McKibben to become next JPA Executive Director, Raiders want ENA canceled?

BANG’s Matthew Artz reports that Scott McKibben will be the next Coliseum Authority Executive Director, filling a position that had been vacant for over six years. JPA counsel Deena McClain has been the JPA’s interim executive director since 2008, when Ann Haley left. Zennie Abraham notes that the vote was unanimous.

McKibben says his goal is to “keep the A’s and Raiders in Oakland.” Having someone with sports experience not limited to negotiating leases is important for the Coliseum’s future.

Andy Dolich endorsed the hire, and McKibben apparently had several recommendations, far above and beyond the previous candidate, the controversial former Assemblyman Guy Houston.

Having McKibben in place will allow the JPA to move forward in concert with the City of Oakland and Alameda County, the partners in the JPA which have been at cross purposes throughout the Coliseum City process for the last three years. If McKibben can lead a team including McClain and the City and County working on the deal terms, they’ll have a much better chance at success. It’s a much better situation than a year ago.

More interesting is a tidbit from Steven Tavares at East Bay Citizen, referring to AlCo Supervisor Scott Haggerty:

However, Haggerty made it clear Raiders ownership does not favor an extension of the ENA. Over a lengthy lunch recently with Raiders owner Mark Davis, Haggerty said, the team lobbied for the county to vote against the extension with New City. Progress is being made, though, added Haggerty.

Why would the Raiders want to kill the ENA? They wanted to provide a competing bid at the last minute, which may indicate that they already have a developer on board for whatever they’re planning. If the Raiders (like the A’s) now want little to do with Coliseum City and New City Development, it would make sense to cut the middleman out altogether, though that would open up a lot of questions about how to steer redevelopment of the Coliseum. The EIR and Specific Plan are moving forward, and the latter piece is valuable to Oakland for planning purposes. But the feasibility studies that have been done on Coliseum City to date would be lost. New applicants like the A’s and Raiders would commission their own supporting work. It’s almost moot at this point since the ENA is set to be extended again, yet from now on it’s worth questioning the value of New City’s place in all of this if both teams would rather go it alone.

If the teams would prefer to not work with the Coliseum City team, it’ll be up to McKibben and the JPA to figure out a way to bring the teams together. In all likelihood, both teams will provide competing visions with little-to-no room for each other. How the two visions can be merged to both sides’ satisfaction along as the City/County – well, that’s not like scaling Mt. Davis. It’s more like trying to climb Mt. Everest.

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P.S. – Remember those shady looking campaign contributions from Lew Wolff to Rebecca Kaplan during last year’s mayoral campaign? Turns out they were legal. Oh well.

P.P.S. – The Orange County Register reports that Mark Davis teamed up with an investment firm last September in order to buy the Hollywood Park site. That attempt failed. 

P.P.P.S. – Mark Purdy has a different telling of the ENA situation.

Did Haggerty interpret the talks wrong, or is someone from the Raiders covering something up?

Shrinkage

When Coliseum City was originally conceived it was supposed to look something like this when fully completed, 800 acres in all.

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800 acre concept

 

Last last year we heard from Floyd Kephart and others that the project would be scaled back to around 200 acres.

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Coliseum City at 200 acres

 

Now we hear that it’s down to 120 acres, which is basically the original Coliseum complex plus the Malibu and HomeBase lots leading out to Hegenberger.

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120 acres

 

With the Raiders and A’s signed up to offer competing bids, the team working on Coliseum City now plays the role of facilitator and competitor, all at once. A single stadium’s footprint will be 14-20 acres. Two stadia would cover 35 acres. When you add the necessary streets and easements for other infrastructure, that should leave 60-70 acres to develop. I was not terribly optimistic from the get-go about the financing coming through, so I wasn’t surprised when one financier after another bailed out on the project. Now that the project’s size has shrunk a whopping 85%, the questions about its viability are even more pointed, especially when trying to pitch it as a way to keep both the A’s and Raiders in town. Just as we saw over the last year, we’re going to let the numbers (or lack thereof) prove these concepts out. If the Raiders can make it work with whatever developer they’re trying to get onboard, bully for them. If the A’s plans prove most feasible, then they get the spoils of developing one of the last large infill developments in the Bay Area. And if Kephart’s New City group somehow gets capital and the teams on board, they will have truly worked a miracle.

However, ask yourself this: If capital wasn’t biting at 800 acres and two stadia, why would they bite at 120 acres and two stadia? 

P.S. – The infrastructure price tag on the whole 800 acre project was supposed to be $344-425 million. Now that it’s 85% smaller, did that cost also proportionately decrease? Nope. The cost of infrastructure for the 120 acres, including the new transit hub and utility relocations, is $170 million. Factor that into your thinking. Some of that figure will be offset by grants, though really only for the transit hub. It’s still a nine figure infrastructure price tag.

 

City of Oakland Press Release Regarding Coliseum City ENA Extension

Hat tip to Zennie Abraham, who posted this first and did a quick video blog about it.

MAYOR LIBBY SCHAAF, OAKLAND CITY COUNCIL PRESIDENT LYNETTE GIBSON MCELHANEY, COUNCIL PRESIDENT PRO TEMPS LARRY REID and SUPERVISOR NATE MILEY SUPPORT THE CITY AND COUNTY JOINTLY EXTENDING AGREEMENT WITH NEW CITY AND ADDING RAIDERS AND A’S TO NEGOTIATIONS

OAKLAND, CA – January 19, 2015 – Mayor Libby Schaaf, Council President Lynette Gibson McElhaney and Council President Pro Temps Larry Reid today announced their support for extending the negotiating agreement with New City, as well as bringing the A’s and Raiders to the table to discuss developing the coliseum land themselves. Mayor Schaaf has also secured a commitment from the Alameda County Board of Supervisors to consider formally joining the City of Oakland in this new approach at their next meeting January 27th. The Oakland City Council will vote in a closed session next Tuesday, January 20th, to extend the Exclusive Negotiating Agreement (ENA) for up to 90 days, with an express condition that the City may negotiate simultaneously with its sports teams about developing the entire coliseum site.

“I’m excited that, for the first time, both the Oakland Athletics and Oakland Raiders have expressed interest in coming to the table to join these serious discussions and that the City and County are poised to move forward together. This new approach represents real progress in crafting a project that protects the public dollar, retains our sports teams, and increases the economic vitality of the coliseum area,” said Mayor Libby Schaaf.

“Keeping our sports teams in Oakland with a world-class development is a top priority of these discussions,” said Oakland City Council President Lynette Gibson McElhaney. “As joint owners of the land in question, Alameda County will be a critical partner in the collaborative effort to retain our teams and determine the best way to build a state of the art complex that will be a beacon of civic pride for many years to come.”

“I appreciate Mayor Schaaf’s hard work to develop an approach that gets the city and county on the same page. I support the idea of signing onto the ENA with New City now that we will also start negotiating directly with our sports teams,” stated Supervisor and Coliseum Powers Authority Chair Nate Miley. “We’ll be doing our due diligence, but I’m optimistic that the City and County will start moving forward as a unified team after our January 27th action.”

More Tuesday, of course.

Schaaf proposal would allow competing proposals from Raiders and A’s

Oakland Mayor Libby Schaaf wants to extend the Coliseum City ENA. But that comes with one huge condition. From BANG’s Matthew Artz:

“…the 90-day extension, expected to receive City Council backing on Tuesday, would come with a condition that the two teams are free to offer competing plans.”

In effect, the Raiders and A’s would be pitted against each other, and also against Coliseum City.

It’s a bold and wise move by Schaaf that’s likely to garner much broader support from Alameda County than Coliseum City has so far. It would also force Mark Davis off the sidelines, into a role with much greater involvement in the stadium process. Previously, Davis had been content to be mostly hands-off, allowing developers to sell him on their plans while remaining detached. This would also explain the promotion of Marc Badain to Raiders team president. Badain, the CFO and interim team president, was the lead in Oakland stadium talks to this point.

What does this mean for Coliseum City? That depends on how much lifting the Raiders want to do. Badain’s the long-time numbers guy for the team, not a developer. It seems most logical for the Raiders to partner with Coliseum City, since some $5 million has already been spent on studies for the project, including an in-progress EIR. The plan already favors the Raiders over the A’s, so unless Davis dislikes some part of the plan so severely that he’d rather strike out on his own, it makes the most sense for him to partner with CC. At the very least he’d have to sign a completely nonbinding letter of interest or something similar.

If the Raiders choose to craft their own plan, Coliseum City as we know it is dead, since it would be competing against the two teams it’s trying to sign. It’s unlikely that CC would be able to satisfy both teams and its own investors to all parties’ desired benefit, especially now that the amount of land being discussed is merely the 120-acre Coliseum complex (out to Hegenberger), no additional land involved. That’s also a game-changer, since shrinking the focus to 120 acres would preclude further public land acquisitions by the City, County, or JPA.

Meanwhile, the A’s have been waiting for this moment for more than a year. Lew Wolff, as well as most of the discerning public, knew for some time that Coliseum City was serious pipe. Wolff will legally have the opportunity to present his own plan, and the City/County can decide which plan is best, or if no presented plan works. There’s a series of questions everyone will have to answer before a single shovel can hit the ground. Among those questions:

1. Which of the venues will be demolished to make way for new development? Neither team wants to play in the Coliseum long term, yet neither wants to build a new stadium for the other since it would blow up their own respective budget. So it might make the most sense to allow the other team to stay at the Coliseum, which would be renovated to some degree (or not) to make it more suitable long-term. Naturally, the Coliseum’s current condition is much better suited for football than baseball thanks to Mount Davis. Plans could also call for the demolition of the arena, which represents 8 valuable acres within the complex.

2. Who pays for the infrastructure? While it was assumed that the City/County would pay for new infrastructure, the introduction of competitive bidding gives them some leverage in terms of allowing the developer to pay for some or all of that cost. That cost would eat into each bidder’s bottom line, so the challenge for the bidders is to balance that public desire with their own internal projections. For instance, a bidder could adjust to assuming infrastructure costs by adding additional square footage to offset. However, keep in mind that Coliseum City’s full buildout at the complex called for around $400 million in infrastructure.

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Colored lines represent easements for utilities, some of which may have to be relocated. Cost could run into tens or hundreds of millions.

 

3. How much does one team’s plan respect the other team? Both owners have expressed an interest in limiting the construction of parking garages in order to preserve surface parking. That’s also valuable, developable land. Again, how does the bidder strike the balance? Does one team’s bid kick the other team to the curb?

4. Does either plan pay off the existing Coliseum debt load? The original Coliseum City plan had no provision to pay off the $100 million at the Coliseum. Floyd Kephart added that responsibility to his plan. Lew Wolff’s alternative also appears to take care of this. If the Raiders propose their own plan do they offer the same? And what about the $100 million owed on the arena, which may not be paid off if/when the Warriors leave?

5. How does the development fit in with Oakland’s planning strategy? A hidden issue in all this redevelopment talk is how the future Coliseum will affect Oakland, especially East Oakland. Will it add much needed affordable housing? Will it gentrify East Oakland? Could it attract one major employer in a campus setting, or numerous smaller companies? Would the retail component be targeted properly, or could it end up with a bunch of empty shell buildings bringing in few rents? What if the retail part is just more big box stores? And how does the plan work with Oakland’s desire to create a thriving transit hub? Does that plan compete with downtown Oakland?

This is finally the emergence of the adult conversation we have long been waiting for. Kudos to Mayor Schaaf for acting so quickly to allow that conversation to begin in earnest. There’s actually a decent chance that Oakland can come out of this looking good in that the City won’t be ripped off. It’s a better chance than it had previously. It gives Oakland new, real leverage. Oakland should approve the ENA with the new conditions, and let the best team win.

Perhaps the City should fly in Mills Lane to judge the proceedings

Perhaps the City should fly in Mills Lane to judge the proceedings

From Now Through Opening Day

With the MLB-San Jose legal battle out of the way (for now), we can turn our attention back towards Oakland, where most of the news over the last two years has originated.

January 20 – Tuesday is the deadline for the Coliseum City three-month extension, granted to Floyd Kephart’s New City Development group when they took over the project. The Oakland City Council will take up the matter in the afternoon’s closed session. During the evening open session the Council is expected to report on Coliseum City’s progress.

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Agenda item for 1/20 City Council meeting

If everything goes as expected, Kephart will get another extension of 3, 6, or 9 months so that he can try to rope the Raiders. The Raiders will probably be given another one-year lease extension, since Coliseum City is not yet a finished product and the Raiders have nowhere else to go for 2015. Mark Davis wants to retain maximum flexibility for his franchise, so a multiyear deal seems out of the question. Meanwhile, the A’s and Lew Wolff will be patiently waiting on the sidelines for Coliseum City to work itself out, wanting no part of the project.

February 8 – On Sunday comes FanFest. It’s worth going just to get acquainted with all of the A’s new players. If there’s a concurrent BlogFest event, there’ll be a post about it. Tickets are $10, and as usual you can expect a sellout.

On a personal note, this year’s FanFest will mark the first one since it came back that won’t be held on the same date as the Double IPA Festival, held at The Bistro in Hayward as part of SF Beer Week. Looking back, the doubleheader was truly my favorite day of the year. DIPA will be held the previous day, February 7 (Giants FanFest day). I may be draggin’ a bit during FanFest.

February 19 – Pitchers and Catchers report to Mesa, AZ. They’ll be at Fitch Park, as the renovated facility in Mesa has replaced Papago Park in Phoenix.

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March 3 – Spring Training Opening Day is a home game at Hohokam Stadium vs. the Giants. You might want to get your tickets in advance, or else the Giants fans will snatch them up. If you want to catch two games during a weekend, come to Phoenix the following weekend, March 7-8.

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March 13-14 – Want a different scene from laid back Arizona? The A’s and Cubs are playing a pair of spring training games at Cashman Field in Las Vegas. Yes, you can relive all the splendor that was the start of the 1996 season, then hit the craps tables and buffets.

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April 6 – Opening Day at the Coliseum. We’ll see if Billy and Bob can work their magic again.

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Get comfortable, folks. We’re gonna be here a while.

 

St. Louis pitches its own Howard Terminal

An open air stadium.

On cleaned up industrial land.

Close to downtown.

Saves a team from leaving for a richer locale.

Sounds familiar, right? But no, it’s not Oakland’s stillborn Howard Terminal. It’s the brand new, last ditch effort by St. Louis interests to keep football in the Gateway City. The 64,000-seat stadium, ostensibly for the Rams, would sit north of of the Gateway Arch and across I-44 from the team’s current home, the Edward Jones Dome.

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The price tag? $860-985 million (gotta make the estimate a tiny bit less than 10 figures, you know). Half of that cost would be paid for by PSLs, a la Levi’s Stadium. The backers claim no taxes would be needed. And as your eyes roll repeatedly at everything I’m writing, there’s also this: the stadium doesn’t have to be for the Rams. It could be for another team desiring to relocate to the renowned football town known as St. Louis.

An open air stadium in St. Louis would be great. It could also look cool, like Paul Brown Stadium, if the stuffy Cincinnati crowd learned to appreciate a cool piece of modern sports architecture. But the financing is fanciful, the plan is extraordinarily late, and the team owner, Stan Kroenke, hasn’t returned backers’ phone calls this week. At least they can say they tried, right?

Kroenke’s gambit may force NFL to act

Stan Kroenke is an extremely wealthy guy. He is worth more than $6 billion on his own, combined with his Walmart heir wife they’re worth $13 billion combined. If Kroenke wanted to build a stadium on his own, he most certainly has the resources to do it. That doesn’t mean he will. But the potential is there.

So it was more than a little curious when Kroenke acquired 60 acres of parking lot between The Forum and the Hollywood Park racetrack in Inglewood. It’s an opening move that sets up numerous possibilities. He could move the Rams to LA against the other NFL owners’ wishes, a rogue move that would have to withstand legal battles. He could partner with the NFL and facilitate a two-team venue. He could stay in St. Louis by squeezing every last nickel out of the State of Missouri, which is planning to unveil new stadium plans on Friday. He could also stay put at the Edward Jones Dome, leaving the various threats hanging over many heads. Stan Kroenke has a first mover advantage, one that threatens to disrupt the NFL is myriad ways.

Thing is, despite Kroenke’s vast wealth and sports portfolio, he has only one new stadium opening under his belt, Dick’s Sporting Goods Park in the suburban Denver area. He has usually bought teams after their new venues were built. The Denver Nuggets and Colorado Avalanche were a package deal two years after the Pepsi Center opened. Kroenke was a minority partner in the Rams when Georgia Frontiere died, allowing him to buy the Rams in 2009. He bought English football club Arsenal after Emirates Stadium was completed.

Should Kroenke decide to move the Rams to the City of Champions development in Inglewood, he would forego the NFL’s G-4 loan program, which can hand out up to $200 million per team. The 80,000-seat retractable roof stadium would be the new West Coast Super Bowl rotation favorite. Or would it?

The NFL would prefer to have two teams in LA, to keep from any single owner profiting too heavily on the LA market. Any of the three teams (Rams, Raiders, Chargers) that moved to LA would conservatively double their franchise valuations once they arrived, with greater riches coming from new stadium revenue. Kroenke’s move is barely above squatting, since it would be in keeping with a 2016 timetable. Other than that, Kroenke’s move spells trouble for the NFL if their hope is to control the transition(s).

The NFL has staff working on potential relocations for all three teams, trying to work out ways that maximize value for the owners while minimizing short-term revenue damage in respective markets. The league would prefer to announce the teams and venues on its own schedule. It appears to be working on a deal with AEG for Farmers Field. Just as important, the NFL would like to control the LA Super Bowl venue. It could do that by partnering with AEG and bringing in a single team, providing competition for Inglewood.

Think about the impact of TWO large, indoor-outdoor NFL venues in LA. The NFL could punish Kroenke by never awarding the Super Bowl to Inglewood, which would hurt him in the wallet. There’s nothing he could do about it. Farmers Field would be in the Super Bowl rotation instead, every 5-6 years. Beyond that, AEG/NFL and Kroenke would be competing for Final Fours, college football playoff and bowl games, soccer and rugby matches, and mega-concerts for the Southland. They’d also compete for large corporate sponsors. A stadium bidding war, turned on its head.

Could LA properly support some $3 billion in mega-domes? There are already plenty of questions about the LA’s willingness (not ability per se) to support a single team. Two domes, with 300 luxury suites and 15,000 club seats to sell will be a strain, even in mighty LA. Having it all in one venue softens the blow. With two competing venues selling out is a must. It’s easy to see a sort of stadium arms race happening in LA, with the two competing stadia trying to leapfrog each other in terms of amenities, scoreboards, and perks. The NFL, which has spent decades successfully extorting other cities out of billions in stadium subsidies, would have to subsidize a money pit of its own. That’s not a war that the NFL wants to get into. It would rather work hand-in-hand with Kroenke or AEG, provide that regular Super Bowl carrot, move the NFL Network studios to that stadium, have two teams in the same building, and maximize revenue. Threatening to build a competing facility in LA takes away Kroenke’s first mover advantage, since the NFL has more cards to play than Kroenke. It also doesn’t hurt that AEG has a certified EIR for its stadium, whereas Kroenke hasn’t started one yet.

Since the Inglewood announcement, I’ve seen a lot of conjecture about what Kroenke’s gambit means for the other teams. Many in the media have said that the chances of the Raiders staying in Oakland become better. Sure, as long as it’s only the Rams moving there. If, as outlined in the previous paragraphs, the NFL decides to compete with Kroenke, Mark Davis will undoubtedly trample everyone in his path to be at the front of the line for a Raiders move south. After all, he’d get a stadium all to himself during the regular season, along with all the benefits of splitting the #2 market. He wouldn’t deserve the windfall, but it would work out perfectly with his M.O.: let the process play out while letting others spend the money and take the arrows.