A spokesman for venture capitalist Graeme Roustan acknowledged there was no bid from in this round of expansion, but said the dream of a second NHL team in Toronto is not dead.
“While we continue to focus on developing the GTA Centre, we were not able to complete the necessary work by the application deadline,” said GTA Centre Sports and Entertainment spokesman Jesse Bernstein. “We hope that another such opportunity presents itself in the future.”
As first reported by thn.com, Roustan declined to make an application despite saying he intended to do so when the expansion process was announced by NHL commissioner Gary Bettman in late June. It’s believed that only two applicants, from Las Vegas and Quebec City, took the NHL up on its offer.
Part of that is because it cost a minimum of $2 million to simply apply for a franchise, but more likely it was because costs have increased to the point where even placing a franchise in the most fertile market in the world doesn’t make sense. There was speculation that the league would be demanding north of $500 million for a franchise in Toronto and that it would cost somewhere in the $425 million range to build an arena. That puts the tab at well over $1 billion in Canadian funds.
Back in November of 2013, there was a deal in place to construct an arena in the Toronto suburb of Markham that would have cost $325 million. Despite assurances from a number of sources, including Roustan and the mayor of Markham, that it would not cost any taxpayer money, the deal was scuttled by the town’s council. There is a chance that the Markham project could be resurrected, but the cost of it will be much higher now than it was 18 months ago.
It’s also unlikely a $425 million arena would be sustainable without an NHL team, as Roustan claimed it would have been at $325 million. Clearly, the NHL is not in the “if you build it, we will come” frame of mind, so anyone building a rink in Toronto would have to do so without any guarantees it will ever have an NHL anchor tenant occupying it. Unless, of course, the league is ever in the position where it needs to relocate a struggling franchise.