London wants the NFL, but there are good reasons why the feeling may not be mutual

Britain’s chancellor of the exchequer (Best. Title. Ever.) George Osborne has promised to do “anything the government can do” to get an NFL team for London, which means of course that everybody is talking about when the NFL will put a team in London now. So, mission accomplished, mister chancellor of the exchequer!

The answer to “When will the NFL put a team in London?” meanwhile, is “Don’t hold your breath,” as Travis Waldron points out over at ThinkProgress:

Given existing concerns around moving a team to Europe, it is also possible — and probably more likely — that London has become the NFL’s next Los Angeles, a city used as a threat to hang over the heads of cities that it and its teams think need new stadiums…

There are myriad logistical issues standing as hurdles to such a move, including how to work bye weeks and address travel and competitive concerns. Where the team would play is also an unanswered question: while Wembley Stadium has made an attractive host thus far, it’s unclear whether a full NFL slate would fit into its schedule or its size, and it’s also less than certain that Premier League soccer club West Ham United would want to share the Olympic Stadium, a more suitably-sized venue that has been floated as a possibility.

But London is really huge, right? Wouldn’t any team jump at the chance to move there, assuming they got a stadium to play in and a vacuum train to get them there?

Possibly not, because of the strange finances of the NFL. Having high ticket demand is all well and good, but given that you only need to sell maybe 70,000 tickets eight times a year, a city the size of London is really overkill when it comes to creating enough ticket demand. Besides, in the NFL the real moneymaker is national TV revenue, and you can get a slice of that just by suiting up to have your heads bashed in. London, England, London, Ontario, London, Ohio — after factoring in TV money and revenue sharing, the amount of money you’ll make by operating a team there isn’t nearly as dramatically different as it would be in any other pro sport.

But wait a minute — wouldn’t putting a team in the UK be a terrific marketing opportunity for the NFL, and possibly lead to a lucrative new TV contract in Britain? Maybe so, but that’s for the NFL, not an individual team owner. If the league agreed to give a team relocating to London the lion’s share of UK TV money, perhaps, or otherwise compensated them for being the league’s European loss leader, then this might be able to work. But that would require complicated negotiations among all the teams to decide what’s fair, and even then you have to find an owner who’d rather be a guinea pig in London than to sit back in whatever U.S. burg they’re in and collect Fox checks. It could happen eventually, but probably not tomorrow.London as a bogeyman for NFL move threats, though? That’s a no-brainer. Besides, as I told Waldron:

“The great thing about move threats like this is that they can work both ways,” said Neil deMause, who follows stadium development news at his site, FieldofSchemes.com (and has co-written a book by the same name). “If talking up London as a potential NFL site works to get interest from an existing owner or an expansion owner, then great. Suddenly you’ve got interest, and a few years down the road, if it works out, then you can move ahead with it.

“If it doesn’t, then it’s still great, because you’ve talked about London so much that other teams can use it as a threat. It’s exactly how it’s worked with Los Angeles.”

Oakland gives Raiders another 90 days to turn pockets inside-out hoping stadium money falls out

You’re going to have to hold your breath a little bit longer to see any start at a resolution of the Oakland Raiders and A’s bipartite stadium battle: After the Raiders brought in some new investors to their Coliseum City vaportecture project, the Oakland city council last night voted to give the team a 90-day extension in which to finalize plans for a new stadium on the Oakland Coliseum site.

And that should be no problem, because as Newballpark.org points out, here’s all that Raiders owner Mark Davis has to work out to make his vision a reality:

  • Sign at least one tenant, preferably the Raiders to start

  • Engage the A’s and Warriors (even though neither team is interested)

  • Provide deliverables and reports that haven’t been completed yet (deal terms, financing, 2nd phase market analysis)

  • Bring in a master developer

  • Line up needed capital for stadium phase and ancillary development phases

  • Figure out who pays for the remaining debt at the Coliseum and Arena (if necessary)

  • Gather support of the JPA and Alameda County

Piece of cake! Three months is way more than enough time to win $750 million at Powerball, right?

 

Hey, the Cubs finally found something worth watching at Wrigley Field!

Yes, obvious joke headline. But yeah, anyway, the Wrigley Field bleacher teardown really is becoming a minor spectator attraction:

And that visual is drawing crowds of Cubs fans, with cameras in hand, interested in seeing a piece of Chicago history.

“I was coming down the L, I saw the Addison stop and I thought to myself, Wrigley Field… Once in a lifetime chance to see this construction going on,” Chicagoan Doug Karsten said.

Chicagoan Rob Lafrentz added, “I think it’s amazing to watch come down.”

No word yet from the Chicago mayor’s office on how much economic activity the bleacher demolition gawkers are generating.

Palm Beach County gives Astros, Nats $135m for spring-training complex, says now go find a place to build it

The city of West Palm Beach may have voted to take the land that the Houston Astros and Washington Nationals wanted for a spring-training site and hand it over to developers who are actually willing to pay for it, but that’s not stopping the Palm Beach County Commission, which voted yesterday to give the two teams $135 million in hotel tax money to build a new stadium complex … somewhere.

The new $135 million proposal to build another stadium calls for the county to pay for about half of the costs, with the Astros, Nationals and the state paying for the rest.

The latest version of the deal trims $5 million from construction costs in a prior proposal. But the deal would also leave the county responsible for about $17 million more in public money than once envisioned.

The hotel tax is already being used to pay off the county convention center, support local arts programs, and other ways of promoting tourism, but hey, maybe hotel tax receipts will rise by $135 million if these stadiums are built, right? And if not, they can always raise the hotel tax. Because surely that won’t do anything to cause tourists to choose to stay in a different county.

In any event, the Astros and Nationals owners now just have to drive around Florida looking for a place to spend their $135 million, which they’re promising to do within the next couple of weeks. It’s a tough life, running a pro sports franchise.

D.C. to Buzzard Point community on benefits agreement: We’re getting you a soccer stadium, that’s not enough?

Last month, a coalition of residents of D.C.’s Buzzard Point, where D.C. United wants to build a new stadium with about $178 million in city subsidies, presented their list of community benefits they’d like to see the city provide them as compensation for putting up with a whole lot of soccer fans landing on their doorstep, including traffic improvements, job development, a small business incubator, and housing preservation programs. Projected cost: $5 million or so.

Yesterday, it was revealed that the city and United had responded with a joint letter saying, in effect: The city already has programs for all that stuff, what makes you think you’re so special?

For instance, in response to the community’s request for a revolving $500,000 workforce training fund to benefit residents of Advisory Neighborhood Commission 6D, [City Administrator Allen] Lew and [D.C. United COO Tom] Hunt wrote that “it does not make sense to create a separate and standalone employment program for ANC 6D residents. The District is, however, committed to working with the CBCC to ensure that ANC 6D job-seekers are successful in accessing these existing programs.”

Similarly, in response to the request for a $750,000 small business incubator fund, Lew and Hunt wrote that “it does not make sense to develop a separate standalone program” from the city’s current small business programs.

On the one hand, sure, the city should be providing money to help all residents, not just those who happen to live in Buzzard Point. On the other hand, helping out residents of a specific neighborhood affected by a development project is pretty much the whole point of community benefits agreements — and if that sometimes leads to community groups just trying to get what’s in it for them instead of thinking of the big picture, the principle is still sound: If the community is going to put up with the headaches of a big construction project, it should get helped out in other ways in exchange.

Plus, maybe more to the point, this kind of response is a great way to build enemies. “For you to basically slap us in the face and tell us to go away…I don’t see where they’ve left us any type of room for negotiation by telling us no to every last thing that we asked for,” Felicia Couts, a coordinator of the horribly named Near SE/SW Community Benefits Coordinating Council, told the Washington Post. Seems somebody really doesn’t get how this works.

Ratner puts debt-ridden Brooklyn Nets arena up for sale after just two years

Bruce Ratner, the developer who spent ten years buying the New Jersey Nets and then fighting a bitter court battle to tear down houses in Brooklyn to make way for a new arena and brought in a Russian billionaire partner to help pay the bills, is celebrating his ultimate victory the only way he knows how: by putting the arena up for sale.

Developer Forest City Ratner is marketing its majority interest in the Brooklyn arena that is home to the NBA’s Brooklyn Nets, seeking a buyer for some or all of its 55% stake in the building, according to people familiar with the matter.

An arena spokesman declined to offer details, but said in an email that “Our goal is to identify a strategic partner as we continue to capitalize on the great performance of Barclays Center.”

“Great performance” sounds nice when shopping the place around to buyers, but the fact of the matter is that the Barclays Center hasn’t done great in terms of its bottom line: It just about barely broke even in its first full year of operations, 2013, despite record-setting ticket sales. (The Wall Street Journal’s Eliot Brown, who earlier reported that the arena turned a tiny profit, now says that the arena reported a small loss in 2013.) And while arena revenues were up in the first half of 2014, they’re still well below projections, and not likely to improve significantly as the Nets honeymoon wears off and a trade war for concerts heats up with the newly renovated Madison Square Garden. (Yes, the Islanders arrive in 2015, but as we’ve seen elsewhere, sports teams often cost as much in lost concert revenue as they pay in rent.)

The reason for all this red ink? The $29 million a year in debt that Ratner saddled himself with, while turning over majority ownership of the arena’s biggest money-maker, the Nets, to Mikhail Prokhorov in exchange for more cash to feed the arena’s $1 billion construction budget maw. Even the most successful arenas don’t churn out that kind of profit margin year after year, which is no doubt one reason why Ratner is looking to cash out, though it’ll be extremely interesting to see what price he gets for a building saddled with $500 million in debt, not to mention Brook Lopez’s tender feet.

There’s much more, as you’d expect, at Atlantic Yards Report, including the observation that Ratner is really only selling operating rights to the arena, since it technically belongs to the state of New York in a complicated tax-dodge arrangement.

The big question remains, however: Why on earth did Ratner care so much about this project that he moved heaven and earth (and Daniel Goldstein), plus assumed half a billion dollars in debt, to make it happen? The man has never shown any interest in basketball, and ditched control of the team as soon as possible after the project was approved. There was the theory that the arena was a loss leader for getting hold of valuable Brooklyn land to develop with housing, but Ratner’s planned housing towers are doing even worse than the arena, though he’s still shopping around in China for investors. That leaves … wanting to drum up foot traffic for his mall across the street? Wanting to make even more of a name for himself in Brooklyn real estate, even if it’s not an especially positive one? Presumably he had something in mind all along — or maybe it’s just Hanlon’s Razor.

Milwaukee group says Bucks owners “don’t need our money” after getting cold shoulder on playground demands

Common Ground, the Milwaukee coalition that previously said it would support public funding for a Bucks arena if it would also provide $150 million for school athletic facilities and playgrounds, now says it is opposing public funding for the arena altogether. The reason, apparently: The Bucks’ owners refused to meet with coalition leaders to discuss their plan.

Common Ground leaders had sought a meeting with the new Bucks owners to discuss their plan but have been rebuffed so far. Bob Cook, the Bucks’ vice president of business affairs, had offered to meet, but Common Ground said it wanted Edens and Lasry to fulfill a commitment to meet with the group.

Common Ground has also targeted Bucks co-owner Wes Edens for holding mortgages on several abandoned foreclosed properties in Milwaukee, which … has nothing to do with anything, I can tell, except maybe that they’re trying to argue that Edens is a guy who doesn’t really care about the city, so doesn’t deserve public money.

All its new talk of moral outrage over arena subsidies aside — “They do not need our money,” declared Jennifer O’Hear, co-chair of the group’s Fair Play campaign for public recreational facility funding — this still seems to be less a matter of principle and more a matter of wanting to use holding back support for any arena subsidies as leverage to get funding for programs they want, too. Common Ground is affiliated with the Industrial Areas Foundation, the community activist umbrella group founded by Saul Alinsky, whose guiding premise was to focus on winnable battles over concrete local issues, not big-picture ideology. That certainly has strengths, but it also has weaknesses, one of which is that it can become easy to buy off Alinsky-style groups by throwing some money at their pet projects, as Brooklyn Nets developer Bruce Ratner did by offering the IAF-inspired ACORN control of affordable housing on the site in exchange for its support of arena subsidies. (And as the same ACORN group earlier attempted to do around a minor-league baseball stadium in Brooklyn.)

So, this is all presumably tactical for Common Ground, in order to get a seat at the negotiating table. Which may end up being good for Milwaukee playgrounds, but that’s not necessarily the same thing as being good for Milwaukee.

No, Columbus Blue Jackets’ future isn’t actually threatened by county’s arena loan woes, yeesh

Mike Ozanian, aka the guy who’s been overseeing the Forbes sports team valuations since before Forbes was even doing them, took a look at the Columbus Blue Jackets arena loan payments mess yesterday, and declared that the team may be “economically nonviable” in its current home.

On the face of it, this doesn’t make a lot of sense: Franklin County has skipped out on paying off its debt on the Blue Jackets’ arena (which the Blue Jackets initially took on, then decided it’d be way better if somebody else were stuck with paying for) because money from taxes on new casinos is running way below expectations. That doesn’t say anything about whether people in Columbus like hockey, just about how much they like spending their money at casinos — and about how rose-colored the glasses were that Franklin County officials donned before approving this deal.

What Ozanian seems to be getting at, though, isn’t anything about the current arena payments mess, but rather what it will reveal about the Blue Jackets’ shaky underlying finances. Team execs demanded the money in the first place, after all, because they said they couldn’t possibly pay off the arena that they themselves built while also running an NHL franchise in Columbus, and Franklin County agreed to bail them out. Now that the bailout money is on hold, Nationwide (which originally built the arena with the team) will have to wait on its loan payments. The Blue Jackets owners, meanwhile, will be on the hook for arena operations and maintenance, which are … actually just barely being paid off by what casino tax money is coming in, but, you know, if that number drops, then they might have to pay something toward running their own arena!

Certainly, any cost for the Blue Jackets will be a lot, given that Ozanian’s own figures for Forbes show that the team was losing larger and larger sums of money until the arena operating costs were taken off their hands in 2013. On the other hand, the team did make an estimated $4.9 million profit last year under the new deal, and casino revenues would have to drop by an awful lot before the Blue Jackets’ share of operating costs would make a significant dent in that. And anyway, under the bailout deal the Blue Jackets are committed to playing in Columbus through 2039, so it’s not like they could do much even if they were “nonviable.”

So mostly Ozanian’s article comes down to “County’s Threat to Make Blue Jackets Pay Own Arena Costs Reminds Everyone How Broke Team Was Before Public Bailed Them Out.” Poor, sad Blue Jackets. Hey, I know what would cheer them up — a nice fun trip to a local casino! Because that always helps!

This is what “renovation” of Wrigley Field looks like

It’s what Chicago Cubs owner Tom Ricketts said he was going to do, but still, ouch:

The happier thought is that these are simple bleachers, they’ve been rebuilt a bunch of times before, and the hope is that Ricketts will be able to put up new ones that look pretty much the same (he did hire an architect to focus on maintaining historical details like the right kind of railings) except with enough supports underneath to hold up a big-ass video board. Still, in the meantime, those with a squeamish nature around wrecking balls and landmarked structures should probably avert your eyes.

 

Franklin County not making payments on Blue Jackets arena, because turns out there’s no money, oops

Hey, everybody, remember when Franklin County refused to let residents vote on whether to stop payments on the Columbus Blue Jackets‘ arena because if the county voted to pay for things and then didn’t that would make them look terrible? Turns out the county has stopped making payments after all, for a simpler reason — they don’t have any money! It’s irony!

The city-county authority financed the $52 million deal through loans from Nationwide and the State of Ohio in March 2012. To make the payments, the city and county pledged to use a portion of casino tax revenue.

But casino revenue is far below projections. And Franklin County Convention Facilities Authority Executive Director Bill Jennison said no payments have been made to pay off either loan. More than $3 million remains unpaid.

County officials say that if casino taxes don’t start rolling in, they’re not going to fill in with general revenues, but rather will just make bondholders sit and wait for their cash. Wait how long?

[Activist Jonathan] Beard ran his own numbers and expects the city-county authority to be paying on the loan far beyond 2039 based on current casino-tax revenues returns.

“We showed a $1.8 billion deficit at the end of 100 years when we’d still be paying on the [arena]. So it’s this huge albatross,” Beard said.

Yep, that’s a while. I’m guessing at some point somebody is going to suggest selling a few hospitals to save the county’s bond rating in the meantime.