The first news came yesterday, as it so often does these days, in the form of a tweet:
On first glance, this sounded like a pretty good offer: The Oakland A’s owners would take the Coliseum and its debt off the public’s hands, and put it into private ownership where it would actually pay property taxes? Where do I sign? (Okay, I don’t sign because I’m not an Oakland or Alameda official, but you get my point.)
Read the fine print in that small-type attachment, though, and it becomes clear that there’s a rather large catch:
This letter serves as an indication of the A’s desire to assume control and purchase the Oakland-Alameda County Coliseum complex in exchange for paying all remaining debt service on the more than $135 million of debt ultimate owed by the City and County against the Coliseum complex.
Wait, the entire complex? Including the Oracle Arena and all the parking-lot land that has been eyed for development in the red-hot East Bay real estate market? (Admittedly the Coliseum isn’t exactly the most desirable location in the East Bay, but anything west of Nevada is considered commuting distance from San Francisco these days, so.) How much land is that exactly, anyway?
Matier and Ross in the San Francisco Chronicle (warning: page may not load properly thanks to the Chronicle’s weird-ass paywall) have the answer: 130 acres, including “the stadium where the A’s have played since 1968, the arena soon to be vacated by the Warriors, the parking lot — everything.”
The average sale price of land in Oakland, according to my new favorite study ever (thanks, correspondent who sent it to me!) was $1,412,000 per acre from 2005 to 2010, which would price the Coliseum site at $183 million — plus any inflation over the past decade. If you want more direct comps, here’s a seventh-of-an-acre vacant lot right across the road from the Coliseum that’s on the market for $150,000, which is about $1 million per acre, pricing the site at about $130 million.
So this looks to be a better offer than the New York Islanders‘ deal with New York state, and the Los Angeles Angels‘ rejected proposal to Anaheim, and probably the Denver Broncos‘ plan for their parking lot land as well. Though I would still want confirmation that the A’s owners would take title to the land and pay full property taxes, and to be sure that $135 million is a fair price for the site.
Fortunately, there’s an easy way to figure this out, which is to open the Coliseum site up to competitive bids:
A number of outfits, including Fortress Investment Group — a money management firm in San Francisco that boasts billions in assets — have approached the city and county about purchasing the land and possibly turning it into something besides a ballpark. The A’s fear they could quickly find themselves shut out.
City Council President Larry Reid, who sits on the city-county Coliseum Authority board, called the A’s offer “a pretty big deal. But other players have expressed interest in the property.”
He added, “The mayor, and I assume a majority of the Board of Supervisors, would like to have some control on what happens to that 130-acre site that the Coliseum sits on.”
The A’s owners, though, are trying to avoid this, proposing an “exclusive negotiating agreement” that would preclude taking other bids. Is finally ending the long A’s stadium saga — they’re not promising to build a stadium on the Coliseum site, but it would at worst be a viable Plan B if other sites don’t work out — worth giving up a shot at a possible better payday from another developer? Is estimating the value from other comparable properties good enough for government work? It’s a classic Monty Hall problem, only without Monty Hall there to know which door has the goat, which makes it a whole lot tougher to solve. Good luck, Oakland and Alameda officials!