Jan 27, 2022
It’s a tale of two cities for the CFL in southern Ontario
The CFL’s challenges in Toronto are as big as they’ve ever been, but if there’s a reason for hope it’s just down the highway in Hamilton, Dave Naylor writes.
By Dave Naylor
The Canadian Football League has long been focused on reviving its popularity in Southern Ontario, the economic and corporate capital of Canada and region in which roughly one quarter of the country’s population resides.
The challenges are well-known – competition from other major-league sports, the multitude of other entertainment options available, and the perception that Southern Ontario has outgrown the CFL.
However, the CFL markets in Hamilton and Toronto are as different today as they’ve ever been in modern times.
To understand how and why, you need to go back to the summer of 2003. That’s when the Hamilton Tiger-Cats and Toronto Argonauts both wound up in bankruptcy, their respective owners – Toronto’s Sherwood Schwarz and Hamilton’s George Grant and David Macdonald – having thrown the keys at the league and run off into the night amid mounting financial losses.
There was considerable concern about finding new ownership in a region of the country where some people seemed to shrug at the crisis, and where substantial financial investment was going to be necessary to turn things around.
Eighteen years later, the Tiger-Cats have managed to create a sustainable business in Hamilton, while the Argonauts continue to search for relevance and a viable business model.
It’s believed that the recent transaction that saw local steelmaker Stelco take on a 40 per cent share of the Tiger-Cats, Forge FC of the Canadian Premier Soccer League, and the lease at Tim Hortons Field, placed a value on those assets of more than $50 million.
That means Stelco paid roughly $20 million for its 40 per cent share, quietly marking the highest valuation of a CFL franchise in history. In other words, the business of operating a CFL team in Hamilton seems quite healthy and sustainable.
Meanwhile, the team that plays 67 kilometres away had a rebound on the field last season but not in the stands, where Toronto continued to have the league’s worst attendance. The Argos’ biggest home crowd of 2021 was for a playoff game that was loaded with Tiger-Cats fans from down the highway.
A big part of why the two teams are currently in such different situations starts with ownership.
Until their recent Stelco transaction, the Tiger-Cats have had one owner since 2003 – Bob Young, a local tech entrepreneur who spends most of his time in North Carolina and remains the team’s majority owner.
Young made plenty of mistakes in the early years and burned through tens of millions of dollars along the way. But in the end, he managed to get the Tiger-Cats into a new stadium in 2014 and from there built the business and fan base to the point that it has real value.
The Argonauts have had four owners since 2003, the latest being Maple Leaf Sports & Entertainment, which took over in late 2017 season after two years under the proprietorship of Bell and Larry Tanenbaum.
While there was great hope that synergies within Canada’s richest and most powerful entertainment company would produce a Toronto CFL renaissance on the shores of Lake Ontario, it hasn’t happened. And there are no signs that it’s coming.
MLSE has had its hands full managing the COVID-related activities of its NHL, NBA, and MLS franchises, leaving the Argos – at least by appearances – as a low priority.
Last spring, it was widely reported that MLSE was deeply in favour and pursuing a merger with the XFL, preferring the risks and potential upside associated with such a move over the predictability of the status quo. When that didn’t happen, it gave rise to speculation that MLSE’s days in the CFL were going to be numbered.
Since then, it’s been silent.
There’s no sign that MLSE is stepping away from the Argonauts anytime soon, just as there is no evidence that they’re in the business of Canadian football for the long haul either.
The CFL’s challenges in Toronto, for MLSE or any future owner, are as big as they’ve ever been.
But if there’s a reason for hope, it’s just down the highway.
Hamilton isn’t Toronto but it’s also not the blue-collar town it once was. People there enjoy many of the same entertainment options as those in the Big Smoke, yet the CFL thrives there.
No one is saying that it’s easy, or that it can happen overnight.
But in this tale of two cities, it’s worth paying attention to what’s been proven possible.