Just two months after establishing a long-range plan to revive pro hockey in the Phoenix area, the NHL will now need to hit the reset button on what has long been a problematic market for the league.
Alex Meruelo, the owner of the dormant Coyotes franchise, is abandoning efforts to reactivate the team, marking an abrupt end to his attempted restoration. The move closely follows the cancellation of an auction by the Arizona State Land Department for a 110-acre piece of state-owned property in north Phoenix that Meruelo sought to purchase for a new arena. But despite the nearly five years Meruelo still has in his deal with the NHL to secure an arena agreement, there was no backup site option for the team and, thus, no viable path forward for him.
Neither the team nor the league has yet issued a statement on the decision. But Front Office Sports confirmed an initial report from PHNX Sports. FOS has further learned that the owner’s son, Alex Meruelo Jr., relayed the change in course to remaining team staff. Most of those last Coyotes employees have been laid off, but a small handful of people are still employed by the team, a source with knowledge of the situation said.
Meruelo’s Struggles
The problems surrounding Meruelo, however, went far beyond land and zoning issues that led to the aborted auction. In his five years as majority owner of the Coyotes, Meruelo developed very few political allies locally and often found himself in various disputes with multiple jurisdictions across the Phoenix area. Support was also weak for the use of any type of public funds, including property tax abatements, for the arena project.
So as complications quickly arose with the north Phoenix parcel, Meruelo had essentially no fallback options.
“No one should be surprised at this ownership group’s incompetence and duplicity,” Tempe councilman Randy Keating tells FOS. “They were told several times what they needed to do to move forward with the auction by the City of Phoenix and not only chose not to do so, but then had the gall to cast blame. The call is, and always has been, coming from inside the house. Fans deserve so much better.”
Expansion Considerations
With the opportunity now for a fresh start in Phoenix with a different ownership group, the NHL could ultimately view the market much like other cities that have openly sought an expansion or relocated franchise, including Houston, Atlanta, and Quebec City. NHL commissioner Gary Bettman has long been an advocate of the Phoenix area, and it ranks as the No. 11 U.S. media market, helping to explain that support. But the city might ultimately find itself placed in a new consideration by the NHL without a sitting franchise, or the pathway to one, and it is smaller than both Houston and Atlanta.
For now, Bettman has not formalized any expansion considerations, despite robust interest from what he says are “at least half a dozen places.” But that is expected in some circles to eventually change, particularly as the league has just completed a banner season with a variety of new records in key business metrics such as attendance and revenue.
Meanwhile, the former Coyotes team is thriving thus far in its new home of Utah. Despite Salt Lake City’s standing as a smaller media market—ranking 27th—the immediate reaction from fans to the new Utah Hockey Club franchise has been intense, creating something of a capacity issue for the franchise. More than 34,000 deposits for season tickets have been received, a figure far in excess of the roughly 10,000 seats at the Delta Center that will initially offer unobstructed views for hockey. Bettman has likened the fan frenzy there to “drinking from a fire hose.”
