Billionaire Philadelphia 76ers owner Josh Harris, who has already proposed building a $1.3 billion arena in Center City near Chinatown using no public money except for property tax breaks and possible state funds that could actually amount to a whole lot of public money, on Friday had one of his fellow execs announce that they would happily host the Flyers at their new home as well:
“We’d love the Flyers to come, we’re having discussions with them. We don’t know what will happen,” [part-owner David] Adelman said. He added that “hopefully [the proposed arena] aligns with [Comcast’s] goals as well.”
For the Flyers to move makes zero sense on the face of it: Not only is the hockey team currently in the middle of a $300 million renovation — conducted by Gritty, apparently — to add things like (checks) uhhh, themed bars, but agreeing to become the Sixers’ tenant rather than being their landlord at the current arena seems like a definite downgrade.
But then, there’s a lot that doesn’t make sense about this new arena plan. Sure, one generally prefers to be the landlord than a tenant, but is it really $1.3 billion better (less whatever subsidies the Sixers owners end up extracting)? Especially when having two major arenas fighting for the same sports and concert market — and each having to pay off their own pile of construction debt — is just going to make each of them less lucrative? Adelman told the Philadelphia Business Journal that the ownership group is “willing to accept lower than market returns on this project” because they see the new arena as a “social mission” that “can be a catalyst for Philadelphia,” all of which is nice PR glurge, but there’s a big difference between “lower profits than we could potentially get by spending the money elsewhere” and “throwing money down a hole that we’ll never see back,” and there’s plenty of evidence that an arena gamble like this could end up the latter.
The most plausible explanation for the Sixers owners’ move, really, is as a scheme to try to displace the Flyers at the top of the Philadelphia arena heap. We’ve seen this tons of times before: It didn’t make much sense, for instance, to build a new Newark arena for the New Jersey Devils what with the old Meadowlands Arena still drawing concerts nearby, but once the Meadowlands was shut down, the Devils had a monopoly on that market. It’s the concert-industry equivalent of the pre-Amazon days when Barnes & Noble would open an outlet right across the street from a successful local bookstore: In the short run, there may not be enough customers to go around, but if you can be the last store standing, you’ve just seized somebody else’s business without having to go through the trouble of buying it.
If that’s what the Sixers owners are up to — and this latest invite to the Flyers to come bunk with them makes it seem likely, though it could also always just be more PR glurge meant to counter Philadelphians’ questions of “Why do we need another new arena exactly?” — then it’s an awfully big risk in the hopes of getting to be the big dog in the Philadelphia arena market. Which, if the Sixers owners were just gambling their money, then it’s their money, but once they’re asking for tax breaks and the right to mess up Chinatown, it becomes the public’s problem as well.
why would comcast let its owned sports property become a paying tenant in someone else’s arena when they own their own building?
If anything, they should become 50/50 partners. I can’t see the Flyers paying rent but 50/50 would lessen the $1.3 billion bill for the Sixers and at some point, the Flyers are going to want a new arena. When this new one opens up, the old one will be almost 35 years old and you know how that goes…..