EDMONTON - The Edmonton Oilers, fighting to get public funding for a new downtown arena in Alberta's capital, agreed Tuesday to explore a deal to run Copps Coliseum, the main rink in Hamilton.
Team president Patrick LaForge said the memorandum of understanding with Hamilton is aimed at growing the business of Oilers owner Daryl Katz and is not a negotiating ploy or a subtle threat to move the franchise to Ontario.
"We've not had discussions with Hamilton. We never brought it up. Ever. This is not about the Oilers. And in Hamilton it's not about the Oilers. Edmonton is about the Oilers," said LaForge in a conference call with reporters.
LaForge, however, admitted that given the sluggish pace of arena talks in Edmonton, the optics of the Hamilton announcement are poor.
"I agree this is confusing to some. I think as we made this effort today, we expected to get some of these questions. But it is purely a business strategy," said LaForge, adding the discussions have been going on for months.
Earlier Tuesday, LaForge and other officials met in a closed session with Hamilton councillors who heard a presentation on the suitability of Copps Coliseum to host an NHL team.
Included on the Oiler delegation was a representative from AEG, the Los Angeles-based sports and entertainment industry giant that operates venues around the world. AEG has been signed on to help develop the arena proposal in Edmonton.
LaForge said councillors voted unanimously to enter into the non-binding memorandum of understanding.
The memorandum would explore the Katz Group, which owns the Oilers, leasing and running Copps Coliseum. Also included are the proposed Pan Am sports stadium, which will also serve as future home of the Hamilton Tiger-Cats, the Hamilton Place Convention Centre and some parking lots.
LaForge stressed both sides still have to sign off on the deal once details are finalized. He said it's all part of a larger Katz Group plan.
"Eventually we were going to have to step off the dock and fulfil our strategy to be a sports and entertainment development company in Canada from coast to coast. This was our first effort."
In Edmonton, Mayor Stephen Mandel declined to comment specifically on the talks or on their implications for the arena debate.
"I don't overreact to things. I don't think that's a good way to do business," said Mandel.
"We'll find out more information as we go forward, but at this point in time it might or might not be my affair at all."
Katz has said previously he is not interested in moving the team out of Edmonton, but believes it's imperative for the team's growth to push ahead with a proposed $400-million rink in the city core.
Katz has the land and the development plans in hand and wants to break ground within 18 months so that the new rink opens when the team's lease expires at its current home in Rexall Place in 2014.
The rink would be part of a sprawling $1.5-billion downtown redevelopment plan that would include office towers, hotels, restaurants, a casino and student residences. The arena would have 18,000 seats, and 64 or more luxury suites.
Katz has offered to put up $100 million toward the project, but public concerns over the funding have forced him to delay until a fall rezoning hearing with city councillors. The rezoning would just be the first step in a number of required planning approvals.
Mandel said an invitation has recently been sent to the Katz Group to appear before an open council meeting on July 21—not for a rezoning bid but to discuss the arena proposal in more detail.
"It's really to start the overall discussion and relationship with council. It's an exciting opportunity. We're looking forward to it and we'll see what the Katz vision is," said Mandel.
Some councillors have criticized Katz's team for lack of consultation with them on the cost and design ideas for the project. Political observers have said it's doubtful anything will be done on the potentially divisive issue until after municipal elections on Oct. 18.
The Katz Group has pitched letting the city own and operate the rink, while the Oilers would pay minimal rent and keep profits from all games and other non-related events. It has argued that the increased property taxes from the amenities built up around it would pay for the cost of construction.
The pitch has also pitted the Katz Group against Northlands, a non-profit board that has run Rexall Place since it was built in 1974.
While the Katz Group has hired AEG, Northlands showed earlier this month that it, too, can lure in big names by hiring Richard Andersen to be its new president. Andersen ran Petco Park in San Diego, a stadium-downtown renovation megaproject similar to the Edmonton concept that has been an unqualified financial success.
Northlands spokesman Brian Leadbetter said they're waiting for more details before commenting further on the Hamilton talks, but said, "We support the vision for a downtown arena in Edmonton. We've been pleased to partner with hockey in Edmonton for over 30 years and certainly it's our intention going forward with a new arena."
The Oilers play in the second-oldest rink in the NHL—only the New York Islanders play in an older facility. It is about half the size of the new rinks that have sprung up in the last 15 years.
Premier Ed Stelmach has already said no to direct provincial funding for an arena, but maybe to infrastructure like a transit line to the new rink.
Hamilton is no stranger to being caught in the push-pull of arena negotiations involving NHL teams in other cities, most recently in talks involving BlackBerry mogul Jim Balsillie.
Balsillie, the co-CEO of Research in Motion, tried and failed last year to buy the struggling Phoenix Coyotes out of bankruptcy and, against the wishes of the NHL, move them to Hamilton.
Hamilton has long meant controversy for the NHL. It has a large base of fanatical hockey supporters but could also draw fans away from the nearby Toronto Maple Leafs and Buffalo Sabres.
The move is also a bit of deja vu for Edmonton hockey fans. Former Oilers owner Peter Pocklington made noises about moving the team to Hamilton during acrimonious lease negotiations with Northlands in the 1990s.