A new deal between the city and a local ownership group will keep in Preds in Nashville for the time being, but carries no long-term guarantees.
The Nashville Predators won’t be packing their equipment bags for a move to Kansas City or anywhere else, at least not for the next three years.
Multiple sources have confirmed to THN.com a deal has been reached between the city of Nashville and a prospective local ownership group to rework the team’s lease at the Sommet Center that will guarantee the Predators remain in Nashville until at least through the 2010-11 season.
The deal has been reached between the city and the group led by Nashville businessman David Freeman. Although the tentative deal has not been approved by either the Metro Sports Authority or Metro Council in Nashville, it is expected it will be ratified by both bodies within the next 30 to 45 days.
“From the draft of the deal that I saw, I didn’t see anything in there that would offend a council member or a citizen of Nashville,” said city councilor Charlie Tygard.
But unlike the current lease that forces the Predators to remain in Nashville if they average 14,000 per game in paid attendance, the reworked lease will not have an attendance component to it and the team will essentially be free to leave the city after it expires in three to five years. Essentially, that means the team has at least another three seasons to turn its financial fortunes around and if it fails to do so in that time, the Predators will almost certainly be on the move.
Freeman’s group, which has an agreement to purchase the franchise from Predators owner Craig Leipold for about $193 million, maintained it needed to change the arena lease to have a chance to make the Predators financially viable. It was asking for $4.2 million a year in sales tax and set fee revenue and $7 million in arena upgrades, most of which would go toward building a smaller concert venue that would seat between 3,000 and 4,000 people.
The deal calls for the Predators to get about $3.2 million in sales tax revenues and will also get the concert venue, with revenues from the events going to the Predators.
Tygard said one of the options would have been for the taxpayers to simply buy the remaining tickets to get the Predators up to the 14,000 paid level, but acknowledged there was no appetite from the city politicians to go that route.
“That probably would have been the cheapest and easiest way to do it, but it was the least palatable to the political side because it looks like a corporate giveaway,” Tygard said. “That option was not even on the table.”
Through six home games this season, the Predators have been averaging 14,428 per game, but only 12,305 of that is paid attendance. The organization is expecting that number to rise when some of the partial packages kick in later in the season, but the number is still well short of the team’s stated goal. There has also been a significant lack of corporate support for the team, something that will definitely have to change if the new ownership group has serious designs on a long-term future in Nashville.
An NHL source said the deal will almost certainly be approved by the league’s board of governors as soon as it receives approval in Nashville. Nygard said he’s quite confident the deal will be accepted by both the city council and sports authority.
“I think the administration and Metro Council have a sales job to do,” Nygard said. “But I think the administration has identified the economic benefits that would go away if the team left, namely sales tax revenues that are generated in and around the arena on game nights. I think they have to make it clear that the city would be worse off without the franchise and it had to make up the difference.”