Re: $50millions is nuts! I don't think you're looking at that correctly. The rate you quote, is for the 1/2 Amphitheatre. I do not believe the "1/2" is determined by attendance but rather floor space. The full amphitheatre specifically mentions soccer. The smaller ones are for things like concerts and tennis where the entire floor space would not be used thus allowing BC to close entire sections of the stadium - no lights no concessions no maintenance no security. For soccer, you need the full floor space and the full amenities. That argument is moot however as the Whitecaps would be paying 15% of gate regardless. Also, I think you are low on the $25 average ticket price. Toronto's average ticket price is roughly $45. - I'd expect Vancouver's to be similar. So, you are looking at a minimum of 27,000 per game (by 2011). However, the actual amount you would pay is 15% of gate. Vancouver should be able to average 20,000 fans 20,000 x $45 = $900,000 15% = $135,000 per game. There are a minimum of 15 home games (probably more by 2011) $135,000 x 15 = $2,025,00 With increases over the 5 years, Vancouver will lose out on about $12 million over the life of the lease. That is substantial money. The problem is much bigger than you make it out to be.
Opportunity cost for the proposed $65m stadium is around $5m a year, they would need to control $3-4m additional revenues on top of overhead. Stadia are expensive.
Re: $50millions is nuts! As far as I know, there are only two examples of this. The Montreal Expos and the Vancouver Grizzlies. The Expos did well until the strike killed their World Series year and an owner who wanted to move the team ensured that the necessary steps to keep the team in Montreal were not taken. The Grizzlies were well attended but, again, had an owner who's entire plan was to move the team. Regardless, I don't believe that problems in baseball or basketball necessarily imply problems in soccer.
Re: $50millions is nuts! It is substantial money. That said, it represents a reduction in profits, not a cumulative loss. I don't know for sure but it may very well represent less of a reduction in profits than would the cost to build the proposed SSS. Regardless, none of the numbers bandied about above show anything but a financially successful club.
Re: $50millions is nuts! Why, because you say so? The rate sheet is specifically talking about seats, not floor space. They don't get discounts for keeping seats of the endzones. I wouldn't read too much into what seating configurations on that pricing sheet have been designated for "soccer." When the Caps played the Galaxy there last November it was the first significant match played at BC Place since 1983. Soccer has not been high on BC Place's marketing list, and that rental sheet was done well in advance of the Whitecaps announcement. Regardless, it doesn't matter if you have 30,000 in the lower bowl, or two horseshoes of 15,000 each in the lower and upper bowls, it still requires the same amount of staff, concessions and security. But besides all that, if they are paying 15% of the gate rather than a flat rate, the seating configuration is moot. Where your argument fails to make sense is when you say there is a "much bigger problem" than what has been represented here. I see where you are going - if the Caps pay $135,000 (15% of the gate on 20,000 seats sold @ $45), 15 games per year, for five years... ...it amounts to $10,125,000 in rent paid over the lease. But you are conveniently ignoring the fact that they are retaining 85% of the gate, which is $765,000 per match x 15 games per year x 5 years.... = $57,375,000 in gate revenue over five years. Further, this does not account for advertising revenues, TV deals or merchandising.... So if Kerfoot spends $10 million in rent to retain $57 million in sales, how is this unwise for MLS?
First, I said the 1/2 vs. full argument was moot because the 15% applies. Also, as I said, the $10,125, was increased to $12 because prices will rise between now and 2011. But with a revenue controlled stadium, Kerfoot would get the $57mil + the $12 mil + 5 years of concessions, + 5 years of parking, plus whatever % of merchandise BC gets for their shops. My point is, the true numbers are nowhere near the minimum amount you stated. This is why MLS has said they want revenue controlled stadia - they aren't happy with just some profits, they want all the profits. You're also failing to account for the $50 mil expansion fee or the cost of running and marketing the team. $57 mil revenue over 5 years would mean Vancouver is operating at a loss which would not be wise for MLS.
ANY team entering the league, with or without their own stadium, will be operating at a loss if they are paying $50 million to get in. So what's your solution then? No expansion? Flip the argument. Let's say Vancouver finally builds their stadium. Kerfoot has already paid $25 million for his land. He'll pay $80 million to get the stadium built. He'll pay $50 million to get into the league. So Kerfoot is $155 million in the red and the Caps have yet to set foot on the pitch. How is that any better for MLS?
That's not my point at all. I'm simply not going to let you cross post in three different threads that Vancouver's lack of revenue control should not be a concern when your underestimating it by $10 mil. It is definitely a concern especially when Waterfront is nowhere near guaranteed. Who knows how long Vancouver will be in BC. Shit happens. It was assumed that San Jose, DC United and Houston would be in their own stadia but we see how that has gone. MLS is way beyond awarding a team based on a promise of a stadium.
That's a good question that you should ask every team owner and league executive in MLS, who all agree that teams are more profitable when they own their own stadiums. Maybe BC Place would be an exception, but the burden of proof is on the Vancouver ownership group. And they'll be making the case where it counts, to the MLS Board of Governors, not to us. Again, all I'm saying is: Vancouver is not a slam-dunk, not a foregone conclusion, not a guaranteed cash-pumping machine.
And I'm simply not going to let you cross post in three different threads that Vancouver's lack of revenue control should be a concern when you refuse to acknowledge the substantial advantages which exist when a club takes up residence in a gov't owned, low cost, rent-controlled facility while still charging the same ticket prices as their league counterparts. No matter how you crunch the numbers, the profits come out extremely favourable. Even at $2 million a year... how does that compare to other MLS teams that rent? Better yet, compare the $2 million Vancouver is going to spend on rent to the cost that MLS teams running their own stadiums are going to pay in property taxes, mortgage financing, utility costs, stadium maintenance, grounds staff, security fees, and liability insurance. Even without the parking fees & concessions, shelling out an additional $2 million is an absolute steal compared to a team burdened with those overhead costs.
You mean... as a skeptic? I suppose so. That puts me in the company of, let's see... virtually every other MLS and USL team fan in North America. This rapid rise in price and rush for 4 more teams just seems like a desire for the original MLS investors to make some scratch off the TFC #1 Fan Story and Beckham Pony Show while they're still playing.
Why not let people from different cities make there own team rather than wait for the MLS to give a franchise. It ridicules to wait and frustating! Each team has ther own finances and not MLS business.
Re: $50millions is nuts! The only two clubs in mls that loss a lot of money are DC and New York. mls needs to expand its footprint so it can increase viewership
No but the value of TFC did. I hear they pay about 15 million for the team but their revenue was more than 20 million in the first year alone. MLS bosses were jumping for joy until they realize they got rob. I bet Seattle will crack the 20 million also. If a team is going to generate that type of money then 50 million don't sound that much.
Losing money doesn't just happen in regards to owning a major sport franchise in the long run. For example, the original owner of the Nashville Predators spent $80 million on a expansion fee, and then LOST an estimated $70 mil over the next decade. That's $150 million in the red. He then turned around and sold the team to local investors (save our team guys, yea!) for... a reported $185 million! Honestly not a great investment, but he still made money. Owning a MAJOR LEAGUE sports team is like owning real estate, the real profit doesn't come until you sell. Team profits in the mean time are a very nice bonus, help with interest, and increase the clubs value further for eventual sale. So while $40 or $50 million might seem high, remember that in 1996, the NHL charged $80 each for the four new teams, and is rumored to be charging $200+ million for the next two.
So you think it is not wise to add Vancouver in MLS? Thats a shame. Gee, I guess you have better expansion cities other than Vancouver and Montreal? I'm confused, doesn't every new expansion city start off with a $50 million expansion fee loss. If you just want to dump on this city just because it is the likely choice over your own, just say so. Why make up some lame excuse.
That's not what I said at all. I think Vancouver will be great in MLS. My problem is that MLS should learn from their mistakes. No expansion to cities with a temporary stadium and a promise of a new one. But I think MLS will wait until the 19 & 20 round so that Vancouver can shore up their stadium situation. I also think MLS will not add 2 Canadian teams together. And IMO, Montreal is further along. So I'm not at all against Vancouver in MLS. I'm just against it at this time.
Ah ha ha...yeah, we'll see. No St. Louis fan has "dumped on" Vancouver. There's a difference between pointing out the deficiencies of an expansion plan and "dumping on" a city. Vancouver would be a great addition to MLS if Kerfoot can get his stadium built. If not, well...
And St. Louis won't build their stadium until they get the franchise.......... right? So Vancouver at least has a place to actually play beginning in 20XX while St. Louis will have to wait for construction if..... and only if...... they are awarded a franchise. One could easily say St. Louis would be a great addition to MLS IF Cooper can get his stadium built. See how that works? Vancouver..... place to play immediately....... St. Louis no stadium (EVEN TEMPORARY).
That's stretching things. St. Louis's stadium is a sure thing. It's been voted on. The bonds are in place to pay for it. There are no more hurdles for the stadium. There's just no reason to start construction until a team is announced. Whatever team is announced, play won't begin until 2011. That's 3 1/2 years from now. St. Louis stadium will be built and Vancouver will still be lease tied to a temporary stadium that is not revenue controlled. And we'd just be guessing as to where the plans for Waterfront will be at that time.
So why won't Cooper and Collinsville just start construction and get things going? Doesn't a Womens league team start playing next year? The whole plan is contingent on MLS granting a franchise. NO franchise....... no stadium.... right? People claimed Qwest was bad and wouldn't work........ wrong. Now it's BC Place that is being held up as "too big" etc. Don't count on it. IF Vancouver MLS can make it work FINANCIALLY then MLS will have no problem granting a franchise. Right now St. Louis doesn't work FINANCIALLY for MLS..... it's been stated several times. Vancouver.... Portland...... Montreal are all moving up the expansion list. St. Louis is treading water or losing ground daily.
You can believe that if you want, I think Cooper is too smart not to be doing work behind the scenes. Regardless, if there are any "problems" with St. Louis, it has nothing to do with the stadium. That deal is sound. Now, even I'm smart enough to figure out that if we don't get accepted this time around, all of those cities (and others) pass us and STL in MLS is dead. But, right now, I still think St. Louis is in the lead. Edit: to respond to the why not build now question. The womens team doesn't need a 18-20,000 seat stadium. There are are a few places that hold around 4-6000 that will let them play. If they built it now, and no team is awarded, they have a $100 mil stadium just sitting there.
I agree with this. But I doen't see how they make it "work fiancially" for a few years still. Besides, I think St. L, Montreal, and Portland will all make it work financially before Vancouver. As I've said before, I have no problem with Vancouver in the league. I just think MLS is going to wait a couple years for the stadium to work itself out. If Vancouver was alone, sure MLS might take them. But there are too many other good options right now. All four of these cities are good options. But all of them need "something" to push them over the edge - I think St. Louis can accomplish that first. Vancouver will be the last to do as they've gotten themselves tied up in a stadium mess.
I'm sure Cooper............. along with every other potential ownership group is working behind the scenes to make things happen. Cooper has had the MOST time to make something happen and it hasn't as of yet. In Seattle we know how this works..... it took several years to make it work financially for the league. Just don't be surprised if St. Louis is not in the lead. Especially when there is an announcement.