The last time Arizona Coyotes president and CEO Anthony LeBlanc saw Gary Bettman, the NHL commissioner gave him a message.
“I was with Gary earlier this week at league meetings in Colorado Springs and his closing remarks to me when we were saying goodbye was ‘get your (arena) deal done,’” LeBlanc said.
A new arena deal hasn’t officially been completed, but the Coyotes are closer now than they’ve ever been to leaving Glendale for another location in the Phoenix area. It was announced Monday that the team and Arizona State University were moving towards finalizing a new building.
The Coyotes have officially entered into an exclusive negotiation agreement with Catellus Development Corporation, which is the master developer for the Arizona State University Athletic Facilities District.
The site of the proposed new arena, which will be shared by the Coyotes and ASU, is the Northwest corner of E. Rio Salado Parkway and South McClintock Drive in Tempe, Arizona. Arizona State started playing Division I men’s ice hockey this season as an independent.
This agreement provides for a period ending no later than June 30, 2017 to create the overall budget, design and operational plan for the development. The hope is that the team can start play in the building in 2019-20.
“I’m thrilled for Anthony and for the Coyotes’ organization and fan base,” NHL deputy commissioner Bill Daly told Puck Daddy in an email. “ A lot of time and a lot of hard work went into today’s announcement and while there is more to be done, it appears that the team now has a defined path to stability and success. And that’s good new for the National Hockey League.”
This news should eventually end Arizona’s tumultuous tenure in Glendale, where the Coyotes have played since 2003. The decision to find a new home in the area was in part spurred by the City of Glendale’s decision to cancel the team’s 15-year Gila River Arena lease in the summer of 2015. The Coyotes then came to a two-year pact with Glendale shortly after, but it appeared the possibility of staying in the city long-term at that point was no longer an option.
Since then LeBlanc has looked around the area to find the right type of situation for his team, and settled on the partnership with Arizona State in Tempe.
We talked to LeBlanc about the new deal, the next steps, lessons learned from the legal battles with Glendale and how the team and ASU decided to enter this partnership
Q: How satisfying is it that you can finally release details about this project? You had gone kind of radio silent recently.
LEBLANC: We settled on a partnership with Arizona State University quite a few months ago, but out of respect for their organization, they’re obviously a very large public entity, we needed to do things that were probably at a slower speed than we would have hoped but we certainly understood based off their larger organization, and we completely respected the fact that these things need to be done quietly. So there was a lot of speculation in around the state of where this facility would end up, but it was actually good that there was that speculation of different sites because it allowed us to really get a lot of work done, and let me be up front, there’s a lot of wood left to chop, but I mean, we’ve been able to progress to a point with this announcement today and get a lot done in the background that probably wouldn’t have been done in a typical corporate environment. It’s incredibly satisfactory to get it done, but we’re just really excited about what this can do if we can get it across the finish line and today was a real jump in that direction.
What are the next steps to get it across the finish line?
Really the key work we need to do now is rekindling conversations we were having with public entities, so mainly the state of Arizona and the City of Tempe, but the difference is we had significant conversations with those bodies back in the spring and then in particular the state went into recess and they come back here in the next month, but at that point we were doing so in a more innocuous, non-site specific, non-partner specific manner. Now we’re going to be able to rekindle those discussions, partnering with one of the largest institutions and probably the most respected institution in the state, so it’s going to be a significantly different conversation. And look, we feel we have put together the framework for a private, public partnership that is going to be very well received across the board. We, as the Coyotes are going to put in a vast sum of money towards the construction of the facility and of course ASU will be participating. But the only thing we’re looking for from government per se, is helping us fund an arena that we believe will fund itself. So there’s a lot of those details to work out. That is really the key work over the next couple of months is getting that kind of ironed out and we start that process this week.
Is there a chance this could fall through? Are there backup plans? Is there a risk with this?
Everything has risk until – I’m a lifelong sales person and nothing is ever done until it’s done. But we’re not focused on that. We feel very strongly that this will move towards the finish line. We have a lot of work to do but I’m sure people have already seen that we’ve been pretty extensive in our planning that’s required a fair amount of money to date and now we’re getting into more expensive soft costs before the building starts being constructed and we’re confident it will get done. We don’t have backup plans. We’re focused on this and we have an exclusive arrangement with this site so we feel very confident that this will end well.
Does your prior situation with Glendale make you more cautious about asking local government for a more substantial stake in the arena?
Ed note: It was reported the Coyotes are looking to put in $200 million (roughly half the cost) into the arena and will look to have the rest publicly funded.
I don’t know if I’d tie it to Glendale. I think the difference with the Glendale facility is look, this was a facility that was pretty much 100 percent financed through general obligation funds by the City of Glendale. That is not something we’re looking for this time around. We’re looking at putting in substantial money from the ownership group and what we’re looking for from government involvement isn’t a handout of any form and details will come out over the next several weeks and months of what we’re talking to the state about, but it’s fair to say the key focus is on making sure that this facility funds itself so that nobody’s upside down, nobody is putting themselves at risk and we really feel that the partnership with ASU – this is a very unique opportunity that I don’t think exists in most other environments. And while I know that there are some pro teams that play in a facility that’s shared with a university such as the Carolina Hurricnaes, I think this will be the first real, tight integration on campus with the arena being right on campus itself. This is going to be kind of the first of its kind and we’re really excited about it.
When Arizona State announced they were going Division I in 2014, did the light bulb start to go off in your head? When did you start to think of them as a partner?
It’s funny because it went in stages. So yes, when ASU announced they were going D-I, that was prior to Glendale terminating our lease, but immediately I sat down with ASU’s athletics director, Ray Anderson who is a great guy and has a very long, distinguished career in professional sports – he came from the NFL. I think he looked at college athletics through a different lens. So initially what we were talking about was partnering with ASU in regards to a smaller facility that they’d be building for their D-I team and maybe incorporating in a new practice facility for the Coyotes. And then when Glendale terminated the lease in the summer of last year, then Ray and I followed up and I can’t remember who was the one who said it, but the comment was ‘maybe we should be looking at something bigger.’ And that’s how this all started.
You were mostly looking in the East Valley, where this arena will be located, correct?
Our focus was the East Valley. Another location pretty close to the location we’ve landed on and of course we actually spent a fair amount of time with the City of Phoenix. Mayor Greg Stanton was a great supporter and really wanted to see an environment where we would move downtown and possibly in a new facility and we actually worked very closely with him and his staff through the spring, but unfortunately all required parties weren’t interested in being at the table. That unfortunately didn’t move forward but having that said, where we ended up at ASU, we’re pretty excited.
Can you also tap into the Arizona State student body to join your fan base? What type of opportunity does that provide?
Oh absolutely. Every business runs off of ensuring that their facility or their business is easily accessible by the majority of their fans and look, we have great fans in the West Valley and Glendale and Peoria and places along the West Valley. But the reality is they’re not the majority of our fan base. The majority of our fan base is in the East Valley and it’s the same thing as our partners on the sponsorship front. The majority of those are in the East Valley, so while it’s difficult and we thank our fan base that has been so strong and working with us here in the West Valley, at the end of the day you have to go where the majority of your customers are and that happens to be in the East Valley. And yes, you also touched upon this, we happen to be pretty attracted to the fact that we’ll be sitting on what happens to be the largest student body campus in the United States.
Why are most of your fans in the East Valley?
I think it’s just the city, it’s like in a lot of places like the city was formed – you’re actually asking me to be a historian of the Phoenix area, which I’m not particularly good at (laughs) but Scottsdale, Phoenix was kind of the first, I guess they were the main areas that people flocked towards. Now don’t get me wrong, the West Valley is growing – and that was certainly Steve Ellman’s vision when he put the team out here, was that the region is growing so quickly because of so many natural reasons why people want to be in this location. Then there was the financial crisis that happened, which certainly hurt things and the westward population growth has not been as extensive as was expected. Don’t get me wrong, there are a lot of people who live in the West Valley but the East Valley seems to be kind of where the traditional base is.
I read the goal is to have this ready by 2019-20?
The aim is to have shovels in the ground just before next hockey season begins and we anticipate it will be very similar to Las Vegas with a 22-24 month build.
What are the steps in regards to staying at Gila River Arena?
That one we’re less concerned about because of the fact that we have such a great relationship with AEG due to the fact that we’re both on the NHL Board of Governors with their ownership with the Los Angeles Kings. So they’re an organization that we know very well. And the city did provide them – when AEG took over – AEG has the sole authority and decision making in regards to any lease either extension or what have you with the Coyotes. I know they would like us to be here and I would certainly expect, and our plan is that we will just extend for the amount of time we need until the new facility is created.
It did seem to work out well for you guys that AEG was picked to manage the arena.
Sometimes luck comes into play. When (Glendale) initially took the action to terminate our lease back in June of 2015, I mean I was devastated. I didn’t know what it meant. It’s one of those things you look back now and go, ‘that didn’t have a silver lining, it had a gold lining.’
What has the league told you?
The commissioner and deputy commissioner were out for a visit, I think it was in the spring, and toured the sites we were working on and met with some of the stakeholders.
I was with Gary earlier this week at league meetings in Colorado Springs and his closing remarks to me when we were saying goodbye was ‘get your deal done’ so I’m sure he’s happy.
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