Just when you thought the Sacramento Kings saga couldn’t get any more wacky, yesterday Reuters issued an anonymously sourced report that, if true, indicates that jilted buyer Chris Hansen may be about to open a whole new can of crazy-ass:
The idea, this source said, would be for Hansen to persuade NBA owners to support his efforts to buy the team, even if they do not immediately allow him to move it.
Under the NBA’s rules, a decision to relocate a team is separate from a decision to sell a team. So under this scenario, the league could support its committee’s recommendation against moving the Kings to Seattle, while still supporting the Hansen group’s efforts to purchase it.
The league could require Hansen to work in good faith with the city of Sacramento to try to keep the team there, setting a deadline for the construction of a new arena and working to keep attendance high at the games.
But if the arena wasn’t built according to the schedule, or if attendance slipped at the games, Hansen could apply again for permission to move the team – and it could be more likely to be granted, this source said.
This gambit should be familiar to Seattle basketball fans, as it’s essentially the Clay Bennett Maneuver: Buy a team, promise a “good faith” effort to keep it in town, then when arena negotiations stall, hightail it out of town to where you really wanted to be in the first place.
USC sports business professor David Carter tells Reuters that this could be a graceful way for the NBA to avoid the public uproar over moving a team, while still getting into the Seattle market once the Sacramento arena deal hits a snag. Which sort of makes sense — except that when the entire plan is spelled out in the newspaper before it’s even started, then you end up facing public uproar over calculatingly playing a city that you don’t intend to stay in just in order to duck a public uproar. Kingsgate, anyone?
Also, Hansen would be running the risk that Sacramento would call his bluff and actually build an arena, at which point he’d be stuck with a team in a city he doesn’t want to own one in. (Though he works in San Francisco, so it’s not like it’s that far a commute.) I suppose at that point he could always sell the team and ask his new NBA buddies for a different one that he could put in Seattle. Because that’s how it works in the sports biz.
This also allows the Maloofs to sell to a buyer of their choosing and let’s the league be rid of them in a relatively graceful manner. It also allows the NBA to bring Ballmer into the club. Gives KJ and the Sacramento City Council a chance to put the $258 million (or $330 million) where their mouths are while giving Sacto an even wealthier set of partners than Team Ranadive. Speaking of the $258M, it allow Hansen to walk into a much bigger public subsidy and a less risky business deal for him. It gives the Seattle fans hope, while enabling the Kings fans to keep their team without the Maloofs. It almost seems so crazy that it might work.
Why would the NBA approve the sale to Hansen? They know what his intentions would be (ala Clay Bennett).
This, of course, is all predicated on the NBA Board of Governors giving any credence to the wishes of the Maloofs.
Considering what the Maloofs did to the NBA staff’s collective work last year by blowing up the prior arena deal, I find that a dubious proposition at best.
SS: I find it dubious as well. If there is a way the NBA can get both Seattle and Sacramento arena cash AND totally screw the Maloofs, my bet is they do just that.
Mike: They do know what his intention is, but they also control whether he gets to act on that intention. If he buys the Sacramento Kings, that is what he owns. As Neil says, if an NBA approved arena deal is consumated (or consommated, if we assume they add gravy…), Hansen would have no reason to leave town beyond “cos I want to”.
Missing in this conversation: How do you deny the “perfect prototype” of an ownership group from owning 7% of the team?
This is where the courts would demand to see the NBA’s work.
1) Hansen read the instructions on the bid.
2) He followed them.
3) He was the sole bidder.
4) The NBA itself pre-approved him as a bidder. He was the only bidder. He won.
5) Now Stern has described him as the “perfect prototype” of an owner.
Hard to see how you deny him now.
If ROFR truly exists for minority owners, it’s only a matter of time before Hansen matches any offer the Maloofs might get.
I think the best the NBA can do is offer resistance now.
Stern will regret saying what he said. That looks like evidence in a bankruptcy court proceeding to me.
Neil: Loria is far from the only example of this… Craig Leipold (married to another Walton daughter, as I recall) was the first owner of the sad-sack nashville predators. Not only did he manage to unload that dog on a group of local businessmen (he wasn’t a Nashville native), Bettman helped him “transition” into the Minnesota franchise… a better team & a better market for hockey.
Of course, he just spent $200m on two free agents and very nearly missed the playoffs… so maybe he isn’t really that good an example of anything at all, except perhaps marrying well…
The flaw in the “What if they carry through on the arena argument?” is that this plan still does rely heavily on private contributions. If Hansen says, “I don’t like this plan, but if you pay for 100% of it, I suppose I have to listen,” then maybe it works.
Hansen’s contribution to a DTP arena would be $0.
But first, you have to show me now how they deny Hansen that 7%. If they do, this will end up in bankruptcy court, and the NBA will have to prove why Hansen isn’t qualified to own those shares. Now that we know he’s the “perfect prototype”, I think the NBA needs to now show why he’s not qualified to own 7% of the team.
The NBA sold to Bennett knowing exactly what his intentions were. So the league really has not qualms selling to owners with the intent to move but like Neil points out, tough for the league to plea ignorance when it is spelled out in the paper.
JB, I agree 100%. This is starting to look exactly like the Bennett/OCK model for bringing a team back to Seattle. This is going to bad for Sac fans…….
One more minor contribution:
http://www.sacbee.com/2013/05/01/5387810/questions-remain-about-kings-fate.html
Who’s to say Ranadive won’t move the team
To San Diego or San Jose? Carmichael Dave may need to fire up the RV again.
To Jason: nothing. If it failed he could move to Seattle if he wanted. It would be a situation where the group legimately wants to stay and it isnt all BS, but if in the next 5 years nothing gets built they would move the team. Hell, I still think the reason why the Penguins owner was involved untol recently was because he knew if all failed, he could have moved the team to Pittsburgh to share the arena with the Penguins.
John Bladen is reminding me of my antipathy for Leipold. He’s a Wisconsin native (Racine) but instead of trying to get a team in Milwaukee he goes for Nashville. Then on his second try he goes to MSP. And to top it all off since Fox Sports Wisconsin is from Minneapolis (not sure if Leipold owns it or just has sway there), f8cking Wild games sometimes pre-empt Bucks games. The only good part is that they might dump the ‘Hawks and then I can laugh at ‘Hawks fans again.
As an Oklahoman, a reminder that the arena was put to a vote. If it failed,the Sonics would have stayed.
Will Seattle put their arena to a vote? Doubt it.
Another reason why Hansen buying the Kings and staying in Sacramento is not so crazy. By buying the Kings, he get’s the Sleep Train Arena, the land around it plus all the goodies that KJ is offering to Team Ranadive. Hansen might be playing a whole other game here.
Seattle doesn’t have to put this arena to a public vote. Hansen owns the property and the financing is backed by arena-generated revenue, land swaps, property taxes, etc. It’s similar structure to the same way the City has backed a few other non-sports projects (like the Amazon HQ & developing the South Lake Union neighborhood). It doesn’t use any of the revenue or tax streams that would trigger a public vote. All it required was approval of the City & County Councils, which it got.
We still have I-91, which blocks public subsidies and that the City must profit from deals it makes with Sports Teams, but so far Hansen’s plan has cleared a preliminary legal challenge on that front. Hansen has to complete the EIS, which the Port of Seattle & Longshoremen attempted to block, but their cases were ruled against as well, and Hansen agreed to pay for additional traffic mitigation.
There’s still some potential legal hurdles (always is) but for the most part, Hansen could put shovels in the ground for the arena tomorrow if he secured a team.
Hansen could put shovels in the ground for the arena tomorrow if he secured a team.
That’s really not possible. The city of Seattle isn’t going to buy his land until they’ve done some more studies and taken another vote to proceed to transaction documents. Hansen just filed the MUP, not approved. Filed a street vacation (since it runs through center court) but it’s not approved. He’d also have to put $70-100 mil more in, since he was going to turn around and use the land payment as his equity to pay for the building.
I wonder if the NBA could approve the sale, and tell Hansen that his file says “RECOMMENDED NOT TO APPROVE RELOCATION FOR AT LEAST 10 YEARS” stamped all over it.
We’ll just have to see how much of the Sac money gets put in escrow and when the Maloofs decide they like money now more than Hansen’s schemes.
… And then Hansen moves them to Seattle anyways, a la Donald Sterling.
Well, they could recommend the team be moved only when Mars crashes into the sun, but these things have “unenforceable” written all over them.
The Pacers had an iron-clad lease in Indy, right?
There you go.
Just watching the way this is all developing (way too slowly, by the way), I think this idea of “Sell to Hansen” is gaining traction.
There is a high chance Sac’s arena plan falls apart; way higher than Seattle’s. So you cover yourself.
In about 8 months, we should have a firm idea how much the parking bonds will raise. When it turns out to not be enough… “Say, doesn’t Seattle have an arena in the works?”.
NBA is covered either way, and still gets their “perfect prototype.”
Evil, but starting to make sense anyway.
The Hansen idea is a wacky stupid idea, and I doubt it would happen.
Also, if Hansen is buying NBA teams in other towns, then the Seattle MOU would be dumped. The more Hansen is around, the more of a lowlife Hansen and Ballmer seem.
Jake E, Could you substantiate your contention that the Amazon HQ in Seattle, South Lake Union businesses, and non-sports businesses in Seattle, gain anything similiar to the Seattle subsidies Hansen demands?
I can’t seem to find anything that would corroborate your statement.
Which buildings have Seattle financing 145 million dollars of up-front, and then diverting all taxes at the building to pay for the debt service on the up front public funds? Which building is having tax revenue from another building used to pay for the another building? Which building has Seattle property tax being diverted to the building from the Seattle General Fund? Which building is Seattle issuing General Obligation bonds to finance?
I looked, Jake E, I could find no building gaining even close to the deal with Seattle Government that Hansen and Ballmer would. So, edify me, Jake E.
Today we find out if Team Ranadive puts half of their payment in that escrow account. I wonder if seeing that money will push the Maloofs into spurning the Hansen offer. I doubt it because as Don Draper said a few weeks ago, “You go to the dance with the one that brung you.”
Come on, jhande give the guy a break. He’s a hedge-fund manager, and they are almost to-a-man, very upstanding, honest people. haha. This whole thing is unreal. I’m so happy for Sacramento, it’s unbelievable. It’s like the German’s being 10 miles from Moscow, and Sacramento is the Red Army. Crazy that Hansen was up-front, had an offer like that, and didn’t get what he wanted. Probably the first time in his entire life that things didn’t go exactly how he wanted. Now we see a bit of true colors.
Oh, and I’m not jumping on any bandwagon. I’ve always wanted the team to stay, but thought it was close to 100% that they were moving. Happy to be wrong, in this case.
The Red Army is not a good metaphor for Sacramento because eventually the Soviet Union was done in, among other reasons, because it didn’t operate under economic reality. Spending $258M (if not more of city resources) to build an arena that’s closed for half of the days of the year is not economic reality.
I think the best metaphor for Sacramento is Orlando. Very similar deals.
You know, watching that Warriors game last night, I’m having a hard time figuring out why they need a new arena. Freeway access, central location, BART, sufficient parking lot, enough seats, appears to be structurally sound…
What’s that about? I’ve been there myself, and I just don’t understand the problem.
Chris Daniels, not the Sacramento media, reporting a Public Records Act suit might be filed today.
The Warriors might want that Giants downtown SF mojo and SF execs buying luxury boxes on the Pier. Wasn’t the Coliseum renovated in 1996-1997 (that’s Ancient history in the David Stern world), the same time that the Oakland Coliseum was renovated?
I meant Oracle Arena being renovated in 1996-97, the same time as the Coliseum.
Mike: the opinion is that a San Fran arena would be much more profitable then an Oakland one, and with the 49ers gone they have a shot at getting a better deal with the city then they would have before.
Talking about Oakland, someone (ok, my dad) suggested the reason the Raiders have been silent about a new stadium is because they are waiting for the Warriors and A’s to leave so they can get a bitching new stadium from Oakland, because no doubt that city will be desperate to keep any team at that point. However, thats a topic for another day.
Sacramento arena opponents file the Public Records Act lawsuit, Team Ranadive makes a deposit (all of this with some snide writing by the Bee on arena opponents could be found here): http://www.sacbee.com/2013/05/03/5393349/sacramento-investors-make-deposit.html
Hrm, Issac Gonzalez is a busy activist.
http://ransackedmedia.com/2013/04/30/amazing-footage-of-sacramento-redevelopment-in-the-1950s-is-a-time-capsule-to-behold/
I’m sorry, I thought public records requests did have to be somewhat targeted. Requesting 3 months of communications between 5 different possible people, all involved in the new city budget, seems pretty broad.
http://ransackedmedia.com/2013/04/22/arena-lawyers-say-city-of-sacramento-in-violation-of-california-public-records-act/
“All emails, and attachments to emails, dated January 2013 to the present, between City Manager John Shirey and City employees Howard Chan, Richard Sanders or Desmond Parrington..
All emails, and attachments to such emails, dated January 2013 to the present, between Assistant City Manager John Dangberg and City employees Howard Chan, Richard Sanders or Desmond Parrington..
All emails, and attachments to emails, to and from the Mayor’s Chief of Staff, Daniel Conway, regarding the ESC or the City-owned parcels to be
conveyed to private investors pursuant to the ESC’s “term sheet.””
Per Michael McCann, the lawsuit by itself is not likely to derail the project but the NBA could be really concerned if it is found that the City of Sacramento has withheld information from the public- as in, have they weithheld information from the NBA as well?
ChefJoe: I’m personally involved in a public records act request for information right now myself, and that request is not terribly broad at all.
The one we received asked for all information since 2008. We are complying. It’ll take me about 1 day.
just Deja vu all over again…
Dangberg has been caught before…he’s a known liar and devious character…
The entire Sacramento deal is a fraud
As far as I know, Dangberg really has no other job except working on this arena boondoggle.
forget the specious nature of the Sacramento proposed ownership group
Sacramento can not raise taxes to pay for an arena
Sacramento can not rely on Redevelopment for money for the arena (Moonbeam killed it)
Sacramento has cooked the books two years ago for an Arena which the Magoofs exposed through a study by an independent agency…
Only recourse for funding a Sacramento Arena is this current phoney baloney flim flam scheme that seems like Rube Goldberg himself thought it up
Previous Federal Court Order ordering Sacramento to open the process and the Grand Jury has demonstrated that Dangberg is a LIAR and Fraud Artist
It is a Fact the Queens are a real loser or the Magoofs wouldn’t bail…
The entire downtown Sacramento deal is just part of the overall scheme to fix Sacramento which has already seen a billion (news sources) thrown into it with no success
I am glad I don’t live in Sacramento…the place is an embarrassment
Jake E
I don’t think you can find an example of a 145M subsidy in Seattle for a private building. But there is always a first time and I think this was lawyered in such a way that a public vote is unnecessary. Just as in Sacramento the city is going to have to have a separate corporation owned by the city issue the debt. Additional debt of the city is subject to a public vote that would probably lose again. The city will just pledge specific revenue streams, i.e. the hotel tax and parking funds, to pay off said debt.
Yeah, but it lasted another four and a half decades before it collasped, Jason. That’s longer than the life-span a new arena is likely to have. Anyway, don’t sleep on the Red Army, it’s coming back—just a new name this time. Eurasian Union.
In a recent interview with Sacramento City Treasurer (not online) he gives a lot more detail of the Sacramento plan. And it’s not pretty.
He freely admits that the city has lowballed the amount of their contribution (which is rightly 300+ million rather than 250 million).
He then goes on to explain how the city will skirt CA law forbidding parking meter revenue to pay bond issues. They will actually use taxpayer (i.e. general fund money) in some sort of complex swapping of funds to make it seem like they funds are not being paid by the metered parking revenue (while of course they are, putting the general fund at risk).
The money promised for the Arena (hotel TOT revenue and so on) has been earmarked to save our local community theatre (which needs millions in ADA upgrades, or it will be shut down). So far, with this money pledge to the Arena, there’s no plan to replace these funds.
It’s a mess and a disgrace.
Biggs, that’s quite a change from :
http://www.sacbee.com/2013/03/26/5295013/kings-fans-gather-at-city-hall.html
Tuesday, though, was all about the arena – an essential component to the bid. City staff members assured the council that the financing plan would expose the city to very little risk.
“I’m very, very confident,” said City Treasurer Russ Fehr, who would oversee the parking bond sale. “There’s very minimal risk to the city’s general fund.”
The city would borrow $212 million against future parking revenue. Much of the rest of the financing would come from donating city land worth $38 million to the investor group.
Fehr said the parking operations should generate plenty of cash to pay off the bonds. “We’re not making assumptions that we would grow into our debt,” he said.
Next thing you know, KJ will ask Greg Jamieson to put a group together to buy an NHL team to play in Sacramento. What a joke.
From “Inside the City” May 2013 Edition.
Craig Powell -Eye on Sacramento:
City staff issued a report that claims that the city is contributing $257 million toward a new arena or 58 percent of the total costs (compared to Seattle’s 40 percent contribution). Staff did not, however, count the value of the 3,700 garage spots the city is giving to the investors or the value of free city sites for the placement of digital billboards. Eye on Sacramento has calculated the value of these contributions at $75 million, putting the total taxpayer contribution to the arena at $333 million or 75 percent of the arena cost. Isn’t it misleading to the public for city staff not to include these two contributions?
City Treasurer Russ Fehr :
I don’t know. Regarding the Downtown Plaza garage, not all of the parking spots in the system generate the same amount of revenue, and the Plaza spots are less valuable than the others. But should that value have been part of the value of the published contributions? I agree with you.
—————
Note the last two lines. Also, he makes the ridiculous claim that the spots in the plaza (i.e. the spot right under or directly adjacent to the new proposed arena) are somehow “less valuable” than the other spots. I don’t see it. And he doesn’t address the giveaway of extremely lucrative electronic Billboard signage (which Clear Channel pays big bucks to the City for) at all.
From Inside the City – May 2013 Edition
Craig Powell:
So you’re counting on receiving the same parking revenue even though you’ll have about half as many garage spots, since the city is giving up close to half of its garage spots as part of the arena deal?
City of Sacramento Treasurer -Russ Fehr:
But you’re assuming that all parking spaces are of equal value.
—————
Craig Powell:
A city ordinance and state law require that net parking meter revenues can be used only to support the city’s parking operations and, therefore, can’t be used for general fund purposes and can’t be used to make payments on the arena bonds.
City of Sacramento Treasurer -Russ Fehr:
We’ve already worked this through with the city attorney and bond counsel. As part of the bond indenture, there would be a general fund contribution to the nonprofit financing authority equal to the annual profits of the parking meters. This additional burden on the general fund is one of the reasons the interest rate on the arena bonds will be pretty high.
[Author’s note: Don’t feel dim. Why this contribution would satisfy the statutory limit on the use of parking meter profits was not clear to me either, and I asked Russ to explain it to me three times. I suppose all will be revealed in time.]
—————
Note Fehr’s complete non answer to the first question. (i.e. how will half as many spots generate the same parking revenue?)
And his answer to the second (and in my view very important) question regarding the legality of the trying to get around state law (which doesn’t allow metered parking to pay off bonds) by placing more stress/risk on the general fund is completely at odds with what he told the council about “being conservative, low risk to the general fund, etc.)
I won’t post up the whole question/answer concerning how Sacramento intends to fund much needed ADA upgrades to their community theater (which is facing possible closure over the issue) except that we’re told that there’s no answer now but hopefully there will be an answer in September.
http://eyeonsacramento.com/2013/04/its-all-about-the-money/ So it’s from this blog/interview. As typical, the government doesn’t have gobs of money just set aside for building sports stadia and goes through some real contortions to deliver on financing. The poor treasurer is being interviewed from an extreme element.
Of course the parking spots under the half-vacant mall are probably underutilized now. If there’s more coming to downtown for said arena parking revenues are likely to increase, the automobiles just shift to any remaining spots.
Even the Bee is saying that the Sacto arena subsidy is more like $300M than $258M. But the Bee is a month late and $42M short.
The NBA’s position, though, seems to be that they larger the subsidy, the better the odds. They’re probably happier at $350M than they were at $258M.
But one thing in those term sheets really bothers me. It is highly likely that the mitigation required in the EIR will be very expensive. But the terms sheets say that the parties will simply negotiate the percentages and amounts later.
That strikes me as being a very expensive KJ error. Especially if you see the freeway interchanges in question; they will not be up to the task, and solving this will be very expensive (because of the design of the boat section). If they simply redirect the traffic down 9th Street, or 15th Street, the neighborhoods can and should sue. I wouldn’t stand for it if I lived there.
The NBA is happier with a higher value subsidy but what’s happening here is that the NBA is saying, “Sacramento, you’ve offered up at least $250M for two years in a row. Mayor KJ and Senator Steinberg, you’ve talked a big game for the last few years. We got the Maloofs out of your hair. Time to put real money on the table and shovels on the ground. Produce, or else.”
There’s an article in a sports business journal (for subscribers only) that claims that Team Ranadive will forego revenue sharing until the Kings move into the new arena to so the NBA would consider the Kings as revenue neutral instead of takers.
Bee has a summary of the SBJ article here:
http://www.sacbee.com/2013/05/06/5398439/sacramento-kings-dallas-nba.html
I guess the problem I have with Ranadive’s offer is that it creates an uneven playing field. How many other NBA bylaws that benefit the owners can they choose to waive?
Oh well, they chose to accept the offer. Seems kind of weird to me.
If the Kings set themselves up to not make a profit, how will Sacramento ever see more than $1M/year?
I like the bit in the Bee article that MikeM posted about who covers cost overruns: Significant vs. All. The boosterish Bee put out a potential crack in the deal. Interesting. Stay tuned.
I still think Hansen has a good shot at getting the Kings. The Ranadive group is strong but Hansen is hard to turn away and he’s what the Maloofs want.
I was just at Downtown Plaza. It’s hard to turn away practical things like a Starbucks, Hallmark, and a Post Office for an arena.
Ranadive makes zero sense to me for a few reasons:
1. Why would he agree to turn down revenue sharing under any circumstances? That is just bad business and in a small market like Sacramento that puts the team in a bad situation when it comes to free agents and maximizing profit and revenue. No businessman in their right mind would voluntarily agree to this…..even a new arena would not solve the Kings need for revenue sharing. How many small market teams have great arenas but still get revenue sharing?….Indiana, Charlotte, Memphis, just to name a few.
2. Ranadive is also agreeing to pay cost overruns on the Sacramento arena on a site that needs a massive infrastructure overhaul….I.E. freeway interchanges, tearing down the old mall, new parking structure, etc….He must know of the 2004 study that showed an arena being built on the same site would cost upwards of 500M-600M because of all these issues and he agrees to covering cost overruns? Huh?
3. Ranadive and his entire group are from the Bay Area and not one is a Sacramento homer. This makes this even more puzzling. Why is Ranadive and his group fighting to save this team in Sacramento when in reality not one of them lives anywhere near Sacramento? Ranadive’s company is based in the South Bay (Palo Alto) and it is 2 hours away easily without traffic to Downtown Sacramento. I understand why Hansen-Ballmer are going all out because they are in fact Seattle “homers” and want their team back….Hansen is from Seattle and Ballmer has lived there for years.
4. Ranadive is paying 525M for a team he knows full well is not worth that in Sacramento. That price was negotiated based on a Seattle team and their market demographics yet he is willing to pay that same price when he knows its inflated? How does he expect to make his group’s money back by overpaying for the team, paying 200M-300M for the arena, and not taking revenue sharing? This is unbelievable….
Conclusion: Ranadive and his group have no intention of keeping the Kings in Sacramento. They want to do what Larry Ellison has tried and failed to do several times and that is move the team to San Jose CA.
In San Jose, the team is worth 525M because of the area being flush of corporate sponsors, affluent fans and a new TV deal would allow the Kings to share all of Northern California/Nevada with the Warriors. Right now the Kings are blacked out in the Bay Area by the Warriors. Meaning Ranadive and his group cannot watch the game from where they live if they buy the team….Another thing that perplexes me.
In San Jose, Ranadive can partner with the Sharks on a major renovation that will cost far less than a building new in Sacramento and attract affluent fans, corporate sponsors, and a TV deal where revenue sharing will not be needed. San Jose is far enough away from the Warriors that they will be able to get fans because of sheer distance. Right now getting to Warriors games from San Jose is horrendous as traffic flows to Oakland from San Jose at night. The Warriors get very few fans from the South Bay.
The NBA in turn gets 2 Bay Area franchises in its two richest cities, SF and SJ. Both of whom would be revenue sharing winners.
I believe this is what Ranadive and his group want to do but unlike Ellison they are playing it cool like Clay Bennett did with OKC. They are agreeing to anything and everything the NBA wants to get into the door then within 1-2 years from now when it is obvious KJ’s arena plan is vaporware and never was feasible, Ranadive will turn around and move the team to San Jose where his entire group can attend games.
This is the only explanation I can think of as Ranadive and his group are not making a sound “business decision” buying the Kings and voluntarily shooting down revenue sharing.
@MikeM
Ranadive is taking a risk by foregoing revenue sharing but let’s not forget that a non Maloof owned King team has the potential to rank in the upper half of the NBA in revenue generated. If so, they wouldn’t be collecting from the revenue sharing pool in the first place.
Keep in mind that they will be in the bottom half of the league while remaining at STA but they will be getting revenue sharing, albeit a smaller share due to what they agreed to. It’s when they move into the new arena, if it indeed happens, that they have the ability to generate an above average revenue number.
Sounds to me like the BOG was concerned about losing a revenue sharing contributor like Hansen/Ballmer in Seattle for a possible low revenue alternative so they forced this deal on Ranadive or else he wouldn’t get the team.
@SBSJ
Yes, Charlotte, Memphis, Milwaukee, Indy and New Orleans are, have been and always be revenue sharing leeches.
But keep in mind that one horse towns like Portland, San Antonio and Salt Lake City are more often than not, in the upper half of revenue generating due to being the only show in town. Ranadive is taking a risk but he believes that the Kings, if ran correctly, can be another SA or Utah. Like I said in the above post, that may have been the deal maker so he may not have had any choice.
@SBSJ
I have to think that if the arena deal with Sacramento falls apart at some point, Ranadive will flip the team to Hansen and Ballmer. San Jose isn’t an option because the NBA has the Warriors’ back. They know that Lacob is putting a ton of his own money into the SF arena and wants the bay area to himself. They’ll put a stop to a 2nd bay area team and would take care of Seattle all in one fell swoop if the DTP deal falls apart.
As far as being blacked out is concerned, I’m pretty sure that Ranadive can just purchase league pass and watch the Kings since they are over 75 miles away from Palo Alto.
@MikeM
I agree in that the Warriors have a good thing going with Oracle Arena. They don’t need a new building nearly as much as the Kings do.
OTOH, check out these new renderings of what the arena will look like. Lacob is a smart man. He has to know what type of naming rights deal will be in place, how many extra corporate sponsors will come his way and how much more he can make with all the extra suites in the new building. Not to mention that value of the team goes up just by putting “San Francisco” in front of Warriors as opposed to “Golden State”. I’m sure he’s done his homework and it must all pencil out or he wouldn’t be doing this.
http://www.nba.com/warriors/sf?venue
anybody who calls Portland a one horse town is an idiot…Portland like Seattle are the GREAT American Cities…and where the kids are moving…those cities have no problem attracting talent…
New York is a cesspool of Wall Street money changing leaches…it’s the past…the East Coast is TOAST…the West Coast, China, India are the future…get used to it…Spanish, Mandarin, Cantonese, Urdu, Hindi are the future…
Portland IS the city of innovation…re the Oscilloscope and technology…
If you don’t believe the West Coast is the future…IMMEDIATELY disconnect your computer and throw it away…for EVERYTHING on that machine is from or designed either in Portland, SF, Seattle or LA….
Whoa, “segio”, relax. I’m pretty sure “one horse town” was used to refer to the number of “major league” sports teams in town.
re: “Ranadive is taking a risk by foregoing revenue sharing but let’s not forget that a non Maloof owned King team has the potential to rank in the upper half of the NBA in revenue generated.”
Not very likely. You’re forgetting that we now live in a world where a very large portion of your revenue comes from your local TV contract. As the #20 TV market in the US, Sacramento-Stockton-Modesto isn’t gonna get you into the upper half – unless you figure out a way to sell all your seats for $200.
I think if this group wins next year the ticket sales will be dramatically higher than last year (not sold out, but still respectable) to both show the appreciation to the NBA for letting the Kings stay, and as a middle finger to the Maloofs for how bad they were. They probably could sell tickets to the point that they get little to no revenue sharing, so why not throw away nothing to potentially gain something?
@sergio
I’ve lived on the west coast my whole life. Bay Area and LA. And yes, Keith is right when he confirms my comment of Portland being a one sport town.
@Keith
Correct that the tv deal will be below average but they also have proven that if you give them a good product, they will produce big time sellout streaks. Even if they don’t get into the upper half, they’ll come close enough to make the loss of revenue sharing a non factor.