With this morning's news from Caitlin McGlade of the Arizona Republic that the City of Glendale's revenue projections for the first year of the lease agreement signed in August between the City and Renaissance Sports & Entertainment (RSE) will not be met, the usual chorus of skeptics and opponents are chirping about the feasibility of the agreement, and of hockey in Arizona in general.
Yet a more detailed look at the report reveals a different picture, one that even has more than a few positive takeaways for hockey fans in Arizona.
To begin, the gap between projection and reality is a little less significant than initially indicated. The article leads off with this dose of bad news.
Glendale expected to recoup $6.8 million this year from sources that include ticket sales, parking receipts and naming rights for the arena.
But too few non-hockey events at the Jobing.com Arena and lackluster revenue from parking means the city likely will get just $4.4 million.
A shortfall of $2.4M from revenue estimates is certainly disappointing, but not entirely accurate. As the article goes on to state:
The agreement does include a partial safety net — an escrow account funded by an additional surcharge on tickets — that Glendale will dip into to make up some of the difference, but that will still leave the city with only about $5.3 million, according to estimates by Duensing.
So the escrow account brings the shortfall to about $1.5M. It's still problematic, but not quite as bad as the first few paragraphs of the article suggest.
Perhaps more important for Coyotes fans is where the shortfall stems from. The team averaged 13,775 fans this season, which was last in the league, but over 1,000 fans more than they averaged in the previous full season.
In fact, the Republic's article goes on to state that the performance of the hockey club at the ticket office was up to par with what the city expected.
The team had seven sellouts and even broke the single-game record for revenue three times.
That put Glendale on target for money coming from ticket surcharges at hockey games.
The council expected to collect revenue from 23 non-hockey events based on prior years, but the city will only collect revenue from eight this year under the new agreement.
Duensing said the city wouldn't change next year's budget based on this year's returns, predicting that Global Spectrum's first year at the arena would be the most difficult for bringing in a lot of events.The arena already has five events booked for next fiscal year.