A city committee voted in favour Monday of allowing the Edmonton Elks to renew their lease at Commonwealth Stadium as well as to offer the Canadian Football League club a break on fees as it aims to refind its financial footing.
At city hall on Monday, the public services committee unanimously approved the deal, which now needs to be approved by city council as a whole to move forward.
The arrangement would see the Elks renew their lease at the stadium for another five seasons and also have some licensing fees temporarily waived that would save the club about $400,000.
“It’s a recognition of us as a community-owned team — what we bring back to the city,” Elks president and CEO Victor Cui told Global News on Monday.
The Elks say the football club has lost about $18 million over the last four seasons.
READ MORE: Edmonton Elks open 2023 CFL season at home on June 11
Cui said the COVID-19 pandemic, which triggered the outright cancellation of the 2020 CFL season, played no small part in the team’s financial misfortunes in recent years.
He also acknowledged that attracting fans to the games amid the current economy and with various entertainment operations competing to do the same thing is a challenge.
“In general, the world of sports is going through a massive turmoil right now in trying to get the share of wallet of fans,” Cui said.
Last summer, the Elks tried various initiatives to try to increase attendance at Commonwealth Stadium, including allowing fans to receive up to four free youth tickets for every adult ticket purchased for home games.
READ MORE: Edmonton Elks offering free tickets for kids 12 and under
Mayor Amarjeet Sohi noted that if the waiving of licensing fees is approved, the Elks plan to use the extra money for marketing.
“I think it’s a good investment to help the Elks get back on track to recovering some of the revenue they lost,” he said, adding it is important that the Elks receive support and can operate under predictable conditions. “The Elks are community-owned.
“They are integral to our community and we need to make sure that they are successful.”
On Tuesday, Cui told Global News he believes the “lease renewal is a shining example of how a sport organization can build a fantastic partnership (or) relationship with the city.”
“How do we work to make our city better together? And that really is what I think the lease summarizes,” he said.
Cui also elaborated on Tuesday about shifting attitudes ever since the pandemic hit.
“In 2022 we all said ‘the world is going to return to normal’… And we found that the new normal was not anything like it was in 2018 and 2019,” he said.
Committee members said Monday they expect the Elks to continue to work to attract concerts and other events to the stadium in addition to trying to increase attendance for football games.
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Cui said the Elks organization generated millions of dollars worth of economic impact in Edmonton and said he believes the club has an opportunity to break even this season.
Since last winning the Grey Cup in 2015, the Elks’ roster has undergone a significant overhaul in recent seasons.
READ MORE: Lawler pays tribute to Edmonton on social media, says goodbye to Elks ahead of CFL free agency
The 2022 season saw the Elks finish with a dismal 4-14 record, although it was an improvement from their three wins in the 2021 season.
“We want them to be successful,” Sohi said Monday. “We want them to start winning.”
The Elks have not won a home game since 2019. Cui said Tuesday the club is committed to earning back the trust that fans will see the best possible product on the field.
“We underperformed in the past, we get that, but all we have been focused on and from fans, from our players, from our coaches, from our front office and back office, is how do we improve and get better?”
Sports economist weighs in on challenges facing Elks
Moshe Lander is an economics professor at Concordia University who teaches about the economics of professional sports.
On Tuesday, he told Global News he does not believe the Elks spending an additional $400,000 in marketing will have much of an impact in light of some licensing fees being waived.
“There’s other (CFL) markets that are also suffering,” Lander said, noting profitability is a challenging goal the football league is always pursuing. “But it could also be an Edmonton issue.
“(Commonwealth) Stadium is in the wrong location, and it’s not really built for 21st century tailgating and broad sorts of experiences that come with sports.”
Lander suggested that perhaps the heart of downtown Edmonton would be a better location for the stadium for the Elks to be profitable, but acknowledged “there’s not a lot of space to put a new modern stadium in downtown Edmonton anyways, so they’re kind of stuck where they are and I’m not sure that this is really going to make a difference.”
Lander said while the CFL’s ability to generate revenue is always a challenge, he agrees with Cui that the COVID-19 pandemic and the cancelled season were extremely difficult for Canadian football teams to navigate through.
“For the CFL, its two biggest sources of revenue are coming from TV deals and it’s coming from fans, and if you can’t put fans in the seats there’s no question you’re going to lose money,” he said. “The CFL’s not profitable at the best of times. And even if it’s profitable, we’re talking about low seven-figure (or) eight-figure numbers.
“We’re not talking about the NFL, we’re not even talking about the NHL in terms of its ability to make money, so the fact that they’re losing money is not at all surprising.”
Lander added that amid a slowing economy and rising cost of living, the Elks’ consecutive losing seasons have not done the club any favours in the competition for people’s discretionary spending.
“The CFL is entertainment dollars. So whether you’re spending it on the (Edmonton) Oilers, the Elks, on sushi night, you only have a limited number of disposable income dollars,” he said. “So if you put a product on the field that stinks, which the Elks have for the last few years, yeah, sushi and Netflix are a lot more exciting.”
Lander said he is not sure there is a long-term solution for the Elks and other CFL teams to consistently profitable but added that there are ways for sports teams to survive even when they don’t make money.
“(You can have) public ownership,” he said. “Or an acknowledgement that this is maybe a team that’s not destined to be profitable in the long run, and to find people that want to rotate ownership and absorb losses before they pass it on to somebody else.”
–with files from Global News’ Sarah Komadina and Morgan Black