The big 3 Ottawa Senators unknowns: The arena, the owners, and the money
As Bettman comes to town, mayor floats city lands as arena alternatives to LeBreton
We may not get to spend the spring cheering the Ottawa Senators in the NHL playoffs, but the capital will still be hockey-crazed over the next few months.
That's because after years of strained fan-owner relations, the spectacular failure of a downtown arena redevelopment plan and even a threat to relocate the team, a new start for the Sens is crossing the blue line.
The team is officially for sale after Eugene Melnyk died last year, with a new owner expected to be announced next month. His daughters, who currently own the team, have a signed —but not binding — agreement to build a new arena on LeBreton Flats.
To kick off the season of Sens mania, the NHL's top brass are arriving this week in the nation's capital.
Commissioner Gary Bettman and deputy commissioner Bill Daly touch down today. They're scheduled to meet with Mayor Mark Sutcliffe, National Capital Commission (NCC) CEO Tobi Nussbaum and chair Marc Seaman before chatting up reporters and taking in the home game against the Florida Panthers.
Cue the speculation on the identity of the new owners, tentative dreams of a downtown arena, and a contentious debate on the use of public funds to build it.
New owners should be known by April
Questions abound about who's bidding for the team, and Bettman himself has said there's been interest from multiple groups.
It's no secret that golden boy Ryan Reynolds is involved and has reportedly teamed up with Toronto-area developers The Remington Group. Both Bettman and Daly have indicated the movie star's involvement could be a huge boon to both the franchise and the league.
Toronto billionaire and minority Montreal Canadiens owner Michaal Andlauer has put in a bid, as have the Kimel brothers of Harlo Capital, according to both CBC sources and other news outlets. Like Andlauer, Jeffrey Kimel was involved in the NHL as a member of the Pittsburgh Penguins' management committee.
According to The Athletic, Los Angeles-based AI entrepreneur Neko Sparks is making a bid — and even retweeted a post by that publication about his interest in the Sens.
Locally, CBC has learned of at least three parties involved in larger bids: the Malhotra family of Claridge Homes; Jean-Pierre Poulin of Devcore; and Jeff York of the Farm Boy grocery stores.
It's not clear what groups these local players are part of, or whether some members of the bidding teams are moving around.
With the Sens expected to cost more than $800 million — and NHL brass trying to talk up the price tag even further — the new owners are expected to be a consortium led by a deep-pocketed tycoon from afar that includes local minority shareholders to provide some hometown flavour.
Although the sale process is being run by New York investment bankers Galatioto Sports Partners, Bettman is sure to give reporters some indication as to when the winning bidder will be announced.
So far, it's looking like the big reveal will be next month, with a signed-on-the-dotted-line deal finalized later this year.
Dreaming of downtown
Perhaps even more exciting for hockey fans than the identity of the new owners is the potential for a new arena.
The Capital Sports and Entertainment Group (CSEG), which owns the Senators, inked a memorandum of understanding with the NCC last year over an arena at LeBreton Flats. Their partners include Live Nation Entertainment, the parent company of Ticketmaster.
The proposal would see a major events centre, with additional mixed use development, on a 2.6-hectare site along Albert Street, between Preston Street and City Centre Avenue.
The NCC is hoping to sign a lease this fall, although that could be delayed with new owners in place. But this is not a done deal, as there's nothing compelling the future purchasers of the team to go through with the LeBreton deal.
NHL executives have signalled for years that they want the Sens to move to a home in the city's core. The Canadian Tire Centre is one of the few remaining suburban arenas in the league and is inconvenient for many fans.
But they've also been broadcasting mixed messages about whether a downtown arena necessarily means one at LeBreton Flats.
Earlier this month in Florida, Bettman said that the sale of the team wasn't tied to a new arena and that it would be up to the new owners how to proceed. Still, he added that he believed LeBreton Flats is a "good opportunity for somebody who's interested in possibly moving downtown."
However, in February, Daly told The Bob McCown Podcast that there "may be bids that don't have Lebreton Flats as part of their future projection for this franchise.
"I think it's certainly a relevant part of the mix," he said. "But I don't think it's an essential element."
Mayor floats city lands as possible arena locations
A LeBreton Flats arena is likely not a huge deal for the NCC, as its master plan for the 29-hectare site makes it clear a major events centre would be nice but isn't a must-have.
If the new owners give LeBreton a pass, the master plan calls for mixed-use development along the Albert Street corridor, adjacent to the new central library. That would end any chance to put an arena there in the future.
So if not LeBreton, where?
The Sens could stay in Kanata, and new owners could try to work around existing issues. Transit is a tough one: the $1.8-billion LRT Stage 3 out to Kanata is just a concept at this stage, completely unfunded and likely a decade away if it ever gets built.
There are also large enough areas in the central part of the city that are publicly owned. Think Bayview Yards, the city's financially disastrous baseball stadium, even lands near the Hurdman LRT station.
These were rumoured alternate locations for weeks until last Thursday, when the mayor suggested them as possible alternative locales on TSN1200.
Sutcliffe pointed out that downtown-adjacent LeBreton Flats is "not walking distance from Elgin Street for most people," and the area isn't built up yet. (Of course, the city-owned properties the mayor did mention are also not in the middle of any existing entertainment districts and are farther from the core than LeBreton.)
Sutcliffe told the sports radio station that while he'd be happy if a new arena was built at LeBreton, it's also "not the only location."
How much public money will be involved?
All this brings us to the most contentious question around the Sens sale, and the issue we'll be talking about the most intensely in coming months: how much public money should go toward the new arena?
In NHL markets other than the very largest — think Toronto, Vancouver, New York — owners get an assist from local governments.
"If you're in a centre smaller than two million people, you probably have to have a blend of private and public money to get it done," said Glen Hodgson, a fellow with the C.D. Howe Institute and former chief economist at the Conference Board of Canada.
Hodgson, who co-authored the book Power Play: The Business Economics of Pro Sports, wrote in a recent paper for the institute that an arena would ideally be "completely privately financed and operate profitably" through ticket sales for game, concerts and other events — and also related real-estate development.
I'm not a fan of putting city money into an arena, but it depends on so many factors.- Mayor Mark Sutcliffe
But in smaller markets, "the private sector's financial capacity and taste for risk are more limited," Hodgson wrote, especially as brand new arenas can cost as much as a billion dollars.
In Edmonton, for example, the city contributed $226 million to a new arena, which it owns, that was paid for by property taxes from rink-related development and parking. (If that sounds familiar, it's because it's similar to Ottawa's financing deal for Lansdowne, which a decade later needs a $332-million injection.)
Until very recently, Sutcliffe has been staunchly against any direct municipal funding of a new arena, both during the 2022 election campaign and in an email to CBC in December, when he wrote that he didn't "support a cash contribution from the city of Ottawa."
But last week, with the reality of a deal possibly just weeks away, the mayor's stance on public funding was starting to waver, if just a little.
"I'm not a fan of putting city money into an arena, but it depends on so many factors," he told reporters. "I think it's too early to have that conversation."
The mayor will likely touch on that today in his meeting with Bettman, and he'll be under some pressure to give some city help. Sutcliffe said that from what he heard while campaigning, there are "a lot of people who want to see a more centrally located arena and feel that's in the best interest of the city … so the city's got a role to play in this."
Exactly what that role will be is one of the biggest question marks around this entire deal. And the mayor's injection of using public lands has just raised the stakes even more.