If Madison Square Garden sells the Liberty, where are they going to play?

The owners of the New York Liberty, one of the WNBA’s three remaining original franchises still in the same city they started off in, are putting the team up for sale. That’s of interest if you’re a WNBA fan — I’m actually a former Liberty season ticket holder, so I qualify as one of the few and the proud even if I haven’t been to see a game in the last couple of years — but also for readers of this site in general, because of what it says about the arena industry.

In brief: The Liberty are owned by James Dolan’s Madison Square Garden Co., which also owns the Knicks, the Rangers, and its namesake arena. The team, and the WNBA in general, was launched in 1997 for a bunch of overlapping reasons: to take advantage of excitement over the 1996 U.S. women’s Olympic basketball team, to fill dates in the otherwise-slow summer months (which is why the league plays outside of the traditional wintertime schedule for basketball), to make the NBA look women-friendly and provide a more affordable product to rope in fans priced out or alienated by the men’s game, and to beat down an attempt by the independent American Basketball League to horn in on the NBA’s pro hoops monopoly. The ABL was gone within a year and a half, and the Olympians were soon forgotten, but the WNBA has burbled on for another two decades, with modest attendance and revenues but remarkable longevity for a startup league, in no small thanks to the NBA’s financial backing.

That’s starting to change, though: While originally all the WNBA teams were fully owned offshoots of NBA siblings — down to teams getting sister names, like the Sacramento Monarchs to complement the Kings and the execrably named Detroit Shock to go alongside the equally-terribly-named-if-you-think-about-it Pistons — that’s starting to change, with more and more teams independently owned and operated. And the Liberty would be the biggest independent team of all once cut loose from MSG, which clearly has decided that it would rather get out of the women’s basketball game and stick to its core business of crappy men’s teams and lots and lots of concerts.

The big question for a future Liberty owner, meanwhile, is: Where are they going to play? Renting out MSG is a possibility, of course, but unless there’s some sweetheart lease deal baked into the sale agreement, it would likely be prohibitively expensive, since you’d be bidding against all those concerts. The Barclays Center in Brooklyn is another option that might come slightly cheaper, but again it’s pretty busy with concerts, even in the summer. (One problem with a basketball schedule is that it seriously restricts your flexibility for hosting concerts, which are typically booked long after a team’s home games are set in stone.) When MSG was getting renovated in the summers a few seasons back the Liberty played in Newark’s Prudential Center, but attendance was pretty bad (I picked up Stubhub seats ten rows from the court for one game for $3 apiece); Nassau Coliseum desperately needs something to fill dates, but it’s way out on Long Island.

I suppose a new Liberty owner could try to demand a new arena of their own, but that’s not going to go far when your fan base is the size of a WNBA team’s. Maybe this could all be part of the plan to build a new arena for the Islanders out by Belmont Park, something that Dolan is a part-investor in, so … I dunno, we’re deep into the tea leaves here. It’s an interesting moment, though, one that could end up revealing a lot about not only the future of women’s pro sports, but how arena managers are thinking about the relative value of sports vs. other events. I’ll have more on this soon, I hope.

Wizards’ $50m practice arena renderings are scenes from a post-apocalpytic nightmare

New renderings for the Washington Wizards practice facility (and Mystics home arena) to be built with at least $50 million in city money were released yesterday, and, I’m sorry, what?

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The new arena will apparently be surrounded by a massive frozen pond, or maybe a thin coating of a liquid polymer. Fortunately, no one will be around to try to walk on it, since that could get ugly.

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Is that a WNBA player? If so, why is she wearing so much makeup? What’s suspending the banner (?) in midair like that? And why on earth is there a film reel countdown projected (?) on a brick wall? What is it counting down to? Will there be any concession stands, or will the whole place just feel like an empty hotel lobby?

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The most important part of any new development: lens flare.

new-dcpract-5Put it all together and you have … dear lord. At least the rest of human civilization appears to have been destroyed in whatever cataclysm turned the very ground into a shiny flat surface, so no one will be around to see this. When the aliens land, though, they’re going to be disappointed that there’s nowhere to buy any curly fries.

NYU study: Relocating MSG would cost $5B, give it a rest already

Certain sectors of the New York City policy world (the Municipal Art Society, the New York Times editorial board) have been calling for a while for the relocation of Madison Square Garden, so that a new, grand Penn Station could be built in its place. (The old, grand Penn Station was demolished in the 1960s to make way for the current Madison Square Garden, the fourth building to bear that name.) NYU’s Rudin Center for Transportation Policy and Management released a study last week of how much it would cost to do this, and came up with … do I hear $5 billion?

Screen Shot 2016-05-06 at 8.23.17 AMThis isn’t really all that surprising: A billion and a half for a new MSG sounds about right given that just renovating the old one cost a billion, and acquiring new land could easily cost half that in this market. (The Rudin report looks at the price of buying up the annex to the Farley post office building across the street Morgan post office annex a couple of blocks to the southwest, but other sites would be priced similarly, if you could even find any.) And almost $3 billion for building a new Penn Station is already the price tag established by Gov. Andrew Cuomo for his plans (which would leave MSG intact but build lots of new stuff under it).

It’s also important to consider the political context, with Cuomo’s plan to expand Penn Station with MSG in place (to be paid for by some as-yet-unidentified private developer — applications were due two weeks ago, but if any have been revealed it’s news to me) going up against the MAS and Regional Plan Association’s insistence that MSG really needs to be kicked out. Given that Rudin director Mitchell Moss has already endorsed Cuomo’s plan, and his report’s conclusion is “It’s time to move on,” it’s easy to see some political gamesmanship going on here.

Still, this whole mess is a reminder that as easy as it is to envision redesigning your city to undo past mistakes (tearing down one of the greatest public spaces ever, building a kind-of-ugly sports arena in its place), there’s something to be said for actually existing architecture, both in that it’s already paid for, and in that the city has grown up around it to accommodate it. Not to say that nothing should ever get built or torn down, but it’s important to look at the true costs of doing so, and whether the money could be better spent mitigating the effects of your last mistakes.

D.C. council asks not to pay for Wizards cost overruns, mayor implies that it must hate black people

Oh yay, it’s some actual news for once! Washington, D.C. councilmembers have gotten cranky about Mayor Muriel Bowser’s plan to stick taxpayers with not just the $50 million cost of a new Wizards practice facility but all cost overruns as well — which was first revealed back in December, okay, but it takes a while for the D.C. council to work up a good head of cranky — and have introduced a bill to cap the district’s costs at $50 million:

“The District’s tax dollars are finite, and we have an obligation to our residents and businesses to use their funds as responsibly and efficiently as possible,” [at-large councilmember Elissa] Silverman said in a statement from the dais. “If we have to put more money toward a practice arena because of cost overruns, there is less money for new school construction, new ambulances and fire trucks, new and remodeled recreation centers, and other needed civic infrastructure, especially in Ward 8.”

Silverman also noted that the way the mayor has put forward her plan, the council wouldn’t even have to vote on it — unless the council blocks it by this Thursday, the spending deal will be “passively” approved, which is the kind of crazy that sounds about right for D.C. governance. (Several councilmembers have already filed a motion to extend the arena decision until April 7.)

Bowser’s chief of staff John Falcicchio showed that the council has no monopoly on the cranky, telling Washington City Paper: “It’s troubling that certain Councilmembers would move to strip $5 million from a job creating project in Ward 8. This is similar to the Council’s effort last year to defund the RISE Center at St. Elizabeths. Don’t tread on Ward 8.” Why are you picking on poor Ward 8, councilmembers? Do you think Ward 8 doesn’t deserve your blank checks? If you really loved Ward 8, you would buy it a pony.

All this over whether D.C. taxpayers will pay for an entire $50 million NBA practice arena, or will pay for an entire $50 million NBA practice arena plus any additional costs that crop up when the Wizards decide they want gold-plated exercise equipment. Representative democracy sure seemed like a good idea at the time.

Wizards practice arena plan would put taxpayers on hook for full cost, plus overruns

If the idea of Washington, D.C. spending $50 million on a practice facility for the Wizards sounded terrible enough, it just got worse: The city government would be on the hook for all cost overruns as well, with the team’s share limited to $4.5 million in rent payments over 19 years:

Monumental is the only tenant lined up for the facility and is expected to use it about 40 percent of the time, through Wizards practices, Mystics games and games from a NBA D-League franchise that has not yet been created. Events DC, the city’s convention and sports arm, would be responsible for booking events the rest of the time and would pay for any overruns beyond $55 million.

[D.C. council chair Phil] Mendelson said since Monumental’s contribution of $4.5 million equated to the rent the company would pay over the 19-year lease it expects to sign, the mayor had committed to paying for the entire bill even though ticket sales will go to Monumental. “How will we make any money off of this?” Mendelson asked.

The details of the deal for the arena, which would also host Mystics WNBA games and maybe an NBA D-League team, are still not worked out. Mendelson actually supports the plan, despite his qualms, so it looks to have a good chance of passing — if so, I hope they’ll at least chisel his “How will we make any money off of this?” quote into the cornerstone.

D.C. residents give resounding thumbs-down to mayor’s NFL stadium plans

Residents of the area around RFK Stadium really do not like Mayor Muriel Bowser’s idea to use the land for a new NFL stadium:

More than 150 residents of Capitol Hill filled a church gymnasium Wednesday night to propose ideas for re-use of the Robert F. Kennedy stadium property.

Most of the ideas centered around sports: playing fields, a pool, a boathouse, skating rinks, walking trails, even a velodrome.

There was one idea they widely and intensely opposed: building a new stadium for the Redskins. And almost every one of the more than 20 people who stood up to oppose a new NFL stadium did so without saying the team’s name.

Meanwhile, two former National Park Service workers who live near the St. Elizabeth’s Hospital site really do not like Mayor Bowser’s idea to use it for a new Wizards practice facility:

“I don’t think we need it over here,” said Alphonzo Walker, an unemployed 53-year-old who lives in Ward 8.

“I don’t know about this area,” said Eric Clark, also unemployed and in his 50s, though a few years older than Mr. Walker. “What’s going to happen to the homeless who live there?”

Okay, sure, small sample size. Still, the general principle is valid: If you have a plot of available land, and a plan to dedicate a few tens or hundreds of millions of dollars in city money towards it, what’s the best way to generate jobs and other benefits for the surrounding neighborhood, if that’s your goal? Think carefully before you answer.

D.C. mayor proposes $55m Wizards practice arena, because city was out of other sports to subsidize

Washington, D.C. Mayor Muriel Bowser has scheduled a press conference today to announce her proposal for the construction of a brand-new sports facility in the District. Nope, not the NFL stadium she talked about last week. But wait, you ask: Don’t the Nationals and the Capitals and the Wizards and D.C. United all have new buildings either in place or under construction? What on earth is there left to build?

D.C. Mayor Muriel E. Bowser has reached a tentative deal to build a $56.3 million Wizards basketball practice facility and Mystics arena for majority team owner Ted Leonsis on the east campus of the former St. Elizabeths hospital in one of the poorest corners of the nation’s capital.

Yes, you read that right: a $56.3 million practice facility. Plus a home court for the WNBA’s Mystics, because apparently the team is giving up on ever again being able to sell more than 5,000 tickets a game, despite the league average attendance being over 7,000. (Yes, I’m sure lots of those tickets are freebies or heavily discounted, but still.) The money would come overwhelmingly from public pockets: $23 million from the city itself, plus $27 million from the city-funded Events D.C. tourism bureau, with Wizards owner Ted Leonsis chipping in a whole $5 million, plus another $10 million for unspecified “redevelopment and community philanthropic investments.”

Bowser’s administration says this will be a terrific use of public money, notes the Washington City Paper, because:

A press release about the new facility estimates that it will generate $90 million in tax revenues over 20 years, in part by hosting Mystics WNBA games and an estimated 90 non-basketball events a year.

Okay, so let’s get this straight: Having the Mystics sell fewer tickets at a new arena instead of more back at their old arena would generate more in tax revenues because … there’s such a pent-up demand for concert dates that the Verizon Center will be able to fill those former Mystics dates with lots of new revenue-earning events? While also slotting in another 90 new events at the new arena? All of which will be spending by people who never would have been in D.C. otherwise, because after all, it’s not a big tourist town.

Not to mention that at a 5.75% city sales tax rate, to provide $4.5 million a year in new tax revenues, this new practice facility — practice facility, keep reminding yourself that — would need to generate an additional $78 million a year in sales all by its lonesome. That seems pretty unlikely — though if it could be such a cash cow, you have to wonder why Leonsis can’t just build it with his own money instead of making the people of D.C. build it for him and then hope to earn it back through sales taxes. It’s not like he’d need to take out a loan, even.

If there’s any argument for handing $50 million in public money to one of the richest guys in town, I suppose it would be that this is supposed to “revitalize” a rundown section of Southeast D.C., because what business owner can resist the draw of selling their wares to 17 games a year worth of WNBA fans? There is a Metro stop nearby, so it’s always possible you’ll eventually see condos springing up in Anacostia, like you do in pretty much every other D.C. neighborhood with transit. Of course, whether condos — or easy access to WNBA games — is what poor neighborhoods really most need out of $50 million in public spending is another story, but hey, beggars can’t be choosers, right?

This whole mess still needs to go before the D.C. council, where it will no doubt be the subject of months of raucous debate before it gets approved at the last minute by councilmembers scrawling out an agreement in ballpoint pen on the council floor. Democracy!

MSG now earning more than $50m a year in property tax breaks

The New York city council is gearing up for another run at Madison Square Garden’s 32-year-old full property tax exemption, and the city’s Independent Budget Office has a new estimate of how much MSG’s owners will get from it: $54 million in 2015, based on the projected increased value of a renovated Garden. The total value of MSG’s exemption now stands at a whopping $541 million*.

While the IBO doesn’t make policy recommendations, it just presents policy options, economist George Sweeting makes it pretty clear what the agency thinks of the MSG tax break, noting that “there is broad consensus within the economics field that government subsidies for sports facilities are not an effective use of scarce public resources,” that the Garden’s is the only property-tax exemption that applies only to a single property and is open-ended (most other property tax breaks end after a number of years, but the state legislature neglected to include a sunset provision in this case), and any threat that may have existed in 1982 of the Knicks and Rangers leaving town has long since gone by the wayside.

Of course, the council already voted once before to axe the MSG tax break, in 2008, but it didn’t accomplish anything because the tax exemption is enshrined in state law, it’s impossible to get the New York state legislature to do anything, really. Unless you’re a rich guy looking for a tax break, in which case the three men in a room would be happy to serve you.

*[UPDATE: IBO confirms that $541 million is the present value of the tax exemption over the next 30 years, net of tax breaks that would be available to any company, not just MSG. So allowing the tax break to remain in place for another 30 years would cost New York City $541 million in present-value 2014 dollars.]

NYT to MSG: Get lost, we wanna rebuild our underground train station

This is really weird: The New York Times has an editorial today calling for New York City to refuse to renew Madison Square Garden’s lease zoning permit on the land atop Penn Station, which apparently expired in January. The argument: MSG is “bulky” and “drumlike” and is in the way of a grand renovation of Penn Station that nobody really wants to spend the money on anymore, but anyway, “The Garden has moved twice since its original location in Madison Square. It can move again.”

The Times does note in passing that MSG’s owners just spent about $1 billion on renovating the arena, and that “of course makes them less eager to move” — and then suggests that they instead be given a new 10-year lease, “and use the time to find a new home for the Garden.” Because it totally makes sense to tear down a building that just got $1 billion in upgrades so you can tear down something else and spend another $1 billion on a new one.

This smells like the Times is carrying water for someone, but I’ll be damned if I can figure out who. Old-time rail terminal fans who are holding out hope for the Moynihan Station plan? Developers hoping to revive some plan to do a giant development project on the site? And in any case, if you want the city to lean on MSG over something, why no mention of that perpetual property tax exemption they’re still getting? Very, very weird…

MSG renovations on for 2011, sending Liberty into three-year exile

The on-again, off-again renovations to Madison Square Garden are back on again, slated to begin next summer and be completed by Fall 2013, a full year later than at last report. By limiting work to the summer, MSG will be able to avoid disruptions to the New York Knicks and Rangers schedules, but as I wrote on the Village Voice website yesterday, the New York Liberty WNBA franchise won’t be so lucky:

This won’t be the first time that the Liberty will be forced to relocate: The orange-teal-and-black were displaced to Radio City Music Hall for part of their 2004 season so that George W. Bush could be re-coronated on their home court. But there’s a big difference between shifting a few home games 20 blocks north and completely pulling up shop for three seasons…

As for future summers, it’s as yet unclear where Maddie will be parking her doghouse. Newark’s Prudential Center, as the Times suggested, is the most accessible big arena to city Liberty fans, and would if nothing else lead to a rise in the average Kinsey number among PATH ridership. (It could also make for a nice low-cost option for hoops fans in one of the tristate area’s most impoverished cities; Liberty games at the Garden are already distinct from Knicks games for drawing a large number of African-American teens of all genders.) And with MSG renovations slated to last through 2013, there’s even the possibility of a one-season stay in Brooklyn, given that Bruce Ratner’s Atlantic Yards is still — officially, at least supposed to be complete by late 2012. Liberty officials didn’t immediately return calls seeking more info on the team’s plans.

The renovation itself, which will essentially end up gutting the Garden and building a new seating bowl inside the existing shell, are now estimated to cost between $775 million and $850 million, all of which will be paid for by MSG’s corporate owners. MSG’s corporate owners who already get an $11 million a year tax break from the city of New York, mind you, but it’s still a pleasant change to see a sports team not asking for new subsidies on top of the ones they’ve already received.