Raiders could stay at Alameda HQ through Feb 2019 even if they leave Oakland next year

Update 10:00 AM from Steven Tavares:

Original post:

When the Raiders balked at paying past due rent at the Coliseum last month, we figured it had something to do with the lease extension, but we couldn’t figure out the rationale. Now, looking at the new lease terms – set to be voted on by the Coliseum JPA Friday morning – there’s little that stands out. There are clarifications on how to handle signage and advertisements inside the stadium, along with updated parking revenue definitions. The $400,000 in back rent will be paid. Then I saw this:

7.5 Additional Payments for Use of Permanent Training Facility and Training Site. If the Raiders announce a relocation or sign a lease to play football games outside of the City of Oakland or Alameda County (a) for the 2015 season prior to March 1, 2015, then, commencing on March 1, 2015, or (b) for the 2016 season prior to March 1, 2016, then, commencing on March 1 of the year following such announcement Raiders shall have the option of continuing to use the Permanent Training Facility and Training Site for up to thirty-six (36) months, up to and including February 28, 2019 as determined in Raiders’ discretion. For the first two years, Raiders shall make an additional payment to Licensor each month for continued use of the Permanent Training Facility and Training Site in an amount equal to the fair market rental value of the Permanent Training Facility and Training Site on a monthly basis, as determined by a mutually agreeable licensed commercial real estate broker based on comparable rental space. Raiders and Licensor agree that the fair market rental value shall not exceed $525,000 per year for the first two years. For the third year, Raiders shall pay Licensor an amount of One Million Fifty Thousand Dollars ($1,050,000), payable monthly in equal installments. In the event the Raiders are engaged in good faith discussions concerning an extension of the Operating License or other arrangement for the Raiders to play future Football Events in the OACC Stadium as of March 1, 2016, any obligation to make payments shall not commence while such discussions are continuing and the thirty-six (36) month period and obligation to make additional payments shall begin when Raiders agrees to play football games at a location other than OACC Stadium for the 2016 season; provided, however, that if Raiders agrees to play football at such other location, Raiders shall pay such rental payments retroactively from March 1, 2016.

Compare that to the same clause from the 2014 lease, which allowed for 24 months of training facility use and ended on February 28, 2017. Now they’ll get an extra year, giving them until early 2019 to stay. That could prove useful if the Raiders head to LA for the 2016 season, but the Carson and/or Inglewood stadium plans fall apart in the interim.

It’s a great situation for the Raiders, allowing them to stay fairly cheaply in Alameda while entertaining stadium concepts in Oakland, LA, etc. Allowing the team to be in Alameda past the 2018 effectively gives Mark Davis a three-year grace period, even if the Raiders leave Oakland starting with the 2016 season. If they stay at the Coliseum and engage in further stadium talks, rent on the facility is abated.

Can, kicked.

The grace period allows Davis to not have to look for or build a training facility in LA right away. He could continue to keep the team training in LA, fly them down for “home” games at a temporary stadium on the weekend, and fly them back up Sunday night. The stadium plan in Carson has to be modified to include a second team training facility, though chances are it wouldn’t be ready until at least spring 2018, based on what we know about the political landscape involved and construction lead times.

Let’s be clear about this: a training facility is not make-or-break item when billions of dollars of stadium speculation are the order of the day. It’s still a critical part of team operations. That’s where players will be 5 of 7 days every week during the season, and where they’ll report going back to OTAs. Now it makes more sense that the Raiders are funding improvements to the weight room and other parts of the facility, since they know they’ll be there for a few more years.

As usual, it’s Davis looking out for his team first. Maybe he’s not so different from his dad after all.

No dome? Smaller stadium? That’s a start.

BANG’s Matthew Artz continues the Raiders stadium debate with the new old revelation that the Raiders want a smaller stadium, one that would seat around 55,000.

Yes, it’s a familiar story. We’ve heard it before. Fewer seats, fewer suites, slightly less swanky club areas, all of it should contribute to a lower cost solution for the Raiders and the NFL. And finally, the City of Oakland appears to be coming around, instead of clinging to pie-in-the-sky aspects in the Coliseum City plan. At the very least, the idea of a retractable dome is fading away.

The dome made it into several city planning documents, but Mayor Libby Schaaf said last week that it was no longer under consideration, noting that it didn’t make sense to build an enclosed stadium in a city with such a good climate.

That alone should save some $200 million. Dropping 10,000 seats should also save around $200 million. A rough projection today would be $800 million. Or $978 million. Either way it’s way too expensive. If the goal is a less fancy, simpler structure, there’s little reason for the budget to approach $1 billion, even with the higher construction costs in the hot Bay Area market. I showcased two renovation projects in Florida: the recently completed $200 million Citrus Bowl project and the underway $400 Sun Life Stadium plan.

Another good example from the college ranks is the new McLane Stadium at Baylor University. A 45,000-seat venue, McLane Stadium is a pretty, three-decked, partly roofed horseshoe on the banks of the Brazos River in Waco, TX. The stadium was completed for only $266 million.

McLane Stadium facing Brazos River (image from Wikipedia)

McLane Stadium facing Brazos River (image from Wikipedia)

It’s not the cost effective record of $100 million set at Stanford for a new stadium, but it’s impressive in its own right. There are some obvious visual differences between pro and college football venues, such as the expansive use of bleacher seating in college stadia. These stadia also have smaller scoreboards, club lounges, and locker rooms than their NFL peers. McLane Stadium has a total of 860,000 square feet, less than half the space of a new NFL stadium like Levi’s, whose square footage totaled 1.8 million.

Pro football stadia have achieved such girth over the last 30-40 years through the proliferation of suites and clubs, plus greater buildouts at the field level, a place once reserved for locker rooms and plain old storage. The previous generation of stadia may have had 4-5 levels. A modern stadium may have 9 levels thanks to stacks of suites and clubs. Since all these stadia are getting taller, there needs to be more structural concrete and steel, which contributes further to exploding the cost. The end result is a more complicated structure that takes much longer to build than before.

Living in Silicon Valley, since the recession ended I’ve seen so many cranes and buildings under construction it’s dizzying. Unlike the original Valley land rush, developers and companies aren’t building simple one-story tilt-up offices. These are 6-10 story campus affairs as standard, or crazy concepts like Apple’s spaceship campus or the newly reimagined, glass-canopied Googleplex. Apple and Google are perhaps two unique examples of companies building visions that would make the NFL palaces look modest by comparison. Mall giant Westfield is undertaking a $600 million expansion of Valley Fair. Local cheap hotels and motels are frequently at capacity during the weekdays, filled up by general contractors coming from the Central Valley and Southern California. While it’s a great situation for the Bay Area economically, it also means greater competition for labor than ever before.

If Oakland and the Raiders are truly going to come up with a cheaper solution, they’ll need to follow some of the lessons realized in the college process. That means building simpler, and just as important, building faster. Instead of taking 3 years to complete a stadium, it would behoove both parties to figure out ways to cut down the construction time to 2 years or else in order to save on labor, especially union labor here in California. Employing a design-build process to streamline construction and permitting would also help immensely.

Doing all of this would require a level of coordination and competence heretofore not seen in the East Bay. While the county continues to consider the ENA, the ground beneath Coliseum City shifts. Chances are good that whatever gets built there will look nothing like the renderings provided by JRDV and sponsored by the City. That’s standard practice in urban planning, so no one should be surprised. With the clock ticking on LA, it’s probably a good idea to get moving on something everyone can agree on.

Dolphins show off $400 million renovation project

Not long after the Orange Bowl was played on New Year’s Eve, the Dolphins embarked on an ambitious, $400 million plan to rip apart about one-third of Sun Life Stadium. Dolphins President Tom Garfinkel has been regularly posting photos of the progress.

The plan is being carried out in two phases. The first takes off the upper corner sections permanently, leaving the structural raker beams behind. The lower sideline sections are also being removed, to be replaced with new sections that will eventually bring the first row 24 feet closer to the field than before. All of the seats will be replaced with bigger, all-turquoise versions. The lower deck renovation will allow the Dolphins to offer new luxury seating types between the usual club seat and suite choices. Some will be mini suites at midfield, others will be behind the end zone. Concourses are also being redone.

First phase renovations to be ready in time for 2015 NFL season

First phase renovations to be ready in time for 2015 NFL season

Second phase improvements include new scoreboards in the upper corners where the seating sections used to be, and the big reason for the project: a huge open air canopy that will cover virtually the entire seating bowl and outdoor concourses. Given the often rainy and hot weather in the first half of the NFL season, this was considered a necessary addition. The canopy is also a must for the NFL if future Super Bowls are to be held there (the last was held in 2010).

sunlife-2016-outside

Final renovations including seating canopy

Final capacity is projected slightly above 65,000, a cut of 10,000 seats. Despite the reduced seat count, the venue is better positioned to bid for the Super Bowl and the College Football Championship game, which is up for bid separately from the normal bowl rotation (the stadium already hosts the Orange Bowl).

Most importantly, this project is being financed privately, mostly through luxury seat/suite sales, not through bonds, PSLs, or other unsavory means. Stephen Ross campaigned for public funding for the better part of 2 years, threatening that the Super Bowl wouldn’t come back without yet another South Florida giveaway. He eventually gave up his quest, seeing that it would be better to get started on the project and get the Super Bowl. Finally, Miami-Dade County held firm and wasn’t ripped off the way they were by the Marlins and Heat.

In May I covered the much more modest, $200 million renovation at Orlando’s Citrus Bowl. While that project lacked much of the luxury amenities being added to Sun Life, the actual teardown and rebuild was more extensive, gutting and replacing the entire lower bowl. I wondered why the Raiders weren’t pursuing this path at the Coliseum. I can say the same now that the Dolphins are going down a similar, albeit more NFL-appropriate path. A Raiders renovation would be a sort of hybrid of the two, not as swanky as Miami nor as basic as Orlando. Over time I ballparked the cost at $500-600 million, basically the same amount as the funding gap the team and Oakland/Alameda County face at Coliseum City.

So why is no one talking about a Coliseum renovation? Maybe the image of the Coliseum is beyond repair even with a renovation. Maybe the fact that the field is 20 feet below sea level makes it a bad choice for forward-thinking CEQA guidelines about sea-level rise or storm-related flooding. Neither of those is a good excuse. If everyone involved in wanting to keep the Raiders (team, government, fans, investors) isn’t merely about playing games, there’s no reason why this kind of option wouldn’t be investigated thoroughly. It’s cost-effective, proven, and preserves the very site that so many Raiders fans hold dear.

P.S. – While we’re at it, why didn’t the 49ers incorporate some of these amenities into Levi’s Stadium? We’ve already seen these put into arenas and some stadia over the past few years.

P.P.S. – The Dolphins are applying for $50 million in sales tax revenues. A decision to provide that funding along with funding for other sports venues has been delayed by the Florida legislature. Even if that’s approved, Ross is funding $350 million of the project, a better ratio than most American stadia. At least Ross dropped the charade and got started on the project.

M&R: 30 days or bust for Raiders in Oakland

It’s a short article and a rather incendiary headline from Matier & Ross, but it’s not like we haven’t seen this coming.

‘If we don’t have significant progress within the next 30 days, I’d say one party or the other will call an end to it.’ That’s how one source close to the Raiders stadium negotiations in Oakland characterizes the on-again, off-again talks.

Okay, I guess. This doesn’t mean that Coliseum City is dead. There’s a lot of context we don’t have here. Is the anonymous source only talking about the new stadium, or does the lease extension also have something to do with it? Remember that as of now, the Raiders have nowhere to play for the 2015 season. If the only issue is the stadium discussion, that’s an awful way for the Raiders to go about things. Besides not having a place to play and no approval from the NFL to make a move, there’s little concrete evidence that the framework of a deal can be reached in 300 days, let alone 30. Maybe, as Larry Reid said, the work is 90% done. So what’s keeping the rest of the 10% from being done? The Raiders? Maybe. New City? Floyd Kephart said that the ENA runs through April. The ever-balking Alameda County? Who knows?

To me it sounds like yet another bluff. Last week’s reveal that the Raiders and Chargers are working on their own plan was characterized as a bluff by many. Scratch the surface and you’ll see that the Carson site is nearly ready to go after a great deal of cleanup, according to the State. Again, there are so many moving parts here with all the different players and deliverables that it’s hard to know what progress really is. Frankly, if this is coming from the Raiders, I’d like to see what happens if they leave the table. It’s always been up to the Raiders to make the first move. Mark Davis may actually have the courage to push that first domino. And if that happens, expect everyone else – the public sector, the A’s, the NFL and MLB – to start moving in kind. Eventually.

Coliseum City EIR Final Draft now available, JPA postpones lease extension vote, Saperstein comments

The Coliseum City EIR Final Draft was made available around lunchtime today. It’s 17 MB in size and worth looking through. As I run through it I’ll post my observations on Twitter with the hashtag #ColiseumCityEIR.

(Update: As pointed out by Floyd Kephart, the vote was over the lease. The JPA isn’t a party to the ENA, only the City and County can be among public entities.)

Over at the East Bay Express, Steven Tavares reports that the Coliseum JPA postponed a vote (again) to approve the Raiders’ lease extension. Tavares got comments from various JPA Board members, including outgoing and incoming Board Presidents Nate Miley and Larry Reid. While neither said why the postponement occurred, both indicated that certain aspects of the deal don’t look favorable to the county. Miley went on to talk about some of the Coliseum City issues we have talked about on this blog many times: hundreds of millions in infrastructure costs, the Coliseum’s outstanding debt, and the value of the land. Miley even indicated that some public contribution may be required for a Raiders stadium, which should raise some eyebrows in the East Bay.

Larry Reid characterized New City as “90% there” in terms of getting a team commitment, that team being the Raiders. Yet the Raiders’ joint announcement with the Chargers about a shared stadium in Carson took everyone by surprise. Reid still believes Mark Davis wants to keep the team in Oakland, and really, what choice does he have? The only shocker at this point would be if the JPA, City, and County kicked the Raiders to the curb after spending so much time, money, and energy on Coliseum City.

About that time, money, and energy:

Meanwhile, local officials met with NFL officials in January, said Reid. Their assessment was the city and county had made no progress in efforts to build a new stadium since a similar discussion between all the parties a year and a half ago. ‘They made it clear that the city and the county wasted the last eighteen months,’ said Reid.

Again, don’t pay attention to what people are telling you about how Coliseum City is progressing. When teams commit, when real actions happen to advance the ball, then you’ll know. As a wizard once said,

johnwooden380232

Last item today comes from a commenter on the blog named “Let’s Go Oakland,” who snipped a piece of a Facebook thread and dropped it in the comments.

wow

Guy Saperstein is a minority partner in the A’s ownership group

Assuming this is the real Guy Saperstein speaking, it sure sounds like the ownership group is still in lockstep in their position on San Jose, despite San Jose being off limits for the foreseeable future. Saperstein has long been based out of Oakland/Piedmont. Regardless, the only group the A’s can actually make a stadium deal with at this point is the Oakland/Alameda County/JPA triumvirate. As the fog enshrouding the Raiders and Mark Davis recedes, maybe they’ll actually make a decision on their future. Hopefully it doesn’t hurt the A’s in the process. If Davis can make a deal with Kephart, there will be a Raiders stadium at the Coliseum and the A’s can slide down to San Jose. If the Raiders can’t work something out, they’ll jet to LA while the A’s work out a new ballpark deal at the Coliseum complex. Those are the two most realistic scenarios that can be sussed out at this point. Anything else is wishful thinking.

 

Raiders, Chargers announce shared stadium plan in Carson – huge leverage/hedge play

The Chargers have expressed real frustration with the City of San Diego over the last several days. So announcing an LA stadium plan seems like the next logical step. But the Raiders? Say it ain’t so, Mark!?!?

It's like the 49ers' digs, only 400 miles south

It’s like the 49ers’ digs, only 400 miles south

The LA Times’ Sam Farmer has the scoop, describing the deal as a Plan B for both teams if they can’t work out “publicly financed” stadium deals in San Diego and Oakland, respectively. The teams quickly followed up with their own joint statement, explaining their plans with a surprising amount of detail – at least at this early stage. The statement:

  • We have both been working in our home markets to find a stadium solution for many years, so far unsuccessfully.
  • We remain committed to continuing to work in our home markets throughout 2015 to try to find publicly acceptable solutions to the long-term stadium issue.
  • We also both understand and respect the NFL’s relocation process, and we intend to adhere strictly to the relocation procedures that the League has set forth for Los Angeles.
  • In particular, we respect the right of the NFL’s owners to decide on all Los Angeles-related relocation issues and understand that any relocation application that is filed for Los Angeles must obtain the approval of three-fourths of the NFL’s owners.
  • Both teams have kept the NFL owners’ committee on Los Angeles, and the Commissioner, fully informed about our joint efforts.
  • We are pursuing this stadium option in Carson for one straightforward reason: If we cannot find a permanent solution in our home markets, we have no alternative but to preserve other options to guarantee the future economic viability of our franchises.
  • In short, for the remainder of 2015, we intend to move down two tracks simultaneously:
    • On track one, we will continue to work in our home markets to find permanent stadium solutions that are publicly acceptable.
    • On track two, we will work in Carson to preserve our options, and the future economic viability of our franchises, in the event that our efforts in our local markets fail.
  • Throughout this process we will respect the rules and procedures set forth by the League and defer completely to the ultimate decision of the NFL’s owners.

There’s a lot to unpack here, so let’s start from the top. The first five bullets are meant to curry favor with the true audience for this statement, the NFL and its constituent team owners. It’s Dean Spanos and Mark Davis saying to the owners, Look, if you want someone who’s going to play by the rules, who won’t go rogue *cough*Kroenke*cough, it’s us. Stan Kroenke’s actions have taken much of the leverage over LA away from the NFL despite the league’s protestations, so the play here may be that if Kroenke gets stuck in litigation with the league, Spanos and Davis may benefit by getting the two LA slots. By the time the dust settles, the Chargers and Raiders will already be in LA and the Rams may be stuck in St. Louis. Most importantly, Farmer’s report revealed that the Chargers and Raiders bought the 168-acre plot of land in Carson on which the stadium would sit. That’s more than a mere verbal threat, that’s real action.

Kroenke, who didn’t buy land in Inglewood to sit on it, probably anticipated this, while having talks with Spanos and Davis about partnering up in The Wood. He claims to have a privately financed stadium there. Spanos & Davis claim to have a privately financed stadium in Carson. Let’s be clear, though, TWO privately financed stadia in LA don’t work. Even with a market the size of LA, that’s too many suites to sell, too many sponsorship commitments. Two stadia would compete with each other for Super Bowls, NCAA playoff games and any number of other big events, effectively cutting into each other’s profitability and feasibility. If we want to term this a race to LA, there are at most two teams that can win and one stadium plan that can win.

That’s the hedge part, or so we’re being led to believe. The leverage play from Spanos and Davis is that they’re still working on plans in their hometowns. Spanos has allowed team lawyer Mark Fabiani to be the bulldog, quickly getting into a war of words with San Diego Mayor Kevin Faulconer. Davis, who appeared to say the right things only a month ago when he said he wanted to pursue his own stadium plan, is now running back to Floyd Kephart and Coliseum City. If Davis wasn’t on board with CC before, what’s going to change now to make him sign on, besides being backed into a corner? Having LA as an option is a hedge against that very possibility. If you look at what’s been happening in both cities, there isn’t much progress. Neither city wants to to provide any public funding. Both cities’ greatest asset is land, which isn’t nearly as good as money. The Chargers are being aggressive, whereas the Raiders are waffling.

The Chargers’ attacks on San Diego can be considered the first blink after Kroenke’s plan was unveiled. This joint-stadium plan is the second blink. Who blinks next? San Diego and/or Oakland, in order to force everyone to the table? Or is it Kroenke, who may want to accelerate his plan in order to keep others from taking his leverage away? Or perhaps it’s Roger Goodell, who is in danger of losing control over the process?

The boldest move would come from either Faulconer or Oakland Mayor Libby Schaaf. These cities don’t have to be pawns in the stadium extortion game, one that has gotten exponentially more complex because of the number of factors involved. They could call this bluff. The only winning move is not to play, right? It’s one thing for the teams have land. It’s another to actually assemble a shared stadium deal that works for both teams. While MetLife Stadium can be considered a success for the Giants and Jets financially, in use it’s a lifeless gray mess, terribly lacking in home field advantage and absent either team’s character or signature. Do Spanos and Davis really want to go down that path? The LA stadium renderings, done by Warriors’ SF arena firm Manica Architecture, look like Levi’s Stadium 2.0 – similar caste system bowl layout, red seats, and no façade. At least there’s a partial roof.

In the end, the promise of a huge valuation raise may prove too alluring to dismiss for these teams. It’s easy to give lip service in trying to build at home, but it may be the toughest challenge to stay. Even with things moving as fast as they are in 2015, it’s still too early to predict how this is all going to shake out. There are many, many moves left in this game. It’ll be fascinating to watch, that’s certain.

Davis wants Alameda County at the table, but…

This is not unexpected, yet strange.

If memory serves, Davis still hasn’t paid the minuscule 2014 rent at the Coliseum, all while currently making improvements to the Alameda training facility. Seems like there’s a quick way to get everyone on the same page, especially if Davis’s request is just a first step towards completing a Coliseum City deal.

More from BANG’s Matthew Artz:

Looks like Davis’s go-it-alone strategy isn’t going so swimmingly, hence the pivot back to Kephart. Plus now Ron Leuty of the SF Business Times sheds additional light on the County’s resistance to Coliseum City.

‘Currently, (Alameda County) is not at the table,’ said Floyd Kephart, the lead executive of New City Development LLC told an Oakland business group Thursday, though he planned to meet Thursday afternoon with Alameda County Supervisor Scott Haggerty.

The City’s priority is clearly to work out the future of the Coliseum area, beyond the complex. The County’s appears to be fixated on the debt issue, which, while small in the grand scheme of things ($2-3 billion in total development), is plenty large enough to trip up any plan. Few entities can afford to write off $100+ million of debt. Packaging that debt creatively is a monumental task in and of itself. If the County wants to get tough on this, it’s their right and responsibility. Because without the County, there is no deal even if an EIR gets certified. So much for everyone being on the same page.

More comments from Kephart and reaction from Haggerty via Artz:

‘Just come to the bloody table and make a reasonable and fair attempt to see if we can keep the Raiders, build a stadium and do this development,’ said Floyd Kephart, a San Diego-based businessman who is trying to finance the city’s multibillion Coliseum City project, which envisions new stadiums for both teams at the Coliseum site.

Kephart’s remarks before a meeting of the West Oakland Commerce Association, didn’t sit well with Alameda County Supervisor Scott Haggerty who said the county was doing its due diligence. “I don’t know why people are insinuating that we are not at the table,” he said in a phone interview before a scheduled meeting with Kephart. ‘Just because you are asking questions doesn’t mean you are not at the table.’

So many moving parts. Davis wants to try his own bid, then gets back together with Kephart (how willingly is unclear). Haggerty, who is now the President of the Board of Supervisors, is taking on the role of chief inquisitor. Hey, nobody said it would be easy.