Friday roundup: St. Louis to get $790m Rams payoff from NFL or Kroenke or both, MSG deemed too pricey to move

Not even sure how many people are out there reading this rather than still Thanksgivinging (Canadians, right?), but the news sure hasn’t taken a break for the short holiday week:

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24 comments on “Friday roundup: St. Louis to get $790m Rams payoff from NFL or Kroenke or both, MSG deemed too pricey to move

  1. Is a new Penn Station that pressing of an issue? I go through there about two or three times a year and it seems fine. The expansion across the street seems fine as well. I’m confused on how much time and effort is spent on it considering it’s ok.

    Also didn’t St Louis put a no relocation clause in the stadium contract that the Rams fell afoul of? Like the PSAs, I get the impression that the Rams just did the move without reading any of the fine print.

    1. Commuters really, really hate the underground Penn Station, and people who miss the old building that was torn down in the 1960s have dreams of replacing it with a new one. There’s no doubt that it would be better for all concerned (well, maybe not the Dolans) if the original Penn Station had been left in place and MSG had stayed up on 50th Street or wherever, but now that that’s over and done, it does seem kind of crazy to throw billions of dollars at trying to undo it, yeah.

      As for St. Louis, it had a no-relocation clause in its original lease, but Kroenke had the right to break it if the city didn’t agree to keep the dome “state of the art,” and the city rightly decided that it wasn’t worth spending hundreds of millions on renovations or a new stadium just to enforce that clause. That the city still managed to walk away with $790 million (less legal fees) because Kroenke and the NFL couldn’t follow their own rules is definitely an impressive win — clearly St. Louis got some better lawyers in the interim after the bozos who signed the initial dome lease back in the ’90s.

      1. I read somewhere that Penn Station was designed to accommodate 250,000 people a day. It’s used by 600,000 people a day. If you were one of those 600,000 people who has to use it every day, you would want MSG to move somewhere else!

        1. Moving MSG and building a new Penn Station on top of the underground complex wouldn’t increase capacity, though. It would mostly just provide some nice skylights to stand under while waiting to shove your way onto the escalator to the 6:15 to Ronkonkoma.

          1. I’m not so sure. Adding more levels would increase capacity. Although if you did that only the top level would get the skylights.

      2. Chicago has a similar problem with Chicago Union Station and the 40 story office building, 222 South Riverside Plaza, that was built over it in 1970.

  2. That $8.6 billion figure for moving Madison Square Garden seems very suspect to me. The Daily News article says that number includes a $5 billion estimate for the cost of purchasing land to build a new MSG. But they haven’t determined where the new MSG would go. So how do they know how much the land would cost when they don’t even know what land they would be purchasing? This doesn’t make any sense.

    1. Better to be on the safe side, Dave. Just assume they are going to buy Augusta National Golf club and put the new station there. $5bn should cover it, almost.

      And if there’s a couple billion left over, NY will just give it to the Dolans. You know, like a buyout of the future savings they were expecting on the tax abatement that was set to expire in 1992. With interest, of course.

    2. We would need more documents from that June 1 meeting to know that. Time to test Gov. Hochul’s commitment to transparency again!

      1. So you think the documents from the June 1 meeting would specify where MSG would go, if it were to be moved?

        1. Actually looks like the calculations are in the Powerpoint from that meeting:

          https://reinventalbany.org/wp-content/uploads/2021/11/CACWG-6-MSG-Presentation_20210601.pdf

          Estimated Cost to Buy Out MSG
          Land/Building/Air Rights: $1.15B (from Forbes valuation)
          New Land: $3B (assuming two midtown city blocks)
          Demo (2 blocks): $360MM
          New Arena: $2B (~price of MSG Sphere in Vegas)
          Estimated Cost to Reconstruct Penn (Again)
          Demo of MSG: $75MM
          New Penn: $2B

          Those are all guesstimates by Empire State Development, sure, and clearly ESD is trying to make a case that it’s not worth it. But even if you assume cheaper land and a cheaper arena and a cheaper train station, let’s say you get it down to $5 billlion — is that really any more worth it?

          If you just refuse to extend the operating permit for MSG and kick the Rangers and Knicks out the door with a “Good luck on your future endeavors,” that’s a lot cheaper, clearly. But nobody in government seems to have the stomach for that, or just they don’t want to have to wait out the inevitable litigation, so here we are.

          1. It’s weird that the price of MSG Sphere is being used because it’s a state of the art concert venue and not able to host basketball or hockey.

          2. Neil, thanks for the link. It’s very interesting. Yes, ESD is trying to make a case that it’s not worth it. It seems like ESD started from the position that it shouldn’t be done. Then they invented numbers to prove their position. Why isn’t the New York news media reporting that?

            If they could get the price down to $3 or $4 billion I would say it is worth it.

          3. “New Arena: $2B (~price of MSG Sphere in Vegas)”

            This is ridiculous. The Dolans could build a new arena with the $1.15 billion they would get from the sale of the MSG land and air rights.

  3. Clearly the Oak View group is envisioning the Baltimore arena making the jump to hyperspace. No, I’m not sure what hyperspace was/is either, but if Lucas can imply that units of distance can be substituted for units of time (namely, parsecs), then I would say all bets are off in the Star Wars (or stadium vaportecture) world.

    St. Louis did fantastically well. So did Al Davis (twice, as it turned out) in the 80s/90s. The NFL (after a few false starts) successfully modified it’s own rules and properties to prevent another Al from defeating them in court. I have every confidence they’ll make whatever changes are necessary to prevent another St. Louis situation from developing in the coming years. I am personally hoping that whatever that change is it will also eliminate Jerry Jones’ exemption from the NFL’s ‘shared merch revenues’ rule.

    Still don’t understand how that one survives…

  4. $5,000 to pay off the accidental Gov. of New York? It always amazes me how cheap it is to buy off these politicians…..

  5. Renovating Baltimore’s arena sounds so disheartening, especially given how unpopular the arena was 30+ years ago, nevermind today. Not to mention the money invested sounds like it will be bare bones.

    It’s one of the few times I remain steadfast in “replace” rather than “renovate”. But due to the city’s proximity to Philadelphia & DC, the idea is there’s no need for a world class venue. Which makes sense if you have money to travel…

    But not everyone can travel.

    1. Baltimore is too close to bigger/richer cities to get an NHL or NBA team but it doesn’t seem to want to support minor league hockey or indoor lacrosse, which should work in Baltimore.

      So is this arena just for the Baltimore Blast? (Indoor soccer) and the occasional college basketball game?

  6. Neil

    Isn’t there a clause in the NFL-St. Louis agreement that the city and its lawyers have to destroy any documents provided by the league and its affiliates?

    https://profootballtalk.nbcsports.com/2021/11/26/st-louis-settlement-agreement-requires-the-destruction-of-documents-regarding-the-case/amp/

    Also, it’s just semantics, but since Hochul wasn’t elected governor, technically would this be a re-election campaign?

    1. The destruction clause is for any “confidential information,” and while that isn’t defined, it references a 2018 “protective order.” So I’m guessing this is things like internal financials that were provided as part of discovery, maybe, under condition of only being used at trial, which now won’t happen?

      https://twitter.com/SportsLawLust/status/1463608347052097536/photo/2

      And yes, it’s still a re-election campaign regardless of how you got into office in the first place. Gerald Ford ran for re-election as president in 1976, despite never having previously been elected to any nationwide office.

      1. Yeah, that’s why I tried to convince people Alexander Haig’s 1988 presidential campaign was to “Re-elect Haig,” but few people appreciated the subtlety.

  7. I’m thinking the Baltimore stadium rendering is “place you can zone out to after you dropped acid and ate the suicide pills. Because, let’s face it, if you’re an Orioles fan, you’re already halfway there.”

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