The business success (or failure) of the Arizona Coyotes will be an interesting story to watch over the next five years.
Coyotes President Anthony LeBlanc added Andrew Barroway as a majority owner in December in a move that should provide the franchise with reasonable operating capital.
That doesn’t necessarily mean the team will be a success on or off the ice though.
Bankruptcy and constant relocation rumors have stripped down a fanbase that will take years to re-engage. Lack of winning on the ice this season won’t help their cause, as the Coyotes already sit 16 points out of a playoff spot heading into Friday action.
What makes this story an interesting one to watch is that in 2013, the Coyotes and the city of Glendale agreed that the franchise could be relocated if it loses $50 million in five years.
An article from Peter Corbett in the Arizona Republic says that while Leblanc fully expects to lose money in the first two seasons, he thinks the franchise can turn a profit by the third year.
According to Corbett, Glendale has hired a former NHL president to audit the Coyotes financial situation:
Tony Tavares, former president of the Anaheim Mighty Ducks and Los Angeles Angels, will be paid $45,000 to help Glendale conduct an audit of the Coyotes’ finances. That will include reviewing ticket-surcharge and parking revenue for Gila River Arena and determining whether the organization lost money in the first year of a 15-year, $225 million agreement with the city.
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“We want to review all the revenue sources to make sure we are getting the revenue we should be getting,” said Tom Duensing, Glendale finance and technology director.
The scope of the audit includes ticket and parking revenue for hockey and concerts and whether the team exceeded its 1,000-seat limit on free tickets. Plus, Glendale will review the Coyotes’ reported operating loss for the 2013-14 season in connection with an early-termination provision in the contract.