million a year) and $20 million from the city over 10 years for advertising.
The cost to Katz, besides the $5.5 million a year lease payments, was an estimated $10 million a year to operate the building.
That $10 million cost has become the main stumbling point in the talks.
Two weeks ago, the Oilers, in a letter delivered behind closed doors to city council, said they have had another look at the numbers and now feel more public money is needed to keep the team viable in the city, including an annual $6-million subsidy from taxpayers to run the arena.
City councillors rejected the bid for the new money. As word of the $6-million ask leaked out to the public, both sides accused the others of bad faith bargaining. Katz said the $6 million was always part of the deal, but councillors said it never was, and if it was it would be in the agreement
That set the stage for the latest logjam that will culminate one way or another in the Oct. 17 decision.
'All bets are off'
Last week Katz told a newspaper reporter that if the deal collapses, "all bets are off."
Katz has said he's losing money on the Oilers in Edmonton and wants a public subsidy deal similar to the one given to NHL teams in Winnipeg and Pittsburgh.
Forbes ranks the Oilers in the middle of NHL teams with a worth of $212 million.
Councillor Kerry Diotte said it's time for the city to see the Oiler books to determine once and for all if Katz, worth an estimated $2 billion, is running the team in the red or in the black.
Katz bought the team in 2008 for $200 million.
The proposed new arena would seat 18,400 with restaurants, shops and enough space to hold parties and even beach volleyball tournaments. Drawings depict a wavy, futuristic building of zinc and glass in the rough shape of an oil drop.
The Oilers have played in Rexall Place since it was built in 1974. It is one of the oldest rinks in the league.
While the total pricetag is $475 million, the Oilers say that is not realistic — given inflation and rising construction costs — if the city wants a true "iconic" building.
Councillors have already been told that the city's on-paper contribution of $125 million will be closer to $400 million once the land, loan interest payments, and surrounding infrastructure is paid for.
On top of that, the project as it stands would still be $100 million short. Mandel is hoping the province will kick in that amount, but Premier Alison Redford says there will be no direct money to private enterprises like a pro hockey team.