Quote:
Originally Posted by Leeman4Gilmour
I'm a big fan the decision to build this facility and don't agree with lot of the negative sentiment regarding the use of taxpayer dollars to fund it. That's not the point of this post though.
Franchise valuations lately got me thinking though. A clause the city should consider putting in their final agreements is around franchise valuation increase due to the new facility. My thinking;
If the franchise increases in value, like other franchises have, due to a brand new city owned arena, if the ownership decides to sell the franchise, the city should be eligible for a portion of that increased valuation. I feel that's fair. If Edwards and Co. decide to sell after the new rink is built, they could end up getting another $200M or more because of the new facility. A portion of that, in my mind, should be distributed to the city.
Random thought.
|
I was thinking about very similar things in the context of the TB sale.
Since 2006 our franchise value has gone up almost $700+ Million. The current ownership group bought in 1994, so no doubt their actual increase in wealth is greater than that cumulatively. And we are asking for less than half of that increase in wealth to fund the new arena. A new Arena has typically added 3-400 million to a franchise value. Edmonton saw their value DOUBLE due to new arena (according to forbes):
https://www.forbes.com/sites/mikeoza...h=4256a4b170dd
vs
https://www.forbes.com/sites/mikeoza...h=9461590360cb
IMO not only should we be looking to wrap in future clauses about increased value on franchise sale, but also we need to be critically looking at how much value the franchise has gained over the period of ownership. The ownership group potentially stands to have gained over a billion in total value once the arena deal is finalized. In fact likely 1.3 billion-ish.
Yet some will still make the argument that this is not a profitable venture without government support. Get bent.