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 New Jersey Devil - Financial Issues

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Beans15 Posted - 06/18/2013 : 06:25:49
I'm not sure how many people have been following this but the Devils have been in financial 'dire straits' for years. Basically, since they built their new arena they have struggled to stay in the black, having gone through a few owners and refinanced their debt on more than one occasion.

This TSN report talks about the current issues as the Devilís owner recently missed a $3 million interest payment. This is after refinancing $170 million in debt just 6 months ago. It also discusses around $30 million is support the Devils have received from the NHL.

This has been something that I have followed reasonably closely, mostly because of the talks of eventually putting another NHL team in the GTA. There are very few cities in NA that can sustain two teams in the same pro sports league over an extended period of time. In fact, I think one of the few successes has been the Jets and Giants in New York. Many can point to other two city teams such as Chicago in baseball, LA in basketball, and NY in baseball but face it, those teams usually have one very strong financial team and the other is streaky in their success.

Point is, I still don't think the NHL would be wise to bring another team into the GTA. New York can only sustain one team financially themselves. I get that it's Toronto and hockey is a rabidly followed game in Canada, but I still can help but think: what happens to Buffalo if the NHL puts another team between them and TO???

There is no value in adding a franchise only to decapitate a different franchise.

Ottawa, the best coached team in the NHL, with MVP like players such as Chris Neil, will win the Cup in 2013!

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JOSHUACANADA Posted - 06/18/2013 : 15:35:43
I am a person who see's both sides of the coin. For a few years the ownership of the Devils have been struggling, but fan support is not the major issue with the finances of this team now, although prior to the lockout this team needed cap help with payroll reduction. There is the issues with the stadium not being booked for non hockey events and the owner can't make non hockey income to the level he and the city had budgeted for when the financial agreement was made last year. The budget was not met for non hockey related income, combined with the lockout and not reaching the playoffs after the ownership having just refinanced all of the team assets including the stadium which was suppose to relieve them of the financial pressure. That payment has just been defaulted upon. The market in New Jersey can sustain a hockey team, but this ownership is having multiple issues financially, which have a bit to do with the team but more to do with ownership issues. The restructured CBA and cap will help in the future, but an 82 game season, playoff positioning may not be enough as non hockey related revenue to there budget will still have to me made. This is just one of the first possible casualties of an extended lockout.

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nuxfan Posted - 06/18/2013 : 15:05:48
Certain cities are able to support multiple teams for certain sports -there needs to be a lot of people, and a lot of fans for that particular sport. The ones you mention (NY area has multiple teams in all sports, LA for baseball, CHI for baseball). For hockey, I see no reason why the GTA could not support multiple teams. They have the population, and the potential fan base, to make it a reality.

I'm not sure how this hurts BUF - if you keep the team to the GTA, I'm sure BUF would still enjoy the support of southern Ontarians, as it does now. Or are there a lot of people in the GTA that support Buffalo?

The other option would be Quebec City, which seemed to be moving towards getting a team again - we all thought it might be one of the southern US teams, but it could be NJ.
Beans15 Posted - 06/18/2013 : 11:40:35
I don't think they are in a position to move quite yet. As I understand the situation, there are a few issues. Firstly, the owner who built the stadium worked with their city council to get funding. It was a bit of a bungle from the beginning and it ended up costing both sides more than what they wanted. However, the larger issue was that from 2007 when it opened until 2010, the Devils and the Seaton Hall basketball team were the only reasonable tenants. College sports teams in the states are notoriously sticky about giving up any of their revenues so I doubt much revenue was coming in other than the Devils. When the Nets moved in, the money got better but paying for and then funding an arena for 3 years is not a profitable venture.

Let's add on top of that a team that has ranked no higher than 20th in attendance since their new stadium opened, will normally draw between 15,000-16,000 fans, and have the 15th most expensive tickets. It's like building a17,600 seat stadium but drawing Winnipeg attendance numbers.

It will take more than just a rich owner to do well in New Jersey. I'm not smart enough to know what the answers are but I think the situation is not to the point of shutting off the lights. However, this issue has been going on for years and many people don't know about it because people don't often perceive a successful franchise on the ice to having financial difficulties off the ice.

Ottawa, the best coached team in the NHL, with MVP like players such as Chris Neil, will win the Cup in 2013!

Pasty7 Posted - 06/18/2013 : 10:49:17
On this i would have to agree I think their are other viable markets available before anywhere in the GTA should come into the discusion. Not so much because of Toronto may suffer but as you stated beans what would happen to the Sabres, espcially with a new owner ready and willing to spend money and invest in the cities franchise.

I havn't however followed the New Jersey situation fully I was aware they were in bad shape financially but it would be a shame to move probably the most sucessfull franchise of my generation not named the Detroit Red Wings.

Maybe you could shed some light Beans is Hockey in New Jersey that unviable that its time to move on? I know with the Rangers and Islanders so close and if i'm not mistaken Newark was a very very poor choice of locations for their new rink. But could noone with deep pockets save this storied franchise in New Jersey?

As for possible Locations before the GTA i think the ideas of Seattle, Kanasas City , Quebec City and even Las Vegas would have to be explored,

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