Glendale Approves Contract With New Coyotes Arena Manager

Published: Wednesday, April 27, 2016 - 9:02am
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(Photo by Matthew Casey - KJZZ)
AEG Facilities COO Chuck Steedman (right) talks about the company's new contract to manage Gila River Arena. Glendale City Manager Kevin Phelps (left) says the deal gives the city a chance to profit from the venue.
(Photo by Jeff Shewan - CC BY 2.0)
Arizona Coyotes play at Gila River Arena in February 2015.

The Glendale City Council voted unanimously Tuesday to approve a five year contract with AEG Facilities to manage Gila River Arena, and if both sides agree, it could be extended to 10 years.

The deal calls for Glendale to pay AEG Facilities $5.6 million annually to run the arena. The sides will share yearly profits. Once AEG Facilities and the city split the first $3 million, any additional profits will be divided 75/25.

Sharing earnings could put Glendale in a position it’s never been before, said City Manager, Kevin Phelps.

“For the first time in the city’s history, we have an opportunity with having the right partner that we can actually start profiting from a successful season,” Phelps said.

Phelps said the city chose AEG Facilities because it’s an expert at managing arenas, has a hockey pedigree, was previously successful booking concerts in Glendale and it values fan experience.

But an out-clause lets AEG Facilities end the contract if the Coyotes leave the arena. If the Coyotes leave Glendale, AEG Facilities can ask to renegotiate the contract. But if a new agreement isn’t reached, the company can kill the old deal.

AEG Facilities believes that as owner of the Los Angeles Kings and operator of other arenas that are home to NHL teams, it can best serve the Coyotes' needs, said Chief Operating Officer Chuck Steedman.

He also said AEG Facilities does not intend to terminate its contract with Glendale, the company has already had preliminary talks with the Coyotes and it has not considered a scenario where the Coyotes don’t play in Glendale.    

“Really, they’ve been very productive, and very friendly and open and honest,” Steedman said.

Coyotes officials have repeatedly said they might move to the East Valley or downtown Phoenix.

After the vote, team President and CEO Anthony LeBlanc released a statement:

“AEG is a company we know well and are in fact partners in the National Hockey League. We look forward to working with them, and will now await official notice from the City of their plans to transfer management of the arena. At that point, we will begin the 90 days (or less) transfer process. The Coyotes are committed to playing the 2016-17 NHL regular season at Gila River Arena and remain focused on securing a long term arena solution in the Valley that is based upon a true partnership.”

AEG Facilities expects to take control of the arena in July, Steedman said.