WILLIAMS: Location, location, location – strong markets in the AHL

Last week EP Rinkside broke down the Seattle NHL expansion franchise’s future AHL affiliation. In Part 2, the elements of choosing a home for an AHL franchise are examined.

Finally Seattle has its own NHL team.

The Pacific Northwest city, a corporate hub and a market with solid hockey roots, landed the 32nd NHL franchise on December 4th. The team will take the ice for the 2021-22 season, but their off-ice work is already well underway.

Now, with an NHL franchise in hand and the clock ticking, Seattle senior advisor Dave Tippett has to secure an AHL affiliate. All 31 NHL teams are in sole AHL affiliations, and Seattle is expected to do likewise.

A MUST-HAVE

Seattle will join a trend that has passed through the rest of the NHL by investing heavily in player development.

In recent seasons, NHL teams have poured money and resources into bulking up their AHL affiliates as part of an overall stronger emphasis on player development. Chalk it up to parity, the NHL salary cap, and teams looking to find even the smallest of advantages. Small-market teams have long had to rely on home-grown talent produced via the draft-and-develop model, but financial powerhouses like the Toronto Maple Leafs and New York Rangers have joined those clubs. After all, if you are Leafs general manager Kyle Dubas and are tasked by ownership with finding a way to fit John Tavares, Auston Matthews, Mitch Marner, and William Nylander into your salary cap, you had better have a robust farm system capable of churning out NHL-ready (but affordable) young talent to make the financial math work.

Of course, there is another incentive for investing in player development as well – it has a strong track record if done well. Sure, you could venture into the free-agent market each summer, but that runs the very real risk of wrecking your team’s salary-cap picture. Or you could take a look at how the Tampa Bay Lightning and Washington Capitals have built successful organizations via the draft-and-develop model. Before them, the Chicago Blackhawks, Los Angeles Kings, and Pittsburgh Penguins built robust AHL farm systems that helped to fuel Stanley Cup championships.

ONE SIZE DOES NOT FIT ALL

Market flexibility is an advantage that AHL president and chief executive officer Dave Andrews often stresses. The larger the market, the larger the potential fan base. However, facilities and other costs also increase, to say nothing of competition for the entertainment dollar. The inverse is true for teams in smaller markets.

A variety of markets have reached the Calder Cup final in recent seasons – the small-market Utica Comets did so in 2015. Mid-size market — or “Triple-A,” to use a baseball vernacular – teams like the Hershey Bears (who, despite playing out of a small town, are in fact marketed to a region pushing one million people) went to the final in 2016. The Grand Rapids Griffins and Syracuse Crunch followed them a year later, and the Texas Stars competed for the Calder Cup this past June. Conversely, plenty of big-city teams in major-league cities also have found success on and off the ice. The Lake Erie Monsters took the Calder Cup before 19,665 in Cleveland in the Cup-clinching win in 2016. The 2018 champion Toronto Marlies, who play out of the fourth-largest city in North America, did so as well in front of sold-out crowds.

Attendance-wise, Hershey has been a perennial leader in that category. Then again, the San Diego Gulls, who play out of the eighth-largest city in the United States, grabbed that title from the Bears last season and are again battling them this season, even though each team is last in its respective division.

On the ice, the AHL veteran rule limits the ability of more prosperous teams to load up on expensive talent. Success instead comes down to finding the right NHL parent team. Methods of attracting that parent club can take a variety of forms. Teams can offer an assortment of advantages – geographic proximity, quality facilities, strong fan support, and so on. What a franchise like Utica lacks geographically – the parent Vancouver Canucks are three time zones away from the Comets – they are able to make up for with a passionate fan base inside of a small community with limited distractions and proximity to other AHL cities allowing for ample practice time.

“I think we can make almost any market work,” Andrews said, “or we can have almost any market not work if we don’t do it right.”

“ONE COMMON THREAD”

As explained last week, Seattle has two main options, ownership-wise.

One is to simply own the AHL affiliate outright. Under that format, Seattle management would run the entire show on and off the ice. This method has become increasingly more common.

An alternative would be to join forces with a local ownership group, something that is a strongly rooted AHL tradition. Hershey and Syracuse are two such examples. An advantage to this approach can be an owner with a pre-existing connection to, and familiarity with, the market.

Regardless, the last thing that an NHL front office needs, wants, or will tolerate for very long is a headache with its AHL affiliate. Any sort of drama or headache is a distraction from the NHL club’s primary mission in the AHL – to develop young talent.

“I think the one common thread is that the most successful teams have really quality, professional staff,” Andrews said. “It’s all about that aggressive, professional approach to marketing, particularly the ticket sales. Selling tickets isn’t what it [used to be]. It’s a whole different world.”

“I think that the most important element for success in the AHL is, number one, quality, committed, passionate ownership. In the cases where we have NHL ownership, [it is] having an NHL team that really values having their AHL team franchise and the market that they are in and understands the importance of it. Because at the end of the day, you have to invest in people. If we look at our most successful franchises, it all comes back to the leadership, the actual professional leadership, on-site.”

“Having ownership that gives [front-office leaders] resources to work with so that they have adequate staffing and all of the infrastructure that they need to be successful, that’s really the key.”

LOCATION, LOCATION, LOCATION

One look at the AHL map yields a commonality stretching from Laval to San Diego – clustered teams. Most AHL teams within these pockets sit separated by only a few hours of highway time, be it in New England, New York, Pennsylvania, Ontario crossing into Quebec, the Midwest, Texas, or California.

Would Andrews like to see the Seattle affiliate fit into a cluster?

“Ideally, yes,” he replied. “It’s better for everyone if travel costs are reasonable and controllable.”

Of course, as with so many areas of AHL business, hard-and-fast rules do not always apply. Just about any point can have a counterpoint.

Take the Abbotsford Heat, who skated for five seasons between 2009 and 2014. That venture did not pan out for several reasons even though they played in a top-notch facility like the Abbotsford Entertainment & Sports Centre. One obstacle was geography. Positioned 45 minutes outside of Vancouver, Abbotsford sat a long plane trip away from even its divisional mates, leading to extended road trips that were not particularly conducive to player development. In 2013-14, their final season, the Heat found themselves in an unwieldy division with the Charlotte Checkers, a set-up that spanned North America. Difficulties surrounding their arena lease, attendance, and an affiliation with the Calgary Flames while positioned in the heart of Vancouver Canucks country only added to the woes, and the Heat eventually departed.

But the Abbotsford example could easily be countered by citing the Colorado Eagles, Manitoba Moose, and Tucson Roadrunners as examples of more geographically stand-alone teams that have found successful formulas capable of working for both the NHL parent club and the AHL affiliate. Those NHL front offices have shown an inclination to prioritize having their affiliates nearby even if it means being outside of those pre-existing AHL pockets. Geographic proximity also can be a more difficult objective to implement in the western United States, where inter-city distances can be vast.

“[Colorado, Manitoba, and Tucson have more difficult travel] yet if you were to ask the parent clubs, they are thrilled with the situation that they have,” Andrews stated.

Unlike in the Abbotsford days, the AHL now has an entire division centered around the West Coast, and Andrews has a track record of finding solutions that can take care of NHL and AHL considerations. Five affiliates relocated to California before the 2015-16 season, setting up a convenient grouping that satisfied a long-existing desire for their NHL parent clubs yet also met logistical and financial realities at the AHL level. Creating the Pacific Division provided NHL teams on the West Coast the ability to have their affiliates nearby, and Seattle could choose to tap into that same advantage. If so, an AHL affiliate could be placed in a location proximate to Seattle yet within an easy flight – or bus ride – of other opponents in that division.

What it all means is that Andrews is approaching the issue with an open mind as the parties try to sort out where Seattle’s AHL affiliate will go.

“If [Seattle has] the confidence that [a particular market] can work, and we have the confidence that it can work, then I think we would do that.”