Quote:
Originally Posted by Senator Clay Davis
The ticket tax has nothing to do with the coming price increases. The ticket tax will be added to the price increase. So while sure, STHs wouldn't mind a $3-5 tax, that will be on top of the 20-40% price increase in tickets. They'll be raising ticket prices 20-40% because that's just SOP for a new arena.
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They'll increase ticket prices, but its not as simple as a blanket increase of 20-40%. I'd guess black seats increase by 100%, green seats by 50% and everyone else by 0-10%. And this is because the new stadium does two things:
1) Results in a lot less "bad seats"
2) Results in more luxury boxes
Say the owners put up $200m. If you make the assumption that none of this is altruistic (which is an extreme, but still reasonable assumption) and the flames need a return on investment of 8-10% on that you end up with a revenue requirement of $16-20m per year. And you're right - that is really only allocated only to flames ticket holders. But I don't think they get allocated equally.
A huge portion of that is going to be felt by luxury boxes because that's the raison d'etre of a new stadium. Id assume the flames add 75 boxes at 12 seats each (900 seats) and remove 2000 cheap seats (blacks and greens) to get the capacity down to ~18,000.
New revenue: 75 boxes x 250,000 = $19m
Loss of revenue (green + black seats): $35 x 2000 seats x 41 games =-$3m
Price increase for everyone else = $0-4m
Net revenue per year: $16-20m
High end return requirement: 8% x $200m = $16m
Low end return requirement: 10% x $200m = $20m
As you can see, it leaves C$0-4m to be split between 15,000 or so non-luxury box seats, which is $0-6/seat per game. That works out to 10% on orange seats and 2% on the most expensive seats.
The caveat is that if you currently have black or green seats, you probably end up seeing a larger increase than everyone else. That's because what black and green seats are in the saddledome will no longer exist - the worst sight lines in the new stadium will be what you get with Orange seats today, so I'd assumes those will probably be the cheapest price point in the new stadium.