SMG - Management of Chesapeake Energy Arena

[jedicurt]

thank you urbanized. so it there is something related to suites and the premium area's with regards to the thunder, so good to know that they have control of those as i was led to believe, but it makes since that they don't get revenue from all of that, as that is pretty standard across leagues.

and i don't think the thunder is opposed to other events in the arena, i hope that hasn't been what i have been saying... i just know they were opposed and nixed the deal with the Stars for the ECHL. and as for whether they are able to make money or not... for a private group running it, and just having an affiliation with an NHL team, i think you are correct. but the reason that several of your teams that are run by very active businessmen, they seem okay with running their minor leagues at a bit of a loss, if the cost for moving players back and forth between clubs is able to make up some of that difference. right now they are having to ship players (at their expense) from idaho to austin anytime they make a roster move, which in the NHL farm system, can be often. and sometimes even just for a game and then back. So several have started to decide that running an ECHL team at a loss is acceptable because they have to have an ECHL team affiliation, and even though they are at a loss, they of set costs as a whole when you look at ever line item across all of the owned and managed teams.

[Urbanized]

You're welcome jedicurt. I think this is all great conversation to have, because I myself had some assumptions that have proven to be incorrect as I've looked into things more.

So there were indeed discussions with ECHL team owner, including multiple meetings with City and the then-GM of SMG. The Thunder had little if any involvement.

But the talks were not regarding Chesapeake; they were actually regarding the Cox Center. The issue that the ECHL team ultimately got stuck on was that there were no long-term guarantees that Cox will be here after convention center opens, as this has yet to be resolved. So...if ECHL moves here into a building that makes sense for them RIGHT NOW, but that building is (potentially) unavailable a few years later, they are back to square one, looking at a building (Chesapeake) which doesn’t make sense for them. So eventually they decided not to make the move and the discussions fell apart. Based on this it seems like the long-term future of Cox would need to be resolved before we could entertain a minor league franchise like that one.

I think that may be one of the reasons the person or people you spoke to might have characterized it as being about the Thunder. In other words, the Thunder's agreements on Chesapeake arena regarding premium areas, in-arena advertising and etc. make it difficult for any team that is NOT the Thunder to derive revenue in Chesapeake Arena, a building where the rent is going to be high for them anyway. So Chesapeake is sort of out of the question, and Cox is a question mark.

But it's not really an effort by the Thunder to keep other teams away, but instead it's the fact that their agreement - which again is pretty typical of recent NBA building agreements in view of rocketing player salaries and the like - effectively soaks up every potential revenue stream, for understandable reasons.

[jedicurt]

thanks Urbanized... i'm going to follow back up with them and confirm this on their side. I'll post back here once i have talked with them

[Jersey Boss]

Urbanized, thanks for taking the time to not only delve into this matter, but writing an informative post as well.

[Urbanized]

You're welcome guys, hoping this brings clarity to the topic. It has for me and I'm glad I asked, and fortunate to know some of the people involved. Along those lines I don't recall if I mentioned that I met the new SMG General Manager yesterday after a Convention and Visitors Bureau Commission meeting. Very impressive guy who apparently came from a building that over-performed for its market size when it comes to entertainment.

Here is a Sioux Falls newspaper article about his departure: https://www.argusleader.com/story/ne...oma/773340002/

A leader who played a central role in boosting the Denny Sanford Premier Center into an internationally recognized venue is moving up to a job in Oklahoma.

Chris Semrau, assistant general manager of the Premier Center, has been hired as the general manager of the Chesapeake Energy Arena and Cox Convention Center in Oklahoma City. The Chesapeake Energy Arena is home to the NBA's Oklahoma City Thunder.

“I am thrilled with all that has been accomplished at the Premier Center and am fortunate to have had a small fingerprint on ongoing success of the venue," Semrau said. "Sioux Falls is an outstanding community and I have full-confidence the Premier Center will continue bring in great events create lasting memories for the region.”

Semrau moved to Sioux Falls in 2014 to open the Premier Center. He was in charge of booking, marketing, sales, event services, media relations and premium seating.

"It was only a matter of time, and he deserves the opportunity," said Terry Torkildson, general manager of the Premier Center. "He’s the most qualified (assistant general manager) in the country."

The Premier Center received numerous accolades under Semrau's tenure, including being named a three-time finalist for medium-capacity Academy of Country Music Awards for Venue of the Year and Pollstar’s Best New Concert Venue Finalist in 2015.

Semrau himself received recognition for his work while at the Premier Center. He was a finalist for Venue Executive of the Year in 2016 by the International Entertainment Buyers Association. He was also a four-time finalist selection for Venue’s Today Magazine's Booking Achievement.

“We are very excited to have Chris join our SMG team in Oklahoma City,” said Doug Thornton, SMG’s executive vice president of stadiums and arenas, in a news release. “He is an accomplished arena manager who has deep experience and relationships in our industry. He will be a great addition to our operation there.”

Here is an industry article on the move: http://ampthemag.com/the-real/smg-na...ention-center/

And here is a Pollstar article: https://www.pollstar.com/article/smg...-center-135864

Here is an Arena industry article (obviously many of these working from news releases): https://arenadigest.com/2018/07/12/s...semrau-new-gm/

He literally just arrived in OKC. I believe he will be joined by others with similarly impressive resumes. I'm feeling pretty optimistic.

[Urbanized]

The next piece of the puzzle (and additional staff that I mentioned) has been announced publicly announced: http://ampthemag.com/the-real/michae...ention-center/

SMG has announced that Michael Owens will take over as Assistant General Manager of Chesapeake Energy Arena and Cox Convention Center in Oklahoma City. Owens will oversee the booking, ticketing and marketing efforts for the complex.

Owens most recently worked as Director of Live Entertainment for Rogers Arena and the NHL’s Vancouver Canucks in Vancouver, British Columbia. Under his leadership, the arena had consecutive record-breaking years hosting the biggest names in music and sports.

“Michael is a highly respected professional with a strong record of booking achievements,” said Chris Semrau, General Manager, Chesapeake Energy Arena and Cox Convention Center in a release. “We are thrilled to add someone with the strong booking skill set and industry relationships which Michael possesses so we may continue to create unforgettable guest experiences and secure high-level events and artists.”

In addition to booking top-selling artists at Rogers Arena in Canada, Owens successfully negotiated and won bids for major, globally-broadcast events including the 2018 JUNO Awards, the massive e-sports tournament – The International DOTA2 team championship and the 2019 IIHF World Junior Hockey Championships.

Prior to relocating to Vancouver, Owens spent four years as Director of Booking for BOK Center, an SMG-managed facility in Tulsa, Oklahoma. During his tenure, BOK Center was recognized as a top-20 arena in the United States for concert ticket sales each year according to Pollstar and was nominated as “Arena of the Year” by the Academy of Country Music 2012 – 2015.

Owens garnered industry recognition by being inducted into the International Association of Venue Managers’ inaugural 30 Under 30 class in 2015, was a finalist for International Entertainment Buyers Association’s “Rookie of the Year” in 2014 and 2015 and was nominated for Venues Today’s “Hall of Headlines” in 2014 and 2015. Owens is a native of Springfield, Missouri where he graduated from Missouri State University with a Bachelor of Science degree in Entertainment Management. He will be relocating to Oklahoma City with his wife, Jennifer, and their two young daughters.

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[jdg78]

Urbanized - Thank you for all of the fantastic information! Why do think all these changes are occurring? Do these moves have anything to do with the extension of SMG’s contract? I understand the BOK and Peake have different business models, but shouldn’t the Peake be performing a much higher level? Thoughts?

[Urbanized]

^^^^^^^^^^^
Yes I believe it has very much to do with renewal of agreement. I’m sure that City expressed to SMG that they were very happy overall with SMG’s management of the building but still would definitely like to see an increase in non-basketball event nights. I believe there were additional performance measures put into the new agreement.

Also I know now that - contrary to what many of us here might have thought - the Thunder advocates pretty strongly for there to be MORE events in the building, and I’m sure some of these changes are in response to encouragement from the City’s main, high-profile and very important tenant.

I also expect that the addition of the new convention center has caused SMG to focus renewed energy on the OKC market.

[Urbanized]

...I understand the BOK and Peake have different business models, but shouldn’t the Peake be performing a much higher level?...

Oh, and sorry, I didn’t directly address this part of your post, though I alluded to it in previous posts. By the standard of JUST concerts (meaning removal of Thunder games from the equation), I discovered that Chesapeake was actually performing much closer to BOK than I myself had thought. It’s true that BOK had slightly more bookings over a number of years, but Chesapeake also had years where it outperformed BOK.

But when you add the Thunder into the mix, it’s not even close. By that standard Chesapeake outperforms BOK... ...by a LOT. So, if we are looking at the building as taxpayers we get far more value and performance from our investment.

That said, the City, Thunder and SMG all clearly believe that we could/should secure more concerts and non-basketball entertainment, and it’s pretty clear from the new agreement and the new hires that they have prioritized this. I’m especially encouraged that they brought in the guy largely responsible for BOK’s impressive run of bookings (who since performed similarly in Vancouver, in a building which hosts an NHL franchise). He should have no problem applying the same game plan and relationships in OKC, a larger, more populous city with more available entertainment dollars and a rapidly-improving live music scene.

It will no doubt not happen overnight, but I’d wager Chesapeake will eventually measurably outperform BOK on concerts alone. Give it some time.

[Urbanized]

Oh, I also wanted to mention some of the actual NBA-related logistics that admittedly DO affect bookings, and have to be worked around by the building and by promoters. Before the NBA season is released, the building is required by the NBA to reserve 75 nights for potential games. Recall that the regular season is 41 home games. So the NBA blacks out those nights, and nothing can be booked.

If an exceptional opportunity emerges, SMG and the team can appeal to the NBA to release the night in question, but recall that for the league, crafting a schedule for 30 teams in 28 different cities - all with different priorities - and paying attention to things like TV agreements, featured players, matchups and rivalries - is a very complicated process and takes months. The league doesn’t care much for special requests and does not encourage them.

When the schedule comes out and the reserved nights are released, the building can allow promoters to book. But recall, the 2018 season was just released a week ago, and the pre-season begins in only a little over a month. Big tours are usually booked many months in advance, and sometimes as much as a year. So in many cases, if the tour overlaps the NBA season, it is very challenging to find a night.

To the point that Staples or MSG or wherever still manage -sometimes even with multiple franchises in the building - that’s absolutely correct. But obviously, artists and promoters prioritize LA and NYC, Chicago, even Dallas. These are tier one markets and artists are not NOT going to play there. So they hold open slots just for these cities, find ways to make it work.

Cities like OKC (or Memphis, San Antonio, SLC, etc) have no such luxury. As a rule artists and promoters don’t care whether they are playing OKC, Tulsa, Wichita, Little Rock, Omaha, Kansas City. They only care about a full building and moving on to the next city. So if it’s simply easier and the path of least resistance to book one of those cities I mentioned, that’s how they are inclined to proceed.

This is where relationships, reputation etc CAN make a difference, and this is why the addition of the new SMG personnel should make us all a bit more optimistic.

[BDP]

Totally makes sense. And the 75 reserve days would certainly make a significant difference, especially when considering we are comparing BOK and Chesapeake. That could easily cause BOK to be the only choice for 5-6 shows a year looking to book the Oklahoma market during that span. It's just not that big of difference, especially when you consider Tulsa is only 1 and half hours from OKC. Some of the people who drive an hour and a half to see a show at the Staples Center live in the same city as the arena. Ha.

I think in the end, we're not really going to know which shows were booked in one city over the other as a conscious decision, either by the talent's booking agent or by arena management. All I know is that if I was a decision maker at SMG and a show was offered to us on an either/or basis, I'd prefer to place it in Tulsa if it was a viable act for the market, just to make sure I could justify the contract the next time around.

[Urbanized]

^^^^^^^^
To be clear though, the management of the Chesapeake Arena and the management of the BOK - while both employed by SMG - still are competitors to a very large extent. As in, nobody is sitting at SMG making a decision of whether a show goes to one place or another. They are both out hustling shows as if the other building doesn't even exist. I mean, if OKC has a date conflict I'm sure they recommend sending it to Tulsa as a courtesy, but they each have their own performance benchmarks spelled out in agreements with their respective municipalities. In the case of OKC I know that the new SMG agreement has raised the stakes a bit for SMG, so once again I believe they will pretty jealously be guarding any shows made available to them.

The biggest difference is that if they were not both SMG it would probably be a bit of a bloodbath. That is, if it was say SMG and AEG staring at each other down the highway they would both be playing the incentive game and trying to one-up each other constantly using money that currently they presently aren't having to spend, or at least in OKC they are not. Which means sacrificing building revenue in favor of guarantees and other incentives to the artists, promoters and booking agents. I think that is one thing worth noting in regards to the original point of this thread. The bad news for OKC is that we have a (very nice) competing venue 90 miles down the road. The GOOD news is that we aren't in a bidding war with them.

[jedicurt]

^^^^^^^^
To be clear though, the management of the Chesapeake Arena and the management of the BOK - while both employed by SMG - still are competitors to a very large extent. As in, nobody is sitting at SMG making a decision of whether a show goes to one place or another. They are both out hustling shows as if the other building doesn't even exist. I mean, if OKC has a date conflict I'm sure they recommend sending it to Tulsa as a courtesy, but they each have their own performance benchmarks spelled out in agreements with their respective municipalities. In the case of OKC I know that the new SMG agreement has raised the stakes a bit for SMG, so once again I believe they will pretty jealously be guarding any shows made available to them.

The biggest difference is that if they were not both SMG it would probably be a bit of a bloodbath. That is, if it was say SMG and AEG staring at each other down the highway they would both be playing the incentive game and trying to one-up each other constantly using money that currently they presently aren't having to spend, or at least in OKC they are not. Which means sacrificing building revenue in favor of guarantees and other incentives to the artists, promoters and booking agents. I think that is one thing worth noting in regards to the original point of this thread. The bad news for OKC is that we have a (very nice) competing venue 90 miles down the road. The GOOD news is that we aren't in a bidding war with them.

talked last night again with my Stars contact. read him your post, and they agreed with about 85% of it as is. and stated that the last 15% was probably related to being on one side of the equation rather than the other... they said their perspective is that the city felt that the Cox center was the real choice and that the city kept pushing for that. they were still really interested in playing in the Peake, because the facility has the better amenities, and said the cox was never an option when the city kept presenting it because there was no long term plan for it. So really close to what you heard as well. just a slightly different perspective

[Urbanized]

Gotcha. Understandably different perspectives.

Just to be clear to other interested readers, while jedicurt quoted my post about concerts and etc., but he was actually referencing this post:

You're welcome jedicurt. I think this is all great conversation to have, because I myself had some assumptions that have proven to be incorrect as I've looked into things more.

So there were indeed discussions with ECHL team owner, including multiple meetings with City and the then-GM of SMG. The Thunder had little if any involvement.

But the talks were not regarding Chesapeake; they were actually regarding the Cox Center. The issue that the ECHL team ultimately got stuck on was that there were no long-term guarantees that Cox will be here after convention center opens, as this has yet to be resolved. So...if ECHL moves here into a building that makes sense for them RIGHT NOW, but that building is (potentially) unavailable a few years later, they are back to square one, looking at a building (Chesapeake) which doesn’t make sense for them. So eventually they decided not to make the move and the discussions fell apart. Based on this it seems like the long-term future of Cox would need to be resolved before we could entertain a minor league franchise like that one.

I think that may be one of the reasons the person or people you spoke to might have characterized it as being about the Thunder. In other words, the Thunder's agreements on Chesapeake arena regarding premium areas, in-arena advertising and etc. make it difficult for any team that is NOT the Thunder to derive revenue in Chesapeake Arena, a building where the rent is going to be high for them anyway. So Chesapeake is sort of out of the question, and Cox is a question mark.

But it's not really an effort by the Thunder to keep other teams away, but instead it's the fact that their agreement - which again is pretty typical of recent NBA building agreements in view of rocketing player salaries and the like - effectively soaks up every potential revenue stream, for understandable reasons.

[BDP]

^^^^^^^^
To be clear though, the management of the Chesapeake Arena and the management of the BOK - while both employed by SMG - still are competitors to a very large extent. As in, nobody is sitting at SMG making a decision of whether a show goes to one place or another. They are both out hustling shows as if the other building doesn't even exist. I mean, if OKC has a date conflict I'm sure they recommend sending it to Tulsa as a courtesy, but they each have their own performance benchmarks spelled out in agreements with their respective municipalities. In the case of OKC I know that the new SMG agreement has raised the stakes a bit for SMG, so once again I believe they will pretty jealously be guarding any shows made available to them.

The biggest difference is that if they were not both SMG it would probably be a bit of a bloodbath. That is, if it was say SMG and AEG staring at each other down the highway they would both be playing the incentive game and trying to one-up each other constantly using money that currently they presently aren't having to spend, or at least in OKC they are not. Which means sacrificing building revenue in favor of guarantees and other incentives to the artists, promoters and booking agents. I think that is one thing worth noting in regards to the original point of this thread. The bad news for OKC is that we have a (very nice) competing venue 90 miles down the road. The GOOD news is that we aren't in a bidding war with them.

Makes sense. They're accountable to their specific arena and the agreements in place first. Usually there's plenty to go around anyway. Honestly, I think most of the dissatisfaction occurs when a show someone wants to see plays in Tulsa and not here, and if something plays here that they don't want to see, it doesn't "count" in their mind. As you've pointed out, it's actually much closer than some represent.

I got this email from the Thunder today and found it sort of relevant to this discussion:

As you may be aware, Trans-Siberian Orchestra (TSO) will be returning to Chesapeake Energy Arena on Dec. 5. We have been informed that, if we were to offer a purchase opportunity for our Season Ticket Members to their show, you would be charged more per ticket than the price available to the general public.

Due to this pricing structure, we have declined the option to offer a purchase option, on behalf of our Season Ticket Members.

This would indicate that the ticket offer agreement with the Thunder is not necessarily compulsory, and productions can negotiate on that point.

[bluedogok]

For the late 70's and into the 80's many bands alternated between OKC and Tulsa on tours. During that time there were more concerts at the Lloyd Noble Center than the Myriad. One album tour at the Myriad/LNC and the next at the Tulsa Convention Center.

In a scheduling interest, ESPN has an interesting 30 for 30 about the couple that does the MLB scheduling. That is 162 regular season games between 30 teams.
ESPN 30 for 30: The Schedule Makers

[jdg78]

Is the beginning of changes.

[HangryHippo]

Is the beginning of changes.

What?

[jdg78]

I’m not a fan at all. However, it looks like okc got a show Tulsa isn’t that is hitting every national big city arena. LA, NY, Boston , Philadelphia, Chicago, and etc.

[midtownokcer]

Is the beginning of changes.

Fan or not, this is a pretty big get even though she's played here before. Last month, I took my friend visiting from the UK to the Thunder Shop at the arena, and the guy working chatted him up about how this "new guy" was going to bring artists that are more relevant to younger people. He also mentioned that the players often complain that the 'Peake doesn't get shows that they want to attend. I had a bit of a laugh when he said that "Fall Out Boy and Rod Stewart isn't going to cut it."

[shadfar]

Fan or not, this is a pretty big get even though she's played here before. Last month, I took my friend visiting from the UK to the Thunder Shop at the arena, and the guy working chatted him up about how this "new guy" was going to bring artists that are more relevant to younger people. He also mentioned that the players often complain that the 'Peake doesn't get shows that they want to attend. I had a bit of a laugh when he said that "Fall Out Boy and Rod Stewart isn't going to cut it."

I hope there's some truth to this, as much as i like Tulsa..it's getting harder and harder for me to drive up to Tulsa for a concert on a Sunday night or middle of the week. getting old and not willing to travel for the music as much...

[kukblue1]

Did she play Tulsa last year or was that a few years ago?

[BG918]

Did she play Tulsa last year or was that a few years ago?

She played the BOK in Feb 2017

[OkieHornet]

KISS farewell tour stop at Chesapeake Arena on Feb. 26, 2019. I'm sure Tulsa will get a date on another leg at some point, but OKC gets on the first leg.

[Swake]

KISS farewell tour stop at Chesapeake Arena on Feb. 26, 2019. I'm sure Tulsa will get a date on another leg at some point, but OKC gets on the first leg.

I went to a KISS farewell tour stop at the Myriad over 20 years ago.