Chronicle compares Giants’ Port deal with Warriors’ deal
Well, call it a deal framework for now. Plenty of detail needs to be hashed out to build a Warriors arena in South Beach, but at least the Chronicle’s John Coté has gone to the trouble of comparing the Warriors’ deal with what the City struck with the Giants 15 years ago.
For now, the city’s initial investment is higher, a reported $120 million for the W’s vs. $27 million (year 2000 dollars) for the Giants, not including project soft costs. In both cases, the tenant teams also received development rights to additional land. For the Giants it was the parking area on the other side of Mission Creek. The W’s would get Seawall 330 across the street, where some kind of high rise office tower, hotel, or residential building would presumably be constructed.
Not included in the comparison is the potential property tax impact. While infrastructure for AT&T Park was paid for via tax increment, that avenue is not directly available this time around for the Warriors. Instead, the City/Port could sell Seawall 330 to the W’s or offer a rebate of the City’s share of the W’s property tax payment (a subsidy). Let’s project that rebate a bit.
Say that the assessed value of the arena is $500 million. That’s low but could and will be argued by the Warriors as proper, just as it was by the Giants. That puts the annual property tax bill at $6 million per year if assessed at 1.2%. Roughly 30% of that goes to San Francisco, which is incorporated as both a City and County. The rest of the bill would go to schools, specifically SFUSD. That makes a potential rebate as much as $1.8 million, nearly the same amount as the W’s annual rent payment on Piers 30-32. The Warriors get a fantastic deal on two pieces of waterfront, an standard-bearer of an arena, and a massive franchise value increase due to the deal fundamentals. If you’re Joe Lacob and Peter Guber you jump on this deal toot sweet.
The City of Oakland should be following the progress of this deal project closely, as it provides a blueprint on how to make a Howard Terminal ballpark deal work out. At 40 acres, Howard Terminal provides space for both a ballpark and ancillary development. In San Jose there isn’t as much of an opportunity, since little city-owned land exists adjacent to the ballpark site.