Category Archives: San Jose
Lew Wolff brought up the the idea of a temporary stadium to the SV/SJ Business Journal’s Greg Baumann this week. Wolff looks at the concept as potentially necessary if another extension at the Coliseum can’t work out. He had already expressed concern when MLB pushed the Coliseum Authority (JPA) into a two-year extension through 2015. The thinking in November was that no new permanent home could be built in that two-year span, and if Coliseum City’s phasing and the Raider owner Mark Davis’s preference of building on top of the current Coliseum footprint take hold, the A’s would no longer have a place to play. Combine that with Larry Baer’s comments about allowing the A’s to play at AT&T Park while an Oakland solution was being hammered out, and you can see all of the moving pieces and the complexity therein. Because of that complexity, let’s break the situation down into its basic components.
To start off, there’s the Raiders. The Raiders are the first domino here, because they are the team in some sort of negotiation with Oakland and the JPA. Even though Davis has labeled the talks as discouraging recently, reports coming out of the Coliseum City partnership should bring everyone back to the table in the next month or so. Then Davis can decide how to move forward: either partner in Coliseum City, or decide that CC doesn’t pencil out and look elsewhere. So far Davis has stuck with the idea that the Coliseum is the #1 site. That could change quickly as the numbers are released and parties have to make fiduciary commitments.
The A’s can’t do anything without the Raiders’ move. As much as Oakland waterfront ballpark proponents would love for Howard Terminal to become the apple of Wolff’s eye, the many questions and doubts that hang over the site continue to make HT a nonstarter for Wolff. Coliseum City had the A’s in a new ballpark no earlier than 2022, unacceptable terms for Wolff and MLB. However, if CC falls apart for the Raiders and Colony Capital, the Raiders could leave for Santa Clara, LA, or elsewhere. Wolff could easily call for CC to dissolve and put together a development plan of his own at the Coliseum, one that he would control. It could make room for the Raiders as well, but the football team would end up on the back burner, not the A’s. If Davis were to stay for several years at Levi’s Stadium while gathering up the resources to build anew in Oakland, such phasing could work out. Then again, the Jets spent nearly two decades “temporarily” at the Meadowlands while not working out any new stadium deal in the five boroughs of New York City.
Next, this idea isn’t new. Wolff floated the temporary venue concept in 2012, when he initially tried to get a lease extension. Wolff has reason not to go down such a path due to the expense and amount of upheaval. Should lease talks once again turn difficult, a temporary move becomes more a value proposition than a logistical problem.
If the JPA couldn’t come to an agreement on a new ballpark with Wolff – say, for instance, the JPA chose not to eat the $100 million left in Mt. Davis debt – Wolff would likely go back to MLB and again ask for a decision on San Jose. San Jose brings about one of two temporary ballpark scenarios. The first comes if the A’s are left homeless after 2015 and MLB somehow allows the move south. That’s a long shot at best, but can’t be completed discounted. In this case a temporary ballpark would have to be built somewhere in San Jose for 2-3 years minimum while Cisco Field was being built at Diridon. Besides the process of getting league approval, a temporary site would have to be found. In the Bizjournals article, San Jose Mayor Chuck Reed claimed that multiple temporary sites were available. In all practicality, there are probably only two sites. Many of the previously studied permeant ballpark site candidates are either in the process of being redeveloped (Berryessa, North San Pedro) or face logistical hurdles that make it difficult to ensure that 20-30,000 people could make it in and out easily (SJ Fairgrounds, Reed & Graham cement plant).
Instead, there will probably two or three sites in play: the old San Jose Water Company site near SAP Center (site owned by Adobe), the spare parking lot south of SJ Police headquarters between Mission and Taylor Streets (a.k.a. the Cirque du Soleil lot), or the land adjacent to the under construction Earthquakes Stadium (under control by another developer). The SJWC/Adobe site would be the easiest to convert for a ballpark, is the right size, and has an existing building that could be leveraged for ballpark use. It’s also directly underneath a San Jose Airport landing approach, which could cause red flags by the FAA. The Cirque lot is smallish, though large enough for a small ballpark. There’s lots of parking nearby, and potential makeshift parking on the other side of the Guadalupe River. Light rail is only 2 blocks away. As for the Earthquakes Stadium-adjacent site, there were enough problems getting it prepped for that project that it should give pause to anyone considering even a temporary ballpark there.
That’s not to say that San Jose is the only place for a temporary ballpark. Wolff was quoted as looking at the entire Bay Area:
“I am hopeful of expanding our lease at the Oakland Coliseum for an extended term. If we cannot accomplish a lease extension, I hope to have an interim place to play in the Bay Area or in the area that reaches our television and radio fans — either in an existing venue or in the erection of a temporary venue that we have asked our soccer stadium architect (360 Architecture) to explore. Looking outside the Bay Area and our media market is an undesirable option to our ownership at this time.”
The East Bay is in play for both temporary (if needed) and permanent venues. MLB won’t hand over the South Bay to Wolff, yet MLB has also allowed Wolff to enter agreements with San Jose, so it’s clear that MLB is hedging big time. A temporary ballpark could be built on the old Malibu/HomeBase lots near the Coliseum, in Fremont, or even Dublin or Concord. Fremont’s Warm Springs location could enter the discussion again because the Warm Springs extension is scheduled to open in 2015.
It’s also possible to read into Wolff’s statement the possibility of the A’s playing at Raley Field on a temporary basis, since his description of “area that reaches our television and radio fans” covers CSN California and the A’s Radio Network.
Warm Springs could be in play because CEQA laws that govern environmental review largely don’t affect temporary facilities. Generally, seasonal installations such as carnivals or circuses that don’t create any permanent environmental impact are exempt from CEQA. The challenge, then, is to create a temporary ballpark that can also fit this model. That would be tough because of the large-scale consumption of water, food, and energy during a single game. Still, the A’s are already familiar with major recycling efforts, and if trash can be properly contained there should be little permanent impact. Just as important, Warm Springs remains within the established territory, so MLB wouldn’t have to negotiate anything with the Giants. Finally, if the experience is positive it could provide enough political goodwill to convince Fremont to again consider being a permanent home.
Strategically, the Baer vs. Wolff war of words (what happened to the gag order?) has only gotten more interesting. Baer’s statement is cajoling Oakland, not Wolff, to get its act together. Wolff’s response is to say that the A’s don’t need the Giants’ help, especially if he can get San Jose. Keep in mind that if Oakland fails, the East Bay as a territory loses value, hurting Baer’s argument and supporting Wolff’s. What’s left is for both rich guys to let the processes in Oakland and in the courts play out, and prepare for next steps. At some point, the leagues are going to ask Oakland to either step up or step out ($$$). While some local media types continue to believe that the teams can carry on indefinitely at the Coliseum, at some point the conflicts become too great to bear. For those of us who have been following this saga for so long, it’s good to know that actions are being taken to make new homes for the teams. Even if one of those homes is temporary.
A simple, one page order came out of the Ninth Circuit Court of Appeals today. In it, the court granted the City of San Jose’s request for an expedited briefing and hearing. While it was previously thought that briefs wouldn’t be field until the summer at earliest, the court is setting a March deadline for the opening brief.
Before: LEAVY and TASHIMA, Circuit Judges
Appellants’ opposed motion to expedite briefing and hearing on appeal is granted. The opening brief is due March 5, 2014. The answering brief is due April 4, 2014. The optional reply brief is due within 14 days after service of the answering brief.
This case shall be placed on the next available calendar after the completion of briefing. Any request for an extension of time to file a brief is disfavored and must be made under Ninth Circuit Rule 31-2.2(b). No streamline requests for extensions of time in which to file briefs will be approved.
While I’m not going to go so far as to say that the court will rule in favor of San Jose (the case still looks pretty weak), this shows that the court acknowledges the high-profile nature of this case. Both San Jose and MLB will get the opportunity to make their filings, just as spring training and the regular season are starting. It could mean a summer
trial oral argument date, too. Even if San Jose’s chances of winning aren’t great, it means a potential resolution for this case could come more quickly and a little more work for MLB in the meantime. Plus the timing of the briefs will keep the story in the news cycle.
Of course, March 5 is coming pretty soon. Chop chop, Joe Cotchett!
The City of San Jose fired a salvo in the appellate court case against Major League Baseball. In the reply brief submitted yesterday, the City asserts that a decision by the Ninth Circuit court should be made before the land option agreement expires in November.
A decision on the antitrust issues concerning the Athletics’ move should be made before November 2014 or the Athletics may choose another site for their new stadium. Reed Decl., ¶22. If that occurs, San José will suffer irreparable harm because an eventual judgment in the City’s favor will be too late to allow the Athletics to successfully relocate to San José.
While damages for the economic harm caused by MLB would still offer some remedy to the City of San José, such a remedy is inadequate. Ultimately, MLB’s illegal conduct would have been successful in preventing free competition in the baseball market. Dkt. No. 1, ¶ 133; Gregory Decl., ¶2, Exhibit A. The only true remedy is an expedited briefing schedule and hearing with a final decision from this Court prior to November 8, 2014 in order that the Athletics will be permitted to exercise the option set forth in the Option Agreement.
This seems like a hollow stance for the City to have, since the land won’t necessarily go away just because the option agreement will expire. It will still be there, waiting for development, whether from a ballpark or something else, and in the future the land could easily be negotiated at the same price, as long as Santa Clara County and the Successor Agency signed off on it.
The other takeaway is the phrasing in the first paragraph: “…or the Athletics may choose another site for their new stadium.” Well, that would certainly be a November Surprise, wouldn’t it?
In addition, the City argues that MLB has delayed long enough – which it certainly has, but MLB has responded time and time again that it can make a decision on whatever timeline it chooses thanks to its antitrust exemption. If the judge rules in the City’s favor, that would be an indication that there’s substance to San Jose’s argument about economic damage.
Speaking of the antitrust exemption, another lawsuit was filed yesterday against MLB. This time it’s a potential class action suit in federal court alleging that baseball fails to pay minor league players minimum wage. At Fangraphs, Wendy Thurm wrote an examination of the lawsuit and its ramifications. With this suit and related ones, attacks on MLB’s broadcast blackout policy, and the City going after territorial rights, the antitrust exemption is defending itself on at least three fronts. Essentially all of these lawsuits go after the outdated notion that baseball is not a business, but rather a number of recreational exhibitions. As an $8 billion enterprise, you have think that at some point that notion shouldn’t hold water.
The surprise was that the lesser state claims about economic damage via MLB’s alleged interference were also refiled – in Santa Cruz County Superior Court. That’s right, Santa Cruz County.
— Wendy Thurm (@hangingsliders) January 24, 2014
— Wendy Thurm (@hangingsliders) January 24, 2014
City attorney Philip Gregory brought up MLB’s mysterious denial of the A’s petition to move to San Jose. Although the state claims are not considered as substantial as the federal antitrust case, it’s clear that San Jose aims to dig up some dirt on MLB’s machinations, which could help their case. The denial letter, which MLB has refused to release citing confidentiality, is probably the big prize. Santa Cruz County may also have a lighter docket compared to other nearby counties, which could be a factor in San Jose choosing to look south. Nothing’s expected to happen in either Santa Cruz or the Ninth Circuit until spring at earliest. Until then, the sides will prepare their next filings.
As we bring on a new year and a new baseball season, let’s reflect on the rather tumultuous year that was 2013.
- January - FanFest was a great event again, though the cramped concourses at Oracle Arena had many fans wishing for the event to be held at the Coliseum instead.
- The Coliseum Authority raided scoreboard funds to pay for the ongoing Coliseum Study.
- February – Oakland officials were forced to apologize to A’s owner Lew Wolff for misplacing a letter requesting further lease extension talks.
- March – The City of Mesa, AZ, approved a renovation plan and 20-year lease for Hohokam Stadium that will bring the A’s over from their longtime spring home, Phoenix Municipal Stadium. 2014 will be the last year at Muni for the A’s, after which the stadium will be home to the ASU Sun Devils. The Cubs, who vacated Hohokam after 2013, are moving to their own mega-complex on the west side of Mesa.
- San Jose was dealt the first of a series of setbacks when the state rolled back the City’s transfer of the Diridon ballpark site to the Diridon Development Authority. Eventually the City and Santa Clara County worked out the details of a deal, though it remains up in the air for now. In addition, a request to disqualify the Stand for San Jose lawsuit failed.
- April/May – Kevin Johnson rallied Sacramento and Bay Area interests to put together an ownership group that eventually bought the NBA Kings from the Maloof family.
- SAP takes over for HP as naming rights sponsor of San Jose’s Arena. Most fans continue to call the building The Shark Tank.
- The Giants refinance the remaining debt at AT&T Park (originally due to be paid off in 2017) in order to provide funds for their own project in the parking lot across McCovey Cove from the ballpark.
- Oakland Fan Pledge kicks off a campaign to build a list of fans willing to buy season tickets (and in some cases PSLs) at a new A’s ballpark in Oakland. Currently there are just over 5,000 pledges.
- Levi’s Stadium and the 49ers are awarded Super Bowl L in 2016. While the game will take place in the new stadium in Santa Clara, most of the other festivities will take place in San Francisco at venues like Moscone Center.
- June – San Jose files an antitrust lawsuit against MLB, alleging that the league’s stalling is costing the City tax revenues.
- A settlement between Howard Terminal operator SSA and the Port of Oakland could help clear the way for a ballpark on the waterfront site. Site proponents call this move “site control.” The Port was also motivated to get rid of an expensive, ongoing lawsuit by SSA over more favorable lease terms given to a nearby rival operator.
- A sewer main at the Coliseum is clogged, causing sewage to overflow the clubhouse level and requiring the teams to use the Raiders’ facilities (up one level). Eventually a towel or piece of clothing is found to be the culprit.
- July – A feasibility study for Coliseum City outlines the funding gap (now $400-500 million) that needs to be bridged for a new stadium, along with an explanation of the economic weaknesses of the East Bay market.
- The Earthquakes’ stadium is further delayed (until 2015) when numerous underground bunkers are found and need to be demolished before building anew. Erection of the stadium bowl would begin in late December.
- August – Raiders owner Mark Davis starts crowing for a long lease extension at the Coliseum, with the condition that the extension comes with a replacement to the Coliseum, preferably on the same site as the current stadium.
- MLB and the San Jose make filings in anticipation of an October hearing in their antitrust lawsuit.
- September – Lew Wolff clarifies that he seeks a five-year lease after the current lease ends after the 2013 season, with flexibility to leave early if impacted by a Raiders stadium.
- October – A federal judge throws out San Jose’s antitrust complaint against MLB, but allows the City an immediate appeal (Ninth Circuit) and for the state tort claims to continue. The state claims were also thrown out at the end of the year.
- A private investor group headed by LA mega-hedge fund Colony Capital and Dubai’s HayaH Holdings signs on to be the financial muscle behind the Coliseum City development. The group, teamed up with architecture firm JRDV, is tasked with providing a series of deliverables that will determine the feasibility of the project.
- Bloomberg estimates that the A’s are worth $590 million, a huge jump over Forbes’ preseason estimate of $468 million.
- November – With talks between the A’s and the JPA at an impasse, MLB steps in and negotiates a two-year extension for the A’s, resolving an outstanding issue regarding parking taxes. The Raiders receive a one-year extension with a one-year team option, which they would presumably exercise if they saw sufficient progress on the stadium front.
- December – The Oakland City Council and Alameda County Board of Supervisors hold their first joint session to discuss the pros and cons of Coliseum City. The Supes claim that the City has dragged the County along, and the County has not been sufficiently involved in the process.
- A court filing in the antitrust case states that MLB denied the A’s proposal to move to San Jose in June, just before the lawsuit was filed. MLB is unwilling to disclose the contents of the rejection letter. Sources inside baseball indicate that the A’s proposal, not the City of San Jose, was denied, opening the door to another proposal that MLB could conceivably accept.
- Renderings of the Howard Terminal ballpark are released. It appears that the vision would try to avoid the BCDC’s jurisdiction by placing the footprint sufficiently inland. It is unclear if such a move will work. Normal CEQA issues remain, and proper environmental review has not started yet. Meanwhile, the Port solicits bids for use at the vacated terminal per state law.
What can we expect in 2014? A lot of follow-up to many of the issues above. Lawsuits will continue, and short-term leases only kick the can down the road. With the leases temporarily out of the way, 2014 is the year of the election. Both Oakland and San Jose have mayoral races this year. Oakland Mayor Jean Quan finds herself at the top of a list of five declared candidates. The race to replace San Jose Mayor Chuck Reed will also be hot and heavy, with several current council members facing off against a former councilman and current county supervisor. We should expect to see some serious progress on Coliseum City’s feasibility, as several project deliverables are due in the first half of the year. Oakland partisans will continue to flog Wolff, while San Jose partisans flog Mayor Quan. 2014 is also Commissioner Bud Selig’s last full year in his job. The search for his replacement could be interesting, though the favorite is currently COO and longtime MLB exec Rob Manfred. Movement on the antitrust lawsuit is not expected until the spring, and the “forgotten” Stand for San Jose lawsuit continues its machinations. All in all it looks to be a very newsworthy year. Will attendance continue to grow? Will it be an eventful 2014? That depends on whether anything gets resolved. This site has been running for nearly nine years. The stadium situation has never looked more muddled, with no end in sight. Something’s gotta give, right? Right?
If you haven’t heard, the City of San Jose finalized a five-year lease extension with the San Jose Giants this week. Talks were somewhat contentious for several months, as it was Giants ownership (San Francisco Giants) that spearheaded the Stand For San Jose-vs.-City of San Jose lawsuit two years ago. The relationship was so sour that the SJ Giants had to remove themselves from the lawsuit in order to repair the relationship with the City. The Giants, usually at the tops of the California League in attendance, had things pretty good with a favorable lease and a vast array of corporate sponsors to choose from.
In fact, it wasn’t that long ago that the Giants took the City for granted. In 2007 they even played the old stadium ransom game, threatening to leave if they didn’t get as much as $8 million to renovate Municipal Stadium. City let the San Jose Arena Authority manage the situation, so renovations on an annual basis were kept reasonable, a little over $1 million from that point until now.
So when the time came for the two sides to talk, you can imagine how uninterested the City was with the Giants’ sales pitch. The S4SJ lawsuit involved the Giants’ law firm, Pillsbury, and from what I heard, City was happy to let the Giants twist in the wind a little. Eventually cooler heads prevailed, resulting in the five year extension through 2018.
The lease remains dirt cheap at about $25,000 per year. In addition, the City is for the first time granting the sale of naming rights to Muni. Money from any naming rights deal will go into a capital improvements fund. The important takeaway is that the City is no longer responsible for general upkeep at Muni, nor will it be pushed into funding other improvements at Muni as the Giants had previously requested. In a related move, a deal to share parking with Sharks Ice next door was also reached.
With the coffers running low to fund ongoing facilities improvements, City has used naming rights successfully to take care of various small projects. Most recently, the venerable Civic Auditorium received a name change to the awkward sounding City National Civic, after City National Bank. And of course, there’s also SAP Center, which changed from HP Pavilion in a rather quick manner after the CEOs of HP and SAP talked it over. City National Civic’s deal is worth $240,000 a year, within the range of single-A ballpark naming rights deals. It remains to be seen if Muni will fetch more because of the Giants’ name and the size of the market or less because Muni’s elderly condition. In either case, there should be a number of local sponsors who should be expected to bid, Adobe and Orchard Supply Hardware to name two.
Or, if the parent SF Giants wanted to get really snarky about it, they could rename it Giants Stadium. Talk about planting a flag. The Sharks took over the naming rights to their practice facility from Logitech, and have been expanding that brand ever since with rinks in Fremont and uptown Oakland.