Seattle Kraken CEO explains why investors paid a premium to bring hockey back to the Emerald City

The Seattle Kraken, the 32nd team in the National Hockey League, will play their opening game in Las Vegas on Tuesday evening.

For the businesspeople behind the return of professional ice hockey to Seattle after a nearly 100-year hiatus, the Kraken’s first game is a critical step in a nearly $ 2 billion investment in the team.

“When people think there aren’t many options, we’ve found this great frontier called Seattle,” Kraken CEO Tod Leiweke told Yahoo Finance Live (video above). “And we’re really optimistic about our future.”

Seattle Kraken goalkeeper Chris Driedger (60) looks on ice while warming up before their NHL preseason game against the Vancouver Canucks on October 5, 2021 at Rogers Arena in Vancouver, British Columbia, Canada. (Photo by Derek Cain / Icon Sportswire via Getty Images)

Kraken’s group of owners, which includes billionaire David Bonderman and Amazon (AMZN) CEO Andy Jassy, ​​paid an expansion fee of $ 650 million to join the NHL. That was the highest amount ever paid to join the league and worth more than the estimated value of 20 NHL franchises.

Oak View Group, whose president is Tod’s brother Tim Leiweke, partnered with the Kraken to double hockey in Seattle by spending around $ 1 billion on upgrades to the former Key Arena. Leiweke, now Climate Pledge Arena, bragged that the octopus home will be “the most beautiful arena in the country”. The venue is designed to host the Kraken, WNBA’s Seattle Storm, as well as concerts and other events. (The Kraken also has a new $ 80 million training facility.)

These investments are a premium compared to the NHL’s newest expansion team, the Las Vegas Knights, who paid a $ 500 million expansion fee in 2017 and currently plays in an arena that cost approximately $ 350 million to build.

A general view of the signage at the Climate Pledge Arena on December 10, 2020 in Seattle, Washington. (Photo by Abbie Parr / Getty Images)

“Pinch a little”

Leiweke is no newbie to the sport in Seattle.

He spent nearly a decade as CEO of the NFL’s Seattle Seahawks in the early 2000s and helped found Seattle’s Major League Soccer Club, the Seattle Sounders.

As CEO of the newest NHL franchise, Leiweke has placed his biggest bet yet on the loyalty and passion of Seattle’s sports fans. Fans have already approved the logo with their wallets: the team sold 8,000 jerseys within five days of launch, most of them for an NHL franchise, the team said.

The story goes on

Seattle Kraken fans will begin showing at the Spokane Veterans Memorial Arena for the preseason ice hockey game against the Vancouver Canucks on September 26, 2021. (James Snook-USA TODAY Sports via Getty Images)

The interest “far exceeded our expectations,” Katie Townsend, Kraken’s senior vice president of marketing and communications, told Yahoo Finance.

Leading indicators from the secondary ticket market show a high level of interest in Kraken games. The average price of a Kraken ticket is $ 188 on the SeatGeek website, double the average price of an NHL ticket. On Ticketmaster, Kraken’s official ticketing partner, tickets for the home opener on October 23 are listed for no less than $ 399 and can go up to $ 9,999.

“[Seattle] The fans are incredible, ”said Leiweke. “I think they are the best sports fans in the world. And on the opening day we will prove that they are also really big hockey fans. “

Legendary octopus, monster of the deep, represented as a giant squid. Engraving 1870. (Photo: Universal History Archive / Universal Images Group via Getty Images)

While ticket prices can drop before game day, Ticketmaster’s list price speaks to the excitement surrounding the Kraken’s opening season novelty.

“Our building will be full,” said Leiweke. “The response from the fans has been incredible and it really encouraged us to try.”

Josh Schäfer is a producer for Yahoo Finance.

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