Arizona Board of Regents approves plan for Coyotes to play games at ASU’s multi-purpose arena

The Arizona Board of Regents on Thursday approved a $134.7 million capital development plan for ASU’s multi-purpose arena that includes $19.7 million worth of Coyotes’ improvements and additional team areas at the northeast corner of the facility.

The board’s decision means that ASU will be the Coyotes’ temporary home for at least the next three seasons as the team awaits word on its proposed Tempe arena on the south bank of Rio Salado. The board approved extending the lease beyond three seasons if needed.

Arizona State Executive Vice President, Treasurer and Chief Financial Officer Morgan Olsen also confirmed an earlier PHNX Sports report that the Coyotes will pay all associated costs for the annex up front, as well as paying the full cost of the term of their lease at the arena up front. The university will assume no risk.

“We are thrilled that we have arranged to play our home games in Arizona State University’s new multi-purpose arena starting next season,” Coyotes President and CEO Xavier A. Gutierrez said in a statement. “This will be an incredible, intimate and exciting fan experience in a state-of-the-art new arena in a fantastic location in the heart of Tempe. We are very grateful to (ASU President Michael) Crow, the ASU administration, ASU athletic department, and the Arizona Board of Regents for agreeing to provide us with this temporary arena solution for our team as we continue our efforts to secure a long-term home for the Coyotes in the Valley.”

NHL Commissioner Gary Bettman also released a statement.

“The National Hockey League thanks Arizona State University for its support of the Coyotes during this transition period and for what will be just its latest major commitment to growing our game in the Valley,” the statement read. “Having made the full-time transition to Division I just seven years ago, ASU hockey already has an NCAA Tournament appearance to its credit and now is moving into a new, state-of-the-art facility. Hockey is thriving in Tempe, and we are delighted that the Coyotes’ passionate fans will get to experience ASU’s on-campus energy while the club’s new arena is being built.”

The Coyotes also confirmed an earlier PHNX Sports report that the club is negotiating with Ice Den Scottsdale to make the complex the team’s full-time practice facility. The Ice Den was built in 1998 as the Coyotes’ primary practice facility. Since moving to Glendale in 2003, the Coyotes have continued to use the facility when Gila River Arena was unavailable due to concerts and other events.

There are numerous questions surrounding the Coyotes’ use of ASU’s multi-purpose arena, so before the Regents meeting ended, I sat down with Morgan Olsen to discuss the deal in an exclusive interview.

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A key point in this deal appears to be the Coyotes’ willingness to pay all costs up front so that the university assumes no risk. Is that a fair assessment?

Almost everything in life has some risks to it, but part of our duty is to try to manage those so yes, we’re comfortable with it. One can’t predict everything in the world, but we think we’ve worked through with the Coyotes the various aspects of this and so we’re comfortable coming today to the Board and asking for their authorization to move forward with the deal.

What is the benefit of this deal for the university and for ASU’s hockey program?

We’re just thrilled about the multi-purpose arena itself. That is just going to be a tremendous asset to the university in so many different ways, specifically for the hockey team, giving them a place to play that really allows more people to enjoy watching them. 

It should be a great recruiting tool, a fantastic entertainment venue for people, it will help the other teams that we mentioned — the women’s gymnastics team and the men’s wrestling team — in terms of a competition venue, and we think it’s also going to be great for shows and concerts and meetings and other types of events.

But specifically with respect to the Coyotes, our business plan was built around not only having the university events I just mentioned in there, but also having other folks benefit from using the venue. In this case, the Coyotes came along and that’s what it’s built for is hockey. Now it probably isn’t quite as big as a lot of NHL fans are used to, but we don’t think we have to make any excuses at all for the quality that we’re going to have. It’ll just be smaller and I would imagine on NHL game nights when you get the world’s biggest stars in there, the place is going to be rocking.

It has to help the university’s visibility, right?

When someone’s watching the Coyotes play the Pittsburgh Penguins, the New York Rangers, or you pick the team on television, they’re going to see that pitchfork in the middle of the ice. So we’re good with that.

On that note, what is center ice going to look like?

That’s one of the things we’re working out and obviously we want to be good hosts for the Coyotes. This is sort of a first-time experience for everybody so we’re kind of working out how those things will be done from scheduling to game-day activities and what the ice is going to look like.

You noted in your presentation to the board that ASU will retain naming rights and sponsorship revenue for the arena, but there would be game-day revenue available to the Coyotes. Can you elaborate?  

They will essentially be renting or licensing the facility. The gate will be theirs. The merchandise sales will be theirs, they’ll have a share of concession revenue and the game-day sponsorships. We’re putting logos on everything now, helmets, jerseys, so the game-day stuff will be theirs, but the things that relate to the venue and are longer term will be accruing to the university. 

What about parking revenue?

That will be university revenue because we’ll be making available the university’s parking facilities, but we’re going to make sure, working with the Coyotes, that they have the opportunity to have some kind of premium parking for their fans who are maybe leasing a suite or otherwise paying a lot of money to be on the glass or whatever it is they might want to do. The parking will kind of fit in with that as well.

Do you have any sense of what the seating capacity is going to be for NHL games?

This is probably something that is best asked of the Coyotes, but my understanding is that they probably will use more camera views than we might for a college game. Maybe we’ll learn something along the way, who knows, but there’s at least a possibility that those will be in locations that would otherwise be seats. I wouldn’t expect it to be a large number, but that’s all being worked out with the NHL and with the team. The important thing for us is that whatever is necessary in addition to what we have designed for the building will be temporary. We’ll remove it. 

Any time you have a multi-use venue like this, the ice is going to be in there all season, but if we have a circus come in or a concert, there’ll be some overlayment that will go over the ice to protect it and keep people from freezing their feet and we will pull it back out after the event. There will be a lot of tear down and change-out. That’s just part of running a modern entertainment venue.

Can you retrace the genesis of this deal?

They approached us saying, ‘We want to play here’ in December. We’ve been working through that with them since. There had been some conversations previously. I think they started thinking, ‘What are our alternatives since we’re apparently not going to be playing in Glendale after this season?’ They worked through a wide variety of things and that took a while. We had some discussions last fall and then they went away. And then they came back in December with the request.

Did the recent negative press on the Coyotes’ situation in Glendale give you pause?

There’s a lot of water under the bridge, I guess it would be fair to say. We have worked out terms that we’re comfortable with in terms of managing and mitigating whatever risks we think pertain to us from the relationship. 

But under (athletic director) Ray Anderson’s leadership, we made a commitment to Division I hockey. I grew up in North Dakota and played a little bit of hockey growing up and when I came here 13 years ago, the last thought that ever entered my mind was that we would have a Division I men’s ice hockey team. But it did happen and so we’re trying to build community engagement; youth engagement in sport with lots of things that we do in a whole range of sports. We’re doing that formally as a part of our design principles in the Novus Innovation Corridor so this is just a logical extension of that. We just see this as being part of growing the game and meeting people’s interests. 

In your presentation to the board, you asked for the option to extend this agreement beyond three years. Can you elaborate?

No one should be confused that this is going to be their home ice forever. It’s not our plan and it’s certainly not their plan for obvious reasons. But they said, ‘We’re just not sure how long this might take. We’ve built a couple of sports venues ourselves and those are complicated, they are hard and it takes a long time.’ So it made sense to us that there might have to be a little bit of flexibility here. 

What we asked the Board for was the authorization to extend additional one-year options if we so choose. They are the university’s options so we’ll see how that goes. We want to be helpful and obviously, if they’re going to be our permanent neighbors, not two miles from where we’re sitting right now, if that comes to pass, we want to be helpful. We think it’s certainly good for the game of hockey and it’s good for the community. We think it is accretive to some of the things that we’re trying to do with the Novus Innovation Corridor. Within reason, we’ll be flexible and work with them.

Can you tell me the various completion dates for the arena, the entire facility and the Coyotes’ additions?

We think it will be available in October. We tend to hedge our bets a little bit so we were very careful with our venue. There is something called long-lead items that take time to make and they just aren’t on a shelf some place. So you want to get those ordered as quickly as you can. We did all that and that’s why we’re where we are right now. We’re ahead of schedule. But we’re starting in a new place with this annex or addition for the Coyotes. They’re working through all of that now, but we don’t have the same assurance that we know where those things are and we know that we can get them on a schedule. We’re going to move as deliberately as we possibly can but right now, December is what we think can be done, barring events beyond people’s control. 

The league seems to think that NHL games could be played at the venue before the completion of the Coyotes team areas in December. What is your understanding? 

We’ll have to see. It would depend on what that is. As you’re aware, the players have a union and a collective bargaining agreement and a players association. That’s not our business but obviously it’s a relevant fact. We have to figure out something that makes sense for everybody; for the university, for the Coyotes, for the players’ reps, for the league. We’re exploring that. If there’s a way to do it that checks all of those boxes, then, yeah, I would say that’s at least possible.

Giving the Coyotes the opportunity to keep NHL hockey in the Valley is a big deal to a lot of people in this community. Does that enter your thinking?

At ASU, we have something we call the charter. One of the things that it talks about is we take fundamental responsibility for the cultural and social well being of the communities that we’re in. And so, I would suggest this is one example of that. If there is a way that we can assist in the community being able to enjoy the best hockey in the world, well, that’s great. It’s a positive thing, and if we can be part of helping make that happen, that’s OK. 

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