A local consortium of local business representatives attempting to bring a hockey franchise to Cranbrook is alleging the city turned down a sub-lease agreement that would have brought junior hockey to the area in the fall.
The group, which is headed up by Colin Sinclair and Kevin Epp, has been working to find a junior hockey option ever since rumours of a Kootenay Ice relocation Winnipeg began to swirl last fall, according to a media release.
Sinclair is a Kootenay Ice alumni who played in Cranbrook between 1998-2003, but moved back to Cranbrook with his family after his hockey career ended, while Kevin Epp is a former NCAA college and professional hockey player who now works with Titan Sports Management, which boasts clients such as Shea Weber, Jake Virtanen, Oliver Ekman-Larsson and more.
The consortium has been working to secure junior hockey through purchasing and relocating existing franchises with the Alberta Junior Hockey League (AJHL) as well as the Kootenay International Junior Hockey League (KIJHL).
“The Group of investors is disappointed that the City officials involved did not seek the residents of Cranbrook’s opinions in a more formal manner,” reads the media release. “The group was the only group to secure a legitimate franchise for operation in the 2019 season, and now the future of hockey in Cranbrook is uncertain. The group spent countless hours of work to ensure the City had Junior hockey in the fall of 2019 and that the team would be viable long-term with no financial concerns.”
According to the prospective ownership group, an agreement to purchase the Calgary Mustangs of the AJHL was made, however, BC Hockey would not approve the team playing out of Cranbrook without the support of the city, which was allegedly denied due to an existing lease agreement with the Kootenay Ice. An attempt to sublease the existing agreement was approved by the Kootenay Ice, but rebuffed by the city, says the group.
Without that approval, a purchase condition was not met and the sale was not completed.
The group says it also looked at acquiring a franchise from the British Columbia Hockey League (BCHL) and the KIJHL. The consortium says it believed that a BCHL franchise wasn’t financially viable, but pursued a KIJHL option.
An agreement was made to purchase an existing KIJHL franchise, with the condition that the group receive league approval, which requires a lease agreement with a municipality. The consortium says that the city was not willing to approve the sublease for the Kootenay Ice agreement, therefore nixing the purchase.
The group alleges that the city had expressed interested in a British Columbia Junior Hockey League franchise and wasn’t in a rush to get a hockey team into Western Financial Place by the fall of 2019.
The city says it has not turned down any offers to relocate a hockey team to Cranbrook, according to a statement.
“The City has not turned down any offers, and we presently have a questionnaire open for any hockey organizations that are willing to submit an offer to bring their team to Cranbrook”, said Paul Heywood, Acting Director of Community Services with the City of Cranbrook.
“The City of Cranbrook decided that the Kootenay ICE are no longer a tenant in Western Financial Place, after establishing offices in Winnipeg and selling tickets for a new season at the Wayne Fleming Arena at the University of Manitoba.
“The City of Cranbrook has clearly stated that the Winnipeg ICE no longer have the right to assign a sublease to any hockey organization. It will remain at the discretion to the City of Cranbrook to choose which hockey team will be coming to WFP.”
Read the full media release from the consortium below:
Local group denied sublease for junior hockey in Cranbrook
Acting on rumours that the Kootenay Ice would be relocating to Winnipeg, a group of prominent Cranbrook business people collaborated to look at the feasibility of Junior Hockey in Cranbrook. All parties involved have a passion for hockey and/or sports in general as well as being community members or from Cranbrook originally.
The group completed numerous feasibility studies of various levels of Junior hockey, with the ultimate goal of ensuring the long-term viability of the next Junior Hockey team in Cranbrook. This included a detailed financial analysis of current and comparable BCHL Junior A franchises, Alberta Junior Hockey League Junior A franchises and the Kootenay International Junior Hockey League Junior B franchises.
It is important to note that the group, using their vast resources, received current actual financials from comparable teams in the BCHL, AJHL and KIJHL, and combined that with projections based on assumed values from the Kootenay Ice.
The unanimous opinion of the group, which included recommendations from business accountants, independent business lawyers and business owners, was that the Alberta Junior Hockey League and/or the Kootenay International Junior Hockey League were the only financially feasible long-term options for Junior Hockey in Cranbrook. The initial cost for a BCHL franchise combined with the extreme travel created uncertainty in the business model and as such the long-term viability of a BCHL franchise in Cranbrook is not positive.
The group began negotiations with the City of Cranbrook in the fall of 2018 regarding a lease agreement for either the Memorial arena or, depending on the level of hockey, Western Financial Place. The organization directly dealt with Mayor Lee Pratt, David Kim and Paul Heywood. The group was advised that the decision on a future hockey lease in Cranbrook vested in these city officials and that City Council had no relevant influence.
The process to obtain a lease would prove to be difficult and eventually led to the ultimate denial of both an Alberta Junior Hockey League team and a KIJHL team for the fall of 2019. Initially, the City’s position was that they had an existing lease with the Kootenay Ice and as such could not negotiate. Once the Kootenay Ice announced that they were relocating to Winnipeg, the group further approached the City of Cranbrook for a lease agreement in principal. The City’s position at that point was that they expressed interested in having a BC Hockey League Junior A team and further noted that they were in no rush to put a team into any arena for the Fall of 2019.
The group then approached the Kootenay Ice about a sub-lease of the Ice’s existing obligation with the City and Western Financial Place. The Kootenay Ice expressed interest in ensuring Cranbrook had hockey in the Fall of 2019. The two groups came to an agreement to sublease the existing tenancy agreement with the Kootenay Ice and the City. The terms were simple — the Kootenay Ice would be guarantors of their existing lease which would ensure the City of Cranbrook would receive Western Hockey League revenue for the next four years, the term left in the Kootenay Ice lease, and that the City of Cranbrook would have Junior Hockey in the Fall of 2019.
The group involved and the Kootenay Ice agreed, and requested an approval of the sub-lease from the City of Cranbrook.
The group pursued 2 different Alberta Junior Hockey League franchises and reached an agreement to purchase the Calgary Mustangs contingent on a lease agreement and B.C. Hockey approval.
B.C. Hockey notified the group that they would not approve an Alberta Junior A Hockey League team playing in British Columbia without City of Cranbrook support, and further that they had received communication directly from the City of Cranbrook that they were interested in a BCHL team, not an AJHL team.
The purchase condition of B.C. Hockey approval and a City of Cranbrook lease agreement was not satisfied and as such the Alberta Junior A Calgary Mustangs purchase did not complete.
Failing to secure a Junior A Hockey team, the group then re-evaluated the financial opportunity to own a BCHL team as well as a KIJHL team. As discovered months earlier, the BCHL model and its 1.2 million dollar expansion fee as well as 1 million dollar yearly operating budget is not feasible for long-term ownership in Cranbrook and as such they focused on a KIJHL franchise.
The KIJHL provides opportunities for local natural rivals with Kimberley, Creston, Fernie and Columbia Valley, as well as having a strong contingent of local talent playing for the franchise which will generate further fan support.
The group secured a conditional purchase of a KIJHL team which was conditional on BC Hockey approval, league approval, and a City of Cranbrook lease agreement. At this point, the group presented the City of Cranbrook with the Kootenay Ice sublease offer and advised the City that there was a tight timeline on any approval. The group received preliminary word from numerous league and B.C. Hockey officials that league approval and B.C. Hockey approval would be granted provided an appropriate lease agreement could be reached.
The group was given a May 31, 2019 deadline to secure the sublease and on May 30, 2019 they were notified by the City of Cranbrook’s legal counsel that the City was not willing to approve the sublease of the Kootenay Ice’s lease agreement to the group, therefore eliminating any chance of having Junior Hockey in Cranbrook in the Fall of 2019 and further jeopardizing the Western Hockey League revenue streams that the Kootenay Ice had guaranteed in the sub-lease.
The Group of investors is disappointed that the City officials involved did not seek the residents of Cranbrook’s opinions in a more formal manner. The group was the only group to secure a legitimate franchise for operation in the 2019 season, and now the future of hockey in Cranbrook is uncertain. The group spent countless hours of work to ensure the City had Junior hockey in the fall of 2019 and that the team would be viable long-term with no financial concerns.
The group would like to commend the Kootenay Ice for working diligently with them to provide a fair lease deal for the City of Cranbrook for the next four years by way of a sublease that ensured the citizens of Cranbrook received Western Hockey League revenue. The group will cease investigating further options for the City of Cranbrook and will not be commenting on this matter any further.
Group Directors — Colin Sinclair, Kevin Epp