Coyotes won’t participate in Glendale RFP process for new arena manager

GLENDALE, Ariz. — When the City of Glendale receives bids from companies hoping to manage Gila River Arena, the Coyotes won’t be among them.

“The Coyotes have no intention of participating in the Glendale RFP (request for proposal),” Coyotes president, CEO and co-owner Anthony LeBlanc said Wednesday in a terse and brief response.

The Glendale City Council voted last week to hire Beacon Sports Capital Partners LLC as a consultant to seek bidders to manage the arena. The new manager could take over as early as July 2016. IceArizona, the Coyotes’ ownership group, has managed the arena the past two years.

When the city and IceArizona reached agreement on a new, two-year arena lease and management agreement — after the city voided its two-year-old, 15-year, $225 million deal with the team — Glendale included the possibility of a new arena manager in the new deal. LeBlanc expected to have several conversations with the city before a decision was made. According to Coyotes sources, the sides met once to discuss it before Glendale made this decision.

So what does it mean for the Coyotes’ future in Glendale? LeBlanc wouldn’t comment other than to say: “We are committed to Arizona.”

Glaring in its omission from that statement was the word, “Glendale.”

While it is likely the team will remain in Glendale for the remainder of its agreement with the city, the efforts to find another home in the Valley are likely in overdrive now.

Speculation on the possibility of a new downtown arena for the Suns and Coyotes has existed for at least a year. So has the idea of building an arena along the 101 corridor in Scottsdale.

To do that, the Coyotes would need to find a temporary home. They could play downtown at US Airways Center, which will officially become Talking Stick Resort Arena next month. They could play for a couple seasons at the old Arizona Veterans Memorial Coliseum. They could even play at Chase Field with the roof closed.

None of those set-ups are ideal, but a new arena won’t be built in two years so they could serve as a stopgap. If all those possibilities are exhausted, the Coyotes could also look at relocating to another city.

Managing the arena hasn’t meant a great deal of revenue for the Coyotes, nor does it for most teams. A source familiar with league averages said teams average between $100,000 and $200,000 per concert, with most of the revenue going directly to the bands or acts.

The greatest value for the Coyotes in managing the arena has come in the team’s ability to package concert suites for top acts like Taylor Swift or Justin Timberlake with suite sales for less desirable teams like the Columbus Blue Jackets or Nashville Predators; teams that don’t typically draw large crowds.

Glendale councilman Ian Hugh and other city officials have asserted that IceArizona did not book enough non-hockey events in the arena in the past two seasons. IceArizona hired Spectra to manage the concert business, and Spectra booked 14 shows for the fiscal year ending June 30; seven the year before.

Glendale reported an $8.47 million loss on its $15 million arena-management investment for the 2014-15 fiscal year, although $6.5 million of that was budgeted for management of the arena and capital expenses and the losses don’t account for the difficult-to-measure sales tax created at Westgate by Coyotes events.

Concert-industry insiders have said repeatedly it would be extremely difficult for Glendale to support the arena if it were to lose the Coyotes and the more than 40-plus events they create in the arena. Those same insiders also wonder how Glendale would attract more shows in a soft market where bands don’t tour as much due to costs, and a competitive market where concert behemoth Live Nation controls the vast majority of the market with Ak-Chin Pavilion and Comerica Theatre, not to mention the competition from US Airways Center.

 

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