Canada is ripe for major league sports expansion, with the capacity to support up to three more NHL franchises and many other professional sports teams over the next 25 years, according to the Conference Board of Canada.
In the final report in its series examining what the Canadian pro sports scene could look like by 2035, the Conference Board says the country has all the right conditions for the continued financial prosperity of existing professional sports teams as well as to support new franchises.
There could be new NHL teams in Hamilton and Quebéc City, a second team in the Greater Toronto Area, and second chances for an NBA franchise in Vancouver and an MLB team in Montreal, the report says.
The projections are based on what the Conference Board refers to as the “four market pillars” for the success of professional sports teams: market size, income levels, corporate presence, and a level playing field.
“You need people buying tickets, you need corporate support, you need rising incomes, you need the advertising, and media,” explains Glen Hodgson, senior vice-president and chief economist at the Conference Board of Canada.
Hodgson says the teams that left Canada did so at a time when the Canadian dollar had a much lower value against the American dollar, making it even harder for Canadian teams to match American contracts.
“The [Montreal] Expos, the Winnipeg Jets, Quebéc Nordiques left when the Canadian dollar was weak. The teams were absorbing a much bigger payroll than their American counterparts,” he says.
“So a strong [Canadian] dollar, where you got contracts denominated in U.S. dollars, means you can fulfill your financial obligations without undue hardship.”
Hodgson says the rising demand for commodities, especially in emerging markets such as India and Brazil, makes the economic outlook of resource-rich Canada optimistic, which means the Canadian dollar should continue to remain strong 25 years from now.
However, it takes more than a strong dollar and a new stadium to support a franchise in leagues such as the MLB, where the smaller-sized teams face a major challenge in acquiring and retaining top players, the report says.
“Baseball’s never tried to create a level playing field. The New York Yankees have basically set the rules for 150 years, so that’s not going to change easily,” notes Hodgson.
New Markets for CFL, MLS, NFL?
In one of the earlier reports in the series, the Conference Board identified potential new markets for new CFL teams, including London, Kitchener-Waterloo-Cambridge, Moncton, Halifax, and Québec City, in addition to Ottawa-Gatineau where the league is already set to return.
The new report names Saskatoon as a potential city to have its own CFL franchise as well. There’s also a possibility for Toronto to have a permanent NFL team, though past attempts at this have been unsuccessful, the report notes.
Canada could also see three more Major League Soccer teams added, with Edmonton, Calgary, and Ottawa being potential markets thanks to their growing populations.
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