[Jay Random]

Originally Posted by MisterJoji

Not trying to say you're wrong as you seem to be very knowledgable on this front. Just wondering where you got the 250 million for an expansion fee from? During the last round of expansion the Wild and Bluejackets paid 80 million 13 years ago. Has that price really more than tripled since then?

I don't have any NHL source, of course, since the NHL is not officially saying anything about expansion. However, the usual journalists and rumour sites are tossing out numbers $200 million and up, based (I suppose) on the fact that proven money-losing franchises in bad locations are selling for not much less than that.

Why did the price not even double from 1991-2000, but it costs more than triple the amount from 2000-2013? Seems ridiculously high.

It is ridiculously high. On the other hand, it's also ridiculous that the Phoenix Coyotes were valued at $170 million — without the option to relocate.

However, what you get for that money has changed dramatically. In the 1990s, the league was selling franchises that were almost certain to lose money, thanks to cutthroat competition for players among an increasing number of teams. Expenses were rising faster than income, with no end in sight. Today, the NHL would be selling franchises with predictable expenses, thanks to the cap. If your team has average revenues, you're almost certain to make a profit. That makes it a much better investment even at $250 million than Columbus was at $80 million. (Not that that's saying much.)

Also who sets the territory fee? Again, 1/4 million dollars seems insanely high as I can't see the Leafs losing any money with a 2nd team in the GTA. With a 20 year wait list to get Leafs season tickets, it wouldn't even dent their cheque book.

It would dent their chequebook, all right. It would make them have to spend money putting a good product on the ice, instead of just taking their enormous customer base for granted. The Toronto Maple Leafs are almost the only franchise in the NHL that is driven entirely by pursuit of profit and cares nothing for winning. If they had local competition, they would have to start caring. Every owner since Stafford Smythe has been fighting tooth and nail against that.

The real point, however, is that the Leafs are going to set an asking price of infinity, and they are only going to lower it to the point at which it is cheaper for the league to pay the fee than fight it in court. In the past, territorial fees have tended to be roughly the same as the cost of an expansion team. The Islanders, I believe, paid $6 million for their franchise in 1972, plus a $5m indemnity to the Rangers. The Anaheim Ducks got their franchise by paying $25m to the league and $25m to the L.A. Kings. If the league can get $250m for an expansion franchise, as many people are suggesting, then the Leafs can probably hold out for an indemnity in the same range.