THE NHL TO EXPAND IN 2020
The NHL Board of Governors will meet later this week and will likely approve the expansion to Seattle in 2020. The cost of the franchise is rumored to be $650 million, a $150 million increase over what Las Vegas paid in 2017.
Las Vegas joined the league for a mere $500 million dollar ticket. It happened fifty years after the NHL’s biggest expansion in 1967. The six teams involved in that expansion paid a “whopping” $2 million dollars for the right to play in the NHL. All except the Oakland Seals are still in operation. The Philadelphia Flyers for example are now worth over $600 million. Taking it into context, in 1967, a dozen hockey sticks cost $38, NHL payrolls averaged $300 thousand and the average cost of a new car was around $3,500.
People who invest in a sports franchise don’t generally invest for immediate profits. They have visions much different than most of us on how to make their money grow. When he purchased the Buffalo Sabres for $189 million in 2011, Terry Pegula was asked if he thought he could make a profit in Buffalo, he was quoted saying: “if I want to make money, I’ll dig another oil well”. The Sabres are now worth more than $300 million dollars. Not as profitable as an oil well but a nice gain of over 111 million dollars in just six years.
Current owners enjoy watching the value of their own franchise increase along with the new franchise fee. Their share of it is undoubtedly a welcomed added bonus!
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