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Jets return sees no sign of crashing

Winnipeg able to support teams until 2035: report

By: Geoff Kirbyson

Posted: 08/25/2012 1:00 AM | Comments: 0

Population and income growth are securing the future of the Blue Bombers, the Goldeyes and the Winnipeg Jets. (TREVOR HAGAN / WINNIPEG FREE PRESS ARCHIVES) Photo Store

Canadian NHL future earns a 10

If the Conference Board of Canada's crystal ball is correct, there could be 10 NHL teams residing north of the 49th parallel by 2035.

Quebec City and Hamilton face significant startup costs in building or upgrading arenas and Hamilton would face territorial fees from the Toronto Maple Leafs but both would have the necessary population and income. A second team in the Greater Toronto Area, which is forecast to hit 10.5 million people in 2035, would also have a substantial fan base from which to draw.

By comparison, six new Canadian teams joined the NHL between 1970 and 1990 -- the Vancouver Canucks, Edmonton Oilers, Winnipeg Jets, Quebec Nordiques, Calgary Flames and Ottawa Senators.

HAVE no fear, Winnipeg hockey fans, the Conference Board of Canada is confident you will never have to endure the loss of your NHL team again.

A new report from the Ottawa-based think-tank indicates the long-term future for professional sports in the Manitoba capital is downright "rosy" through to 2035. In particular, it points to a steadily growing population and rising incomes as evidence the city will be "quite able" to support the Winnipeg Jets, the Winnipeg Blue Bombers and the Winnipeg Goldeyes. With an average annual growth rate of 1.5 per cent, the Conference Board predicts Winnipeg's population will approach 1.1 million people in 2035.

"You'd be like Calgary, Edmonton or Ottawa right now. You could easily carry the three franchises," said Glen Hodgson, senior vice-president and chief economist with the conference board.

"Each (Winnipeg) team needs to be aware of the market. The market is constrained now with just under 800,000 people, but it's growing with good momentum (expected) over the next three to five years. The population is bigger and income levels have risen -- the fundamentals are all aligning now for the Jets."

The conference board had expressed concern in an earlier report about Winnipeg's ability to support both an NHL and CFL franchise, but "so far so good," Hodgson said.

The Jets have sold out the MTS Centre for the next two to four years, depending on the section, and with a waiting list of 8,000 people, they won't see an empty seat in the foreseeable future. The Bombers, meanwhile, are also in a good position with their new stadium set to open next season. Hodgson said he expects a honeymoon period with the new home to last three to five years.

"People will go for awhile just for a chance to see the new facility," he said.

In fact, Hodgson predicted Winnipeg's arts groups, which have suffered to varying degrees since the Jets returned as people shifted their discretionary spending toward sports, stand to benefit from the rising population and incomes, too.

"Everybody in the country knows you guys feel much better about yourselves right now. There's a nice glow over Winnipeg when you fly over it," he said.

There is one potential dark cloud on the horizon for professional hockey, he cautioned. If the Canadian dollar was to ever plummet to the depths experienced just a decade ago -- it was barely above 60 cents US in early 2002 -- or even to the mid-70-cent range, as it was when the original Jets were sold and moved to Phoenix, the reincarnated Jets would be severely tested.

"Then it's a different story, we'd be back in the bad old days. There is a cost disadvantage to being in Canada and having a payroll in U.S. dollars but your revenue is largely in Canadian dollars," he said.

For example, with a salary cap of $60 million and a dollar in the 60-cent range, it would cost a Canadian team nearly $20 million to cover the currency differential, he said.

Luckily, Hodgson believes Manitoba is very well-positioned for the long term thanks to its abundance of commodities, including wheat, nickel, pork and hydro electricity. These and other products are in high demand in Asia and other emerging markets, which actually bodes well for all of Western Canada.

"That has created a new demand for commodities. I don't see that going away. I think the chance of going back to a really soft Canadian dollar is fairly slim," he said.

geoff.kirbyson@freepress.mb.ca

Republished from the Winnipeg Free Press print edition August 25, 2012 B17

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