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| Championships | 1st 1984 |
2nd 1985 |
3rd 1987 |
4th 1988 |
5th 1990 |
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Revenue drives push for new arena
Ownership group wants more modern, comfortable replacement for Rexall Place, NHL's third-oldest rink
David Staples
The Edmonton Journal
Sunday, October 02, 2005
A new arena for the Edmonton Oilers is now on the to-do list of the team's owners, the 37 partners of the Edmonton Investors Group (EIG).
The EIG is planning for the Oilers' long-term future now that league owners have negotiated a more favourable collective bargaining agreement with the players' association, one that could help NHL hockey thrive here.
Part of the EIG's plan includes a new state-of-the-art arena to replace aging Rexall Place. Only the Pittsburgh Penguins and the New York Islanders play in older buildings, says EIG board chairman Cal Nichols. "One day we will have the oldest building in the league, and eventually you have to do something about it."
Adds EIG partner Bruce Saville: "I'm not sure anybody wants to hear it, and I don't know what number to pick out of the air, but let's say 10 years from now we're going to have to be in a new arena."
Nichols's favourite NHL arenas include the new Glendale Arena, home of Wayne Gretzky's Phoenix Coyotes. The $180-million US arena was built by the city of Glendale.
The EIG hasn't looked at where the new arena will be built or focused on how the project will be funded. Northlands, a community group, built Rexall Place in 1974 with a $3.7-million grant from the province, a $10-million low-interest loan from the federal government, and roughly $2 million in federal lottery money.
The city donated $3.7 million to buy land for the arena, then known as Northlands Coliseum.
The economics of the Oilers and the NHL have to justify private individuals and the community investing money in a new building, Nichols says. "The thing can only be dealt with if you're viable and profitable as far as the eye can see, because if it isn't, you can't think new building."
Nichols isn't looking for government to do all the heavy lifting here, EIG lawyer Mike Crozier says. "He doesn't have the attitude that somebody should provide it for nothing."
Before plans advance for a new arena, EIG partners must pay down the remaining $30 million on the bank loan taken out in 1998 to purchase the team. So far, the investors have not made money on their initial $60-million investment. In 2002, they had to put in an additional $14 million to cover costs.
But things are looking good this season, Nichols says, with demand for season tickets the highest since the EIG took over.
"I've never seen such excitement
since 1979 (the Oilers' first year in the NHL)."
The team now leases Rexall Place from Northlands.
There are nine years left on the lease for the arena, which was extensively remodelled in 1994 with 39 luxury boxes and 16 skyboxes installed.
The need to increase comfort in the building and revenues for the team is driving the urge to build, Saville says.
"It just allows that much more revenue to be generated.
"That's the key. If you tour all the other arenas in the league now, they're just that much better in the way of amenities, food services, suites, access to suites, number of suites."
NHL tickets are expensive, and customers who pay more than $250 a ticket, the price of a ticket in an Oilers corporate box, demand the best, Nichols says.
"You've got to have a modern, first-class, up-to-date presentation and facility because if you don't, you just can't command those kinds of prices forever. Everything wears out."
There's no need to add increased seating, Nichols says, but Rexall Place doesn't have enough gold and silver seats, which command more money for the team than upper blues.
Many of the existing high-priced seats are uncomfortable for fans to sit in, especially down in the arena's corners. "I've sat there and it's really uncomfortable and I'm not a big or tall person," says Nichols.
"You just have to have more comfort."
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