OSEG’S NEW CHIEF: ‘THIS IS THE END OF OUR STARTUP PHASE’
Five years ago, Mark Goudie was listening to the radio on his drive home when he learned Bernie Ashe had been appointed chief executive of Ottawa Sports and Entertainment Group.
There’s a direct line from that radio report to Wednesday’s announcement that Goudie, 52, will take over from Ashe as CEO on April 30.
The two were close colleagues during the 1990s. Goudie had served as top financial executive at the Ottawa Senators, while Ashe was chief operating officer. Despite moving on to other companies, they had kept in touch.
When he got home that day, Goudie left a message for Ashe to congratulate him.
Two days later, Ashe returned the call and offered Goudie some consulting work. Soon after, Goudie was chief financial officer. By 2015, Goudie had added the title of chief operating officer. He had become OSEG’s heir apparent as CEO.
When Ashe, 61, decided Wednesday to announce his retirement, it shocked no one that Goudie would replace him.
“Bernie had a timeline coming in here,” Goudie said. “It was just a little uncertain how long he wanted to stay.”
The tenures of the two colleagues promise to play out very differently. Ashe was the first CEO for the OSEG, the partnership that, among other things, owns three sports franchises: the Redblacks (football), 67’s (hockey) and Fury (soccer). Majority owned by Roger Greenberg and John Ruddy, OSEG was formed in 2012 to revitalize Ottawa’s Lansdowne district, including the refurbishment of the football stadium.
Under Ashe, OSEG’s first years were spent putting out fires — dealing with construction hiccups, finding customers to fill 400,000 square feet of retail space, renegotiating terms with the City of Ottawa over a defective arena roof, you name it. The partnership also did a lot of hiring. Goudie said OSEG employed just 12 full-time workers when he started there in 2013. Today it employs 125, a workforce that expands to more than 900 parttimers on game nights.
The result of all the spending was larger-than-forecast losses for the partnership in 2015 and 2016. The combined net loss for both years was $27 million on revenue of $92.9 million. OSEG is expected to absorb further deficits through to this year. But thanks in part to the fact Lansdowne’s retailing space is now 95-per-cent leased, those losses should soon disappear.
“This is the end of our startup phase,” said Goudie, who has the luxury of more stable operations. “This is the first time we’ve been able to take a breath. I have some ideas about what comes next, but I want to work through them first with my management team.”
Although Goudie declined to be precise about his plans, in general they are aimed at getting more people onto the Lansdowne property. “The site is not being used to capacity,” he noted.
Goudie declined to comment about the rumoured possibility OSEG could one day acquire the Ottawa Senators from mercurial owner Eugene Melnyk. But this seems an unlikely fit financially. The Senators, like many NHL franchises, tend to lose money on operations but more than offset that through the increased value of the team. This sort of strategy demands a hefty bank account or a willingness to borrow against the increased value of the team’s assets. OSEG appears to be run too conservatively to absorb this kind of risk, especially following years of financial losses.
Nevertheless, OSEG partner Ruddy, executive chair of Trinity Development Group, could play a role separately in the future of the Senators. Ruddy is a principal — along with Melnyk — in the RendezVous LeBreton bid to develop LeBreton Flats. That proposal includes a new downtown arena for the Senators.
For Goudie, who previously served as top financial executive at a string of technology firms — Plaintree Systems, World Heart Corp. and Mxi Technologies — the focus will remain squarely on Lansdowne’s 40-acre patch of land.
“We’ve built an exceptional entertainment venue. It’s time to make use of it to the fullest.”