This is an archived version of a Field of Schemes article. Comments on this page are closed. To find the current version of the article with updated comments, click here.
February 11, 2009
Kings still pushing for new Sacramento arena
The Sacramento Kings' arena plans aren't dead, they're just resting. The Sacramento Bee reports that NBA consultant John Moag will present a new plan to the board of Cal Expo by February 27 to propose a ""mixed-use project" anchored by a basketball arena. (The Bee also reports that the Kings are losing $25 million a year, but as that's cited only to "sources close to the team," take it with a grain of salt, as it could well be an intentionally placed bit of disinformation from the team's owners.)
Of course, given that the last plan for Cal Expo depended on using future development rights to fund the project, and the value of real estate in Sacramento right now can only be measured with an electron microscope, the real news will be whether or not Moag presents a new financing plan. ESPN blogger Henry Abbott suggests that it's only a matter of time before someone pushes a Kings arena as a "shovel-ready" plan for federal stimulus funding; the sports-sleaze blog Sports By Brooks polled its readers on this, and currently 94% are opposed to the idea. Which only goes to show we'd probably be better off with sports blog readers running Congress.
The Kings are history in Sacramento. Northern California has no desire and ability to fund sports stadiums (See the 49ers, Raiders, and A's (Along with the Kings) as examples of this). Throw in Arnie's "Sports Tax" in the mix as well, which of course hurt team profits. Do they end up in Kansas City again (Just like the Raiders did with Oakland)? Or maybe Pittsburgh?
Posted by Januz on February 11, 2009 10:39 AM
The Kings are history in Sacramento. Northern California has no desire and ability to fund sports stadiums (See the 49ers, Raiders, and A's (Along with the Kings) as examples of this). Throw in Arnie's "Sports Tax" in the mix as well, which of course hurt team profits. Do they end up in Kansas City again (Just like the Raiders did with Oakland)? Or maybe Pittsburgh?
Posted by Januz on February 11, 2009 10:40 AM
You really have to see the games first-hand to appreciate the point that the Kings may be losing $25M/year.
They're in last place in attendance.
People who own tickets aren't showing up, which is hurting their other revenues. When they say 11,000 in attendance, their 17,317 arena is half-full, barely. Half as many cars coming in, and at $15 per car, that hurts.
Souvenir sales are down.
Their biggest TV sponsors are a copier store and a Ford dealership. Enough said.
Losing $25M? I absolutely believe it.
Which is why I think they need to consider the San Jose/Anaheim/LV/Seattle options. It's just plain good business sense to do so.
Sacramento used to have one company in the S&P500. That's right, you heard it, one company. That company is McClatchy, which is now down to 71 cents per share, down from $33, for a market cap of $41M. There's simply no corporate presence in this town.
All the indicators are in place for taking this season's financial losses and doubling them to calculate next year's losses. If they're losing $25M this year, I believe they will lose $50M next year. The Maloofs are smart business people; they know a better deal when they see one. Selling to Larry Ellison would be one better deal, for sure.
Ailene Voisin thinks the Maloofs need to get more vocal (LUDICROUS ARTICLE ALERT!):
http://www.sacbee.com/kings/story/1615603.html
Posted by MikeM on February 11, 2009 01:10 PM
While I totally believe that the Kings are in a lousy place financially, I trust self-reported financial figures as far as you can throw them. Given all the tricks that teams have for conjuring up red ink (simultaneously depreciating and costing out player contracts, for one), I'd rather see an independent analysis of their finances.
Posted by Neil on February 11, 2009 01:43 PM
"I'd rather see an independent analysis of their finances"
Yeah, good luck with that.
Bottom-line, it's not even about that. The voters thought Q&R were way too generous, and the Maloofs thought Q&R were nowhere near generous enough. With Sacramento's lack of corporate presence, with 10% paycuts in effect for 83,000 State employees, with the governor threatening layoffs, I just don't see Sacramento as the Maloofs best business decision.
I personally think they are losing $25M, and that selling to San Jose or Anaheim interests is, by far, the best business decision possible.
We have to add to this Las Vegas's woes. The Maloof family has to be losing plenty of money there. If they were losing money only in one city or the other, they might be able to weather that. But they're not. They have their feet "firmly" in two of America's biggest divots. Okay, Riverside County and Miami might be in worse shape, but not by much. To be so deeply involved in two of America's bottom-ten, though, doesn't help at all.
Posted by MikeM on February 11, 2009 03:03 PM