Originally published Oct. 28, 2014
A National Hockey League arena is, by necessity, a chilly place. The building encloses a 200-foot-long, 85-foot-wide sheet of ice that radiates cold air; the temperature in the stands can drop as low as 50 degrees. Controlling the climate is obviously an important task.
And yet: “When we walked in here, the thermostat didn’t work,” says Tampa Bay Lightning President Steve Griggs, who joined the team in 2010, after Jeff Vinik, who ran Fidelity’s Magellan Fund before starting his own hedge fund, bought the hockey club.
Today, the heating and air-conditioning and most everything else appear to be working much better for the 22-year-old franchise, which is in the midst of a renaissance. Four years after Vinik rescued a team that appeared to be careening toward insolvency, the Lightning have become one of the most stable organizations in hockey, particularly among teams playing in the league’s non-traditional markets across the southern United States.
Season ticket sales have more than tripled, from 3,000 to more than 10,000 today. Attendance has risen 20%, to nearly 19,000 per game. Television ratings have doubled, and the Lightning has a new, 10-year regional TV deal with Fox Sports that pays the club about $16 million per year.
Meanwhile, Vinik has assembled more than 20 acres of prime real estate around the Lightning’s arena in downtown Tampa, including the Channelside retail complex, and the team is now working on plans to redevelop the area into a new residential, retail, entertainment and commercial district.
On the ice, the Lightning feature one of the most marketable stars in the league in 24-year-old Steven Stamkos. Once devoid of young talent, the team now has one of the strongest farm systems in the NHL — it produced two of the three finalists for the league’s rookie-ofthe- year-award last year, and is expected this year to add a 19-yearold regarded as one of the top prospects in professional hockey. The Lightning could challenge for the Stanley Cup this season.
“From day one, I cited my desire to make this organization into a world-class organization, on and off the ice. I think we’ve made great progress toward achieving it,” says Vinik, 55. “We’re not there yet. But I believe we’ll get there.”
A number of challenges still loom. Executives say that the team is still losing money, though they say the losses have narrowed significantly. The 2003-04 season, when the Lightning won their only Stanley Cup, remains the only year in which the team turned a profit, according to people familiar with team finances. And Lightning management must negotiate a new contract with Stamkos within the next two years — a deal that could require a commitment of $100 million or more — or risk losing him to unrestricted free agency and wealthier clubs.
Those problems are still preferable to the kind of issues the team faced when Vinik bought it.
“The turnaround has been dramatic,” says Steve Bartlett, an NHL player agent whose clients include Ryan Callahan, who this summer signed a six-year, $34.8-million contract with the Lightning. “As someone who looks at the stability of a franchise and management and ownership when I advise a player, I think they’ve gone from pretty low on the totem pole to very near the top.”
It’s difficult to overstate just how much of a mess the Lightning were four years ago. The team was owned by OK Hockey — a group led by former film producer Oren Koules and former NHL player Len Barrie — who had bought it in 2008 from longtime owners Palace Sports. But the new ownership essentially ran out of money. The NHL was forced to step in just so the Lightning could make payroll while the team cut outlays on things like arena maintenance and marketing.
Meanwhile, Koules and Barrie feuded over control of the team. One player agent recalls receiving different offers from each owner for the same player. “It was a gong show,” the agent says.
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