Saturday, March 17, 2007

Some Stability For The Penguins

Pittsburgh has been a good hockey market that has housed a successful team with two Stanley Cup victories (so far?). They have a good young core built around the best forward in the NHL - Sidney Crosby and the likely rookie of the year Evgeni Malkin. However, they have had some uncertainty due to the need for a new arena. They had the Isle of Capri casino which would buy them a rink get denied and have tried to sell the team to Howard Fingold and Jim Balsille only to have both deals fall through. The Penguins have even looked somewhat seriously in relocating (possibly to Kansas City)

Some stability returned to the Pittsburgh Penguins organization this week when it was announced that they have reached an agreement to have local government help to pay for a new arena (only in pro sports does local government pay for your building). The bulk of the money will come from the state of Pennsylvania's slot machine parlors, while the Penguins will contribute $3.8 million a year for construction and $400,000 for capital improvements. Not as bad deal for Penguins owners who get a facility expected to cost $290 million cheaply. The cost of running a sports franchise is subsidized by taxpayers (but somehow they do not share in any of the profits). The building should be ready for the 2009/10 season. Here is the TSN story on this agreement.

With the expected increase in franchise value that will come with a new arena and with the emergence of the Penguins young stars, Mario Lemieux has announced that the current owners are no longer trying to sell the team. Here is the TSN story on this announcement.

The city of Pittsburgh went through a lot before a new arena was blackmailed from taxpayers. In the end the Penguins owners got what they wanted. Which city will have to go through this emotional roller coaster next?

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