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Category: Business of Hockey

At financial crossroads, how will Rangers cope?

Money or success?

Money or success?

We knew this time was coming. Rangers’ fans knew that as the team’s window of contention began to open so would the period come where multiple essential Rangers would approach contract negotiation time. It leaves the Rangers in a sort of crossroads over the next twelve months.

With Derek Stepan still unsigned, Henrik Lundqvist, Dan Girardi and Ryan Callahan all approaching free agency, the absolute core of this team – Rick Nash aside – is in need of new deals. Whether the Rangers can afford to pay the going rate for all these players is questionable. Brad Richards’ uncertain future, the impending free agency of Anton Stralman, and a potential career year –in a contract year– for Derick Brassard also play roles in the questionable financial future for the Rangers.

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Despite high cap number, Rangers are not going over the ceiling

Don't worry, there's enough room to sign him (Photo credit: Christopher Pasatieri).

Don’t worry, there’s enough room to sign him (Photo credit: Christopher Pasatieri).

When the Rangers re-signed Mats Zuccarello the other day, the attention rightfully shifted to Derek Stepan. Many went to Capgeek and saw that the Rangers had a shade over $2 million of cap space, and began to instantly panic. After all, if Stepan’s market value is the $3.75 million that Claude Giroux received in his bridge deal (that value will be used as Stepan’s cap hit for the sake of this post), then the Rangers don’t have enough room. However, the data on Capgeek is a tad misleading.

Capgeek currently lists everyone signed to a one-way deal. Per the summer cap rules, any player that does not have a separate –and lower– AHL salary, thus the definition of a two-way deal, must count against the summer salary cap. This is why players like Aaron Johnson are currently listed on the roster. There are some nuances that I don’t quite understand — For example, why Chris Kreider counts, but JT Miller doesn’t. I seriously don’t understand that, so any answer would be helpful– but this is also the reason why each team can spend 10% over the cap ceiling each summer. For the Rangers, this means they can spend $70 million this summer, giving them ample space to sign Stepan.

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Deadspin: MSG has ten years at its current location

Deadspin is reporting that MSG has ten more years at its current location, and then it will likely need to find a new place to call home. MSG’s 50-year permit expired this past year, and MSG was lobbying to extend that permit. While the initial pitch was for a permanent lease on the area, the City Council voted last night, per Deadspin, to limit the new permit to ten years. The vote wasn’t even close, with the City Council voting 47-1 to limit the lease to that duration.

The timing couldn’t be worse, as James Dolan just dropped a cool $1 billion of his own money renovating the new MSG. It won’t be difficult for Dolan to make a profit off that investment, especially because it was $1 billion over three years. MSG will make that back in no time. What it does mean is that MSG will have a new home in ten years, and that the city’s plan to have a new Penn Station will finally come to fruition.

Zuccarello’s arbitration date set for July 31

The NHLPA has announced its arbitration dates, and Mats Zuccarello’s hearing will be on July 31. Zuccarello filed for arbitration on July 10. As we noted here, this is just a part of the process. The hearing, if it takes place (remember both sides can still work out a deal), will find the middle ground between the two sides on a one-year deal.

Zuccarello filing for arbitration is part of the business

In case you missed it yesterday, Mats Zuccarello filed for arbitration before the 5pm deadline. He and the Rangers were unable to come to an agreement before the deadline, so it makes sense that he filed for arbitration. This is just a step in the process, and does not represent any ill-will on either side. Some things to note about player-elected arbitration:

  • Since he has filed for arbitration, no one can offer sheet Zuccarello anymore.
  • In player elected arbitration, the team has the ability to walk away from the decision (if the salary is higher than $3.5 million). The Rangers did this with Nik Zherdev.
  • Both sides can still hammer out a deal before the hearing date (date TBD).
  • An arbitration filing all but guarantees that Zuccarello will be back next season, unless point #2 comes into play.

Rangers watch from sidelines as UFA circus begins



As the window to Free Agency opens in a few hours, it got me thinking about the post-lockout economic landscape and how it will affect the Rangers.  I actually think it will be a blessing in disguise that the Blueshirts have almost no cap space to work with in the UFA market, with most available resources going to re-sign our own (very talented) RFA’s.  Even if another team decides to take Darrell Powe and Arron Asham off our hands, there will likely still be less than three million to play with, and some of that needs to be saved for the deadline.

The biggest wild card GM’s are dealing with is the salary cap in subsequent seasons.  All signs point to that cap meeting, or even exceeding the current $70.3 million cap of this past season.  With six outdoor games planned for this coming year, revenue seems to be increasing at a rapid rate.  The general effect of this type of revenue spike in pro sports (and especially under the new revenue sharing provisions) is that more teams find themselves competing for higher-end assets.  Basic law of supply and demand will tell you that this will drive up UFA prices in the future. Read more »

Rangers will not be buying out Brad Richards

The Rangers have announced that they will not be buying out center Brad Richards this summer. The Rangers have one additional compliance buyout –they used their first on Wade Redden– but have until next offseason to use it. With a new coach in place, and without a pressing need to use the buyout this season, the Rangers have decided to see what they can get out of Richards this year.

Richards had been the subject of many buyout rumors, with seven years left on his deal at a $6.6 million cap hit. The Rangers still have $14.1 million in cap space to work with this offseason.

Taking a look at a possible Henrik Lundqvist contract extension



Henrik Lundqvist’s contract situation has been quite the hot topic since the season ended.  Prior to his non-committal remarks as to his future, it seemed like a foregone conclusion that Hank would remain in New York long-term.  Since extension-gate and the coaching change, combined with news that Lundqvist’s camp and the Rangers are commencing negotiations at the Draft in a few days, there has been much speculation about what a possible extension would look like.  Many pundits have theorized a possible max-contract to keep The King in his kingdom, but there hasn’t been much in the way of analysis.  Let’s change that, shall we?

For those who aren’t CBA geeks, the max-contract under the current collective bargaining agreement (for a player re-signing with his current club) is 8 years/$80 million.  For a UFA changing destinations it is 7 years/$70 million.  Hank is currently entering the final year of his 6 year/$41.45 million contract, signed in 2008.  If he were to receive a max-deal, the massive cap hit of $10 million would be approximately a $3.125 million increase from his current contract.  Even with the cap increasing again based on the HRR (Hockey Related Revenue) calculation in 2014-2015, the cap hit is staggering.

The implementation of the new CBA has changed the landscape of long-term extensions for superstar players.  Gone are the cap-circumventing 12-14 year deals and the suppressed cap values that came with them.   This alone makes forecasting an elite free agent contract all the more difficult. Not to mention that goalies are generally priced differently than players are, anyway.  Read more »

Buyout window officially open; Brad Richards watch begins

Bruce Bennett/Getty Images

Bruce Bennett/Getty Images

As of yesterday at 11pm, the compliance buyout window is officially open. We do know that Danny Briere and Ilya Bryzgalov will be bought out by the Flyers. We know that the Canadiens will be buying out Tomas Kaberle. But right now, that’s all we know. There are rumors that Mike Komisarek will be bought out by Toronto, but that’s just a rumor for now. (Update: Vinny Lecavalier will be bought out by Tampa Bay.)

A few things to keep in mind: We will not be hearing news of Player X being bought out immediately. To be bought out, a player must be placed on waivers, clear waivers 24 hours later, and then the paper work must be submitted. If we really want to see who is being bought out, then follow the waiver wire. Briere, Bryzgalov, and Kaberle will be the first players placed on waivers. If one of them actually gets claimed, then there’s no need to worry about a buyout (the other team will just take the contract).

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Addressing Henrik Lundqvist’s extension comments

After a frustrating end to the Rangers’ season in Boston several days ago, the voracious New York media was bestowed with the “We’ll see” heard round the world.  Henrik Lundqvist’s non-committal response to his future in New York almost imploded the entire hockey media.  Articles were written, page hits were had, and ad revenue rained down on media outlets.  Many observers and analysts alike feel that the King possibly moving kingdoms was the impetus for John Tortorella’s unceremonious dismissal on Wednesday.  Obviously, I’m not behind the New York Ranger curtain, so I couldn’t tell you with any certainty whether this is true, but I can dig a little deeper into those comments and see if the “threat” is credible in this case.

For those who missed it (and I’m paraphrasing), when asked about his long term future with the team, Hank responded with the functional equivalent of “we’ll see, I need to talk to my agent”.  Normally, this is a very typical response from a player when asked about his contract, but considering Hank’s importance and impact on the franchise, his remarks were bound to cause a stir.  Read more »