An open letter to Chris Hansen: Please openly endorse the Seattle Center Arena Plan

Dear Mr. Hansen,

I’ve been attending your rallies, participating at City and County Council meetings, and supporting your efforts online for the better part of the last 6 years. I was at the unfortunate Occidental Street vacation vote. And, like a lot of Sonics and hockey fans in the area, I was devastated by the outcome.  

Tuesday night, I could not make it to the City Council meeting. I was in Las Vegas attending the first ever Las Vegas Golden Knights home opener game and it was an amazing experience. I had goose bumps from the second they took the ice. It was also very emotional for all the locals as they looked to hockey to help them heal. There wasn’t a dry eye in the house as the announcer named the first responders accompanied by the Golden Knight players. I’ve been to a lot of great sporting events in my life including a Super Bowl, World Series and NBA Playoff game, but none that compared to that game. It reminded me how powerful sports can be in bringing people together.

Your priority is the Sonics and mine is bringing an NHL team to Seattle. I have no issues with our differences in priorities, which made it so refreshing to hear you say that you are open to two arenas. Which is why I am asking you to openly endorse the Seattle Center Arena Plan by OVG and not request any further postponements by the City Council.  

As you may not know, I am on the city’s Arena Community Advisory group for the Seattle Center Arena Plan I am familiar with the process and OVG’s MOU.  In addition to suggesting a delay in the City Council vote on the OVG MOU, some of the comments made by you during your Seattle visit earlier in the week are not correct.  Namely, your statement about OVG’s proposal including a “fair amount of public financing.”

Because OVG has been able to identify NHL owners and because the Seattle Center Arena Plan is under serious consideration because it’s a strong proposal, Seattle is so very close to gaining the interest of the NHL to expand a team here. By openly endorsing the Seattle Center Arena Plan and not delaying voting, you will build some goodwill with the City Council and it could buy you some time to address the outstanding issues with your SoDo Project. A Seattle Center Arena could also provide an opportunity with a shorter runway of time to bringing the Sonics back should a team become available. Isn’t that what you have said your primary goal is – to bring back the Sonics? Additionally, by supporting Seattle hockey fans by helping them bring a team to town you will surely win their support in your continued efforts to bring the Sonics back.

Please don’t hinder Seattle’s chances of getting an NHL franchise. The league will eventually look for other options, if we fail to start building an arena. I love the Seahawks, Storm, Sounders, Reign, and Mariners, but the NHL is my passion. I am not alone. Please give NHL fans in the area the sense of community that sports provide.

If you are truly open to two arenas, as you mentioned, then I encourage you to send a letter to the City Council in immediate support of the Seattle Center Arena Plan.

Sincerely,

John Barr

NHLtoSeattle

Bigger than Hockey. #vegasstrong

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Prospective Seattle NHL franchise owner breaks his silence

Earlier this evening, Chris Daniels from King5, shared info and a conversation with prospective Seattle NHL franchise owner, Victor Coleman. The article was full of important information and is one of the few times we have heard from one of the potential owners. Please read the entire article here and I will break down some of the critical pieces.

PSBJ Survey Crop

Survey results from the Puget Sound Business Journal

First off….

“I think the demographic base (in Seattle) and the desire of the NHL in that marketplace is the perfect match right now.  The expansion of the NHL into the Pacific Northwest, with Vancouver and the presiding area, makes it a perfect fit,” said Coleman.  “There are built in synergies.  That’s a ‘Day 1’ rivalry.”

There sounds great but there isn’t much that a lot of us know. We have had Bettman and Daly both speak well of the market & several NHL governors have spoken highly of the opportunity as well. A ton of you have confirmed this with your desire to purchase Season tickets. It is awesome to hear a prospective owner believe in the market but I expect that from an owner.

Coleman and co-investor Jonathan Glaser, who sits on the board of Hudson Pacific, met face to face with Seattle Mayor Ed Murray and King County Executive Dow Constantine in separate meetings in Seattle.  NHL Commissioner Gary Bettman and Deputy Commissioner Bill Daly were also on hand.  The parties all left without an agreement or plan to move forward.  Coleman says he feels like he’s made progress since.

“We have a clear path,” he said.

Key piece here is the last bit. He has made progress since and “clear path”. The City of Seattle’s position and role in this has been a little unclear. Yes, we have heard the Mayor and other city council members say there is no plan to change the MOU. Many reports suggest it is the risk associated to the NHL first vs. the NBA in the case of default and less about the financial (recovery) projections. Specifically, it is the value of an NHL franchise vs. the NBA. Forbes Valuations are historically in accurate but at least you can get a feel for the difference between the leagues (Forbes links: NHL and NBA). If that is the case, the prospective ownership group would need to do something to mitigate that risk. This is responsible by the city and can be resolved under the right situation.

Two sources with knowledge of the talks between Hansen and Coleman say that the two potential owners met in person a couple of weeks ago, and have been actively talking for months. In fact, according to the sources, the two potential ownership groups have signed a “non-binding” agreement which lays out the terms for Coleman’s contribution to the project and his potential revenue streams for a hockey franchise.

That is the money quote from the article right there. We have generally thought this was happening and to hear they could have a non-binging agreement is excellent. The best thing about it is that both Hansen and Coleman are actively working on a solution.

“There is obviously a deal in place that can get done,” said Coleman. “The semantics by which it gets done, and the priorities by which it gets done, are going to depend on city officials, the county, and the Hansen group.”

That just about sums up where we are at. We could be waiting for an NBA team or we might not but it sounds like they are moving to a framework that could land the NHL in Seattle. There is a lot of work to be done here and there are no guarantees so be patient with the League, Potential Owners and Elected Officials. There has been no call to action, rallies or public hearings but when the time comes you will know.

Quick thoughts on Ballmer’s pursuit of the Clippers

As most of you are aware, Steve Ballmer is placing a bid on the Los Angeles Clippers. I have had some discussions in various social networksbllmnba9087 and “real world” conversations about it and figured I should jot something down. There are two schools of thought on the impact that a successful purchase of the Clippers will have on the return of the Sonics: 1) Hurts the bid to bring the NBA back to Seattle and 2) No impact to the SoDo Arena plans. To get the narrative on those two opinions, enter our two favorite journalists, Geoff Baker with the first perspective and Chris Daniels issuing the later point of view. One thing I would like to call out is that it is great to have two people covering this story with a somewhat different approach. I saw somewhat because they are not contradicting, they are just coming from two different angles, both of which can and are probably right. Both articles (and video) are worth reading but at a high level, Baker says that if Ballmer’s bid for the Clippers is successful, that investment gap will need to be filled. Meanwhile Daniel’s suggest that gap will not be too hard to fill.

My take

The likely scenario is somewhere in the middle. There aren’t too many people in the world worth $20 Billion that can fill Ballmer’s shoes, actually there are only 35 of them in the world and only two that live in the Puget Sound. Obviously it is not a requirement to find someone worth $20 Billion but it was nice to have that kind of backstop behind you for the franchise. The bigger issue to me is what that says about the prospects of the Sonics returning to Seattle. Baring a failure of an Arena plan in Milwaukee, this implies we are probably over 4 years away from seeing the Sonics in Seattle. If the outlook was better, I think Ballmer would have waited. The positive of Ballmer becoming the owner of LA Clippers is he would have a vote on expansion and/or relocation of a team for Seattle. All that said, what I will miss most about the departure of Ballmer from the Sonics Ownership group is his local ties and civic leadership. The man was passionate about the Sonics before they left and would have loved to see him be involved in the team.

Wait….this isn’t NBAtoSeattle.

Damn…you got me. You are right, this is not NBAtoSeattle. We know the Seattle NBA Group has been driving the bus on this project for a while they have welcomed us hockey fans for the ride from the very beginning. The potential Ballmer departure from the project is probably a net neutral. I think the prospects of the NBA returning to Seattle only helps the NHLtoSeattle’s chances so if it is a slight negative for NBA, it is a slight negative for the NHL. Oh and we still have the issue of the MOU that will still need to be changed for an NHL first scenario. Which leads me to think of the positive spin on this scenario. The departure of Ballmer could open the door for an NHL friendly partner to fill the gap left by Ballmer that might help kick start the NHL first Arena process. Either way, I am supportive of all SonicsArena efforts and will continue to support them regardless if and when the NHL comes to Seattle in the process.

Changing the MOU should be no risk to the City of Seattle

I posted an article on SonicsRising last week on the risk to the city of amending the Memorandum of Understanding (MOU) to allow an either NHL or NBA scenario. Currently the MOU reads that an NBA team must be obtain before breaking ground on the SoDo Arena. I wanted to document the same content here so if you read the SonicsRising post, you probably don’t need to read this one.

The premise of the MOU is simple. ArenaCo will pay the city rent + taxes generated specifically at the arena will be the mechanism on which how the City of Seattle gets paid back the loan for the Arena. So on that last part, taxes on ticket sales and concessions will be applied to the loan from the city. (I am trying to keep this simple).

My argument is that the City has less risk if an NHL team is the lone tenant in the building vs. the NBA. This is backed up with data from 3 supportable metrics.

1) Attendance: NHL averages higher attendance than the NBA. Higher attendance = higher tax revenues

NHL-NBA Attendance

2) Ticket Prices: NHL averaged higher ticket prices than the NBA. Higher ticket prices = higher tax revenues

Average Ticket Prices

3) Demo Profile: According to The Nielsen Company report, 53% of NHL fans income is greater than $75K per year vs. 33% of NBA fans who have income over 75K a year. More disposable income = more money spent at the arena and therefore more tax revenues.

Now the reality is that the Sonics are more popular than a potential NHL team but the city used league averages to run their risk analysis models. Therefore the logic I lay out above should stay true when evaluating the risk of changing the MOU to potentially lead with the NHL. From a city’s perspective, changing the MOU should be an easy exercise.

The complexity comes from the other party in the MOU agreement, ArenaCo.

Arena progressing and potential NHL ownership group in town

UPDATED 11AM PST: Check the bottom of the post.

Chris Daniels teased us for about 24 hours when he tweeted that he would have an exclusive interview with Hansen to get an arena update and talk NHL first scenario.

Remember – after #MNF, tune into KONG or KING5 for the exclusive interview w/ Chris Hansen on the #SeattleArena status…

— Chris Daniels (@ChrisDaniels5) December 3, 2013

…and then Daniel’s teased us hockey fans more with this one:

Here is a link to the King5 Video that eventually was posted: http://www.king5.com/sports/Chris-Hansen-Were-waiting-for-the-right-opportunity-234175161.html

Ok let’s recap the video:

  • Chris Hansen says arena is progressing & he is optimistic on working with the new city council member and mayor
  • Dow Constantine (King County Executive) says in a nonchalant manner that the MOU will probably need an addendum to lead with NHL
  • Chris Daniels mentions that potential NHL investors were in town and if that isn’t enough, read the quote from the article:

“a source who was in the meeting, says NHL legend Jeremy Roenick was in Seattle on Monday, along with an investment team, to discuss an expansion franchise and working with Hansen. It is believed Roenick wants to be the “front man” for the NHL franchise. He made an attempt to be part of a group to bring the Phoenix Coyotes to Seattle earlier this year.”

I’ve always thought that one of the biggest hurdles locally would be hammering out an agreement with Hansen and the potential NHL group. From the cities perspective, the first tenant should not matter as long as the terms remain the same. Being that Hansen made the intro of Bartoszek/Lanza Group to the Mayor & JR was rumored to part of that group, I think it is relatively safe to say that discussions appear to be going well on the Hansen-NHL group front.

It looks like JR is fitting in well: http://instagram.com/p/hcsFd6PTB2/#

11AM Update:

Apparently JR is part of a separate ownership group interested in brining a team here, not the Bartoszek/Lanza group that we has allegedly part of in June 2013 as part of the Coyotes “Plan B”. This is probably a good thing to help our odds with the team. Now they have two groups that are potentially bidding on Expansion team and Hansen now has two groups that he can try to come to terms with on his side of the deal. How this ends up is anyone’s guess but I for one would be ok with either ownership group. There is no way JR is a principle investor here so who those other parties are remain to be seen. Hang on boys and girls, this should get interesting.

Here is Aaron Levine’s tweets on the matter:

Levine

The Sacramento Kings news and what it means to a potential NHL team in Seattle

Key Arena

This is the hockey configiration inside the Key Arena. The far end is closed off.

As I imagine most of your Seattle readers and even fringe NBA fans, news broke yesterday that the Maloofs are close to selling the Sacramento Kings to Seattle SoDo Arena backed group led by Chris Hansen & Microsoft CEO Steve Ballmer. The intent of the purchase will be to move the team next season to play in Key Arena while the SoDo Arena is built. This is obviously huge news for the City of Seattle and the huge Sonics fan base. As I’ve said numerous times here before, an NBA team is a prerequisite to getting an NHL Team. Why? Well we don’t have an arena for them to play in and the SoDo Arena is really tied to the Hansen group’s financing deal with the city. In that deal, the arena cannot break ground until an NBA team is procured for the Seattle. (I actually cannot recall if it is specific to an “NBA” team but I know Hansen does not want to be an NHL owner). Also important to realize is that the Key Arena is not a good temporary facility for hockey. Because of the small footprint, part of the arena must be closed off (I’ve included an old grainy picture from a game I played in 7 or so years ago in the Key).

Take a look at some of Hansen’s comments made to a radio show in the summer. He has said that it is probably ideal for hockey to come a couple years after the NBA because of the Key Arena facilities. I also recall an interview Gord Brown, one of the owners from the T-Birds, gave about a year ago where basically said there is no way the NHL would play a season in Key Arena. The interview was about this time last year but I have no clue what radio show it was on.

So this all sounds great but it is important to remember that this deal for the Sacramento Kings is not done and the Maloofs have not been the most forthright negotiator so let’s not get overly excited here. It should also pointed out that the news triggered Kevin Johnson, ex-NBA star and Mayor of Sacramento, to hold a press conference saying that they will “fight like crazy” to keep the team in Sacramento including finding a local ownership group.

In something that even surprised me, yesterday a reported asked Gary Bettman about the possibilities of a team in Seattle. His response was pretty much as you would expect: “Not something we’re focused on or considering right now”. Keep in mind that the CBA has not been signed and the schedule isn’t even out yet so I would be shocked if he would have commented with substance on the topic. Audio here: relocation comes up around the 10 minute mark and the question on Seattle comes up around the 14 minute mark.

Here is some other important info that I was able to aggregate:

  • Kevin Johnson will be looking for a mix of local buyers and out of the area investors that will keep the team in Sacramento
  • The rumored price the Hansen/Ballmer team are offering up is 500Million. Forbes has the Kings valued at 300M
  • According to sources, the Maloofs will retain a small ownership position in the Kings/Sonics
  • Deal calls for them playing in Key Arena to start the 2013/14 season
  • NBA has a relocation application process that would require a team to file before March 1st

This is all great news even if nothing is finalized but let us remember there are fans on the other side of this potential deal so be respectful. I wish there was another way.

January 11th UPDATE: According to Matt  Steinmetz, a San Francisco NBA beat writer, the deal is done. 525Million with no ownership for the Maloofs.  https://twitter.com/MSteinmetzCSN/status/289786204034052096