SBD/Issue 192/Franchises

Buffalo Among Six NHL Markets Facing Financial Barriers

Buffalo Danger Signs Include Low Team Value,
Low Population, Nearby Hockey Competition
Buffalo is among six NHL markets that "face the most imposing barriers to long-term financial success," according to a study cited by G. Scott Thomas of BUSINESS FIRST OF BUFFALO. Phoenix is in the "worst shape of any hockey market, failing eight of the study's 10 indicators." Miami and Nashville are "almost as badly off," with both "falling short in seven categories." Buffalo is "next, tied with" Atlanta and Raleigh with "six danger signs apiece." The study "used demographic and financial data from several sources to quantify the challenges facing the NHL's 27 markets." Buffalo's "six danger signs" were low population, low personal income, low franchise value, small growth in value, loss in operating income and nearby hockey competition. The market did get "high marks for attendance," drawing 18,532 fans per home game last season, and "percentage of capacity," selling 99.2% of all seats at HSBC Arena last year. The "other two pluses are its location in prime hockey country and the absence of any local competition" from the NBA. Seven of the nine markets with "at least five danger signs are in the Sun Belt" (BUSINESS FIRST OF BUFFALO, 6/19 issue). BUSINESS FIRST OF BUFFALO's Thomas notes Toronto-based financial planner Ted Rechtshaffen "conducted a separate analysis, yet his findings are similar to those" in the first study. Rechtshaffen rated the Coyotes, Blues, Ducks, Hurricanes, Sabres, Islanders and Predators as "having the shakiest futures." He also "expressed doubts about" the Capitals. Rechtshaffen: "As a business, I think the NHL needs to contract. But if the possibility remains of moving teams and generating money, the NHL obviously would prefer to move them" (BUSINESS FIRST OF BUFFALO, 6/19 issue).

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