NHL’s Vegas owner buys share of arena
Bill Foley, the owner of the future NHL Las Vegas franchise, has bought 15 percent of the $375 million T-Mobile Arena his team will play in.
The facility, which opened in April, is co-owned by AEG and MGM, which used it as a lure to get the first big four professional sports team in the gambling mecca.
“I can confirm Foley has invested in the arena,” said AEG spokesman Michael Roth, who declined to comment on financials.
A source close to Foley said he spent about $35 million for the stake, an amount that factors in elements like arena debt and lack of control over decision-making. Foley’s NHL franchise fee is $500 million.
Foley and his advisory team at Citigroup negotiated the lease with AEG/MGM for the arena, and the contract included a provision that allowed him to buy the stake.
The trend for years in sports has been for teams to control the buildings they play in, to capture revenue from all of the events that a venue hosts. While 15 percent obviously does not give Foley a controlling stake, it does give him a slice of the financial return of the new arena, which is projected to host 55 to 60 events this year.
“It is a smart move,” said Sal Galatioto, a longtime sports investment banker. “There should be an alignment of interest between the owners of the building and the owners of the team.”
The NHL in June awarded the franchise to Foley. The team will begin play for the 2017-18 season.
The team has yet to be named, though the name might include the term Knight, a nod to Foley’s time at West Point and to one of his companies, Black Knight Financial Services.