Florida Panthers plan long-term with big free agent deals
Shortly after the Florida Panthers were eliminated from the 2015-16 Stanley Cup Playoffs the team’s management planned out the next season.
It also looked two years down the road and three years and four years in order to set a common sense salary structure for the group that had a lot of its young core due for large long-term raises.
“In a salary cap league it’s hard to make mistakes,” Panthers co-owner Doug Cifu said.
The results of that meeting played out over the course of a near two-week period from late June into early July.
During that stretch the Panthers added unrestricted free agent defensemen Keith Yandle and Jason Demers to long-term contracts. They wasted no time in signing cornerstone blueliner Aaron Ekblad to an eight-year contract extension on July 1 – one year before he was set to hit restricted free agency.
They re-signed young restricted free agent sniper Vincent Trocheck to a six-year contract the day after he hit the market. On July 3 they re-signed forward Reilly Smith to a five-year contract extension. Smith, like Ekblad, wasn’t due to be an RFA until the following year.
Florida also signed UFA goaltender James Reimer to a five-year $17 million contract as a possible successor to Roberto Luongo.
The only major restricted free agent they have coming up for next summer is Jonathan Huberdeau. The only major unrestricted free agent is Jaromir Jagr. Gone are aging defensemen Willie Mitchell and Brian Campbell, but both weren’t expected to return.
Such type of contract preparedness hardly happens in the NHL, where teams often sign pending unrestricted free agents during the season and hold off on restricted free agents until the summer they hit the market.
“There’s a core of players here that know – we’ve given you great teammates, we’re going to add people as the opportunities arise but it’s up to you guys to come together as a team and win multiple Stanley Cups and that’s the plan,” Cifu said.
In May, the Panthers announced restructuring within their management. General manager Dale Tallon, who constructed the team’s entire roster, became the Florida’s president of hockey operations. Tome Rowe became the team’s general manager and Eric Joyce and Steve Werier were named the Panthers’ assistant general managers.
During this change, it was maintained decisions still went through Tallon, even though he said he would focus more on scouting.
The team then announced in late May it had fired director of player personnel Scott Luce. In June, longtime pro scout Peter Mahovlich was named special advisor to the owner.
Externally, the new structure didn’t seem to jibe with the traditional hockey hierarchy. This created some skepticism, but this is exactly what Cifu and Viola wanted – to have what they called a “flat structure” that involved multiple voices on decisions, which included old school hockey minds, younger analytical thinkers.
“That obviously unnerved some people because you have this traditional notion that there’s a GM and he’s a dictator and does all this work and he comes in to the owner and says ‘I’m going to sign this guy, that guy and that guy’ and the owner says, ‘OK, as long as it’s under the budget’ but that’s not how (co-owner) Vinny (Viola) and I run any of our businesses,” Cifu said. “I’m not a hockey guy, Vinny is not a hockey guy. We’re hockey fans. We don’t get involved in the day-to-day sausage making if you will of the hockey team but we want to know what’s going on, who we’re talking to, why we’re trying to add guys and how does it all fit together. I like having Dale and Tom Rowe and Eric Joyce and Steve Werier and Peter Mahovlich who has been in the game forever.”
For the group, it was important for the team to not procrastinate on contracts. They believed in their core and thought it made little sense to wait until the last second to sign them. Because of this proactive approach the Panthers have $59,052,499 million locked into their roster of 24 contracts for next season. They currently have $3,716,668 of salary cap space left this summer.
“With how we run my company, when Vinny and I started this company, it’s a very flat organization and we have 150 employees. Vinny and I have hired all of them, Vinny and I have interviewed all of them,” Cifu said. “I have conversations with and they kind of report to me as CEO of the company but what’s so special about a hockey team that you have to have a single filter or a single person that makes all the substantive decisions? As long as people are willing to check their egos at the door and engage in really active open and trusting dialogue with each other I think you can get a result that’s a better result.”
The Panthers also used the natural and legal attributes of South Florida to their advantage.
The place has no state income tax, so they were able to pitch contracts with lower salary cap rates than what they believed some players could have gotten on the open market. This enabled them to lock up Demers at five years for $22.5 million and Yandle for seven years at $44.5 million.
“It’s huge – I mean I love California to visit but there’s a 13 percent difference,” Cifu said. “If a guy makes $5 million in Los Angeles and makes $5 million in Florida, he’s going to make $650,000 less net in the state of California than he is in the state of Florida. It’s an absolute slam dunk to be in the state of Florida.”
Also, it doesn’t hurt that Florida has some of the mildest winters in the NHL.
“Aaron Ekblad is coming to practice in December in flip flops and board shorts and practice is over at 12:30 p.m. He has lunch, he’s back over in Fort Lauderdale, I think he has a place on the beach or near the beach, by 1 p.m. and life is pretty good,” Cifu said. “It’s a great place to play.”
Even with these advantages, a prime free agent player still won’t come to a team if it doesn’t have a winning environment. In the past, the Panthers had to overpay for aging vets to try to stay competitive.
Cifu said Demers and Yandle both wanted to come to Florida because they saw a team with Stanley Cup potential.
“I know when I met Keith Yandle for the first time at the NHL Draft, he was effusive about coming. He’s friends with Shawn Thornton, he played junior hockey with Jason Demers it turns out in the Quebec League and he thought very highly of Barkov and Trocheck. He said, ‘You were my number one choice because I wanted to play on a winning hockey team. I’m 29 years old and I want to win multiple Stanley Cups and I think your team gives me the best opportunity to do that,’” Cifu said.
As with all non-traditional hockey markets the Panthers have needed local cooperation to allow them to grow. Recently the team came to a new lease agreement with Broward County for the BB&T Center. Before this, there was a report the team lost $36 million in 2014-15 and $27.3 million the year before.
It’s unclear whether losses are behind them, but the business seems to be trending upwards.
Currently the Panthers say their season ticket renewal rate is above 90 percent and the organization has sold more full season tickets already this offseason than they did all of last offseason. Their average attendance went up from 11,271 in 2014-15 to 15,384 in 2015-16.
Since Viola and Cifu bought the team, the Panthers have gone from 66 points in 2013-14, to 91 points in 2014-15 to 103 points, and an Atlantic Division title, this past season.
With this stability and structure, the Panthers believe they should be good long-term investment for a fan’s entertainment dollar in the crowded South Florida market.
“Now when I go on local radio call-in shows it’s really upbeat and people are excited as opposed to when we first bought the team it was, ‘Is the company going to file for bankruptcy? Are you going to move to Quebec? Are you going to move to Vegas?’” Cifu said.
The last couple of years the Panthers have caught the hockey world off guard with their meteoric rise. With some of these new deals there is pressure to win – but that’s all natural if the team wants to be successful long-term.
“Cultures are very overused words, but I think we’ve created a culture of winning in South Florida which hadn’t been there for a while,” Cifu said. “I think the guys really like playing there, I think they like each other. I think there’s a real camaraderie.”
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Josh Cooper is an editor for Puck Daddy on Yahoo Sports. Have a tip? Email him at firstname.lastname@example.org or follow him on Twitter! Follow @joshuacooper