SBD/June 5, 2012/Franchises

Jamison Obligated To Attempt Name Change For Coyotes Under Proposed Glendale Lease

Deal calls for owner to buy Jobing.com Arena, attempt to change team name
Under a proposed 20-year agreement with the city of Glendale, Coyotes Owner Greg Jamison "has an option to buy the arena and is obligated to attempt to change the team's name to the Arizona Coyotes," according to Halverstadt & Chan of the ARIZONA REPUBLIC. The proposed terms “may cost Glendale more than $45 per resident each year over the life of the deal." The city also “appears poised to pay” a group led by Jamison nearly $325M over 20 years "to operate and make improvements" to the city-owned Jobing.com Arena. An analysis of the proposed agreement released yesterday by the city showed that Glendale “expects to collect less than half that amount via ticket surcharges, rent, sales tax and other team fees during the same period.” Jamison has said that he “hopes to capitalize on the Coyotes' deep playoff run this season to increase ticket sales and bring in more sponsorships for the team.” But such success “may not translate into smaller payments for Glendale.” The city's analysis showed that if the Coyotes went to the Stanley Cup Final "for the next 20 seasons and the arena booked 30 sold-out concerts each year for the next 20 years, Glendale could still expect to lose about" $9M annually. That figure “does not include the city's annual arena debt payments," which will average about $12.6M a year over the next 20 years. The Glendale City Council is “expected to discuss the proposed agreement at a public workshop Thursday.” Glendale Mayor Elaine Scruggs yesterday said that she “cannot support the deal” (ARIZONA REPUBLIC, 6/5). The GLOBE & MAIL’s David Shoalts notes while the city said that the management fee Jamison and his partners will collect works out to an average of $15M per year, the payments "will not be that amount or less until the last eight years of the lease.” Glendale taxpayers in the first two years will pay over $17M a year "with the fee rising" to $20M annually in the next three years "and then dropping" to $18M for years five through eight. The lease also states that the city “is not responsible for parking operations” (GLOBE & MAIL, 6/5).
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