NYC Mayor de Blasio: Sure, wealthy sports owners should pay their taxes, I guess

As I mentioned in my Gothamist article last week, a group of New York city councilmembers have called on Mayor Bill de Blasio and Gov. Andrew Cuomo to start making the city’s sports teams pay property taxes on their stadiums and arenas, which none of them currently do. (The Yankees and Mets and Brooklyn Nets all pay “payments in lieu of taxes” that are really their own construction debt payments, funneled through the city as a tax dodge; the Knicks and Rangers don’t pay taxes on Madison Square Garden because somebody accidentally gave them an eternal tax break in 1982 and no one can be bothered to repeal it.) And the campaign got a boost yesterday when de Blasio sorta kinda endorsed its call for team owners to pay their fair tax share:

De Blasio, a Democrat, was asked at his daily press briefing to respond to a letter last month from nine lawmakers on the New York City Council who called for the Garden, Yankee Stadium, the Barclays Center and Citi Field to pay property taxes. The mayor said he hasn’t seen the letter and was unfamiliar with the legal specifics, but supported the concept of requiring New York’s local teams to increase their contributions.

“Let’s be clear – sports franchises have gained incredible value over the years,” de Blasio said. “They clearly have the resources. I think the history in this city and pretty much all over the country was stadium deals were not good deals for the public, by and large. Some of the more recent ones have been better, but mostly they haven’t been that good. Everything should be reevaluated especially at a point when the city is going to need resources for our recovery.”

That phrasing puts the “blah” in de Blasio, but “everything should be reevaluated” is fightin’ words compared to the usual approach to sports tax breaks, which is for elected officials to shrug their shoulders and say whatchagonnado? And the mayor also responded to a call by 161st Street Business Improvement Director Cary Goodman that the Yankees be forced to pay property taxes just as other businesses in the neighborhood do:

“We all hope and pray that next year baseball will resume in person at some point in the year and the fans will come back and the businesses will thrive, but of course the Yankees should help them through and I assure you they have the money.”

Okay, so none of this is exactly laying down the law, and de Blasio has previously called for Madison Square Garden to pay taxes before shrugging his shoulders and saying whatchagonnado? But it’s still more than we’ve seen before, and is certain to encourage both the councilmembers and Goodman and his South Bronx business owners. The latter has a rally outside Yankee Stadium coming up this Thursday at noon, plus a Change.org petition, and with that and a long enough lever you never know what can happen.

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Friday roundup: CFL calls its owners “philanthropists” who need bailout, plus actual sport with actual fans takes place in actual stadium!

And how is everyone out there? Going stir-crazy? Waking up early to watch Korean baseball? Starving to death? All good options!

I personally have been watching this 1988 game between the Philadelphia Phillies and Montreal Expos (spoiler: Randy Johnson is, as the announcers keep noting, very tall), while continuing to keep tabs on what passes for sports stadium and subsidy news these days. Let’s get to it — the news, I mean, not the Phils-Expos game, I have that paused:

 

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Friday roundup: Nashville and Miami stadiums still on hold, cable bubble may finally be bursting, minor-league contraction war heats up

Happy Scottish Independence Day! And now for the rest of the news:

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Friday roundup: Saints’ $300m subsidy moves ahead, St. Louis MLS announcement on tap, Richmond council votes no on democracy

Sometimes I feel lucky to cover a topic with so many constant absurdities, and then this happens, and I realize that constant absurdities are just the new normal. Anyway, I did get to edit this this week, which is an excellent look at how this week’s absurdity is having potentially catastrophic impacts on people’s lives, so go read it!

But not before you read these:

  • The Louisiana State Bond Commission has approved selling $450 million worth of state bonds to fund renovations to the Superdome, in exchange for the New Orleans Saints signing a 15-year lease extension. As covered back in May, Saints owner Gayle Benson would cover one-third of the bond cost, leaving Louisiana to pay off $300 million, bringing the Saints’ five-decide subsidy total to a cool $1.442 billion. In exchange, the Saints will sign a 15-year lease extension — with another 15-year option, but there’s no way they’re going to extend their lease again without more subsidies the way this gravy train is rolling — which comes to state taxpayers ponying up $20 million a year for the presence of an NFL team, which is a hell of a lot of money, though not as much as Indiana pays the Pacers, because Indiana.
  • The St. Louis Post-Dispatch reported this week that St. Louis will be announced next Tuesday as the next MLS expansion city, bringing the number of teams in the league to a cool 154. (I think it’s actually 28, but honestly the number changes so fast it’s hard to keep track.) Deadspin read the announcement that there would be no public subsidies for the as-yet-unnamed team’s stadium and excitedly reported that the deal “might not completely fleece the city”; sadly, it will actually involve about $60 million in public subsidies, but since about half of that is coming from the state, not the city, that Deadspin headline is still technically correct, right?
  • The Richmond city council has voted 5-3 against allowing a referendum on the city’s proposed new $350 million city-subsidized arena on the November ballot, because voting is for elected officials, not regular folks. Though regular folks do still get to vote on electing elected officials, something that referendum sponsor Reva Trammell clearly had in mind when she said following the no-voting vote: “I hope the citizens hold their feet to the fire. Every damn one of them that voted against it.”
  • Two-plus years after the arrival of the Hartford Yard Goats in exchange for $63 million in public stadium cash — plus a couple million dollars every year in operating losses — the Hartford Courant has noticed that stadium jobs are usually part-time and poorly paid. Not included in the article: any analysis of how many full-time jobs could have been created by spending $63 million on just about anything else.
  • New Arizona Coyotes owner Alex Meruelo said he intends to keep the NHL team in Arizona, but that keeping it in Glendale is a “difficult situation,” at which point a Glendale spokesperson said that city officials would meet with Meruelo “to see how we can help him achieve his goals of success.” Which is all fine and due diligence and all, but given that helping Meruelo “achieve his goals” is likely to mean paying him money to play in Glendale like the city used to do, it’s not exactly promising; if nothing else, Glendale officials would do well to remember that Meruelo currently has exactly zero better arena options elsewhere in the state, so he’s not exactly negotiating from a position of strength.
  • Joe Tsai, who was already set to buy the Brooklyn Nets from Mikhail Prokhorov, has officially exercised his option to purchase the team, plus the Barclays Center arena to boot, for a reported $3.5 billion. Given that the arena is currently losing about $21 million a year, this seems like an awful lot of money even if the team does employ whatever’s left of Kevin Durant. Since Tsai already owns the New York Liberty, though, maybe it at least means that WNBA franchise will finally return to the city from its exile in the suburbs.
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Friday roundup: Titans want Miami-style renovation to 20-year-old stadium, Orlando throwing more cash at World Cup hopes, and urban myths about small stadiums

I’m back from vacation, and thanks for sticking with my slightly unpredictable posting schedule for the last couple of weeks. (As opposed to my usual slightly unpredictable posting schedule.) It was an eye-opening trip to, among other places, a city that built a stadium with public money and now suffers from a legendarily bad public transit system, though it just might be unfair to blame the one on the other.

Anyway, stadium news kept coming at us fast this week, so let’s get to it:

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Friday roundup: Spending on training facilities is a bad idea, Portland seeks MLB team, Jays game postponed after roof hit by falling ice

I can’t believe none of you wrote in to ask why I hadn’t reported on a Toronto Blue Jays game getting postponed due to falling ice puncturing a hole in the stadium roof, but I guess you’re all acclimated to waiting for the Friday roundup now for that sort of thing. But wait no longer! (Well, wait a few bullet points for that one in particular.)

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Rams to charge record PSL price, Cavs arena subsidy moves ahead, and other news of the week

It’s Friday again, so let’s go spanning the world:

  • The Los Angeles Rams are considering charging a top personal seat license price of as much as $225,000, just for the right to then buy season tickets for $350-400 per game. This seems like a bit of a reach when the payoff is just that you get to watch Rams games, but I guess Stan Kroenke needs to try to recoup his $2 billion in stadium costs somehow — and at least if it all goes south, he’ll be the one on the hook, not taxpayers.
  • Some Canadian bank bought the naming rights to the Toronto Maple Leafs arena away from some Canadian airline. Is this going to buy it valuable market exposure and name recognition that will justify the $40 million a year expense? Not on this blog!
  • The LED lights at the Atlanta Falcons‘ new stadium make football look all weird.
  • Shreveport Mayor Ollie Tyler says spending $30 million on an arena for a minor-league basketball team is a great idea that only “naysayers” don’t appreciate. “I think sometimes we don’t believe in ourselves and some of our urban areas we don’t believe that we are able to make things happen,” she says. If Mayor Tyler needs a reelection campaign theme song, I have a suggestion.
  • “The Federal Aviation Administration has determined that the Oakland Raiders‘ proposed stadium in Las Vegas would not be a hazard to aircraft.” Huzzah!
  • Would-be St. Louis MLS owner Paul Edgerley says he’s still ready to pay $150 million for a franchise, and $100 million toward a stadium, as soon as someone comes up with the other $60 million in construction costs. Noted.
  • Cleveland Cavaliers owner Dan Gilbert has officially reinstated his plan to do $140 million of renovation work to the team’s arena, with Cuyahoga County paying for half the cost. ”This is corporate welfare at its worst,” said Steve Holecko of the Cuyahoga County Progressive Caucus, after his erstwhile coalition partners the Greater Cleveland Congregations withdrew petitions against the arena subsidy after getting a promise of two mental health crisis centers from the county. Holecko’s group doesn’t plan to mount another ballot challenge on their own, though, so construction work is set to begin later this month.
  • Mikhail Prokhorov is ready to sell the Brooklyn Nets, but will hold onto the Barclays Center, after renegotiating the team’s lease so that it will pay less rent to the arena. This … does not seem like the smartest way of going about things, but maybe Prokhorov is figuring he’ll give up future rent revenue in exchange for a higher sale price now on the team? Or maybe he’s just not very smart.
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“Brooklyn Wars” excerpt: How the Nets arena changed Brooklyn

Hey, everybody, my new book The Brooklyn Wars is out today! (Yes, I know I said tomorrow, but I figured I’d give you all a chance to order it before tonight’s presidential debate numbs your mental capacities beyond the ability to read.) It’s a look at the ongoing transformation of Brooklyn, something that is not only inseparable from many of the issues we discuss here — public subsidies, skewed economic and political power, dunderheaded elected officials — but that involves two specific sports venue projects: There’s a long chapter on the Brooklyn Nets arena that spawned a boroughwide debate about development and eminent domain; and in the Coney Island chapter, the Brooklyn Cyclones stadium turns out to have been surprisingly (to me as well) pivotal to the reinvention of that famed beachfront neighborhood.

You’ll be seeing book excerpts popping up this week on a couple of major news websites, but I’ve saved a good bit just for Field of Schemes readers: a section on the aftermath of the construction of the Nets’ Barclays Center and the surrounding Atlantic Yards/Pacific Park development, and what it did for — and to — the existing neighborhood. Enjoy, and if you’d like to read more, please buy the book!


On September 28, 2012, the Barclays Center arena opened its doors for the first time, for a concert by co-owner Jay-Z. Outside, concertgoers mingled with a few dozen protestors and various onlookers, including a Columbia University class on urban design. Inside, ticket buyers ogled the black-and-grey color scheme and three layers of luxury suites — two forming a vertical wall between the lower and upper decks, the other ensconced at floor level and dubbed “the Vault,” with a half-million-a-year price tag — while high-definition video boards flashed a pre-show message of gratitude: “Thank You Bruce Ratner.”

The building itself by then looked nothing like architect Frank Gehry’s original designs. The odd angles were gone, replaced by a perforated rust-colored steel façade designed by fill-in architects SHoP. (To prevent the rust from dripping on passersby on rainy days, the steel was “pre-weathered” in Indiana before installation; it ended up staining the sidewalks below with orange splotches regardless.) Its size had been trimmed as well, as part of a “value engineering” to cut costs during Ratner’s bond crisis, leading to a shape that fit fine for basketball, but not hockey, a condition that would lead to many obstructed views when Islanders owner Charles Wang chose to move his team in from Long Island anyway in 2015. A promised jogging path and public ice skating rink on its roof, floated as public benefits of the project, had faded away as well, replaced by a plain roof with the logo of naming-rights sponsor Barclays Bank on it, the better to be viewed from airplanes on the approach into La Guardia.

On event nights, the blocks around the arena were utterly transformed, as the surrounding streets swelled with traffic and the subways disgorged thousands of arriving fans wearing Nets shirts, Islanders jerseys, or rainbow-colored Barnum & Bailey circus hats, then reabsorbed them three hours later. (The arena developers had purposely built little parking to discourage car use; as Forest City Ratner senior vice president Jane Marshall explained at one community meeting during the planning process, “There’s a healthy fear that’s already there in potential attendees, and we’d like to encourage that.”)

For a sports arena, though, that’s a minority of the time. In its initial year, the Barclays Center was open for business about 200 nights, which is at the high end for most arenas. The other 165 days a year, plus most mornings and afternoons, it sat like a great beached robot whale at the intersection of Atlantic and Flatbush. An oblong video board tucked beneath its “oculus” — a kind of metal awning with a large hole in the middle, which was just as useful for protecting waiting fans from weather as it sounds — flashed promotions for upcoming events and for various building sponsors: the Daily News App, GEICO, Starbucks, Calvin Klein, Zappos, Bud Light. (Giant animated beer bottles hovering over Flatbush Avenue would normally require special city permission, but the state’s control of the site meant it could trump city billboard laws.)

The surrounding blocks, meanwhile, were an odd mix of the brand new and the remarkably unchanged. Across Flatbush from the new arena, a row of small shops had been converted into outlets of the Shake Shack upscale fast-food chain and the True Religion boutique clothing chain; other storefronts remained vacant, awaiting more revitalized uses. Across Pacific Street to the north, a PC Richard electronics store — itself put in place in the 1990s after a controversial deal to partially relocate a community garden that had been planted there during the previous decade, when the site was an underused parking lot — was fighting the state’s attempts to displace it via eminent domain for an office tower of unknown height. To the south, the former Triangle sporting goods store — named for the shape of its building, isolated on a tiny block bounded by Flatbush, 5th Avenue, and Dean Street — had been sold after ninety-six years in business for $4.1 million to a pair of real estate investors, but remained empty three years later, a wraparound cellphone ad covering its vacant windows.

South again across Dean, the owners of a Patsy’s pizzeria — a newly opened branch of the original East Harlem fixture that claims to be the first pizza place in the city to sell single slices — explained that the arena had been a great boon to their business, but they’d come to grab a slice of the greater Park Slope market as well. “Building a restaurant anywhere, if you have a quality product, you could be a back alley and people will come to you,” said Joe Juliano. “But it could take two-three years — and I don’t have two-three years to pay rent. So over here we have a captive audience across the street, and three nights a week we have the games. That really helps while you’re trying to pay the bills.” Not that capturing an arena audience that only arrives in three-hour bursts is easy, he explained: “You have 100 seats, they all want to be fed in one hour. Our pizza only takes a minute and a half to cook — that helps.” His partner, the Bensonhurst-born Anton Reja, put down his cigar to chime in: “Between this one, the corner, what’s happening over there, you got six thousand families coming into the neighborhood. But this is not working for everybody. People who are coming to see the game but going to eat, they don’t want to go four blocks away. They want to go fast.”

In fact, said Reja, while the arena was a nice bonus, his bottom line was reliant less on spillover from the arena than from the growing aura of Brooklyn as a whole. “I get a lot of locals, and then I get a lot of people who come in from Long Island, and from lots of different countries,” he said. “One night, in my restaurant, I had five tables, five different countries: New Zealand, Australia, France, Mexico. It was unbelievable. They came because of Patsy’s, maybe go to the games. And they’re just coming to see Brooklyn. Just coming to see Brooklyn!”

One block to the east, on a once-residential block of Dean Street now dominated by a police station, a fire station, and the arena’s hulking backside, the owners of Dubai Mini-Mart were finding themselves to be somewhat less of a destination. “The stadium went up, families moved out,” said Abdul Ibrahim, one of a group of cousins who opened the small grocery store in around 2005. Ibrahim, who grew up in part with his mother in Cleveland, in part with his father in East New York, said his family chose the site after the city renovated a small park nearby, building baseball and soccer fields that drew families to the block.

His main clientele, he related, still came from these families, plus police and firefighters at stations on the block, as well as workers at the arena and those erecting the pair of apartment towers that were being squeezed in on two of the arena’s sides. But even they couldn’t provide the same customer base as the now-vanished full-time residents. “Now groceries stand on the shelf. People just buy drinks sometimes,” said Ibrahim. “It’s not like when the neighborhood was a neighborhood.”

Smack up against the arena’s southern side, a bright-red 32-story tower was close to being finished, after years in the works; it had been held up when the contractors chosen to run Ratner’s new “modular” construction plant quit in a huff, saying there was no way to operate it without losing money hand over fist. (The modular technique, in which components of the building would be assembled off-site and then stacked like Legos, raised concerns about whether the project’s promised 17,000 construction jobs would ever materialize.) A couple of blocks to the east, a pair of housing towers — rebranded “Pacific Park, Brooklyn’s newest neighborhood” to avoid the taint of the Atlantic Yards name — were playing rapid catch-up, having broken ground with the aid of Chinese investors, attracted in part after Ratner sought financing via the federal government’s “EB-5” program, which doles out a fast track to green cards for foreign investors who provide low-interest loans to American development projects.

Once those buildings opened, Ibrahim would no doubt see an influx of new customers, but his landlord had warned him not to expect to be around to see much of it. “He told us he’s not going to renew our lease,” said Ibrahim. “We got to do the next four years, and then he’s going to push us out.”

Around the corner, the Slope Food Market had already shut down, shuttering after seventeen years on the spot. Its owner, who gave his name only as Khalid, had packed up and started over with a small luncheonette in the Department of Motor Vehicles building in Coney Island. “I took the store for three years, and the rent started going up high — five hundred dollars escalation every year,” he said there, while ringing up customers. An employee accidentally sold cigarettes to a minor, causing him to lose his Lotto and cigarette licenses for six months; after more losses and more rent increases, he chose to shut down. As for the arena, he said, its impact was almost unnoticeable: “Barclays Center, I tell you the truth, it has an advantage and a disadvantage. It improved the area, and made it look high-class. But as far as business impact, I would say it did not really make a big difference, because the only people we used to get from the Barclays Center were the employees coming into the deli to buy hot sandwiches.” The expansion of the Atlantic Avenue train station to bring more people to the arena, meanwhile, had meant fewer riders disembarking at the next stop, Bergen Street, which happened to be in front of his store. “We lost all the people coming into it. We didn’t see any people coming from the train.”

Two blocks away, the easternmost outpost of Pacific Park, a seventeen-story condo tower sheathed in grey fake brick, was going up on a double-sized superblock at the corner of Vanderbilt and Atlantic Avenues. Vanderbilt, long the main shopping drag of Prospect Heights, was now jammed tightly with new stores and restaurants, including Ample Hills, a homemade ice cream parlor that had soon expanded throughout the borough, and Empire Mayonnaise, an artisanal mayonnaise store that attracted media attention for its $8 jars of white truffle mayonnaise, though it had few visible walk-in clients. After Saturday Night Live lampooned them in a sketch about gentrifying Brooklyn, co-owner Elizabeth Valleau told Good magazine: “We got a whole bunch of new customers because of that skit, so we’re very happy about it.”

Valleau, who said the opening of the arena “had little to no effect on our business” — the location, she explained, had been selected mostly because it was near to her and her business partner’s homes — was somewhat less happy about being painted as a harbinger of neighborhood doom. “People are trying to politicize us, but ultimately we’re just a couple folks from the neighborhood who have a condiment business and we’re making it in the neighborhood instead of in a big warehouse out in New Jersey,” she told Good. Gentrification, she continued, had changed in Brooklyn in recent years, from being “more about new families and small businesses that actually cared about growing a future with the neighborhoods they moved into. [But now] we have these machine-style corporations eating up real estate and literally pushing people out of their homes and businesses the second a new community garden or cupcake shop appears.” Some change was inevitable, she indicated, but the city could be doing more to mitigate the impact. “What it is, is depressing.”

In a subsequent email interview, Valleau reiterated that her store should be seen as “a part of the community that could be pushed out by further gentrification, as opposed to a driver of it” — even at $8 a jar, apparently, mayonnaise sales could only pay so much in rents. (In fact, the storefront eventually closed in summer 2016, though its owners planned to relocate their wholesale mayonnaise business elsewhere.) “I understand how our business could seem frivolous from the outside, but that’s only if the viewer doesn’t realize that we manufacture every jar that we sell worldwide in a 300-square-foot space. There is nothing fancy happening here whatsoever.”

It was the typical New Brooklyn quandary: The minute you arrived in a new neighborhood, it was time to start looking over your shoulder for who was coming after you. Back at the mini-mart, Ibrahim noted that the process had taken a toll on his upstairs neighbors as well: In the past decade, his building’s landlord had already raised apartment rents from $900 a month to $3500 a month. “I’m not mad at him, because development is always good,” he insisted. “But I just feel bad because of the families that we lose. The people that live in the neighborhood, kids, that’s what I’m used to growing up. Not all these big skyrises that could have stayed in the city. But I guess you can never stop change.”

His business partner Ahmed Khtri was more cynical. “To run a business and establish a business, have it in a poor neighborhood,” he advised. “More secure, reliable people. You have it in a rich neighborhood, it comes out greed, and people who love money more than humanity.”

“If they want people to move out of the city, they should make a place for them,” said Ibrahim. “New New York, for the middle class and the broke.”

Print and electronic copies of The Brooklyn Wars (Second System Press, 2016) are available for purchase from brooklynwars.com.

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Islanders owners discussing new arena in Queens or LI, all hell about to break loose

So when new New York Islanders owner Jon Ledecky answered questions last week about the team’s future — previously planned to include staying in Brooklyn but playing six games a year in a renovated Nassau Coliseum — by saying “Barclays Center is our home,” I called it “noncommittal,” on the grounds that 1) Ledecky was still pretty gripey about the flaws of the Brooklyn arena and 2) “Barclays Center is our home” could mean either “we would never leave a place with so many important memories made over the last nine months” or “it’s where we live, we have to deal with it until we figure out something better. It sounded like typical owner weasel words, a way to keep your options open without actually saying you wanted to keep your options open.

But even I didn’t expect this, just a week later:

The New York Islanders are in talks with the owners of baseball’s New York Mets about building a hockey arena adjacent to Citi Field in Queens, people with knowledge of the discussions said.

Willets Point is emerging as a persuasive alternative to the team’s current home at Brooklyn’s Barclays Center if the Islanders’s owners and arena officials can’t agree on a series of hockey-specific improvements, said the people, who asked for anonymity because the negotiations are private.

That was from Bloomberg News, but the anonymous sources were soon talking as well to Newsday (which cited “two people familiar with the situation”) and the New York Post (just “sources” — the Post doesn’t get too hung up on attribution). The Post’s article also included this tidbit:

But if that doesn’t work out, Islanders owners Jonathan Ledecky and Scott Malkin could move the team to Elmont, LI, sources said…

A state source confirmed the Islanders have made preliminary inquiries about moving the club to vacant state-owned land near Belmont Park. That is near another parcel being eyed by the Cosmos for a soccer stadium.

With all this, a clearer picture is starting to come into focus. When Ledecky and partner Scott Malkin bought the team from Charles Wang earlier this year, they inherited Wang’s lease on the Barclays Center, which he had agreed to despite the building’s problems for hockey — it was deliberately “value engineered” to be too small for the sport, in order to save on construction costs — because he was sick and tired of fighting with Nassau County officials over a new arena there. They also, however, inherited the opt-out clause that Wang had negotiated to allow the Islanders to break their lease in 2019 — and that’s the kind of leverage that you’d have to be crazy as an owner not to try to use.

So is an arena next to the Mets stadium feasible, and what would it take to build one? The parking lot to the west of Citi Field is already designated for the giant “Willets West” mall, but that’s currently held up in court because the lots are technically still city parkland. Could the Mets try to build an arena instead if the mall is nixed? Would the courts allow that more readily? Who knows?

Then there’s Willets Point proper, to the east of the Mets stadium, a melange of auto repair businesses that the city has been working to seize and evict for years to make way for a mixed housing and commercial development. Could the city agree to incorporate an arena as well? And on either site, would it provide the land for free, and leave it exempt from property taxes, which might be enough to entice the Mets and Isles owners to actually build this thing? And if they did, could it possibly be successful in a metropolitan area already glutted with arenas (Madison Square Garden, Barclays Center, the New Jersey Devils‘ Prudential Center in Newark, plus soon the redone Nassau Coliseum) and only so many concerts to go around?

Of course, Ledecky and Malkin may never have to determine if a Queens (or Elmont) arena project is feasible, if they can use the mere possibility as a hammer to get Brooklyn Nets owner Mikhail Prokhorov to redo Barclays for hockey. The Isles owners haven’t come out and said what “improvements” they want, but to make a genuinely NHL-scaled space you’d need to knock down the entire west end of the structure and build it out another 50 feet or so, which wouldn’t be cheap, and would also entail shutting the arena for an offseason or two and losing out on revenue from those dates. So to get it done would require quite a formidable threat, and “we’re going to take our puck and go to Queens” might be the kind of thing that gets the attention of their current landlords.

Either way, though, it looks like we have a war on, one that’s likely to drag out for months or years as the various combatants (Ledecky and Malkin, Prokhorov, the Wilpons, the city, maybe Elmont) jockey for position and remake alliances. That should at least help tide everyone over until the final season of Game of Thrones.

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Brooklyn Nets arena lost money in 2015, is probably no good for anything for anybody

Russian billionaire Mikhail Prokhorov, who already owned 80% of the Brooklyn Nets and 45% of the Barclays Center where they play, bought the remaining shares of those two items from developer Bruce Ratner over the holidays. (If I’m doing the math right, Prokhorov paid $285 million in cash, plus $344 million in promised future payments.) But the interesting part of the transaction, as uncovered by Atlantic Yards Report’s Norman Oder, is that the financial documents released then show that the Barclays Center is continuing to lose money:

The Barclays Center had a terrible year financially in the fiscal year ending June 2015. Net revenues plummeted, to less than half the total once projected, and the arena lost some $9 million in what was (roughly) its third year in operation…

The arena’s net operating income (NOI) fell well behind expectations, to $38 million, due to declines in event and related revenues, while operating expenses remained high.

We’ve heard this before, particularly two years ago when it was revealed that despite being one of the top-selling arenas in the U.S. in its first year, the Barclays Center was still barely breaking even after paying off its construction debt, thanks to high operating costs and discounts being offered to performers to lure them to Brooklyn instead of one of the New York area’s many other arenas. That seems to be even more the case now, and while the arrival of the Islanders provides more dates for 2015-16, that’s not necessarily a good thing: It also displaces nights that the arena could be rented out for concerts, and the arena’s weird rent deal with the Islanders (the arena pays team owner Charles Wang a flat negative rent, but keeps all ticket and other revenues) means that if ticket sales are slow, the arena could end up taking a loss on the NHL.

All of this means it’s a good time to wonder what the hell exactly Ratner and Prokhorov got out of this arena that has turned a large swath of Brooklyn upside down for more than a decade now. The purchase price on the last chunk of the arena valued it at slightly less than the construction cost, so Ratner’s not quite breaking even on the money he poured into the arena itself. (Yes, he got a pile of public subsidies, but those were in the form of discounted land and tax breaks, so not anything he can actually put in the bank now that he doesn’t own the building.) He also got the development rights to a bunch of land where he can erect apartment towers, but that isn’t going all too well either, though at least a couple of buildings are now close to completion.

Prokhorov, meanwhile, has put in somewhere around $1 billion in order to own a historically awful NBA franchise plus an arena that might just, if you squint, be able to break even. Of course, he might see this as a perfectly reasonable price to pay to be able to hang out with NBA players and do whatever the hell this is. He has more billions where that came from, anyway.

As for Brooklyn residents, we now have a terrible basketball team to watch, and a pretty decent hockey team, and a garish arena and some growing housing towers on a site that otherwise would probably have something similar anyway, given that pretty much every possible site in Brooklyn now has a giant apartment tower going up on it. And any revitalization effect on the surrounding neighborhood has been mixed at best: There’s a  Shake Shack and other new restaurants, certainly, but then, there were new restaurants opening in droves in that area even before the arena was planned; meanwhile, the site of the old Triangle Sports sporting goods store, which was cited as the harbinger of a land rush when its owners closed it and put the building up for sale, is still vacant almost four years later.

It’s probably too simplistic to say of the Brooklyn arena that everybody ended up a loser, but certainly there are no clear winners. I’m going to be spending some more time shortly digging into some of these questions so I can wrap up the final chapter of The Brooklyn Wars (which means, yes, there’s actually a publishing date visible at the end of the tunnel), at which point I can probably provide some firmer answers. But for now, man, was that an epic train wreck, or what?

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