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Originally Posted by Oilkountry
The issue with converting general seating to premium is that its essentially net zero in winnipegs case. if you cannabilze 500 general lower bowl seats to create 330 premium seats you would have to price them astronomically high to improve your business model by a gate standard alone, then factor the losses of 170 patrons concession dollars you might be worse off.
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You are making an assumption here without any actual proof. You really don't know how many seats would be removed and how many premium seats would replace them. I already mentioned the Jets could add in a few hundred additional sky seating/suites like Vancouver or Milwaukee in their new arena without losing any additional seating. Vancouver charges a few hundred dollars per game for those seats by the way.
Quote:
Originally Posted by Oilkountry
I think the overall issue is how Canada Life stacks up to other arenas long term not today. For example where they fall on the building revenue chart.
lets say edmonton,newyork,montreal,toronto and Chicago are top 5 in no order. Winnipeg most likely sits around 23rd-27th as of today. So we could expect Winnipeg to sit probably right below the average in terms of gate and concession revenue. Still profitable but what happens when the league starts collectively renovating to todays standards and continues to build new arenas and CLC doesn't have the ability to follow those trends? In 2011 NHL arenas were basically still uniformly seats, luxery boxes and more seats. That is changing rapidly and as these new buildings continue to be built the pressure on the older buildings to renovate or replace gets greater because the average revenue goes up which effects your cap. So to stand still on these changes long term isn't an option club seating is becoming king.
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Any examples of this "renovating to today's standards" compared to 10 years ago? There isn't that much difference from what I can see.
Quote:
Originally Posted by Oilkountry
And that's what makes CLC so difficult. It's still so new that in 10 years the thought of replacement is hard to imagine in Canada. The cap in 2011 was just under 65M today its 85M. It's only a matter of time until the salary cap outstrips the revenue potential of CLC in its current form. Ticket prices can only go up so far if anything True North has regressed from the top price Winnipeg is willing to pay to catch an NHL game.
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After the lockout in 2005, Bettman and the BOG were predicting the cap would have increased to $120 million by this point, but a couple things happened along the way.
1) The Canadian dollar dropped from par to below .80 US since the end of 2014 and has remained there.
2) COVID hit and did a number on the NHL's revenues
3) there are markets that have continued to underperform with respect to revenues the past decade
4) the US national tv deals (both the previous one and the current one) have not been as lucrative as some have hoped.
AND a 5th factor which will negatively effect the NHL's revenues and cap in the immediate future - the collapse of several US NHL teams regional tv deals due to the bankruptcy of the Diamond Sports Group. It also means we may see several more seasons of a nearly static cap.
Meanwhile a team like the Jets has a healthy regional tv deal while those affected teams are left scrambling looking for sort of additional tv deal which almost certainly will not approach their previous deals.
An increase of $65 million to actually $83 million (for next year) in a decade is not particularly impressive or unsustainable for an lower income franchise. That works out to less than 2 million a year.
I would also add, that while the NHL is more gate-dependent than the other big-3 pro leagues in North America, it is far less so than it was 12 years ago. Back then, over 50% of each team's revenues accrued from gate/concessions and merchandise. That number has fallen substantially over the past decade plus due to the new tv regional tv deals (the collapse of the regional tv deals in the US notswithstanding), new national tv deals in Canada and the US, streaming deals, new national and international corporate sponsorships.
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