For anyone who holds to the belief that sports fans are mindless boosters who want their elected officials to keep their beloved team owners (or just beloved team’s owners) happy no matter what the cost, I present you with Blazer’s Edge, the SB Nation fan site for the Portland Trail Blazers. Site editor Dave Deckard yesterday did something that the rest of the local media hasn’t yet: He assigned a reader/contributor who goes by the handle BlazerTag (possibly Ryan Whitledge, who used to host a podcast by that name) to investigate whether the Blazers leaving town would really result in an economic and fiscal catastrophe for Portland, with the city left with “a skeleton building, unused and rotting.” And the answer is: If the experience of other cities is to be believed, Portland would be just fine.
The former NHL home of the Arizona Coyotes has been without its anchor tenant since 2022; they’ve moved onto the greener pastures of Salt Lake City. To see how bad the finances got in the immediate aftermath, let’s hear from Glendale City Manager Kevin Phelps.
“The venue (Desert Diamond Arena) smashed its all-time record for revenue after the (Coyotes’) departure,” Phelps said. “The next year, they beat that number by almost $10 million.”
Glendale, you may recall, had an especially horrific lease with the Coyotes, under which the city had to pay the team to play there. Portland, meanwhile, has an especially horrific lease with the Blazers, under which team owner Tom Dundon doesn’t pay any rent or share any arena revenues.
At the peak of their popularity, the Warriors left Oracle Arena in Oakland for a new facility in San Francisco: the Chase Center. So what happened to Oracle (now called Oakland Arena) when the Warriors left? It had its best fiscal year ever and reduced its operating deficit by 97% between 2019 to 2023.
The Bay Area doesn’t have a ton of arenas — it’s basically the Warriors’ new arena in San Francisco and their old one in Oakland (not counting San Jose, the South Bay is really a different market [EDIT: or maybe one market but a really sprawly one or 1.5 markets or something, see comments if this is important to you]) — so getting the Warriors out of the way has been a blessing in disguise for the Oakland arena. Nobody ever talks much about San Francisco as an NHL expansion or relocation market despite its huge population, and this is likely one of the reasons. (The last attempt going extremely poorly would be another.)
KeyArena turned a bigger profit than it ever did with the Sonics. It happened the same way it did in Glendale and Oakland when their anchor tenants left: by freeing up the stadium revenue the sports teams were hoarding for themselves.
It goes on like that, but you get the idea. This is, in fact, a common theme in arena finances: Having an anchor tenant for 40 nights a year is nice, but not so nice when they’re not paying rent and are taking away dates that could be used on concerts that would. It’s still not especially likely that Dundon moves the Blazers, but it does seem that he needs Portland more than Portland needs him.
BlazerTag then summed up with a couple of paragraphs that reflect a position I’ve heard over the years from lots of sports fans who are all too aware they’re also taxpayers:
I’m aware of the sorrow that awaits if no Moda deal is struck. I understand the emotional stakes, but I won’t let them blind me to the cold, hard financial truth.
“Moda Center will crumble without the Blazers” is Stockholm syndrome reasoning from a fanbase being held hostage by ownership. It’s misinformation that I will not suffer.
Blazer’s Edge also did some tea-leaf reading recently of the recently revealed internal Blazers emails in which team lawyer Zandria Conyers suggested just not answering city questions publicly, because “I don’t think our public answers will be well-received.” Deckard noted that while the pissiness was not great, “it was not the kind of nonchalant dismissal one would expect if the organization had already checked out of the process,” which is very true. “The good news: the Blazers do appear to be seeking public funding for the arena for real, which means moving doesn’t seem to be their first option,” concluded Deckard, and while that’s probably stretching the meaning of “good news,” it does argue against the conspiracy theory that Dundon bought the team just to move it, which is better than nothing.
The south bay is not a separate market. I understand it’s classified that way but in reality it’s the same market.
It’s really not. I have spent more time in the Bay Area than anywhere except NYC, and I still have never been to San Jose.
There’s a blurring of where the market lines change over in the South Bay, but San Jose is as much a part of the SF/Oakland market as Sacramento is.
“and I still have never been to San Jose”
Neil, we have a dang ‘ol song that’s a GPS you can tap your foot to…
For shame!!
I’ve been to Santa Cruz and Monterey! And I was one lucky number in my scorecard away from winning a ham and mushroom melt at a Modesto A’s game once…
The Ogdenville’s and North Haverbrook’s of the Greater Bay Area!
I get what you’re saying but the South Bay shares the same tv market as the rest of the Bay Area. im watching the same local news channels in San Jose as I am in San Francisco.Santa Clara County is part of the Association Of Bay Area Governments (ABAG), the regional planning agency for the market. Bay Area Rapid Transit has stations in San Jose . So that’s why most of us automatically think “same market” it is analogous to LA and Orange County? Where they share similar things like SF and SJ by are considered different markets?
Yeah, that’s a good comparison.
I’m sure there are touring acts that choose between playing SF, Oakland, or San Jose. But they’re not drawing from the same audience any more than Newark and Long Island are.
That’s just not the case. I live in the deepest farthest South part of Santa Clara County (Giants territory!) and any event in the Bay Area is absolutely in play– even as far as Napa or Santa Rosa. Chase Center is clearly the number one arena now, but all three get major acts, sometimes it just depends on dates that are available. And you suck it up and go.
When Rush is SJ in October, I guarantee you they’re drawing from all eight counties and beyond. Same with Ariana Grande in Oakland or Noah Khan in San Francisco. It’s one big market.
Fine, I withdraw my “not one market” remark. I forgot that people in California think nothing of driving 100 miles just to be stuck in the parking lot when Rush goes onstage. Enjoy!
I think it’s the same market in the same way that Devils, Rangers and Islanders are all in the same market. Or perhaps its like Washington and Baltimore — physically close but perhaps psychologically far away.
But, as I understand it, the San Jose Sharks games on cable reach a very large part of California and maybe even Oregon. And from the NHL’s perspective, and certainly from the Sharks’ perspective, the Sharks are the team for that entire region.
The NHL would have to expand to at least 40 teams and/or hockey would have to get *much* more popular before they’d want to fight the Sharks to let somebody shoehorn in another team in that area. It’s a big market, but not *that* big.
Based on years of watching local TV ads during sports, my conclusion is that the size of media market is based on the distance a reasonable person in that area will travel to buy a new car or a new mattress.
So as far as concert promoters go- San Jose kinda is a different market. Touring acts will often play the SAP Center and then Chase or Oakland.
It really just speaks to how geographically large/spread out and wealthy the region is.
It is *extremely* rare for touring acts to play at multiple of the Bay Area arenas on a single tour. Chase Center and the Oakland Arena are only 1hr from SAP Center by train or by car under average traffic conditions. The former 2 are only 30min apart by car.
Sorry, I’m going to have to agree with Daniel. The owners of the “San Francisco” 49ers moving to the South Bay proves many in the pro sports world view SF/Oak/SJ as one market. Heck, Bay FC plays in San Jose but is building a training facility on San Fran’s Treasure Island. The Giants blocking the A’s from moving to San Jose further supports the point. Let’s not even start with FIFA labeling San Jose/Santa Clara as the “San Francisco Bay Area”.
It’s why San Jose (and Anaheim) aren’t being bandied about as places Dundon could move to. I think the Sharks would raise holy hell if San Fran/Oakland were considered an expansion or relocation spot just as the Warriors would San Jose for a NBA team.
“San Fran’s Treasure Island”
We prefer if you refrain from using that term, and replace it with the preferred nomenclature of UP YOUR ALLEY.
Football is different from the other sports.
People will drive a lot further for football because there’s less of it and it’s almost always on the weekend. Also, NFL doesn’t care as much about the regular ticket sales as the other leagues do.
A ton of attendance at the Giants’ home games comes from people who live in Santa Clara County. The distance isn’t meaningfully dissuading anyone even for a sport with 81 regular season home games per year.
Seattle’s arena was rebuilt with private funds ($1.15B!) and is now called “Climate Pledge Arena.” The City owns the arena but leased it to the private operator/developer for 35 years, plus options extending to 51 years. It is tricky to compare the current Seattle arena and it’s rebuilding to the current Portland arena situation. Yes, Climate Pledge Arena appears to very profitable now without the SuperSonics, but it was rebuilt specifically to (a) be a world-class facility for music and other artistic entertainment, and (b) accommodate NHL hockey (the expansion Seattle Kraken) and the eventual return of the NBA’s SuperSonics. It’s not clear that the Moda Center in Portland, if it loses the Trail Blazers, can be anywhere near as profitable without substantial renovation. The very renovation that they are balking at now. In Seattle, the taxpayers did not pay for the rebuild. Would Portland be so lucky?
Baltimore’s city-owned arena recently got a renovation funded entirely by the Oak View Group (the same company that paid for the rehab of Seattle’s arena) and NBA star Kevin Durant. Because of the city’s proximity to DC and Philly, it’s unlikely to house the NBA or NHL.
The NBA left Cincinnati in the early 70s, but the city is home to a privately-owned arena that is a dump but still hosts concerts. Ironically, The Cincinnati Royals moved to Kansas City, another city with an arena that hosts concerts with no NBA or NHL team. Even the Hartford Whalers old home now operated by Oak View has upcoming acts like Nate Bargatze and Olivia Rodrigo. (Funny enough, Dundon wore a Whalers hat on the first day he took over as Blazers owner according to Bill Oram.)
If arenas can be profitable without a major league tenant, then the people trying to get a new arena in Cincinnati should just build it instead of trying to convince the public they need public funding so that the arena can get an NBA team or whatever.
Oh, arenas almost never pay off their construction costs with or without a pro sports tenant. But once you’ve blown the money on building one, you’re better off booking concerts, which actually pay to rent the space, than NBA or NHL teams that turn up their nose at such a concept.
https://www.fieldofschemes.com/2009/09/29/2338/is-the-sprint-center-really-making-money/
Oh, I see.
If they don’t pay off their costs, then why would a private investor ever build one?
They usually don’t, except in big markets. Or in places where they hope they can grab all the choice concerts and drive the competition out of business. (The Barnes & Noble Effect?)
Since the Giants paid off the loan they took out to build PAC Bell Park , does that count as paying off their costs?
This is mostly outlined in the article.
“Would Portland be so lucky?”
Is it luck? A for-profit company did all that and is, apparently, profiting away.
Chicago is facing the same issue and I honestly don’t care at all what happens to Soldier Field. There was talk of pouring money in and turning it into a “world class venue” and hell it’s a great place to see a show as it is, so if a place wants to do that, have at it. If they raze it and build condos, it’d be an insanely valuable property. The Moda Center isn’t in a great place like that but it’s certainly not without potential. But I really don’t know about rival venues that it would be competing against, etc.
This further illustrates the point that the only remotely credible arguments for stadium subsidies are the emotional ones.
Unless you’re someone who’s turned being a fan of Team X into your whole identity/personality, or someone who cares entirely too much about how your city is seen by the outside world, any clued-in local would recognize the economic and financial arguments for these huge giveaways as unpolished turds that they are.
The main problem is that the former group routinely makes up the majority of crowds (and public speakers) at any city countil meeting related to stadium negotiations, and the latter group also routinely comprise the majority of city councils themselves.
For normal people who don’t believe every relationship is a financial transaction – i.e. not billionaires – emotion is what makes life worth living, so all of that cannot just be dismissed out of hand.
But there have been attempts to measure how much people really value having a big pro sports team in their city and the results seem to show that it’s a lot less than the cost of the deals. Neil could provide links, maybe. There have been surveys, of course, and the study on property values.
People tend to value what they already have – or think they already have – far more than whatever they could have instead. That is, as I understand it, called “the endowment effect.” The world would be better if everyone were aware of these common biases.
So I would imagine Portlandians would value the Blazers far more than any other kind of development they might get instead. I also suspect that most people would not say that Portland is not getting enough big concerts because the NBA team is hogging all the good dates although, for all I know, that may be true to some extent.
(However, I have noticed that the fans of struggling teams have a tendency to overvalue what they might get in a trade or if they fire their coach. I’m not sure what that is called. Maybe it should be called the “Grass is Greener” fallacy or maybe the “A boat is a boat but the mystery box could be anything. It could even be a boat” fallacy.)
Looks like it’s the Focusing Effect:
https://en.wikipedia.org/wiki/Focusing_illusion
Thank you!
Being a cheapskate, I get TV through an antenna. I am in SF but can’t receive SJ stations, so I consider them separate markets.
Are the Sharks on broadcast TV at all?