Las Vegas, City of Risk, Sex, and ... Ice Hockey?

Everyone’s talking about the Raiders moving to Nevada. In the meantime, Bill Foley’s $500 million NHL expansion team is practicing its slap shots.

Lee Orchard, a Golden Knights performer, being outfitted.

Photographer: Michael Friberg for Bloomberg Businessweek

By late summer, some 14 million visitors had landed at McCarran International Airport in Las Vegas. Whether they came from Boston or Beijing, many were on the ground only about 72 hours. Probably, when they deplaned, their plans were fluid. That’s why—for an experience that’s about luggage retrieval—the baggage claim at McCarran is so thrilling, filled with electronic signs teasing a multitude of options for sensory overload, or what people in hospitality here have long called “impressions.” Even in the age of screen bombardment, this remains an essential part of the Vegas-entry high—to be so wanted, you’re followed from bags to cab to hotel check-in to elevator to the first time you flick on the in-room television.

One attraction, though, was surprisingly impressionless: the Vegas Golden Knights. It’s not just a new hockey team; it’s the first franchise from one of the four major leagues—NHL, NFL, NBA, MLB—to call Las Vegas home. This seems like it should be a big deal, and maybe it will be, but I sensed it would be easier to make small talk with the rental car clerk by bringing up the Oakland Raiders’ relocation here, set for 2020.

If everyone in Las Vegas anticipates the NFL effect—casino mogul Steve Wynn has predicted a “thermonuclear” boost in room occupancy—support for the Golden Knights has a more muted, we’re-all-pulling-for-you air, as if the team were a civic light opera. “Las Vegas is a unique place,” says Steve Miller, chief executive officer of the Andre Agassi Foundation for Education, the philanthropy started by the tennis star, one of the city’s most famous native sons. “Hockey or any other spectacle fits in well here.” He adds: “The difference between success and failure is two issues—scalability and sustainability. Is it something people will continue to come and see?” Neither Agassi nor his wife, tennis great Steffi Graf, bought season tickets, which Miller says is only because of their “not being hockey fans, per se.”

The Golden Knights aren’t expected to be good when they take the ice on Oct. 10, just off the Strip, at the new T-Mobile Arena. Caesars Entertainment Corp. bought tickets, which range from $50 to $650, to provide as comps for loyal patrons, but the company passed on the $140,000 to $160,000 suites, says a spokesperson. A query about sponsorships to the Las Vegas-based online shoe retailer Zappos.com Inc. yields an upbeat no—“Always possibilities in the future!”—from its spokesperson.

Clark County, whose 2.2 million residents make Las Vegas bigger than many longtime NHL markets, has supposedly been starved for a professional team for decades. In recent years, as the city tried to rebound from the Great Recession while confronting millennial indifference toward gambling, various multipurpose-arena proposals, including one trumpeted by then-Caesars CEO Gary Loveman, have died. Then, suddenly, in 2014, because that’s how it seems to happen here, something was being built—right off Interstate 15 behind the Monte Carlo Resort and Casino—by MGM Resorts International, not long removed from bankruptcy rumors, and Anschutz Entertainment Group (AEG), the leading purveyor of live entertainment.

For years, Las Vegas had been discussed as an NHL expansion destination. Fueling the speculation: AEG’s president, Dan Beckerman, sits on the NHL’s board of governors, and AEG owns the Los Angeles Kings. In 2013, before it broke ground, the MGM-AEG project was announced as a home for megaconcerts, Ultimate Fighting Championship bouts, and, maybe, a future pro team.

But the Las Vegas-based Maloof brothers (Joe, Gavin, and George), who developed the Palms Casino Resort, had just sold their NBA team, the Sacramento Kings, and they wanted back into a pro league. They partnered with Bill Foley, the title insurance billionaire, who coveted a team of his own. By 2015, Foley had gone public with his bid to persuade the NHL to put a franchise in the soon-to-open arena. He was so sure it would happen, he moved the headquarters of Fidelity National Financial Ventures, the private equity arm of his business, from Jacksonville, Fla., to the Las Vegas suburb of Summerlin.

The $375 million T-Mobile Arena—MGM and AEG sold the naming rights for $6 million annually—was christened by a concert from local rock heroes the Killers, with Wayne Newton as the opening act, in April 2016. (MGM and AEG received no public money, but the Raiders’ new stadium got $750 million in local financing via a hike in room taxes.) Two months later, after Foley agreed to pay the $500 million expansion fee to the league’s 30 other owners, the NHL announced it was all in.

Kerry Bubolz, president of the Vegas Golden Knights.
Photographer: Michael Friberg for Bloomberg Businessweek

“This was a major city that didn’t have any professional sports,” said NHL Commissioner Gary Bettman during an interview in his Manhattan office in July. “Does it elevate hockey’s profile that we’re in this kind of city? The answer is yes!” Las Vegas is the apotheosis of his campaign to put the league on a national stage by establishing teams throughout the Sun Belt. Under Bettman the NHL has added franchises in Atlanta, Miami, Nashville, Raleigh, N.C., and, via relocations, Dallas and Phoenix. Of those, only Atlanta failed, and the NHL had to rescue the Phoenix Coyotes from bankruptcy in 2009.

The curse of the NHL is its troublesome adaptation as a TV sport. It’s resistant to the star-making culture that’s turned the NFL and NBA into year-round, Twitter-fueled soap operas. The bland public face presented by the Pittsburgh Penguins’ Sidney Crosby, considered the game’s best player, typifies the soldierly ethos of the NHL, whose athletes rarely emerge as personalities off the ice.

The speed, choreography, and fearlessness with which the game is played could compensate for that fact, except that TV cameras don’t capture it adequately. When Bettman became commissioner in 1993, the NHL hadn’t had a U.S. broadcast network contract in almost two decades, the period in which Wayne Gretzky, the most transcendent star in the league’s 100-year history, was in his prime. This is akin to nobody outside Chicago appreciating Michael Jordan’s run with the Chicago Bulls. It affirmed Bettman’s resolve to expand hockey’s reach and put the product before American home audiences, low-single-digit ratings be damned.

Some years ago, rather than persuade players and owners to agree to a ban on fighting, the NHL adjusted rules so brawls were less essential for entertainment. The boards were miked to convey the impact of hits, and a more recent innovation, the “goal-cam,” takes viewers into the chaos around the net.

The Golden Knights practice at City National Arena.
Photographer: Michael Friberg for Bloomberg Businessweek

When Bettman took over a then-24-team league, he says, gross revenue was $437 million; now there are 31 teams, and revenue is “around four and a half billion” dollars. The NHL is working hard to sell the only rivalries it can, between markets, though it hasn’t yet contrived a narrative to generate coast-to-coast chatter. That’s why it made more sense to put the Predators, who entered the league in 1998, in Nashville, rather than Hamilton, Ont., where fans were already committed to the Toronto Maple Leafs.

The NHL is in a 10-year, $2 billion deal with NBC’s sports network, NBCSN. In a triumph for the commissioner, all 84 playoff games last season were nationally televised. The NHL has an even bigger TV deal in Canada, courtesy of the C$5.2 billion ($4.2 billion) that Toronto-based media conglomerate Rogers Communications Inc. pays for rights. This doesn’t include ancillary revenue streams that come from being a live sports provider in a technological age ravenous for content. The NHL has streaming deals with Yahoo! Inc. and Twitter Inc. and is two years into a partnership with MLB’s in-house tech company, MLB Advanced Media, in which the league pays the NHL $100 million annually for the right to distribute its digital content.

As I ticked off these media deals, I sensed the commissioner casting a glance at his spokesman, Frank Brown, as if we were getting off-topic. “It starts with what takes place on the ice,” Bettman said. “It starts with the experience that fans have touching our game, and the best way to touch our game is in person.”

Marc-André Fleury, goalie.
Photographer: Michael Friberg for Bloomberg Businessweek

Attendance is a big deal for the NHL because it shows off fans’ passion and media rights still pale compared with those for other major sports. Bettman said NHL arenas played to 95 percent capacity last season, a skewed average because half the league had continuous sellouts, while teams such as the Carolina Hurricanes and New York Islanders struggled to fill seats. The Golden Knights, everyone involved hopes, will follow the example of the Predators, who rode all the way to the Stanley Cup Finals this year, turning Music City into Hockey Central.

Bettman extolled the convenience of T-Mobile Arena for tourists and Strip-hating locals. “With MGM building the Park Promenade, you can walk there from the Strip. But for the natives, whether it’s from Lake Las Vegas or Henderson or Summerlin, you’re on the 15, off a ramp, and into the parking garage,” he said. (Being there may be the only way for them to watch the team. Cox Communications Inc., the main TV provider in Las Vegas, hasn’t yet agreed to carry the games.)

The Golden Knights will have five Saturday night home games this season, among the fewest in the league. That’s because for many in Las Vegas, weekends are weekdays. According to the U.S. Bureau of Labor Statistics, the largest employment sector in the Las Vegas area is leisure and hospitality, with almost 300,000 workers.

T-Mobile Arena seats 17,500 for hockey, and the Golden Knights say they capped full-season ticket sales at 13,000. Of course, the Knights will also welcome the patronage of Chicago Blackhawks, Philadelphia Flyers, and Edmonton Oilers die-hards coordinating their Vegas jaunts around their teams’ visiting schedules, plus the estimated several hundred thousand Chinese tourists who pour in annually. The NHL began courting them in earnest in September, scheduling preseason games in Shanghai and Beijing as the Chinese government begins an all-out push to field a team when it hosts the 2022 Winter Olympics.

But Bettman is adamant that “this is about being part of the community—giving to the people who live in Las Vegas,” he said. “Unlike the Raiders, for example, this isn’t some transient play with an existing fan base in another city that may or may not fly in on weekends. This is about something that is indigenous to Las Vegas.”

There’s nothing more indigenous to the city’s creation than an outsider arriving with a large amount of cash and a high tolerance for risk. Foley, 72, is a West Point graduate with white hair who dresses down. Beyond the mainstay title insurance business, his various companies are in real estate software, regional chain restaurants, and wine. Buying distressed vineyards during the recession, Foley says, was an outlet as he shopped for another “hard asset” that had piqued his interest—a sports team.

Foley paid the $500 million expansion fee—the last time the NHL expanded, in 2000, the buy-in was $80 million—and began playing himself in public, the rancher-billionaire just crazy enough to roll the dice on hockey on the Strip. He has a minority ownership stake in T-Mobile Arena, however, which means he’ll get back- and front-end profits if the team takes off, and Nevada welcomed his relocation of Fidelity National Financial Ventures with tax breaks. An avid golfer, Foley is building a spread at Summerlin’s posh new Summit development, where the Tom Fazio-designed course, nestled at the foot of the Red Rock Canyon National Conservation Area, will feature chefs at “comfort stations.”

It’s anticipated that Golden Knights players will live near Summerlin’s brand-new, $24 million practice facility, City National Arena. The building has two ice sheets, putting the total number of rinks in the metropolitan area at four. Essential now for a sports team, the practice space will come with a TV studio from which the Knights can make and control their messaging.

The Hangover franchise gave the Vegas slogan “What Happens Here, Stays Here” a much-needed boost beginning in 2009. But shameless vice is a problematic theme around which to brand a hockey team. In June, when I asked Golden Knights Team President Kerry Bubolz if the in-game entertainment would incorporate strippers, he said: “It’s a fair question on your part.” The short answer was no. “What you are going to see, though, is some of the things that are unique to Vegas, that we’ll incorporate in the right way.”

Jonny Greco (center), vice president for events and entertainment, with his team in an unfinished space at Golden Knights headquarters in Las Vegas.
Photographer: Michael Friberg for Bloomberg Businessweek

We were sitting in a small conference room in the prairie-style office building of FNFV Group, the team’s summer headquarters while City National was being completed. Bubolz, until recently president of business operations for the Cleveland Cavaliers, threw out a host of possibilities for in-game entertainment on T-Mobile’s state-of-the-art scoreboard, called the Tower. “Penn & Teller, as an example, they’re well-known for what they do here. … Like, if there’s a nice shot or a nice hit, we do a video graphic where one of them is doing something that ties to that,” he said. “Or maybe it’s the girl in Cirque du Soleil, she’s a contortionist, and she shoots a bow and arrow with her foot? Well, if there’s a great shot, you show her, and then you go, ‘Nice shot.’ ”

The league’s expansion draft was the following evening, and Foley canceled a scheduled interview, too engrossed in the war room upstairs, where General Manager George McPhee, formerly of the Washington Capitals, was deciding whom to select from other NHL rosters. I spoke instead to Nehme Abouzeid, the chief marketing officer, who spent a combined 13 years with Sheldon Adelson’s Sands Corp. and Wynn Resorts Ltd. He was the lone executive in the Golden Knights’ front office who came from the local gaming industry. In the Fidelity lobby, Abouzeid, tall, lean, and dark-suited, gave a primer on how tickets would move on a secondary market of concierges fielding 11th-hour calls from wolf packs wanting seats at a hockey game. According to the Las Vegas Convention and Visitors Authority, almost 43 million people came to the city last year; talking to Abouzeid, it seemed easy to imagine Golden Knights games becoming the setting of The Hangover Part IV. FADE IN: The guys wake up in a superslick bunker suite at T-Mobile Arena. …

When I returned to Fidelity in August, Brian Killingsworth, the former chief marketing officer of the Tampa Bay Buccaneers, had Abouzeid’s job. (“I felt like he wasn’t quite the right fit for our environment,” Foley said in a phone call.) The branding picture was becoming clearer. Whether in real or 3D-projection form, expect knights on horses, a sword in a stone, the possible involvement of a catapult, performers from the Cirque du Soleil O show, ice girls in “medieval maiden” outfits, and a moment when the ice bursts into flames. All this was just in the ether for opening night.

The person in charge of in-game presentation is Jonny Greco, a former World Wrestling Entertainment live-event producer. A self-admitted hugger, Greco, 38, is a father of two who’s devoted his career to turning sporting events into value-added happenings, or at least trying to disengage people from their phones during breaks in the action. His five-year sojourn with the scripted sport of pro wrestling taught him an obvious but ineffable lesson: People will watch a good-vs.-evil story, no matter the setting.

In Greco’s tight-quartered office, the walls were push-pinned with drawings and animated mock-ups—it looked like the Game of Thrones art department. At a meeting with his technical and event staff, he played a YouTube video of a pregame show from Russia’s Kontinental Hockey League. Its centerpiece was an electric violinist bowing passionately on top of a supersize puck, but Greco was more interested in the dramatic effect of the drop curtains over the ice. From beyond his door, a bell clanged and there was clapping. Somebody in sales, apparently, had sold a partial-season ticket package or made a group sale.

T-Mobile Arena.
Photographer: Michael Friberg for Bloomberg Businessweek

The next day, Greco had a morning conference call with producers from New York-based Van Wagner Sports & Entertainment LLC, veterans of video montages from 33 Super Bowls, to brainstorm ideas for the trailer that will bring the Golden Knights onto the ice.

“Part of Nevada’s culture is the phrase ‘battle-born,’ ” Greco said on the conference call, referring to the Civil War-era slogan on the state flag. The team’s colors are gray, black, and gold, with red accents; the logo embeds the letter V in the face shield of a knight’s helmet. The gloves, like Michael Jackson’s, are white. “There might be a place for a knight that’s been through a lot,” Greco said. “Let’s drop that phrase in there. ‘Battle-born … Vegas-born.’ ”

The conversation recalled U.S. Marine recruitment ads from the ’90s that featured slain dragons and a mythical sword flicking past the ear of a young man in his dress blues. Such reference points aren’t incidental. Nellis Air Force Base is just north of the Strip, and Creech Air Force Base, a nerve center for U.S. drone operations overseas, is only 50 miles away.

Foley, who followed his father into the U.S. Air Force, cut his teeth as a businessman negotiating contracts with Boeing Co. He wanted to name the team the Black Knights, after the Army’s football team at West Point. But trademark issues arose. After contemplating Silver Knights, he went with Golden and, more boldly, cut “Las” from the team name.

“The residents of Las Vegas, if you ask where they’re from, they don’t usually say Las Vegas,” he says. “They say Vegas.”

“Vegas,” to the outside world, connotes gambling. But from the dasher board ads to the goal-scoring song, the NHL doesn’t want any part of the experience at T-Mobile Arena to conjure that.

Action in the sportsbook is one area where the NHL embraces its status as an also-ran compared with the other major pro and college games. “Gambling is irrelevant to what we’re all about,” Foley told ESPN.com in August. Hearing this, at least one of Foley’s season ticket holders was offended. “Gambling is relevant to everything in the city of Las Vegas,” said Joseph Asher, CEO of Vegas bookmaker William Hill U.S. “It’s the driver of the economy.”

The NHL hasn’t filed a petition with the Nevada Gaming Control Board to remove Golden Knights games from the betting window. In his office, Bettman said he’ll simply ask MGM Chairman Jim Murren to remove home games from casinos adjacent to the arena, the Monte Carlo and New York, New York. “One of the things we’re focused on is the atmosphere in the arena,” Bettman said. “We’re family-friendly.” Murren didn’t respond to requests for comment, and the NHL, a month before the season, had no further comment.

Owner Bill Foley talks to reporters at City National Arena.
Photographer: Michael Friberg for Bloomberg Businessweek

Protecting the integrity of the game is the sine qua non of a commissioner’s duties. But sports betting resides in a grayer area than domestic-violence punishments, performance-enhancing drugs, or deflated footballs. Fantasy sports has made betting less taboo, and the NHL, like its counterpart leagues, has forged a financial partnership with the multibillion-dollar industry via the site DraftKings.

The future growth of sports betting hinges on the U.S. Supreme Court, which has agreed to hear New Jersey’s challenge to the federal Professional and Amateur Sports Protection Act, which Congress passed in 1992 to prohibit states from legalizing sports wagering. In 2014, New Jersey contested the law after voters approved legalized betting at state-regulated casinos and racetracks.

Sportsbooks aren’t waiting for a verdict and neither are motivated gamblers. Betting apps from William Hill and others have proliferated, including MGM’s new PlayMGM. In addition to casino games, it enables Vegas residents to bet on games from their couches and offers tourists an alternative betting mode on busy weekends, such as during the NCAA’s March Madness.

Presumably, with a smartphone and an account, you could bet on the Golden Knights during the national anthem. Then, via in-game betting, which has been popular with European soccer fans for years, you could wager on the Knights again, when they go up or down by a goal and the odds change.

At 7 p.m. on a Tuesday, the night before the expansion draft, the Golden Knights showed off their first jersey. Meanwhile, as part of the league’s deal with Adidas AG, the uniform was displayed for VIPs, along with 30 other redesigned jerseys, in a nightclub at the Wynn Las Vegas, while T-Mobile hosted the grand opening of the Armory, the Golden Knights team store. Now the general public and local media were being directed to the iconic Las Vegas sign, which sits on a median on Las Vegas Boulevard. The temperature was about 113F. As cars whizzed by, a smattering of tourists snapped photos of the sign, while the Knights’ contingent, the size of a pancake breakfast for a small church, stood in the heat.

To the right of the sign, a doughy, inflated, headless body modeled the team jersey in less-than-chivalrous repose. Three Las Vegas police officers chatted, and an Elvis impersonator was remarrying a couple from Atlanta. There was a second Elvis impersonator nearby, far more recalcitrant.

Most observers think the Golden Knights will be given a honeymoon season and then be put on the clock. Foley has made one of those new-owner pledges: the playoffs in three years and the Stanley Cup in six. To give the team training wheels, the league changed the expansion draft rules to ensure Golden Knights players weren’t strictly castoffs.

The Golden Knights at their practice facility.
Photographer: Michael Friberg for Bloomberg Businessweek

That evening, when it came time to announce the team, Foley and McPhee, a former player with the characteristically sloping face of an old-timer whose orbital bone hasn’t had an easy life, were onstage at T-Mobile. The ceremonial selection of the first-ever roster was folded into the NHL’s season-ending awards show, when the league bestows honors named after Canadians of forgotten esteem, such as the Lady Byng trophy for sportsmanship and the Hart trophy for MVP.

The Great One, Gretzky, was on hand, as were legends Mario Lemieux and Mark Messier. But Foley and McPhee, with the home crowd behind them, stole the show. The owner and the GM sat behind a table and, like they were in a kind of Hunger Games, spoke the names of warriors selected for battle: “The Golden Knights select … Tomas Nosek.”

The crowd reacted enthusiastically but uncertainly. It was a happening, all right. Bettman later put attendance at 14,000, while 11,000 is probably more accurate. Regardless, Foley looked like he was having a great time, and the consensus among the hockey media was that McPhee had played the rules of the game masterfully, less for the players selected than for walking away from the table with a bushel of draft picks. There wasn’t a star among them, but maybe Foley will lure one down the line, this being a low-tax area with lots of golf courses. The future of the Vegas Golden Knights was here, but like the mechanism of a magic act, you just couldn’t see it.

 

(Corrects the length of Nehme Abouzeid’s tenure with Sands Corp. and Wynn Resorts Ltd. in the 26th paragraph.)