Quote:
Originally Posted by Roughneck
MTS is designed so that the tougher times aren't as hard. 15,000 seats in lean times are easier to fill than 18,000 which means they can charge more while paying less to operate it. It also maximizes the revenue from non-hockey events, which means that even if the Jets aren't making as much money, TNSE can still make up the difference elsewhere.
But sure, let's say that 10 years after building MTS they've paid it off and decide they don't want to secure any more capital and want to take on the costs because of 3,000 more seats for a mere $300M. Those 3,000 seats are going to be the cheapest but hey, times are good, let's assume they'll go for $50 each. Let's also assume that each of those fans will spend $30 at each game because again, times are good. That's only like 3 beers and a hot dog anyway. So in a mere 30 seasons of peak fan support, the team can look to have those 3,000 seats justify the cost of building a new arena, which will be about the time they'll have to start looking at building the replacement. This also ignores the operational costs of those extra seats as well as the interest on the construction costs. Not to mention a bigger arena brings with it a bigger footprint and a higher value so a few more property tax dollars as well. MTS is already an arena designed on revenue maximization for it's size, so this isn't even a Saddledome or Rexall situation. If MTS was still under construction or in it's early phases and an NHL team was coming back and they could say 'hey, it will cost a bit more to add about 1500-2000 seats but it could be better in the long run' it would be one thing. But the arena is built and only ten years old and making money that doesn't need to go to financing the construction anymore, which means more profit.
Plus TNSE would need to find and buy the land which could be tough in Winnipeg since the SHED is pretty much based around an arena so the city (and province) wouldn't be too helpful in any bid that isn't in a prime downtown location to keep that dream alive. Since few cities can justify multiple large-venues, you also need to take into account what to do with MTS when you move out. The cost of re-purposing it would not be cheap either, this would be a lot of money TNSE is committing to after spending so much on the team already, which will leave them with absolutely no breathing room and certainly very little disposable cash for free agents.
Any suggestion for them to build an arena within the next twenty years is a stupid one, plain and simple.
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If you're analysts for why they shouldn't get a new arena because it'll be too costly and they wouldn't get enough revenue from it to cover the expenditure of building a new arena, and spend up to the cap in the future, then that shows why Winnipeg is unsustainable in the first place. They may get money from the other events that occur in the venue, but they're still potentially losing on more money from their most frequent tenant. I'm giving Winnipeg the benefit of the doubt that if they could build a new venue with more seating and luxury suits (which is the big one here), it would give the franchise a lot more security thanks to the added flexibility.
The luxury suits is where the team would make the greatest gains in a new arena. The nosebleeds would allow the Jets to give cheaper tickets to fans that don't want to pay the high value ones night in, night out. That's more revenue their making now then they were before. And then if the buzz dies down and the market doesn't want to pay one of the most expensive tickets in the league anymore, they have the extra capacity, plus the new luxury suits, that can allow them to adjust their pricing so they can still get the same revenue now, or at least close to it.
It would be costly now to build a new arena, but it could help them tons down the road. If Jets are going to be in Winnipeg for the long term, they're going to have to build a new arena at some point anyway since the MTS will reach outdated standards at some point. Why not build a state-of-the-art facility that will last three decades now while the support is at it's highest, rather than possibly having to do this 5-10 years from now?