Quote:
Originally Posted by polak
I don't think we'll see as many boxes sold off as you think.
First off, they're not all owned by Oil companies. I don't think they list who owns the boxes anywhere but off the top of my head there's Telus, CP, CN and the Herald that own Suites and I'm sure there is a lot more. I know I noticed a couple companies with "Logistics" in the name.
Second, I heard that when you buy a box you are forced to renovate it too. That's a big investment and if they can't make most of it back then I doubt they just let it go, especially with the costs and time involved to get it back. Plus they still need a way to entertain clients.
Third, I think most of the companies that can swing suites are pretty big and can ride this out.
I don't think we have to panic about corporate clients selling seats and suites for a long time. Calgary is still a major business hub and the seats cost pennies relative to most of these companies budgets.
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You are completely out of touch with the economic reality of the Calgary Corporate community if you actually think that. I would bet that around 30-40% of the boxes are directly purchased by Oil & Gas Companies, and the others are mostly made up of oilfield service, construction companies, and other industries that support the Oil & Gas industry or directly benefit from it (Legal, accounting, real estate, financial services).
Sure BMO and some law/accounting firms and Telus may keep their boxes, but a lot of the other won't.These guys can barely make payroll and are laying off every second week and you think they are going to give 200K+ a year to the Flames to maintain their boxes? These guys have to buy that box for every single event at the dome and pay for the food and drink people spend in there on top of that. I know of several companies in town that currently have boxes and are leaving the empty on purpose to they can avoid the food and beverage charge associated with the box being used.
What does a large leasehold improvement cost have anything to do with companies walking away from their box? That's a sunk cost. These companies are trying to conserve cash flow, it's irrelevant to their cash flow management decisions. In fact, the leasehold improvements requirement is more of a barrier to the Flames filling those empty boxes back up than it is people walking away from them.
We aren't just talking about boxes here either. We are also talking about a large portion of the lower bowl seats that are being purchase by companies. My firm had 10 sets of season tickets in the lower bowl. We are going with 2 next year, the decision has already been made.
Obviously this isn't going to kill the Flames, and they'll still have good attendance (personal tickets), but box and lower bowl attendance is definitely going to be a problem next year so I don't think I'd be taking shots at Winnipeg for having a couple hundred unsold tickets prior to a game that half the city probably doesn't even know are available given their season ticket holder requirement of a 3 year purchase (or has that been thrown to the wayside?).