Rams attendance continues not to knock anyone’s socks off, despite huge L.A. market

How soon is too soon to point and laugh at the Los Angeles Rams for low attendance in their return to the nation’s second-largest city? Not now, anyway:

On Sunday, the Rams faced the Atlanta Falcons at the Los Angeles Memorial Coliseum and, based on the game’s attendance, the honeymoon is already over for the NFL in Hollywood. Either that or a lot of Rams fans came dressed as empty seats.

Which, you know, yes, it’s embarrassing. But it’s also the tail end of a lousy season for the Rams, in a sport where fans would just as well rather stay home and watch games on TV. And some of those fans might have just been stuck on line for hot dogs or something.

On the other hand, both Rams attendance and TV ratings have been pretty mediocre all season. Maybe things change once their new stadium opens in 2019, but history shows that new stadium attendance figures typically return to background levels pretty quickly once the new-car smell has worn off, so it has to be at least mildly worrisome for Rams owner Stan Kroenke. Not to mention for San Diego Chargers owner Dean Spanos, who right now has to decide on whether to become the second-fiddle team in the L.A. market. Some lousy attendance figures for a lousy team probably won’t change his mind by itself, but it should at least give him pause — or maybe get him to try to negotiate an out clause in an L.A. lease to let him jump back to San Diego if things go south once he moves north. That’d be what a savvy negotiator would do.

Court rules St. Louis Rams PSL contracts still valid, could cost Kroenke $150m+ in payouts (UPDATE: probably not that much)

Well, ain’t that a kick in the head:

A federal judge in St. Louis ruled Wednesday that the Rams must refund deposits to some fans who purchased personal seat licenses during the franchise’s two decades in that city and offer others the opportunity to buy season tickets to games in Los Angeles.

I was dimly aware that St. Louis Rams PSL holders were suing over the season-ticket rights they’d purchased in perpetuity suddenly being worth nothing since there were no St. Louis Rams season tickets to buy anymore (see my brief note here), but I never thought they’d actually win. Nor, presumably, did Rams owner Stan Kroenke, because he is now seriously hosed, to a degree that we’ll attempt to figure out in a second.

First, a primer on PSLs: Initially created as a bonus for fans who bought inaugural Charlotte Hornets season tickets (not only do you get the tickets, but if you don’t want them anymore you can sell your spot on line to someone who does!), they quickly turned into a lucrative way for team owners to raise cash: Instead of first-come-first-serve tickets, offer fans the chance to buy the right to first dibs, with the carrot that they can then re-sell that right down the road to recoup at least some of what they laid out. In some cases with popular teams in cities with lots of fans with money to burn, it’s been lucrative indeed: The San Francisco 49ers managed to bring in more than $500 million from their PSL sales, which is a sizable chunk of change. And Kroenke has been hoping for similar revenue from PSL sales to help pay for his new $2.5-billion-ish stadium in L.A., though he can’t start selling them until next February as part of his relocation deal with the NFL.

So how much will this court decision, assuming it holds up on appeal, cost Kroenke? Of the 46,000 Rams PSL holders, there were two classes being represented — those whose PSLs were initially bought through a broker and those whose PSLs were bought directly from the team — and thanks to differences in the two contracts (whee lawyers!), each group now gets a slightly windfall: Broker purchasers get a refund of their PSL “deposit” (the judge declined to define what that means for now), while direct buyers get to actually transfer their PSL rights to the Rams’ new stadium. And while that may not sound so great — do any St. Louis Rams fans really want to fly to L.A. to see their former team play? — remember, the whole point of PSL rights is that they’re transferrable, so this is now a hugely valuable asset that they can sell, and more important, that Kroenke now can’t.

How much actual money would that cost Kroenke? Now we’re deep into speculation, since we don’t know how many direct vs. broker buyers there were, nor how much Kroenke was planning on selling L.A. PSLs for. Deadspin reported that the ruling will “likely cost the team millions of dollars in returned deposits and foregone profit,” but that’s almost certainly way too low: If there are 23,000 direct buyers and 23,000 broker buyers, say, then refunding 23,000 fans for their St. Louis purchases at $250 each would cost $5 million, while handing over free L.A. PSLs to another 23,000 fans could cost — let’s see, it’s a 70,000-seat stadium, so if Kroenke was shooting for $500 million in PSL sales, then scrapping 23,000 of those would lose him … $160 million, something like that, depending on which seats the judge says he has to set aside for St. Louis PSL holders?

It’s hardly a deal-breaker when you’re spending over $2 billion on a new facility, sure, but still, unexpected nine-digit losses are never fun. However all this turns out, it’s likely to be at least a moderate-sized headache for Kroenke and his accountants, as well as a cautionary tale for both teams writing up PSL contracts and fans buying them: Read the damn fine print, because it could end up being worth a hell of a lot of money.

UPDATES: As a couple of commenters have pointed out, the cost to Kroenke probably won’t be as much as I’d guesstimated: First off, more than 90% of the PSLs were sold by the broker, not the Rams, so that pushes most of the PSL holders into the less-lucrative “you get your deposit back” category. Second, the St. Louis PSLs were set to expire after the 2024 season (the Rams lawyers did something smart, anyway), so even for the L.A. PSLs Kroenke has to now pull off the market, he’ll get to resell them again in a few years. So we’re down in the $15-25 million cost range for Kroenke, which while it’s going to sting, is more of a rounding error for a guy playing in this spending stratosphere.

Rams celebrate return to L.A. by making fans sit in sun, running out of water by halftime

The Los Angeles Rams will play at the Los Angeles Coliseum for the next three seasons while their new stadium in Inglewood is being built, and they got off to a terrible start in Sunday’s home opener. This had very little to do with the Coliseum being 84 years old, and everything to do with it being so hot that 160 fans were treated for the heat including 14 who had to go to the hospital (it doesn’t help that the Coliseum lacks even a partial roof), and to the Rams management not doing proper crowd control and not thinking to order any jumbo cases of bottled water. From Deadspin, which has been diligently compiling all the horror stories:

Here are your best stories from the game. From Ian, a success story:

I went to the game with a couple buddies yesterday and the concession stand debacle was as big of an abortion as advertised. Left with 4:20 left in the 2nd quarter to grab waters for our group and ended up having to wait in 3 different lines since the first two I was in ran out. Continued to wait through the entirety of halftime and returned to my seat with about 7 minutes left in the 3rd… BUT I GOT THAT DAMN WATER!

Matt tells us that concessions were woefully understocked in St. Louis too:

My wife volunteered regularly for charity concession booths at all of the pro sporting events in St. Louis, including the Rams games. She always said that the Rams ran out of everything before half time. The Cardinals and Blues never had all of the problems she saw at the Rams games.

The whole organization is obviously run by amateurs. The product on the field, marketing blunders, concessions, drafting players. They fail in literally every way they can. Not any different than the other teams that asshole owns.

Another tipster describes the traffic, both human and motor:

Traffic, gridlock. Entry, chaotic and overcrowded. Concessions, sorry we’re out by halftime!? Protection from elements, nada! Rams fans, smack talking and booing their own team with chants to kill the Seahawks kicker! People smoking. Security, what security? Leaving the stadium, dangerously crowded in all walkways. Gridlock at the trains/busses. Complete hell! The NFL should not allow that stadium to host ANY games until they can provide safety and security for the fans!

At least fans only had to pay between $50 and $1,000 for parking. Welcome back to the NFL, Los Angeles!

 

NFL gives three Super Bowls to cities with new stadiums, implies, “Keep ’em coming”

The NFL awarded the 2019, 2020, and 2021 Super Bowls to Atlanta, Miami, and Los Angeles yesterday, continuing its policy of using the big game as a reward to cities and teams with new or significantly renovated stadiums. Or as Rams owner Stan Kroenke said following the decision, “I think they are telling the communities and the owners who stick their necks out that it’s worthwhile.”

The most important target of the announcement, then, isn’t the three cities that will now get the questionable benefit of hosting the NFL’s annual week-long road show, but those that are being wooed with that dubious carrot. Right now most of the reporting is on how New Orleans and Tampa Bay were snubbed because their stadiums aren’t as shiny as the cities that got the nod, but it’ll be interesting to see how this plays into future coverage of stadium campaigns — already, San Diego Union Tribune chief Chargers stadium cheerleader Kevin Acee has written that the possibility of getting a Super Bowl shouldn’t be the reason to vote for a new stadium, but really he means that you should vote for a new stadium regardless, so all remains right with the world.

Interestingly, there’s no reporting yet that I can see out of Las Vegas on the Super Bowl decision, but that may be because they’re too busy covering yesterday’s conflicting comments on a potential Oakland Raiders move from owner Mark Davis (“This is the real deal. If Las Vegas can come through, we’re going to be there”) and NFL commissioner Roger Goodell (“It’s very premature at this point. Until we have more information, it’s pure speculation”). This could be just everyone playing their role — in terms of using Vegas as leverage in hopes of drumming up stadium subsidies from Oakland, Davis is bad cop, Goodell is good cop — or it could be a sign of deeper rifts among league owners over whether Davis should get to bolt from a bigger market to a smaller one in exchange for a lucrative (to him) stadium deal, and on what terms. We won’t know for sure until the next ESPN postmortem, I expect.

Kroenke trying to force L.A. Rams players to file workers comp claims in Missouri to save him a few bucks

And finally this morning, you can take the Los Angeles Rams out of Missouri, but you apparently can’t take the Missouri out of the Rams’ workers compensation contract language:

Per a league source, contracts being offered to new players state that the laws of Missouri, not California, control the relationship. The NFL Players Association has in turn instructed all certified contract agents to reject that term as “inappropriate.”

Why does the Rams ownership care what state workers comp claims are filed in? Because, as Deadspin reports, California workers are entitled to about 25% more in workers comp claims, so with NFL players having a distressing tendency for getting hurt on the job, the Rams could save some money here — probably on the order of thousands of dollars rather than millions, sure, but when you’re trying to finance a nearly $3 billion stadium out of your own pocket, you can’t pass up any opportunity to screw over both your employees and the state you left behind.

ESPN exposé reveals Rams move to L.A. all about “balls”

ESPN: the Magazine ran a super-long insider-baseball (okay, -football) piece yesterday about the NFL’s decision-making process for moving teams to Los Angeles, which I’ve finally finished digesting. (The piece, not Los Angeles. Stupid non-restrictive relative clauses.) Much of it covers ground we already pretty much knew — the whole battle ended up being far more over who had the most friends in the room than over which relocation deal made the most sense financially or anything — but there are several interesting items of note:

  • First off, I guess ESPN: the Magazine doesn’t have any rules about proper sourcing, because the first several paragraphs of the piece are a fly-on-the-wall description of a December NFL owners’ meeting, complete with verbatim quotes, with zero indication of who the fly was. Did reporters Seth Wickersham and Don Van Natta Jr. actually get access to the meeting in exchange for not reporting on it until the L.A. decision was complete? Was all this second-hand reportage based on what they were told by an owner or owners in the room? You won’t tell from reading this article, which is a problem. I guess we should just be glad it’s not cited to “a story going the rounds.”
  • St. Louis Rams owner Stan Kroenke got his appetite for a bigger stage whetted by his 2011 purchase of Arsenal, after which he reportedly “pined for the larger international presence that other owners envisioned for the NFL’s global future.” (No source on that, either.) But the real push for L.A. started in 2013, when the Hollywood Park racetrack site went up for sale by Wal-Mart, the source of his wife Ann Walton Kroenke’s family fortune.
  • Kroenke paid $90 million for the 60-acre racetrack land, though he later paid more for another 238 acres of adjacent property.
  • The biggest bombshell, hidden deep in the middle of a paragraph halfway down the article: One of the losing bidders in the blind auction for the initial 60 acres was NFL VP Eric Grubman, the league’s point person on stadium development. As the article notes, “Nobody knew whether Grubman had bid on his own or on behalf of the league or some other buyer,” but it seems clear that the league had its own thoughts about the Inglewood land before Kroenke grabbed it.
  • Dallas Cowboys owner Jerry Jones told his fellow owners that whoever moved to Los Angeles needed to have “big balls.” If there is one image you should take with you about NFL decision-making procedures and their relationship to rational economic self-interest, this is probably a good choice.
  • San Diego Chargers owner Dean Spanos was really not happy with the booby prize of the option to share digs in Inglewood with Kroenke, if he could work out a lease deal: “When [NFL commissioner Roger Goodell] announced that the Rams had won the right to relocate, Spanos closed his eyes and breathed deeply and loudly, as if preparing to speak at a funeral. When Goodell said that the Chargers had the option to join the Rams, Spanos closed his eyes and sighed again.”

It’s a good (if long) read, but with one obvious omission: Nowhere in the article does it mention how Kroenke decided that the cost of moving to Inglewood ($2.7 billion in construction costs, according to this piece, plus $550 million in relocation fees) was worth it, or how the league settled on $550 million as the price for teams to go to L.A. There’s hardly any mention of money at all, in fact — which, if you take this as a peek inside the brains of NFL owners, lends credence to the theory that while obviously an L.A. move was ultimately about profit, by the time it came down to haggling it was about something else entirely: Kroenke having planted his flag on his wife’s old family property, and refusing to back down until he could declare himself the winner, at any cost.

Or, as Jerry Jones would put it, “balls.” Sometimes an impressive edifice is just an impressive edifice.

Here’s my latest conspiracy theory on why Stan Kroenke is moving the Rams to L.A.

L.A. Times architecture critic Christopher Hawthorne loves the design for the new Los Angeles Rams stadium in Inglewood — though somewhat hilariously, one of his favorite parts is that the translucent roof will make it usable for other events if and when pro football ceases to exist amid its brain-injury scandal — but is concerned whether the surrounding development will be as well-designed, and more important, whether anyone will be able to get there without fighting through traffic jams:

Though the Metropolitan Transportation Authority is reportedly weighing the option of extending a new rail link south to meet the complex, the pity — the absurd reality — of the relationship between the forthcoming stadium and the under-construction Crenshaw Line is that we are once again facing the prospect of a major landmark and a rail route coming tantalizingly close to each other without actually linking up. Call it the close-but-no-cigar school of regional planning. See the Gold Line and Dodger Stadium and the Green Line and LAX for earlier examples.

This brings up a potential answer to the puzzle of why on earth Rams owner Stan Kroenke is plunking down close to $3 billion to build a new stadium and get NFL permission to move his team there, when he could just build all the other stuff on his Inglewood site and presumably turn a much bigger profit. What if — stay with me now — he’s hoping to create a groundswell among folks like Hawthorne and urban planners to connect the stadium complex to the transit grid, thus increasing the value of the property exponentially? We already know he’ll be getting publicly funded shuttle buses from stadium parking lots, but maybe he’s dreaming bigger — a light-rail spur, a dedicated shuttle bus route to the train, something with pneumatic tubes. Maybe?

Okay, maybe not. But much as with Bruce Ratner’s Brooklyn Nets arena crusade, Kroenke’s Inglewood move only makes sense if he’s trying to leverage the presence of a pro sports team into something else. Neither I nor a lot of other people have figured out what yet, so a free light rail hookup is my best wild-ass guess, for today, at least. SoCal readers, please tell me if this is crazy, or just crazy enough to work.