In a development that comes as little surprise, Major League Soccer's owners recently convened to discuss the situation surrounding the Vancouver Whitecaps. According to a report from The Athletic, a small group of owners met earlier this month to deliberate on the team's future and the possibility of relocation. Las Vegas has emerged as the leading candidate should the Whitecaps leave Vancouver, the report suggests.
However, as reports go, none of it is particularly shocking. The Whitecaps have been publicly seeking an owner for over a year, and the search continues. It will not go on indefinitely. It was inevitable that MLS owners would eventually address what comes next, and now we know they have. The Athletic indicates that a group from Las Vegas has expressed interest in the team, though it is not the group associated with a flashy proposal for a sports and entertainment district in the southern Vegas suburb of Henderson. Phoenix, where the ownership of a popular second-division USL team is said to harbor MLS ambitions, is also mentioned as a possibility.
Both options, however, still feel somewhat fanciful as alternatives to Vancouver at this point. Neither city has an MLS-ready stadium, and both face real questions about whether their communities would support building one. In Las Vegas, there is considerable facility fatigue among the public; the vote to approve the Athletics' baseball stadium was highly contentious, coming after public funds were also used to construct the NFL's Allegiant Stadium. Between the two stadiums, over $1 billion has been allocated to billionaires, sparking strong public opposition to both deals. As for the Phoenix option, one need only ask a hockey fan about the challenges of building an arena in the desert.
This underscores that even the leading candidates for MLS relocation are far from perfect. Surely, MLS would prefer to place expansion teams in those markets while retaining the popular team in its current location.
“We are aware of today’s reporting,” the Whitecaps said in a statement on Monday. “The club has faced well-documented structural challenges around stadium economics, venue access, and revenue limitations that have made it difficult to attract buyers committed to keeping the team in Vancouver. Over the past 16 months, we have had serious conversations with more than 100 parties, and to date, no viable offer has emerged that would keep the club here. It remains the strong preference of this ownership group to find a solution in Vancouver. If there is a local ownership group with the vision and resources to chart a path forward, we urge them to come forward.”
The Whitecaps' lack of financial viability in Vancouver remains a core issue. This is the primary reason ownership has put the team up for sale. The B.C. Place lease was never a particularly favorable deal for the team, but it was manageable when signed. However, as player and travel costs have surged over the past half-decade, low revenue has become a significant problem. As long as the team was relatively break-even, owner Greg Kerfoot seemed willing to continue. Presumably, the team's increasing value also helped. The Whitecaps' 2011 expansion fee was reported at US$40 million, while Toronto FC paid just US$10 million four years earlier. Reports indicate San Diego FC paid US$500 million to join the league last season. Now, however, the annual losses are no longer tenable, and the gap between costs and revenues is so severe that dozens of prospective investors have reviewed the team's books and then backed away.
CEO Axel Schuster stated in February that to move from the league's bottom revenue position to just mid-table, the club needed to generate an additional $40 million. “We are really concerned that, after such a successful season, the gap is even becoming bigger, that this at some point will not be manageable for us anymore,” he said at the time. The team's deal at B.C. Place limited their ability to generate revenue beyond ticket sales. The team has signed a series of small sponsorships over the past couple of months, such as with Erdinger beer, but likely needs two dozen or more. Most sponsorships signed to date are believed to be worth hundreds of thousands, not the millions needed in total. “To be clear, I think it needs 25 to 30 more of these little steps, or it needs a few big steps to really get in safe water and to say ‘OK, now this club gets into more of the area of financial stability and viability,’” Schuster said after signing one of the early deals.
For pundits, fans, prospective owners, and Major League Soccer itself, the poor financials are hard to reconcile with the raucous atmosphere in the stands and the team's performance on the pitch. Over 27,000 fans were in attendance on Saturday to witness another thrilling 3-1 win for the Whitecaps, their last home game for three months while the team makes way for the FIFA World Cup. Fans also showed mass support for saving the team, with signs and chants filling the stadium. This is why the leaked report does not signal an imminent departure. Rest assured, this is a market MLS wants to remain in. It is significant for the brand and for soccer in Canada. From a sporting perspective, it is working like a charm. The financials remain the problem.
It also should not be overlooked that this week marks the FIFA Congress, with all eyes on Vancouver. If ever there were a high-pressure moment for MLS and Whitecaps ownership to press municipal and provincial politicians, it is now. Can our politicians figure out a deal to give the Whitecaps a future here? It would be quite the moment to do so.
