Saturday, July 04, 2009

Scorpions Loss 'Temporary Setback'

By Lloyd Jojola And James Yodice
Copyright © 2009 Albuquerque Journal
Journal Staff Writers
          Basketball, anyone?
        More "diverse" events could be in store at the Santa Ana Star Center after the arena's anchor tenant, the New Mexico Scorpions hockey team, announced this week that it will not take the ice for the upcoming season.
        Mayor Tom Swisstack called the development a "short-term," "temporary setback" but remained optimistic that new center management will recharge the venue.
        "What this means for us is, we have a team that's dormant and they will either come back (for the 2010-11 season), or it gives us the opportunity to bring in other types of teams. Maybe basketball, or another hockey team."
        Or even both.
        "What I would like to see happen is that there's more than one anchor tenant," Swisstack said.
        Gunnar Fox, general manager of the Star Center, said the news frees up weekend dates for more concerts and other events. Out of 25 weekend dates last Scorpions season, 23 were on Friday or Saturday nights.
        "I think it happened early enough where we have some time," Fox said.
        "I think (the Scorpions leaving) gives us the freedom to book more diverse events, but this will definitely cause a hit in our premium seating department. Our premium seating clients and our sponsorships sales may suffer, just because we don't have a main tenant."
        After six months of trying to sell the financially ailing Scorpions, the ownership announced Thursday that the team would be dormant for the upcoming season.
        The announcement wasn't unexpected: In January team ownership announced it had lost about $1 million since relocating to the center in 2006. Its average attendance for the 2008-09 season was 2,791, a drop of about 200 from the previous season and a drop of about 500 from its first season at the venue that seats 5,395 for hockey games.
        In 2004, when Rio Rancho signed a 10-year contract with Global Entertainment, the previous management of the Star Center, the company predicted that profit from center events would be sufficient to repay the $36 million in bonds the city sold to build the arena.
        Instead the center sustained losses, forcing the city of Rio Rancho to use tax money to meet the debt obligations.
        With the losses being suffered, Global Entertainment's contract with the city was terminated early in the year. Another company, Global Spectrum, took over management in April.
        "The city has put in approximately $2.5 million from the general fund in supporting that facility since it opened," Swisstack said. "It has never broken even yet. Under the new management, we're hoping it's going to."
        Swisstack also said the city likely won't be in a position to cover the bond debt any time soon from the revenues generated from the Star Center.
        "At least now with the new management group, I'm hoping that we're going to see a decrease over a period of time of how much money that we would have to put in from the general fund."
        Swisstack was highly critical of the center's previous management.
        "It (the Scorpions) didn't flourish because part of it was marketing and our previous management team. They did not do a good job of marketing the center, and that would have marketed the Scorpions."
        A telephone message left with Global Entertainment on Friday wasn't immediately returned.
        Swisstack said the arena's new management company, Global Spectrum, has a reputation for taking over and turning around facilities. He said the venue could thrive if sold right, pointing to its recent use for University of New Mexico women's basketball team games.
        "For all practical purposes, they sold out, which means people will come if you give them something they want to see," he said.
        There also remains the possibility that the Scorpions could return.
        "Would we like to have the Scorpions back? Yes," Swisstack said. "Will we wait for a year? I think we'll start to look at other avenues on how to find maybe another tenant."
       

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