April 10, 2017
Vancouver moving up in weight class as sports town
City’s international reputation growing stronger since 2010 Olympics
View source article: Business in Vancouver
As co-owner of the Whitecaps soccer club, Jeff Mallett has a clear bias when it comes to his praise for Vancouver as a bona fide sports town. But as co-owner as well of the San Francisco Giants, San Francisco’s AT&T Park and the cable television network Comcast SportsNet Bay Area, Mallett offers a valuable outside perspective, too.
The way he sees it, Vancouver is an international contender when it comes to hosting, supporting and making money from competitive sports, right up there with other major North American cities.
“In every big strategic meeting I’m in – whether it is with people who own teams, facilities or media, for TV rights – these days, the border disappears,” said Mallett. “Everyone looks at major markets in North America and, without question, Vancouver is literally and figuratively on the map.”
Hosting the 2010 Winter Olympics helped elevate Vancouver’s status as a sports city. The games broke even financially, with organizers reporting both revenues and expenses of approximatley $1.9 billion, and left behind a legacy of state-of-the-art venues and goodwill for the future of sport in the city.
Other one-off events in Vancouver that have been huge successes include the 2015 Women’s World Cup, the HSBC World Rugby Sevens and the sold-out Toronto Raptors exhibition game against one of its National Basketball Association (NBA) rivals, the Golden State Warriors.
There are, of course, the city’s long-standing franchises that help support the city’s sports business, including the Vancouver Canucks of the National Hockey League (NHL), the Canadian Football League’s BC Lions, the Whitecaps of Major League Soccer, minor-league baseball’s Vancouver Canadians and the Western Hockey League’s Vancouver Giants.
The Vancouver area’s outdoor playground, which inspires activities ranging from mountain biking to downhill skiing, also helps boost its reputation as a place that is serious about its athletic pursuits.
Vancouver’s backdrop a blessing and a curse
What makes Vancouver unique is also what sets it apart from some other sports towns when it comes to keeping fans in the stands.
“We’re not like Toronto,” said Ron Toigo, who co-owns the Vancouver Giants. “Fans there support the Maple Leafs, who have been pretty much dead last [in the past], but you can never get a ticket to see them. You just don’t have that phenomenon in Vancouver.”
While Toigo prefers living in Vancouver because of the “esthetics of what’s here,” he believes the city is predisposed to marquee events rather than ongoing team sports.
It’s in part why attendance at each of the city’s franchises, with the exception of the Vancouver Canadians, has been on the decline in recent years.
“It’s a lot easier to focus on an event like the World Juniors or Memorial Cup or Grey Cup or things like that, and to promote it as being the best,” said Toigo. “As long as there’s something that’s the best in whatever level of sport it is that you’re talking about, people in Vancouver will want to see it and support it.”
Tourism Vancouver CEO Ty Speer believes the fan choice has more to do with urgency than a lack of loyalty. There’s more of a compulsion to attend a once-in-a-lifetime event, or even something that happens once a year, compared with a team that can be followed for an entire season.
“That doesn’t mean that there aren’t plenty of people who don’t get out of bed without knowing what the Canucks did last night, but it’s a different relationship with the customer than a Women’s World Cup, which is a once-in-a-generation opportunity,” said Speer.
Bring back the NBA
Vancouverites will also get excited to see NBA action, according to former Vancouver Grizzlies co-owner Arthur Griffiths.
He believes the league would welcome an application or team transfer to Vancouver.
“The NBA has admitted that the Grizzlies should never have been allowed to leave,” said Griffiths, who bought the NBA franchise, along with Seattle’s John McCaw, and brought it to Vancouver in 1995. “The team was doing a lot better than the NBA was led to believe. They were sold a bill of goods when it came to the merits of the team not being successful.”
Griffiths sold his stake to McCaw in 1996, but stayed employed at McCaw’s Orca Bay Sports and Entertainment. It was from that perch that he watched American businessman Michael Heisley buy the team in 2000 and move it to Memphis for the 2001-02 season, despite assurances it would stay in Vancouver.
While the perception is that the Grizzlies were losing money, Griffiths, who also owned the Vancouver Canucks at the time, said the Canucks’ balance sheet was far deeper in the red than the Grizzlies’.
The lower Canadian dollar today isn’t the barrier many perceive it to be for professional sports teams either, Griffiths said. That’s because between 50% and 60% of a future team’s revenue would be from what he calls “league-generated revenue,” or cash flow from broadcast rights, sponsorship and merchandise licensing.
“To the extent that you’re worried that your U.S. expenses, your payroll, have to be covered by the Canadian dollar discrepancy, you’re covered. You’re hedged. You’re not losing 30 to 40 cents on every dollar every time you open your doors,” said Griffiths, adding that he’s had conversations with both local business people and offshore investors interested in bringing the NBA back to Vancouver.
The strategy to land more big-name events
Vancouver is also on a mission to start attracting more major sporting events, after city council agreed to spend $1 million in 2016 and 2017 to create the Sport Hosting Vancouver partnership (SHV). Another $2.15 million in cash and in-kind donations for the initiative is coming from partners Vancouver Hotel Destination Association, Tourism Vancouver, the BC Pavilion Corp. and the University of British Columbia.
“The [SHV] strategy has been an opportunity for us to be proactive and really target specific events at certain times of the year,” said SHV manager Michelle Collens.
Key shoulder seasons in Vancouver tend to be November through March, although the World Rugby Sevens are slated for each March through 2019.
Some of the events they hope to snag include the 2018 Canadian Figure Skating Championships, as well as the International Skating Union’s Grand Prix of Figure Skating Final later that year, if Canada becomes the winning host country.
There’s also a joint Vancouver-Victoria bid to host the 2019 International Ice Hockey Federation World Junior Hockey Championship.
Further on the horizon is the potential to host the 2026 FIFA World Cup. The Canadian Soccer Association is mulling a bid that has local sports tourism executives salivating.
It’s a huge undertaking, said Speer, who has been involved with multiple Olympic Games and Commonwealth Games.
“It’s a very competitive thing to win it, and once you win it, it’s in the very top tier of sports events,” he said.
After the 2010 Winter Olympics, Vancouver may have the strength and stamina to make it happen.