Discussion:
Parks and Recreation Staff received feedback from Shakopee’s Youth Hockey Association President, Rob Gunnere, affirming that the goal of offering a high-quality experience is being achieved on the ice at the Shakopee Ice Arena. While Gunnere was attending the annual Youth Hockey President’s meeting in Bemidji, more than two dozen Presidents told him that Shakopee has the two best sheets of ice in the state! Growing ice revenues and the high ice demand in booking requests confirms the perceived high-quality of Shakopee’s ice sheets – they’re consistently overflowing with customers.
Unfortunately, the turf story at the ice arena is not what everyone imagined or hoped for. The turf was intended to provide Shakopee’s youth sports associations a high-quality experience to begin their seasons earlier than Spring thaw typically allows teams to get outside. The cost of converting ice to turf and back again is high ($13,592), and the apparently lower-quality reality of the ice-arena-turf experience has those intended associations (baseball, softball, lacrosse, and soccer) choosing to book other venues (High School Fieldhouse, Savage Sports Center, and Soccer Blast of Burnsville) which too often leaves our turf empty without any customers. Ice-arena-turf bookings decreased from 262.3 hours in 2018 to 153.6 hours in 2019, with subsequent turf revenues at $90 per hour decreasing from $23,605 in 2018 to just $13,825 in 2019. Meanwhile, Shakopee is losing out on significant revenues as ice customers move to other venues when their needs can’t be met as a result of the ‘turf window” (note: we’ve lost multiple tournaments that we couldn’t fulfil this year due to turf). A single customer recently requested 216 hours of ice time annually on Rink 2 during the “turf-window” at $170 per hour ($36,720.00 plus tax).
2018 and 2019 Turf Totals by Group.
Shakopee Youth Baseball: 2018: 23 hours/2109: 9 hours
Shakopee youth LAX/ Girls and Boys: 2018: 109 hours/2019: 48 hours
Soccer youth/ High school: 2018: 12 hours /2019: 24 hours
Private rental numbers: 2018: 118.28/2019: 72.61
Grand Totals: 2018: 262.28 hours - $23,605/2019 Totals: 153.61 hours - $13,825
We contacted turf brokers to ascertain where our product would fall on the current turf market. The City’s turf cost in 2017 was $82,474.00 ($74,949.00 basic turf with $7,525.00 sewn-lines upgrade), and with a depreciation of 10% annually ($16,494.80) current turf value would be $65,979.20 if the turf market demand supports that value. Brokers came back with several bids that were unacceptably low ($20,000.00-$30,000.00), but Becker Arena Products, Inc.
has a client who agreed to $60,000.00 net return after expenses (broker fee, transport/delivery). A 91% cost recovery on the City’s turf is a fantastic opportunity that will not likely be available again. Selling the turf now will allow the ice arena to reclaim top ice revenues for the best ice in the state while avoiding lost turf revenues, compounded conversion costs, and reputation damage (no ice available due to empty turf with no customers). Shakopee’s Parks and Recreation Director has spoken to the turf-user youth association presidents (baseball, softball, lacrosse, and soccer) professed to understanding the turf-challenge and expressed support for the sale of the turf.
Turf sale proceeds could be used to generate additional profits by converting excess west-end lobby space (by the windows) to an appealing easy access rental space for ice-skating/hockey parties and meetings/tournament check-in. Customers regularly complain that the ice arena’s existing rental space in the back on the second floor is hard to find and lacks bathroom access. Consequently, very few renters book the existing space, so it generates very little revenue. After discussions with City planners, engineers, and 292 Architects (original designers), all have concluded that the west-end of the ice arena lobby could be easily converted with very few changes using an affordable “store-front solution” of the same materials used at ice rink entrances. This new attractive space would be highly visible, easily accessible, and is likely to generate huge demand for parties generating greater revenues (room and ice rent). After a preliminary assessment, the 292 Architects believe that the project could be completed in its entirety leveraging the $60,000.00 of turf proceeds. Converting that space to a party/meeting room addresses an expressed community need in way that will continue to generate revenue for the life of the ice arena.