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:
- As noted in an update to Wednesday’s post about the billions of dollars Los Angeles Rams owner Stan Kroenke and the NFL could be on the hook for in the city and county of St. Louis’s lawsuit over the team leaving town, the league and city have reportedly come to a settlement agreement where the league will pay St. Louis $790 million to make the suit go away. The St. Louis Post-Dispatch reports that “the league will determine internally how much will be shouldered by Kroenke and how much by the league and owners” (according to “sources with firsthand knowledge of the settlement”), which should be a fun owners’ meeting for ESPN to do one of its in-depth exposes on. St. Louis University law professor (and former minor-league pitcher suing MLB for violating minimum-wage laws for its minor leaguers) Garrett Broshuis called the settlement “a wake-up call to the NFL,” which, sure, maybe it’ll stop the league from threatening to move teams at the drop of a hat, or maybe at least give local officials some backbone in telling the league, “You just go ahead and try, we’ll see you in court.” Or maybe it’ll just get the league to rewrite its relocation guidelines so they’re not so litigable, or send its owners for training in how not to put in writing letters to fans about their pending move before the league approved it, or at least how not to call it an “Adios, MFs” letter. Either way, at least St. Louis will get $790 million that it can now spend on something more productive than an NFL stadium, which is an undeniable win, whether or not it’s ever repeated.
- Talk of relocating Madison Square Garden to make way for a new Penn Station, which has been ongoing for more than eight years and was still in play as recently as this January, is apparently off the table now that it’s been determined it would cost $8.6 billion to do so and taxpayers would have to foot the bill “to avoid lingering MSG complications that would arise with no buyout.” This according to the minutes of a June 1 behind-closed-doors meeting of state development officials and local legislators that was uncovered by the government-watch group Reinvent Albany last week. Metropolitan Transportation Authority chair Janno Lieber went on to add this week in a state hearing that taking time to negotiate for the relocation of the Knicks and Rangers would be “a guarantee that Penn Station won’t be fixed for, I think, another generation,” so really, forget about all that. None of this should stop talk of finally repealing that full property tax break that was supposed to expire in 1992 but instead keeps rebating more than $50 million to the MSG owners every year, but new Gov. Kathy Hochul apparently isn’t interested in doing so; the New York Daily News notes that MSG’s political action committee donated $5,000 to Hochul’s reelection campaign fund in September, which is either a coincidence, a reward for services rendered, or the chintziest bribe ever.
- Baltimore’s arena is set to get a $150 million renovation from arena managers Oak View Group — the city’s Board of Estimates voted to approve the deal on Wednesday, but I haven’t been able to track down the actual lease and operating agreement yet to see what if anything the city is giving up — which means we’re getting the usual batch of renderings what the
I have no idea what any of this has to do with a sports/concert arena or why the weird ceiling lighting appears to be reflected in the floor or who that bare-midriffed woman is whose image towers over the (squints) Top Sail Wine Bar, but presumably we’ll find out in due time. - Twenty-one out of 23 Ohio economists surveyed last week say that the economic benefits of sports stadiums don’t outweigh their subsidy costs, which is kind of a dumb way of asking it — you would think it would depend on how much subsidies are, which is actually something raised by several of the individual respondents — but we get the point.
- The Newfoundland Growlers have been evicted from their arena in St. John’s during an investigation by the city into allegations of “disrespectful workplace conduct,” and their owner is now trying to turn that into a bidding war by surrounding communities to let him build the new arena that he’s been wanting for a while anyway. Maybe if my idea for a Sunday Night Kroenke series doesn’t pan out, someone could take a stab at this one? David Simon, this has your name all over it!
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.
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.
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!
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.
I’m not so sure. Adding more levels would increase capacity. Although if you did that only the top level would get the skylights.
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.
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.
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.
We would need more documents from that June 1 meeting to know that. Time to test Gov. Hochul’s commitment to transparency again!
So you think the documents from the June 1 meeting would specify where MSG would go, if it were to be moved?
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.
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.
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.
“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.
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…
I’m reading!
Everyday!
I NEED my daily fix of some
FOS verbiage!
$5,000 to pay off the accidental Gov. of New York? It always amazes me how cheap it is to buy off these politicians…..
Sigh. This is so disheartening.
The wheel keeps turning, crushing all in its path…..
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.
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?
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?
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.
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.
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.”