Season Ticket Drive Thoughts

There is not a day that goes by that people don’t ask me about the season ticket drive. People hit me up on social media, text, email, and just about every hockey friend I run into asks me about it. I love that Seattle hockey fans are so excited about the possibility of an NHL hockey team coming to town. Let me share with you all the information that I DO know about the season ticket drive.

In a nutshell, I don’t know much on the ticket drive since not much has been announced since the league and city’s announcement on December 7th. What I do know is based on a combination of listening to everything that is being said publicly by people in the know, leveraging data and observed behavior of Vegas. I figured I would summarize my thoughts and findings here:

When will the season ticket drive launch?

No official timeline has been announced from OVG. Based on comments from last Saturday’s Hockey Night in Canada, it would appear they want to put the Executive staff in place before finalizing and publishing any ticket drive timeline. That sounds like a February launch, but again, nothing official. I’ve been suggesting people to sign up for the NHLtoSeattle newsletter here. I don’t use it a lot, but intend to send out ticket drive details as more information is known.

Pricing & Down payment

Another hot topic is how much the tickets will cost. There has been no reporting or speculation on that…so let’s speculate. For starters, let’s look at tickets prices in Seattle for the NFL and MLB to get an idea on how Seattle stacks up as a sports ticketing market. The chart below plots the average ticket price by league and team.

NFL-MLB

As you can tell, Seattle as a market is right at the league median ($30 for MLB. $92 for the NFL). As a starting point, we might be able to anticipate Seattle’s NHL Ticket prices to be around the NHL median so now let’s look at the NHL ticket prices.

NHLticketprices

The median of the average ticket price is around $73 but as you can see, I teased out the Golden Knights to see how they compare as a first-year franchise with one of the smaller venues in the league. (The redeveloped Seattle Center arena will have close to the same capacity). Obviously, ticket prices will vary based on where you sit in the arena and as a good rule of thumb, I tend to think lower bowl between the blue lines could be double the average ticket price ($150 to $178), while upper deck could be half the average ($36 – $44).
As far as down payment or “pledge”, Vegas Golden Knights required a 10% commitment of the value of the season ticket package. This was refundable if the league chose not to expand to Vegas. I would anticipate something similar, so depending on your price point, multiply ticket price by the 44 games and then 10% of that would be your down payment.

Is there a sales target?

“Vegas wants hockey” was the Golden Knights ticket drive campaign. They had a stated goal of 10,000 season ticket holders when the campaign launched. To date there has been no reference to a goal for Seattle’s ticket drive. If there is one, I expect it to be announced by the time the campaign launches. No matter what the goal, I am fairly confident we will hit and hit it quickly. According to research I saw from Scarborough  from 2015, there is over 70,000 people “interested” in NHL season tickets in Seattle.

My recommendations for interested season ticket holders:

  • Join my mailing list. Once I find out more about the ticket drive, I will communicate Facebook, Twitter, blog and email. I don’t want interested folks to miss out.
  • Plan your season ticket plan. If you are like me, I am looking at creating a season ticket group that will sit together for games. Start talking with friends to make sure they sign up around the same time. I imagine there will be a process for selecting your seats based on when you sign up. In order to sit with or near friends, you probably need to get in the same window. I’ve also been talking to friends about full seasons, half season etc. I am already looking forward on having a draft to determine who gets what games.
  • Budget and Save. We are 30ish months away from buying our inaugural season tickets. I am a planner, so I am already putting money aside into my “NHL in Seattle fund”. I am sure I will be buying a jersey and going through plenty of face paint in the first season.

Would love to hear your thoughts and feedback.

NHLtoSeattle 2017 News in Review

We entered 2017 without a whole lot going for us to bring the NHL to Seattle. SoDo Arena was largely dead and a lot of us where skeptical of a  potential redevelopment of KeyArena could accommodate a sheet of ice. If you want to see how gloom it looked at the end of 2016, take a look at my report card from last year. A lot has changed in 12 months….

Here is a timeline of activity over 2017:

January 17th – City of Seattle issues Request for Proposal (RFP) to redevelop KeyArena that could accommodate an NBA and NHL franchise. AEG and OVG are both expected to bid.
February 2nd – The SoDo group launches their PR campaign to counter the City’s efforts at KeyArena with an opinion piece in the Seattle Times from Russell Wilson.
February 4th – In out of town news, the Coyotes deal with ASU for a multi-sheet facility that would accommodate the Coyotes and Arizona State Sun Devils hockey is reported dead. (I am not a fan of relocation but I still pay attention to out of town news concerning fragile franchises.)
February 8th – The SoDo Group resubmits their application for Street Vacation.
February 10th – While speaking at a Sports Business Conference in Philadelphia, Bill Daly talks about Seattle and if a possible remodel of KeyArena could work for the NHL. 2012+NHL+Entry+Draft+Rounds+2+7+lyfx4JlSpv9l

“It would totally depend on the extent and substance of the renovations. Certainly, there’s been a lot of well-intended people who’ve wanted to build a new facility in Seattle, whether that’s a renovated KeyArena or an entirely new facility.
None of that has come to fruition, for whatever reason, so we’re not judging. But by the same token, it’s not something we can even get excited about unless and until something happens. And nothing has happened.”

March 16th – Tim Leiweke speaks to the Seattle times and among other things, says KeyArena remodel could be done in 3 years to accommodate the NBA and NHL. He also mentioned that an NHL team is more likely to come before NBA based on where the leagues are positioned. inside-Hockey
March 18th – a combined 14,162 people watch Junior hockey in the Seattle area. Both the Everett Silvertips (7,989) and Seattle Thunderbirds (6,173) had a home game.1512340_10153169894289145_4550175528159932028_n
March 26th – 100 years ago on this day, the Seattle Metropolitans became the first American team to win the Stanley Cup.
April 12th – As part of the responses to the KeyArena redevelopment RFP, both AEG and OVG name partners with hockey ties to their proposals. AEG added longtime rumored to be potential NHL Owner, Victor Coleman to group, while OVG adds Delaware North to their bid. Delaware North is owned by Boston Bruins owner Jeremy Jacobs. (James Dolan, Executive Chariman of MSG, was already part of OVG group.)
May 1st – Details of KeyArena redevelopment responses begin to circulate including endorsements by NBA and NHL executives.
May 9th – SoDo group continues their campaign against KeyArena. Hansen says KeyArena should be nitpicked like his proposal. outside
May 11th – Both OVG and AEG showcase their Arena proposals in an open house to the public at KEXP. This proved to be a nice opportunity for the public to interact with the two bidders to ask questions and provide feedback to the two bidders.
May 15th – The Seattle Thunderbirds claim their first WHL title in franchise history.
June 4th – After several days of speculation that the City of Seattle was leaning toward the OVG proposal, Seattle Partners (AEG) scorches the earth by issuing a statement saying they are pulling their bid.
June 7th – Mayors office selects OVG as primary negotiating party for KeyArena redevelopment.
On that same day, OVG announces an NHL ownership group have joined their proposal: David Bonderman and Jerry Bruckheimer. In retrospect, this is probably the biggest indicators that we are primed to land an NHL team. 

July 20th – Reports that Houston Rockets owner, Les Alexander plans to sell the Rockets. Almost immediately, people start speculating it could mean that Houston could be the landing spot of the 32nd NHL franchise.
July 31st – Prospective NHL owner David Bonderman is spotted at Seattle City Hall.
September 5th – Houston Rockets owner, Les Alexander sells the Rockets to Tilman Fertitta for $2.2BillionKeyArena_SoDoGroup
September 7th – Just days before Memorandum of Understanding for KeyArena Remodel is expected to be delivered to Seattle City Council, the Sodo group proposes an alternative development plan for KeyArena. This would largely fall on deaf ears as a proposal that was not submitted in appropriate and legal channels.
September 12thMemorandum of Understanding is delivered to Seattle City Council with an intent to open October of 2020.
September 18th – OVG MOU continues to gain support from city council and the public at large.
October 11th – In an interview with CBS Houston, new Rockets owner, Tilman Fertitta says he is open to the NHL. “I would put an NHL team here tomorrow, but this one has got to work.”
November 7th – During an Seattle Civic Arenas committee meeting, Council Member Mike O’Brien mentions the timeline is designed to get an NHL team by the start of the 2020 season.
November 15th – Katie Strang from the Athletic reports that the Houston Rockets owner Tilman Feritta met with the NHL on the prospects of bringing an NHL team to Houston. Talks seem early but after seeing Vegas get a franchise before Seattle, fans start to worry a bit.
December 2nd – The national hockey media begins reporting that Seattle will be discussed at the NHL Board of Governors meeting should the City Council approve the MOU for KeyArena just 3 days before BOG meeting. It’s almost as if this was planned all along…hmmm.
December 4thSeattle City Council approves the Oak View Groups $660Million Memorandum of Understanding to redevelop KeyArena to a state of the are Arena that can accommodate the NHL and NBA.
December 7th – At the NHL Board of Governors meeting, the NHL agrees to “accept and consider Seattle expansion application.” Mayor 20171209
December 15th – Potential NHL owner, David Bonderman meets with new Seattle Mayor Jenny Durkan.
December 29th – 710 ESPN declares the NHL’s formal interest in expanding to Seattle as the #1 Seattle sports story of 2017.

What do you got 2018?

Hansen’s ‘Hail Mary’

Yesterday the Hansen Group threw up a ‘Hail Mary’ by sending a letter to the Seattle City Council on a possible redevelopment plan of their own for KeyArena. As I’ve said in KeyArena_SoDoGroupprevious posts, the three main challenges for SoDo is the lack of money, no NHL partner, and political support inside and outside city hall. His potential plan for KeyArena is interesting, but does nothing to address those challenges.

The proposal

The proposal would subdivide KeyArena into 3 separate venues: a 500-seat theater, 3000-seat covered amphitheater and 6200-seat indoor concert venue. If there wasn’t already a viable redevelopment plan to accommodate NHL and NBA team, i.e. OVG’s proposal, I think this would be an interesting proposal. The Hansen Group would not start this Amp_KeyArena_Hansenproject until after a SoDo arena would be completed. Based on the information posted on Hansen’s website, the SoDo arena would still not begin until an NBA or NHL team is procured. Based on a Steve Ballmer interview last spring, he estimates the NBA in Seattle is closer to 10 years away than 5. You add it all up and we would be looking at about 2027 for SoDo to be open at which time I would not expect the NHL to wait for Seattle. The Hansen Group has mentioned they would be willing to work with an NHL partner, but their track record so far tells a different story. Each of the known prospective NHL Seattle partners, Don Levin, Ray Bartozek, and Victor Coleman, have been unable to reach terms with the Hansen Group. By adding this KeyArena component, he just increased the cost of business for any prospective partners.

What does Hansen have to lose?

In short, nothing. Worst case for Hansen is that the situation remains status quo and the city rejects/ignores his proposal and continues to go down the path with an NHL/NBA arena in Seattle Center with OVG. Best case for him is that the city rejects the OVG NHL/NBA solution and gives Hansen 5 more years to wait for the NBA to either expand or relocate a team to Seattle. He will also need to acquire a whale of an NBA partner and if he can’t strike a deal with the economic proposal of both SoDo and KeyArena, he can go back to the City to request a more appealing deal to lure the NBA. By that time, the NHL will have probably expanded to 32 teams somewhere else.

Oak View Group round up and Bettman comments on Seattle

The Oak View Group’s Tim Leiweke was in town and made a couple key stops to speak with sea_key_arena_entrthe Seattle Times and King5’s Chris Daniels. As you might recall, the Oak View Group is one of the two expected bidders on the KeyArena redevelopment RFP that could host both an NBA or NHL team. Before today, it was assumed that either AEG or OVG would be the operators of a remodeled KeyArena and not the owners of either an NHL or NBA franchise.

Seattle Times Article

The Seattle Times was definitely an enlightening read, filled will lots and lots of quotes from Leiweke himself. I urge you to read the entire article to make sure not to take my thoughts below out of context.

Here are some of the article’s highlights:

“We believe it’s going to take three or four years, preferably three,’’

My take: Seems pretty optimistic based on the snail’s pace that the SoDo project has gone. However, this is a project the city initiated vs a developer initiated project; the city might be a little more inclined to expedite the process to meet their timeline. There wasn’t a whole lot of urgency from Hansen after the Sacramento deal fell through. I honestly have no idea how long this will take. Seems like arenas can go up in a hurry, if the partners are motivated.

Leiweke said he’s in constant contact with Bettman and NBA commissioner Adam Silver and has been assured there is no imminent expansion or team relocation on the horizontimliewikeandgb for either league.

My take: Both Leiweke and AEG have strong relationships with both NHL & NBA and so I would expect both Oak View and AEG to be in lockstep with the leagues. I see this as a competitive advantage these guys have on bringing either an NHL or NBA team to Seattle over Hansen.

“I think that there are certain leaders in this community that finally took a step back and listened to Adam Silver when he said ‘There’s no expansion coming, and we’re not giving a team to Seattle right now because there’s no team moving.’ I don’t think that’s politics. I think that’s the reality of understanding the truth. And I personally believe you’ve been misled.”

My take: This isn’t really anything new. Other than an isolated report several months back reporting that expansion was happening, the league and owners have consistently said there will be no expansion anytime soon. Of course, we heard that for about 2 years leading up to the NHL’s expansion process, so it is within the realm of possibility that the league could do a 180 on this in one day. With no mention during Silver’s presser at the All-Star game and now this, it still feels NBA expansion is a ways out.

Speaking about Hansen’s attempt to buy and move the Sacramento Kings to Seattle, Leiweke said. “I don’t think that was a good day for Seattle, and I’m speaking just as a (Toronto Raptors) member of the board of governors at the time and watching that. … You don’t threaten (then-NBA commissioner) David Stern. And I’ll leave it at that.”

My take: Hmmm…there is some smoke there, but hard to know what Leiweke was talking about. Sounds like there might still be some fence mending that still needs to happen between Chris Hansen and the NBA. I’ve heard the NBA is still reluctant to deal with Hansen, but I never could substantiate that theory, so I’ve largely dismissed it. This does not validate it either. But there is something going on here between the NBA and Chris Hansen.

King 5 Piece

Later in the day, Chris Daniels from King5 published this article. The story line was similar to the Times piece with a couple added thoughts. (full interview posted here.)

Speaking about the traffic conditions down there, Oak View Group’s Lance Lopes said, “Frankly, a lot of it is based on misperceptions.  A great example: Mercer mess. If you go to Mercer at six o’clock at night and look at what the westbound traffic looks like, it actually flows quite well. Eastbound is difficult, we’re actually not going eastbound, we’re having people coming in to that area.”

My take: I travel westbound on Mercer a couple times a week between 4 and 6 from I5 to 99 and it does flow relatively well. How it will perform when there are high capacity events at KeyArena could be a different story. Then again, traffic in Sodo also increases dramatically for events at Safeco and Century link field.

“(Bettman) is fully dedicated to finding a solution in Phoenix. We cannot and we will not ultimately go prey on trying to move franchises. That was a major mistake and we will not make that mistake.”

My take: I know there has been some speculation that the Coyotes might move here, but I’ve remained pretty consistent that this will not happen. The NHL has proven that they will do everything they can to keep the team somewhere in the greater Phoenix designated market area (DMA).

Bettman in Vancouver

Coincidentally, Gary Bettman was in Vancouver last night and was asked about Seattle. Bettman says “We aren’t paying a lot of attention to it because there is no building.” He then proceeds to name all the players trying to get an arena deal done….but he’s not paying attention. This is as good as it will get from the Commissioner. I would love to hear a statement from both leagues saying that they are in regular communication with AEG or Oak View Group to ensure that the RFP responses can work as a long term home for both the NHL and NBA, but we will never get that from a commissioner until the opening faceoff or tipoff.

The arrival of Leiweke and AEG on the scene can only help the situation. Getting some honest and candid comments from any of the arena players is refreshing and I anticipate we will continue to hear more and more from AEG, Hansen, and maybe some potential NHL team owner one day.

Let’s view this as a significant progress report that people are talking to the leagues and working though some of the unique challenges with a redevelopment of Key Arena.

Impasse in SoDo leaves Prospective NHL Owner looking for other options

As you might have heard by now there were was a lot of news about the NHL coming to Seattle over the weekend which stem from two articles by Geoff Baker of the Seattle Times. The first article stated that the NHL has no plans to expand to Seattle right now due to the lack of an Arena plan and the second article states that that prospective Seattle NHL Franchise owner Ray Bartoszek is looking at revamped Key Arena as a potential site for a future NHL team. Both articles are worth the read because there will be several good details I will leave out.

Long story short, neither Bartoszek or any other group has been able to work out a deal with Chris Hansen to build the Arena. As I wrote on SonicsRising over the weekend, this should not surprise anyone due to the complexity of the deal/transaction. With the recent statements by Adam Silver on (lack of) expansion in the NBA, Hansen will need some assurances or additional $ to build the arena. Without the guarantee of a NBA team, the asking contribution price must be huge. Not everyone has the 21st richest man in america as their investment partner and Bartoszek/Lanza might be wealthy but not that wealthy. (Someone else at SonicsRising but this excellent piece together on why the impasse)

Key Arena

As the original Geoff Baker piece states, Ray Bartoszek is looking at other options which includes a KeyArena remodel. It is great to see Bartoszek looking at other options, instead of waiting for the NBA. By the looks of it, the NBA won’t be expanding in the next 5 years so it only makes sense to explore alternatives. I do not know if the Key is an option but I don’t think Ray knows either but we will never know unless someone looks into it.

Bellevue

Meanwhile there appears to be a completely separate group poking around Bellevue at the viability of an arena over there. As you might recall, Don Levin was looking over there about 3 years ago but called off the hounds when it appeared Hansen grabbed the momentum with his SoDo site. It is not clear if Levin is part of this group looking at Bellevue. This should be another good sign there are people interested in this area for a team.

I will never forget the Don Levin quote that the “Seattle market is like San Jose on steroids.” The NHL and prospective owners know there is something special about this market and it almost seems like they are waiting for us before expanding. Stay Positive.

Here is an updated visual on where we are at for landing a team. Lots of unknown on the Bellevue and KeyArena/Seattle Center Scenarios:

42814update

 

Potential Gate Revenues in KeyArena

Let me first say that I’ve always felt analyzing Arena Revenues on the success of a franchise is just part of the financial picture & can be shortsighted. Arena Revs are important and it is largely reported that NHL relies on their Arena Gate revenue much more than other professional sports leagues. My point about the Gate Revenues is that it takes time and generations to develop a fan base that creates excess demand to allow for owners to increase prices. So when you hear of crazy cheap prices and promotions in other cities, this should be considered a good thing and part of the process in developing a fan base. Besides, isn’t cheap tickets a good thing to make hockey more accessible to people of all income levels?

Additionally, the NHL should be doing things to diversify their dependence on Gate Revenues. My analysis of the Forbes NHL Valuations from last year showed that 50% of Canadian Team revenues comes from Gate Revenue where most of the other teams are somewhere closer to 33%. With roughly 50% of NHL franchises selling out every game this year, higher prices and therefore higher gate revenues are surely coming. The unfortunate thing here is that teams don’t have much of a choice but to raise the prices because they will be sold on the secondary market for higher prices should they try to keep prices low.

Ok…thank you for letting me get that out of my system

Seattle revenues at KeyArena

I’ve seen a lot of banter over the last few days on the limited capacity in the KeyArena and the impacts to Arena Gate Revenue. There is a lot of concern that because of the small arena, it isn’t suitable for the NHL, even temporarily.

So I decided to look at the price points of the various I apologize for stating the obvious here but there are two elements to Arena Revenue: attendance and ticket prices. Again with the obvious, in order to make up for lost capacity, one can raise the price of tickets. With the added scarcity of tickets this shouldn’t be too hard to do.

I looked at the average attendance per game in 2013 and the average ticket price per team to get at a “projected gate revenue per game” for each team. For the most part, you can assume that the lower the ticket price, the lower the attendance. The loan exception is Tampa Bay who has the 2nd lowest average ticket price but the 8th highest average attendance per game. Ottawa is another anomaly with the 6th lowest ticket price per game but the 6th highest average attendance per game. Even with that high attendance, they rank the 6th and 7th lowest in gate revenue per game. Here is a graph of what the Seattle NHL Team would need to charge to raise the equivalent in Gate Revenues for each team.

Ticket Prices

Note there are two figures that are being compared against the team averages. One price point at 11,000 people and one at 13,000. The 11K figure is popularly reported but Chris Daniels for Channel 5 in Seattle had done some investigating and noted that the figure is around 13K. Important to note that this assumes that all games sell out in KeyArena, regardless of capacity. I don’t recall how some other markets did when playing in a temp facility but it might be a little naïve to think that they could sell out every game.

Here are my findings:

  • Assuming a sellout of 13K, the Seattle NHL Franchise would need to charge an average of $43.18 to bring in the same gate revenues that Phoenix is brining in at $40 per ticket. 43.18 would be the 6th cheapest ticket in the league.
  • Conversely they would need to charge $186.33/seat to bring in what the Toronto MapleLeafs bring in at the gate per night. (I know not realistic but kind of fun to look at.)
  • If the Seattle team charged the league average of $61 per seat they would make more than 6 teams do today at the gate.
  • At $50 a seat, they would be charging the 12th lowest ticket price in the league and still generate more than 4 other teams.

Those are just some fun stats and thoughts to look when it relates to gate revenue. There are things like variable pricing per game where the team could charge a premium: Vancouver, Pittsburgh, Boston, Detroit, & Chicago draw extremely well on the road.

Let me know if you have other scenarios and I will run them against my model.