Deal sealed to put team in Rossford; Minor-league Wings to make move in 2000

By Joshua Benton
Blade Staff Writer

Page 1

Rossford is ready to become Hockeytown South.

The Rossford Arena Amphitheater Authority unanimously approved an agreement yesterday with the Detroit Red Wings to move their top minor-league affiliate to an arena to be built off I-75 near the Ohio Turnpike.

“This is the final piece in the puzzle,” said Mayor Mark Zuchowski. Having the commitment of the Red Wings will make the $48 million arena-amphitheater project much more sellable to bond buyers, who can be confident the arena will have a major tenant.

It likely makes it tougher for Lucas County or the city of Toledo to justify building a competing ice arena downtown.

The four-member arena authority approved two agreements: one with the Red Wings for the Adirondack Red Wings to move into the arena, and one with Olympia Entertainment, Inc., to manage the arena and amphitheater.

The Red Wings and Olympia are owned by pizza magnate Mike Ilitch and his family. The Ilitches also own the Detroit Tigers. Olympia representatives did not return phone calls seeking comment.

Since Rossford officials announced on Feb. 26 that they had reached a tentative agreement with Olympia to manage the complex, city leaders had said that getting a deal on the team was the key to convincing investors they should lend the project their millions.

Now, with the team committed to move from Glens Falls, N.Y., to Rossford for the 2000-2001 season, investors will be more easily convinced, Mr. Zuchowski said.

“This is just awesome,” he said. “This is a very big step.”

Toledo Mayor Carty Finkbeiner said he will continue to work with Sandy Isenberg, president of the Lucas County commissioners, and Tim Gladieux, Toledo Sports Arena and Toledo Storm owner, to develop a sports arena and exhibit hall as part of the SeaGate Centre in downtown Toledo and a baseball and multipurpose facility at the site of the Sports Arena.

“I’m not a person who’s concerned about what my competition or neighbors are doing,” Mr. Finkbeiner said. “The sooner that we execute Toledo-Lucas County’s dual development plan, the more successfully we will retain our long held position as the center of recreation, entertainment, and sports for Toledo-area residents.”

Ms. Isenberg is on vacation.

The Red Wings deal is for 15 years, with options that could extend it to 50 years. The team will pay $5,000 a game in rent, which would mean $200,000 annually, not including revenues from playoffs or preseason games.

The Red Wings agreement means a long-expected scenario has played out: two hockey teams are committed to playing in the Toledo area, four miles apart.

The Toledo Storm of the East Coast Hockey League plays at the 52-year-old Toledo Sports Arena in East Toledo. Rossford’s announcement caused Mr. Gladieux to announce plans to build an ice arena on the Sports Arena site. Mr. Gladieux has since advocated a county and city plan that would build an ice arena attached to the SeaGate Centre downtown.

He has said that if Toledo leaders come up with a solid plan for an arena, Rossford officials would change their minds and cancel their efforts. Mr. Gladieux did not return phone calls seeking comment last night.

The Rossford arena and amphitheater will be funded by a $48 million bond issue planned in the next two months.

But the Ilitches are making one key contribution to the project’s financing. Under the agreement signed yesterday, Olympia Entertainment will pledge a $2 million letter of credit that will be used to back the bonds.

Having the Ilitches backing the deal financially will make it even more attractive to investors, Mr. Zuchowski said.

The Ilitch letter of credit would be tapped only if all other available funds – including arena revenues, hotel/motel taxes, and admissions taxes – are insufficient to cover the complex’s annual debt service.

The mayor estimated that amount would be $3.9 million a year.

Under the agreement, Olympia will receive:

* Reimbursement for all operating expenses.

* Facility management fees of $300,000 a year.

* Twelve per cent of all food, beverage, and nonhockey merchandise sales.

* Fifteen per cent of all suite license fees, premium seating license fees, advertising and sponsorship revenue, and naming rights revenue.

In addition, Olympia would receive half of all money generated by the arena past the $3.9 million annually needed to pay off the bonds. That includes revenues generated by the city’s five per cent admissions tax.

“A lot of arena deals have that sort of revenue sharing for anything that comes in,” Mr. Zuchowski said. “This way, they don’t get the revenue sharing until the debt service is taken care of for the year.”

Olympia will be in charge of booking all events at the arena and amphitheater and will have the option of promoting events in the complex.

This agreement makes Rossford’s deal the farthest along of the area’s three sports facility proposals. Along with the Sports Arena replacement proposal, the Toledo Mud Hens are trying to build a baseball stadium, possibly in downtown Toledo.

Ms. Isenberg previously announced support for a downtown ice arena. But she said in a recent interview that a Red Wings announcement would add a “major dimension” to the arena discussions.

The Rossford management agreement has been signed by Mark Cory, group vice president of Olympia Entertainment. The Red Wings agreement has not yet been signed by Marian Ilitch, the team’s secretary/treasurer.

But Rossford law director Keith Wilkowski said that is only because of a scheduling conflict for Ms. Ilitch, and that the team will sign the deal early today.

The signed documents are only preliminary agreements; their terms will be fleshed out in more detailed documents in the coming weeks, Mr. Wilkowski said.

Jim Nill, general manager of the Adirondack Red Wings, said he knew “nothing at all” about the deal.

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