Emphasis, or beating a dead horse
- 02.25.11, 06:00
- 86 Comments
The Chronicle’s Susan Slusser catches up with Lew Wolff on the stadium situation:
Wolff reiterated that he believes that the Bay Area should be considered like the other two-team markets, none of which have territorial rights assigned.
Wolff said that funding for any stadium approved in San Jose is in place. “We’re prepared to build the stadium,” he said. “We have the funding, the equity, the sources of revenue.”
This is the first I’ve heard or read Wolff confirm this. Obviously he’s not going to divulge details on how this would work, but we’ve made plenty of reasonably good guesses here to paint a picture.
In other news, the Kings have asked for an extension to the March 1 deadline to petition for a franchise move, presumably to Anaheim.
With both of those in mind, here’s a simple poll question.
[polldaddy poll=4615143]
A’s Fan: according to Fortune Magazine, in 2010, Wells Fargo alone had revenues about equal to Google, Cisco, and Apple COMBINED. AT&T had greater revenues than ANY company in Silicon Valley. As if it mattered to you.
Sid: Okay I give up.
Bartleby: in the past, you repeatedly fudged demographic figures, using values 200, 300, 400 percent off the mark, while accusing me of playing loose with facts. You tried in the past to claim there were 10 times as many Fortune 500 companies in the South Bay as the rest of the Bay Area, that there twice as many people in the South Bay as the rest of the Bay Area, that Walnut Creek to South Diridon is no worse a drive than Walnut Creek to downtown Oakland. These are just huge and ridiculous lies, streaming forth in a pattern from you. Knowingly falsifying data by huge amounts to try and win arguments is pretty straight up a dickhead move. I don’t know if pointing out someone’s deceit and lack of character is the same thing as actually lacking the character, but if so, then fine, I’m a dickhead too.
ML: I wasn’t clear. Sure I’ve opened the page up occasionally and poked around to see if there was breaking news (15 page reads in 2 months, gee…), I was talking about reading these forums such that I’d have noticed a difference in the way you ignore idiot commentary from anyone in favor of San Jose (or anti-Oakland), but are quick with smartass hostility to anyone with doubts about MLB in the South Bay.
@tps – Here’s a tip. Don’t like the way the comments are moderated? Don’t read ‘em. Simple as that. You’ll breathe easier. It’s not like they’re “content.”
Dude, just give up while you’re way behind.
Can’t stand seeing the same lies told over and over again? Can’t stand seeing people who prefer the truth run out of here on a wave of insults? Then move along buddy, this ain’t the place for you!
this is almost as good as my meltdown with jk – lol
” ..according to Fortune Magazine, in 2010, Wells Fargo alone had revenues about equal to Google, Cisco, and Apple COMBINED. AT&T had greater revenues than ANY company in Silicon Valley.”
@TPS – Interesting. Got Link?
FWIW,
Wells Fargo is headquartered in San Francisco and AT&T is headquartered in Dallas TX. And yes, there are some company’s across the country (and even Bay Area) that enjoy greater revenues than many here in Silicon Valley…BUT SO @#$%&* WHAT!
(Hey all, maybe this will work)…TPS, you are 100%, undeniably correct in your assessment of the corporate revenue picture of the Bay Area!! Hip hip hooray for TPS!! Hip hip hooray!!
@David. Wells Fargo is #19 on the Fortune 500, much of the rise coming from its merger with Wachovia. There was a time when Wells Fargo was the “financial services sponsor” of the A’s. Fremont Bank has been for a few years, but I believe Wells has been back in the fold for a bit. Wells Fargo is a perfect fit yet again because rival BofA is the Giants’ charter sponsor.
One of the points Bartleby was trying to make that tps ignored is that Wells is going to be there wherever the ballpark is, and that there is only Wells – they’ll get a suite and sponsorship deal. There are no other such slots as the deals are exclusive. There need to be a lot of smaller companies to fill in the rest, and in this case we’re talking 40 large suites, 40 mini suites, and 3-4,000 club seats.
Let’s just face it, the A’s staying in Alameda County and most likely Oakland is the path of least resistance for the team’s stadium issue. Sounds like if you could go private financed stadium in Oakland is the best and most affordable and viable option. MLB buys land in Oakland. A’s build the stadium. A’s lease stadium land from from MLB. Oakland taxes the income from A’s and MLB profits. Everybody wins. San Jose gets to keep the minor league team, the Giants keep the Santa Clara territory, Oakland maintains the tax base the A’s provide, the A’s have a new stadium, and MLB can make some profit off of the private deal.
Land Costs: $90M
Construction costs : $450M
I did some calcuations and at $650M for land acquisition and construction costs assuming my projections above extremely low. The annual debt service amortized over 30 years with an interest rate of 5.5% (an achievable loan for the likes of Wolff or Fisher) the annual debt service payment would be $45M . Let’s say the A’s payroll is $90M. Assuming this costs and debt for land acquisition construction in Oakland, what revenue do the A’s have to bring in for current ownership to receive a modest return on investment? Is is possible in Oakland considering all the East Bay limitations in terms of corporate sponsorship? Marine Layer help me out!
A’s belong in Sacramento!!! End of discussion!!!
@Ethan – Effectively, the A’s would have to guarantee that virtually all of the debt could be serviced annually, even if the place doesn’t sell out. So if the A’s had to cover an additional $45 million every year (as opposed to $2-3 million now), their revenue would have to rise to nearly $200 million annually, which is where the Giants are. That’s where it gets difficult to figure out if Oakland has the backing to make it happen, because they will surely be heavily dependent on regional sponsorships to get it done. Take a look at my article on the debt rule from September. It’ll show you what other limitations are in place.
@sactodavey – Not gonna happen.
So according to the Forbes 2010 assessment of the team, the revenues are $155M. So the A’s have to bring in $355M in revenue under my assumptions for Oakland to really work. That is a tall task.
You are more than entitled to your opinion Ethan. I’ll give you credit though; at least you’re not foaming at the mouth like some on this site. FYI, San Jose WANTS to upgrade to Major League status and rid itself of Single A status, so in that sense SJ looses under your opinion.
@Ethan – Revenues have to rise to $200 million, not an additional $200 million. Part of the financing is expected to be a loan from MLB. There is no way MLB grants that piece unless the revenue streams are locked in.
Lew Wolff on SJ ballpark, “We have the funding, the equity, the sources of revenue.” Revenue streams anyone? Music to my ears R.M.!
AAPL market cap: $320.8B net income: $16.64B
GOOG market cap: $196.1B net income: $8.505B
CSCO market cap: $103B net income: $7.578B
PCG market cap:$18.16B net income:$1.113B
WFC market cap:$170.1B net income:$11.77B
ATT market cap:$166.2B net income:$21.86B
@ Ethan – Better idea….A’s move to SJ. Lew Wolff buys the land and the stadium. SJ becomes a Major League city and the A’s thrive from revenue standpoint. Oakland takes the RDA money for real improvements to their city and starts to blossom as SF sister city. Former Pro-Oaklanders become Giants fans travelling 10 minutes to PacBell park since they’ve been rooting for Neukum and TR rights for the past 3 years. Everybody wins including: a) real Oakland citizens who won’t get shafted with another Al Davis deal. Wolff and HIS A’s who get the revenue stream they’ve been deserving. b) SJ and SB baseball fans who patiently waited for a couple of decades and did the smart thing in acquiring land and doing EIRs ahead of time w/o any public funding to the park. c) MLB who pickup additional REAL corporate sponsorship (Cisco + SVLG), don’t have to fork out money on loans, and take one MLB off of welfare. d) And lastly, proOaklanders (the closet Gnats fans), will stop complaining about the horrid commute to the SB and take their precious BART to SF. :) Win, win, win…let;d do it!
I’d have to say the Kings have done a lot more. They’ve been at this for going on twelve years now. But the poll muddies the issue–it’s not like the Kings can move to Stockton.
If the question is, “Have the A’s done as much to stay in Oakland as the Kings have to stay in Sac?” then the answer is emphatically no. If Oakland’s efforts to “stay” include Fremont, Santa Clara, and San Jose, then it’s still “no,” but far less emphatically.
“Bartleby: in the past, you repeatedly fudged demographic figures, using values 200, 300, 400 percent off the mark, while accusing me of playing loose with facts.”
You DO play loose with facts. You’re constantly trying to represent SF statistics as if they were Oakland’s. Now you’re apparently trying to claim Fortune 500 companies as part of the East Bay’s corporate base regardless of where they’re located. Since you’re now claiming Wells Fargo and AT&T for Oakland, why don’t you go the rest of the way and claim Wal-Mart, Exxon, and Ford as well?
I’m sure I’ve made factual errors from time to time. We’re arguing on the internet, for crissake; I’m not preparing a brief for court. I do what we all do, surf the internet and cut-and-paste. Sometimes I make rhetorical statements not intended to be taken literally (intelligent people who aren’t consumed with an agenda can tell the difference). Sometimes I’ve made a general statement based on my general sense of things without doing an extensive research project before posting. (For example, when I said large portions of Alameda and Contra Costa County would have comparable drive times during rush hour, I didn’t actually do a calculation of every city in both counties before making the statement). Where I’ve been proven wrong, I’ve admitted it.
You on the other hand, never admit anything; you rarely even respond directly to the facts that don’t fit your world view. Your general modus operandi is to blow small errors out of proportion, intentionally misconstrue what are obviously rhetorical statements, accuse other posters of “lying” and ignore the fact that your “corrected” facts don’t change the underlying point whatsoever. Oh, and make disingenous arguments which pretend San Francisco is actually part of Oakland, doesn’t already have a team, and that there’s a moat surrounding Santa Clara County preventing outsiders from getting in. You’re also consistently and gratuitously rude.
In response to your specific charges:
“You tried in the past to claim there were 10 times as many Fortune 500 companies in the South Bay as the rest of the Bay Area,”
I think this is a mischaracterization of what I said; I believe I said the South Bay had a 2-1 advantage over the rest of the Bay Area generally; I may have said it had a 10-1 advantage over the East Bay. If you know different, show me the link and I’ll comment on the specifics.
Here’s what Wikipedia says about this subject:
“As of 2007, there were approximately 80 public companies with annual revenues of over $1 billion a year, and 5-10 more private companies. Nearly 2/3 of these are in the Silicon Valley section of the Bay Area.”
Bottom line: Based on the above, the South Bay has twice as many large companies of a size suitable for buying premium seating as the rest of the Bay Area combined. So, my basic point is valid.
“that there twice as many people in the South Bay as the rest of the Bay Area,”
Again, I’m pretty sure this is a mischaracterization of whatever it was I said. I did object strenuously to your persistent attempts to take the inverted geographic triangle which is the Bay Area and snip off just the lower tip when making your ludicrous, disingenuous “eight counties vs. one” comparisons. If you know different, show me a link.
The bottom line is, there are just as many people, and way more big corporations, within around a thirty minute drive of downtown San Jose as there are of downtown Oakland, which is the most important radius for purposes of bringing people out to weeknight games. So my basic point is valid.
“that Walnut Creek to South Diridon is no worse a drive than Walnut Creek to downtown Oakland.”
Whatever I said was in the context of a weeknight, rush hour trip. From Walnut Creek, it’s a smooth sail against traffic to San Jose during rush hour; traffic through Oakland is considerably worse. It may not be quite a push between Oakland and San Jose from Walnut Creek, but it is from places like San Ramon and Pleasanton. My basic point was that huge numbers of people in the East Bay will find a weeknight trip to downtown San Jose equal or better than a trip to downtown Oakand;
“These are just huge and ridiculous lies, streaming forth in a pattern from you. Knowingly falsifying data by huge amounts to try and win arguments is pretty straight up a dickhead move.”
Dude, get a grip on yourself, lighten up. You might want to increase your meds. Your ranting sounds like a communique from Pyongyang, or a Raiders press release.
“I don’t know if pointing out someone’s deceit and lack of character is the same thing as actually lacking the character, but if so, then fine, I’m a dickhead too.”
Again, Mr. Pot, please meet Mr. Kettle.
Just as a technical point, the revenues of a financial services company aren’t directly comparable to those of an industrial. That’s the main reason why Wells Fargo can look as big as Apple when by market cap and net income it isn’t.
How much will the A’s have to pay in return for territorial rights if they move to San Jose? I do know the Giants are not just going to give that away. Lou might have the funding, equity, and sources of revenue but he does not have permission. The cost of acquiring permission might throw off Mr. Wolff’s business model. The Giants are not going to just let the A’s move on into San Jose.
@Ethan – There is no set price. It may be $40 million as economist Roger Noll has stated, it may be $100-200 million, it could be $0. That’s all up to the commissioner.
Ethan,
It did cost the Giants $0 to acquire Santa Clara County back in 1992.
I’m thinking the Giants at the most will get $40 million and perhaps guaranteed franchise value and revenue through 2017; the year their mortgage payments sunset.
After 2017 the Giants automatically get a $20 million annual “bonus.”
“You DO play loose with facts. You’re constantly trying to represent SF statistics as if they were Oakland’s.”
SF and Oakland are connected by a Bridge. From the farthest western edge of SF at the Pacific Ocean to the farthest eastern edge of Oakland on Skyline, it’s about the same distance as downtown San Jose to Palo Alto. Your constant attempts to paint these cities as completely separate “regions” is just absurd. Many of the top execs at Wells Fargo LIVE in Oakland, Berkeley, Piedmont, Orinda, etc. I’m pretty certain that more customers and more employees of the company LIVE in the East Bay than in SF. It’s the same for nearly every other company in the Financial District. The SF Financial District is simply the “business park” for the 4+ million people in this densely populated region. This was a large and wealthy enough region to become a two-team market in the 60s, and it is more so today. And unlike you, I’ve never tried to build a mote and fictionally isolate anything. I’ve always gone out of my way to try and include the portions of San Mateo and Alameda counties which are tied to Silicon Valley by proximity and economics, when looking at the demographics–you know, the sort of effort at understanding the Bay Area that you go out of your way to avoid.
@baycommuter: I’m not aware of the technical difference between revenues of companies selling different products. Please help me out and explain.
@thisplanetsux: I think you should take a break. It’s understood you really, really, really want the A’s to stay in Oakland and you really, really, really hate San Jose, but the reality is that you’re really, really, really chasing your own tail here. All you’re doing is antagonizing people and embarrassing yourself. “SF and Oakland connected by a bridge”? Well, yeah.
What you ought to do is crunch numbers and prove that San Jose won’t work. IMO, the A’s are vulnerable from a debt service standpoint if they move to San Jose and they don’t get sellouts all of the time. This is especially true if they end up agreeing to pay an extortionate amount to the Giants. Thtat’s the vulnerability you might be able to exploit to pump up Oakland. But you have to understand: the A’s under current ownership will not build a ballpark in Oakland. Period. That’s a dry hole for you and you need to quit drilling. if you want to keep the A’s in Oakland, you need to find someone to build a park for them in Oakland. Or you need to find new owners who will do it. How many times do you need to hear it? The current ownership will not pay to build a new park in Oakland. And you guys sure don’t enhance the possibility of the ownership’s changing its mind with your name calling.
You want Oakland? Find the money, man. San Jose has found the money. What is there about this that guys like you don’t understand? You don’t want to drive to San Jose? You guys keep screwing around, you’ll be driving to Vegas or New Jersey or North Carolina. Damn, both “New York” football teams play in another state; you guys bitch about a 30-minute drive down a freeway. You’re unserious people.
tps: Sure, let’s see if I can give a clear explanation. If you look at the income statement of an industrial company, it will have a line for gross revenue, which is mostly what you’d call “sales.” This is the top line, and the market will value the company according to it as well as the bottom line (net income). But iIf you look at the income statement for a financial services company, revenue will be broken down into two components– net interest income and non-interest income. Net interest income has virtually no relation to sales– it is the difference between the revenues generated by interest-bearing assets and the cost of servicing interest-burdened liabilities.
A financial services company has some degree of control over net interest income by taking more risk, typically, by lending long-term and taking in short-term deposits (positive duration gap). This is basically how they make money, but if it can also cause a serious problem in certain interest-rate environments.
Thus, for a financial, higher revenue isn’t always a good thing, whereas for an industrial, it usually is. Financials tend to trade at lower P/E ratios because their net income is heavily dependent on net interest margin, which the company has very little control over.
@Old Blue: You have no basis to insult me for being selfish or simple-minded. I don’t live in the East Bay, this isn’t about my drive time. I’m equidistant from Oakland and San Jose out on the San Mateo Coast. I’m a diehard, and will make the trip where ever. I prefer going to downtown Oakland over downtown San Jose, for the scenery, the weather, proximity to nightlife in SF and Oakland, that much is all true. I have misgivings about San Jose in general, and the South Diridon plan in particular, which I’ve stated. I think the slow, painful process MLB is currently undertaking reflects similar misgivings on their part. I sincerely think we’d all get a ballpark sooner with a full effort by the A’s to build in Oakland. I understand they don’t want to build in Oakland, but in that case, THEY are to blame for the delay. They knew going in that San Jose would be a very slow process, and THEY burned their bridges in Oakland before San Jose was even possible. I’ve stated all that. And when I state these things, I typically get numerous responses from people that are wildly inaccurate on many different scores. That’s fine, I ignore some, I respond to some, no big deal. But there are a few semi-regular contributors here that seem hell-bent on countering every statement that conceivably favors Oakland or disfavors San Jose with some exaggerated, false, or at least dubious “facts” while also implying that I’m trying to spreading bad info, or else am just plain crazy. So I confront them directly for their dishonest efforts. If Bartleby hadn’t accused me of being way wrong and intellectually dishonest about things many times, while he was “accidentally” doubling, tripling, quadrupling numbers to help him make those insults, I’d never have had said boo to him. Anyways, I’m a high-tech entrepreneur, I’ve put three kids through college, and I don’t need your advice on how to conduct myself. But thanks.
@ML and others– FWIW, I heard a little snippet of Giants’ President Larry Bear on KCBS radio yesterday that peaked my interest. There’s the entire 28 minute interview on their website linked here below. Good interview, even though I hate the G’s. A’s/TR’s/Ballpark talk runs from 17:30 to the 22:00 minute mark.
Just a few highlights:
LB:We believe they (A’s) need a new ballpark, not a new territory.
There’s no precedent stripping a team of it’s territory.
The commissioner has never indicated to us that the territorial right that we have is in jeopardy or in doubt.
@jk-usa – I cleaned up your link. Thanks for finding this.
When asked how the Giants would be harmed, Baer says that the Bay is a barrier and that people tend to travel in a north-south direction. That is complete, utter BS. What he doesn’t say is that the Giants have effectively siphoned East Bay fans due to China Basin’s better accessibility.
@ML–no problem. I do what I can to contribute to this site, even though I’m not too popular on here. Thanks for cleaning up link. No sure how to do that.
Baer says there is no precedence for stripping a team of it’s territory… they won’t be stripped of it…just required to share it like all other 2 team markets
@jk-usa — Good find. None of us who want the A’s to stay in Oakland, are popular on this site. Don’t take any of it personal.
Baer seems to want to forget that there is precedent for one team gifting territorial rights to another.
My apologies RM for my tone re: Larry Baer. Its easy for us here to become extremely irate when the Giants brass talks about the A’s, San Jose and T-Rights.
But a the end of the day take comfort in the fact that it will be Selig’s and MLB’s decision for the A’s, not the Giants.
Would love to see Baer’s face when the good news is finally uttered.
“SF and Oakland are connected by a Bridge.”
Yes, I get that. And SF and San Jose are connected by a freeway. Both are paved, and can be used by cars for driving. I get all that.
The bridge is a huge DISADVANTAGE for Oakland, because it’s a monumental chokepoint for traffic at the most critical time for getting people to a ballgame.
“From the farthest western edge of SF at the Pacific Ocean to the farthest eastern edge of Oakland on Skyline, it’s about the same distance as downtown San Jose to Palo Alto. Your constant attempts to paint these cities as completely separate “regions” is just absurd.”
See, now here’s you at your most disingenuous. I have to believe you understand that the relevant statistic is not distance, it’s drive time. Getting out of the City during rush hour is excruciating no matter which direction you’re going. Just last week, it took me literally an hour from Pacific Heights just to get on the freeway heading home. From past experience, I believe if I had been unlucky enough to have been going over the Bay Bridge it could have taken me another hour to get to downtown Oakland. Your argument fails.
“Many of the top execs at Wells Fargo LIVE in Oakland, Berkeley, Piedmont, Orinda, etc. I’m pretty certain that more customers and more employees of the company LIVE in the East Bay than in SF.”
First of all, this is you guessing. Second of all, however many employees and customers Wells has in the East Bay, they almost certainly have a greater aggregate number of employees and customers in Marin, SF, San Mateo and Santa Clara counties. Meaning, a trip to the East Bay during rush hour is going to be massively inconvenient for the majority of their employees and customers.
They might go ahead and buy tickets anyway, if the A’s were the only team in the area. They’re not. Wells has a beautiful ballpark within walking distance of their office in San Francisco, which is relatively convenient for all their employees and customers. What on earth is their motivation for making a long term commitment to buy 81 games of premium seating in Oakland?
“This was a large and wealthy enough region to become a two-team market in the 60s, and it is more so today.”
First, the original move to make this a two-team market is considered a mistake by MLB. Both teams struggled with attendance for much of their history as a result. The Bay Area is by far the smallest two team market in MLB.
Second, this is not the ’60s. In the ’60s, all that mattered was butts in the seats. There was no premium seating, and the difference between the top priced ticket and the bottom priced ticket. Today, premium seating drives gate revenue, and is likely the difference between profitability and non-profitability for many teams (at least before considering league subsidies), even the ones playing in publicly-financed buildings. The Giants financed their ballpark largely on the back of long-term commitments to buy premium-seating and PSL-bearing “charter seating.” While exact figures are not publicly available, based on the amount of premium-seat inventory the Giants have and their published pricing it seems a good guess that this revenue may account for as much as half the gate.
Bottom line, the East Bay simply does not have the corporate base to finance a privately-financed ballpark in direct competition with AT&T only eight miles away. All the people with a financial stake in this (the ones with real data, and not just taking educated guesses based in what they can find on the web), have drawn this conclusion. If there was the slightest bit of validity to your arguments, the Giants would be terrified of a VC ballpark and would be paying the A’s moving expenses to San Jose.
“And unlike you, I’ve never tried to build a mote and fictionally isolate anything. I’ve always gone out of my way to try and include the portions of San Mateo and Alameda counties which are tied to Silicon Valley by proximity and economics, when looking at the demographics–you know, the sort of effort at understanding the Bay Area that you go out of your way to avoid.”
Horseshit. Your arguments constantly run like this: “No one from the East Bay will come to games in San Jose because the drive is too far. But wealthy VCs and execs from Sand Hill Road and Page Mill Road will regularly drag their important clients through two hours of Dumbarton Bridge traffic to go see games in Oakland.”
You also persistently ignore the fact that a San Jose ballpark would be far more convenient for East Bay people than an Oakland ballpark would be for South Bay people, for several reasons: First, rush hour traffic is going the other way. Second, a huge number of East Bay people work in the South Bay. Third, no one would have to cross a bridge.