Down but not out, Sullivan Arena targets more and smaller events

One of Greg Spears' first moves, as the new manager of the Sullivan Arena last year, was to fix an LED sign on Gambell Street that had been broken for more than a decade.

The sign was turned on about three weeks ago — a visual symbol of Spears' public optimism about the future of the 34-year-old arena south of downtown, Alaska's largest entertainment venue.

"I say the future's bright," said Spears, who has also been a longtime convention center manager in Anchorage.

But at present, the Sullivan Arena is facing challenges. It is in its third straight year of losing money, hobbled by the departure of the Alaska Aces hockey team and a state recession. Attendance for the current anchor tenant, the University of Alaska Anchorage hockey team, has dwindled. (The arena holds about 6,300 for hockey games.)

After a decade of profitability, the arena lost slightly more than $600,000 in 2016 and about $385,000 in 2017, according to the most recent financial audit. Under the terms of the contract with the private company that runs the arena, city taxpayers have to backfill deficits. The Anchorage Assembly authorized about $250,000 on Tuesday night to help the arena balance its books.

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Spears thinks he can turn things around. He's pushing a new business model, one that moves away from the arena's past focus on huge events and flagship tenants.

Instead, the Sullivan will seek out smaller community events, fundraisers and trade shows — more of them, Spears said.

Big changes

For 13 years, the Aces played 36 home games in the Sullivan Arena and enjoyed a devoted following in the years they won championships.

The team also had a lopsided financial influence on the arena. A recent financial audit shows that in 2016, the Aces single-handedly generated 44 percent of the building's revenue. Hockey, overall, accounted for more than half of the building's revenue.

After the Aces announced a move to Portland, Maine, in 2016, other tenants exited as well. Some migrated to other venues in the city. The brand-new, state-subsidized Alaska Airlines Center across town at UAA now hosts concerts, high school state championship basketball tournaments and the Alaska Fighting Championship, all of which used to be in Sullivan Arena.

In August 2017, a management shakeup happened. Spears, the general manager for the Egan and Dena'ina convention centers, was tapped to also run Sullivan Arena. He started at the Egan Center as a banquet manager in 1992 and worked his way up. Spears' employer, SMG, is an international public facility management company. SMG has held the Sullivan Arena contract since 2001; the current contract expires in 2020.

Today, the arena employs 20 fewer people than it did in early 2017, a staff reduction of about 50 percent. The entire accounting staff turned over, and Spears had to hire a new finance director and accounting manager. For that reason, the 2017 financial audit was months late, according to Chris Schutte, the city development director — Spears had to get accounting help from SMG staff in the Lower 48.

Sitting in a basement VIP room recently, Spears said he's now shifting gears. He's focused on hiring, he said, and filling up a calendar that had yawning holes after the exit of the Aces.

"We're doing more smaller events, community events, fundraisers, trade shows, concerts," Spears said.

He ticked off the more successful recent examples of new events: A monster truck rally, for which 600 cubic yards of dirt was hauled into the building. The "Man Show," an exhibition of beer-tasting, cigars and motorsports equipment. A chicken wing tasting competition that proved to be "wildly successful," according to Spears. (The downtown restaurant Pangaea won the tasting competition with a peanut sauce, Spears said.)

Spears wants to bring a rodeo to the arena next year. He said he also plans to book more family shows, Disney-style.

Fixing up the inside 

Even before the Aces split, the city was pouring money into modernizing the arena's interior. When comedian and actor Kevin Hart performs on Nov. 27, it'll be the first test of brand-new black acoustic panels that were installed in the ceiling to improve sound quality, after years of complaints about echoes and reverberation.

There's also a fresh paint scheme, a new stage and more than 1,300 new black folding chairs with thick padding for floor seating. In the upper bleachers, old rickety seats have been replaced by comfier ones, Spears said. A malfunctioning cube-shaped scoreboard above the main bowl is working again; a new storage facility is being built out back.

The city also paid for artificial turf that can be installed when ice rinks aren't in use. Spears hopes the turf will bring in an entirely new set of business from field sports, including soccer, lacrosse and football.

He hopes some of the 60,000 people who drive south on Gambell Street past the arena each day will notice the restored LED sign.

In all, the upgrades in recent years have totaled more than $5 million, drawn from state grants handed out in better times. With the dramatic economic downturn, Spears said he doesn't expect an infusion of state cash anytime soon. He also doesn't imagine an overhaul of the 1980s-era exterior facade.

While the public areas of the arena have been spruced up, other parts of the facility are showing their age. On a recent visit, Spears' office space was taken up by a ladder, because crews were fixing a leaky ceiling.

Around the main bowl of the arena, championship banners and retired hockey jerseys for the Alaska Aces still hang from the rafters. Down one back hallway, the Aces logo is plastered on a door.

Some people think the Aces stuff should go, to start fresh, Spears said. But he likes it. It's part of the arena's long history, he said.

Spears said he thinks it's possible to get the arena back to profitability eventually. He just doesn't know when it will be. At the moment, the arena is running a deficit.

But he pointed to the recent, substantial investments as a sign of commitment.

"We certainly aren't going anywhere," Spears said.