Update 3:45 PM: The Trib’s Chris Metinko covers prospects for a Raiders move to Santa Clara. For now, the Raiders are dealing solely with Oakland/Alameda County. If you want to read into the situation, you can gather that the Raiders are – at least until their lease expires – in the catbird seat. They don’t have to commit to anyone for some time to come. Best of all, if the 49ers and Santa Clara come up short into terms of fundraising goals, the Raiders’ contribution could come in and salvage the project. However, you can bet that the Raiders will use that leverage to extract the very best deal possible. Only the NFL could make the Raiders come to the table sooner than they’d like.
Also: the 49ers have launched a new stadium website. It has a bunch of dead links and nothing but Flash-based content right now (sorry iPad users). It’s safe to assume that more content will be added in the coming months.
Today the world is a little different. The 49ers now have a stadium site, an approved EIR, and the approval of Santa Clara voters to build a stadium next their practice facility and Great America. On Gary Radnich’s radio show today, he and reporter Dan Dibley are having a lively debate about stadium options. Dibley pretty much nailed the sentiment on the skeptical side when he said that the NFL will not give the lion’s share of funding ($490 million) to a single team’s stadium. If the NFL holds the purse strings (which is not quite a given because of the ongoing CBA talks), it makes little sense for the league to throw $1 billion combined at two teams. The practical path is for Roger Goodell to urge the Raiders to move to Santa Clara along with the Niners. It would make the revenue projections much more reasonable.
One thing I’m curious about is if the NFL forces the issue, how will it determine revenue sharing for the second team? While the term sheet is written to make it appear that the Niners are taking the risk, in reality it’s the Stadium Authority that will have the most risk of revenue shortfalls.
ARTICLE 16. SECOND TEAM
Section 16.1 Second Team. 49ers Stadium Company will have the right to enter into a sublease with a second NFL team (“Second Team”), on terms and conditions consistent with and subject to the Stadium Lease to allow the Second Team to play its home games in the Stadium, subject to the following conditions:
(a) Repayment of Upfront Investment. Prior to the date that the Second Team plays its first home game in the Stadium, the Agency will receive an amount equal to the Agency Upfront Investment, which, as provided in Section 7.4 above, is estimated under current economic conditions to be approximately Twenty-Eight Million Dollars ($28,000,000).
(b) Repayment of Advance. 49ers Stadium Company will pay to the City or Agency prior to the date that the Second Team plays its first home game in the Stadium an amount equal to all the tax increment previously paid to 49ers Stadium Company as payment on the principal amount of the 49ers Agency Advance.
(c) Forgiveness of 49ers Agency Advance. From and after the date the Second Team plays its first home game in the Stadium, 49ers Stadium Company will have no further right to receive tax increment and will forgive all principal and interest of any outstanding 49ers Agency Advance.
(d) Additional Fixed Ground Rent. Commencing in the first year the Second Team plays its home games at the Stadium, the Stadium Authority will pay to the City, as additional Fixed Ground Rent (“Second Team Fixed Ground Rent”), One Million Dollars ($1,000,000) per year. Beginning in the eleventh year of Second Team occupancy, the Second Team Fixed Ground Rent will equal One Million One Hundred Thousand Dollars ($1,100,000) per year, and such amount will, provided the Second Team continues to play its home games at the Stadium, increase One Hundred Thousand Dollars ($100,000) every five (5) years thereafter during the initial term of the Stadium Lease. For each extension of the Ground Lease, the Second Team Fixed Ground Rent payment will increase by Eighty Thousand Dollars ($80,000) for the term of the extension. As Second Team Fixed Ground Rent will be included in Fixed Ground Rent, such amount will be taken into account in calculating Reimbursable Expenses as provided in Section 12.1(i) above, and a portion thereof will be credited against Performance-Based Rent as provided in Section 4.3(b)(i) above.
(e) Reimbursement of Developer Fees. 49ers Stadium Company will reimburse the Agency for the share of development fees paid by the Agency to the City’s enterprise funds as of a result of the construction of the Stadium as provided in Section 6.4 above, estimated to be approximately One Million Seven Hundred Thousand Dollars ($1,700,000).
(f) Capital Costs. 49ers Stadium Company will be responsible for all additional capital costs and additional Reimbursable Expenses required to accommodate a Second Team, except that the Capital Expenditure Reserve may be used to the extent consistent with the Capital Expenditure Plan. There would be no additional investment required by the City or Agency.
(g) Additional Capital Expenditure Reserve Deposit. As provided in Section 14.1(c) above, each year that a Second Team plays its home games in the Stadium, the Stadium Authority will fund, as an additional Stadium Operating Expense, the Second Team Capital Reserve Deposit in the initial amount of One Million Dollars ($1,000,000), escalated at the rate of three percent (3%) per year thereafter.
From this, we can see that both the 49ers and the Stadium Authority (by extension the City) have incredible incentive to lure the Raiders south. But as usual in the lead up, we have no idea what the actual revenues to the either team would be. What would the Raiders’ lease look like? Surely the 49ers, in getting the deal done, would win a controlling share of revenue. How attractive would the lesser share be for the Raiders? There has to be a sliding scale from which the Raiders would view a stadium-sharing situation in Santa Clara, and it’s expected that there’s a threshold that they wouldn’t cross, lest it be a bad deal for them. That’s where it would make sense that the NFL steps in to make the whole thing square for both teams. If history’s a guide, the Giants and Jets have a 50-50 split at the new Meadowlands stadium to open this fall, and the negotiations were particularly contentious. I would be surprised if Al Davis took being a tenant to a 30-year-old landlord easily. Then again, he doesn’t have many choices, does he?
I’m not convinced this stadium will actually be built in Santa Clara (a joint stadium for both teams in Oakland still is the best solution).
In Santa Clara, there has to be lots of $$ raised from PSLs (remember how that worked out in Oakland? Meanwhile, the NY Giants exhausted a season ticket waiting list of 60,000 people when the team tried to sell PSLs. The Jets are 17,000 short of their goal with the building set to open shortly.) Wait till 49ers fans see how much money they’re supposed to pony up for this thing.
Also, stadium naming rights sales are not what they once were (See: Cowboys Stadium (with no corporate sponsor) and The New Stadium at the Meadowlands – also no corporate sponsor).
And where do the 49ers come up with their half of the $967 million and what happens when the stadium price inevitably goes up far beyond the original estimate?
Remember when voters in Frisco approved the stadium-mall in 1997? Funny, but I don’t see a stadium-mall at Candlestick, do you?
re: The practical path is for Roger Goodell to urge the Raiders to move to Santa Clara
What on earth do they call them, then? The California Raiders? Great America Raiders?
@pjk- and no PSL’s for a new Oakland stadium? They still have about $120M of debt from the last remodel—money doesn’t grow on trees and you can bet Oakland/East Bay communities are not going to foot half the bill for a $1B stadium so that there are no PSL’s. these will be part of any new stadium that will be built as well as any new A’s ballpark that is built. Note that the gints were fairly successful at ATT for their PSL equivalent.
What are the ‘9ers called in SC–San Francisco…what will the Raiders be called in SC…Oakland—look to New Jersey for a clue as to how this works for both New York teams.
All of the issues that you cite as to why the stadium will not be built in Santa Clara do not magically go away in Oakland….and in fact some are much worse given the debt on the existing structure and the timeframe (3 years and counting) that the ‘9ers and Santa Clara have been working together to get to this point.
Only half of a new stadium would be needed in Oakland. Half of new stadium with dozens of spanking new luxury boxes already exists – now known as Mount Davis. Ge two teams to build the other half of the stadium and watch that otherwise-billion-dolllar price tag get cut in at least half.
There’s BART access, easy highway access and half a new stadium in place in Oakland. Please tell me how shoehorning a $1 billion+ stadium into the Great America parking lot, away from highways, would be the better solution.
From what I hear, 5:30 pm weeknight games are out of the question in Santa Clara given the massive traffic already in place as it is with commuters in the area. Hop on Route 237 today at 5:30 and see for yourself.
And nobody wants to notice that the stadium is right in the flight path of San Jose Airport. Want to float a blimp over the stadium with jets flying by? Want to watch a game with jets flying by (it’s noisy – I can assure after trying to meet withy people outside the Hyatt Hotel, right next to where the stadium would be).
Think San Jose, which is in massive debt with its now-underutilized airport, will shut the airport down during Raiders-49ers games and any concerts that might happen? Think again.
re: SF Giants PSLs. You’re talking a baseball stadium built for probably one-third the costs of a football stadium and used 10 X more. Not comparable to a $1 billion football palace.
Also, it seems apparent the 49ers have no takers as corporate sponsor for the Santa Clara stadium or they would have shouted it from the housetops already.
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So ML…what do you think this development means for the A’s stadium effort in Santa Clara County? Is it now more or less likely that a public vote would go the A’s way in November? Beyond that, this whole co-tenant issue could really impact the A’s future in Oakland, in my opinion. If the Raiders are somehow convinced to move into the new place with the Niners, I would think that regional leaders would push hard to keep the A’s in Oakland as a remaining Coliseum tenant…might that possibly convince a re-thinking of keeping the A’s in Oakland and even in the Coliseum area, if it could somehow be rebuilt/revamped/retooled as a near-new type of baseball-only facility?
@pjk 1. Two-thirds of a new Coliseum would have to be built if a rebuilt Coliseum is even acceptable.
2. Both teams would have to leverage large numbers of PSLs (SBLs in 49ers parlance) regardless of location. If both partner there’s a chance those numbers could be reduced, increasing sellability of season tickets. 3. The Raiders are off scot-free once their Coliseum lease ends. If they pursue a new or revamped Coliseum the remaining Mt. Davis debt becomes part of the deal. 4. A blimp would be equally problematic for an A’s ballpark, but perhaps worse because the blimp would be directly over residential neighborhoods, bringing noise.
In the end, the main issue for both teams regardless of whether they share a stadium is financing. NFLPA wants a cut of premium seating revenue, which has long been kept away for the purposes of financing stadia. If the union gets some of that, the stadium’s financing model would have to be revised if not completely redone.
@ Taj Adib – I would expect the A’s to sink in far more than the $4 million the Niners spent. Given the likely more taxpayer-friendly nature of an A’s stadium, right now it’s hard to see a measure failing.
Oakland/Alameda County are in a wait-and-see stance, not a proactive one. A renewed push for the Coliseum (new/revamped/whatever) would show a lack of unity and would not be good, especially since the City of Oakland has basically pushed their chips behind a JLS option. It’s hard to consider the Coliseum an option at all unless someone performed a miracle and suddenly made it attractive.
…not many blimps used at baseball games. But all football stadiums seem to have them floating above. (More likely, the 40er game blimp will keep floating over Alcatraz and the GG bridge, even if the game itself is 43 miles away. The TV networks will do what they do with the Jets and Giants and pretend the game is in the more prominent city in the region, not in some small town nearby.)
One thing I have trouble with: How can anyone believe the NFL needs any taxpayer money at all when it has made JaMarcus Russel and several generations of his descendants set for life?
Having the 49ers and Raiders share a facility makes too much sense, that’s probably why it won’t happened.
“Given the likely more taxpayer-friendly nature of an A’s stadium.” Damn straight R.M.! I was very much against a possible SJ ballot measure for the A’s…UNTIL YESTERDAY! 60-40 SC voters in favor of a Niners stadium (WOW!), which will (unlike an A’s SJ ballpark) require taxpayer monies in the form of redevelopment and hotel mello-roos funds. Market or below market-rate land lease for the A’s to build a PRIVATELY FINANCED ballpark on SJ owned land? Should at least get 60% SJ voter approval!
In regards to both the Niners and Raiders possibly shacking up in Santa Clara together: The Great America stadium site is less than a mile from San Jose city limits. The city of SJ should at least try and make one of the teams OURS! “SJ” instead of “SF” on a Niners helmet? “Your San Jose RAIDERS!”? IMHO, the largest city in the Bay Area should have a NFL team. If anything, this thought should make Georob turn in his grave (figuratively speaking of course)…hope you’re doing well out there Rob!
Regarding Al Davis: is he even in charge now a days? The way the NFL Draft went this year for the Raiders, which was one of their best drafts in recent memory, one has to wonder. Whatever the case, the younger York always talks highly of “Mr. Davis” and Amy Trask states the two teams have a great working relationship.
Great post ML,
As a die hard Raider fan I would much rather have the Niners play at the Coli site and build a new stadium there, but now that its just about safe to say that it won’t happen, I’m not against sharing a stadium in SC the least bit. It really does just make too much sense…
If the largest market in the US is doing it there should be NO reason why we shouldn’t…The bay area needs to put away their stupid territory rivalry and be open minded at least just for this issue…the whole “ghetto VS wine & cheese” argument between the two fans might interfere with a smart collaboration…Instead of rejecting the idea we should embrace it. Personally I think it creates an opportunity to build a state of the art stadium that can alter between the two teams when they play there home games to fit their franchise personalities…kind of like how the Staple Center dims the lights for Laker games but floods them for Clipper games, but on a bigger scale…
Make the stadium transformable so home games don’t look exactly the same for both teams…Slightly alter the seating arrangements close to the field like a distinct “black hole” or “red zone” section, having some kind of LED lights that switch colors in and outside the stadium that match the teams colors when the play, things like that…
In the NY market, the Jets are media stereotyped as the ” blue collar ” team ala Raiders and the Giants are the ” wine and cheese ” team ala the 49ers. Of course , on any given Sunday, their are plenty of garbage truck drivers as well as mega millionaires routing for all 4 teams.
Thanks for the great work ML. This is always a daily stop for me on the blogroll, and on the days you have a new post it’s always a highlight.
A few questions for you, or any community members:
1. Would you expect that there would be a college bowl game hosted annually in this new, state-of-the-art Santa Clara stadium?
2. How many dates would a new football stadium realistically be in use per year? Let’s say the whole grand plan comes to fruition. Optimistically, I’m thinking…10 days for the Raiders, 10 for the Niners, 1 bowl game…maybe 10 concerts? Am I leaving out another potential possible stadium use? So…about 30-31 days per year of stadium use?
Thank you for your replies.
Concerts at In-the-flightpath-of-the-airport stadium.
“I know! It’s only rock and roll but I – WHOOOOOOOOOOOOOOOOOOOOOOOOOOOSHHHHHH!”
nsj, I have had similar questions in the past and wrote a post on here about why Oakland might prefer football.
I looked at newer stadiums websites (like Cowboy Stadium) and found that we can add Monster Truck Rallys, Pro Bull Riders and AMA Motocross to the list (depending on demand, not sure if Pro Bull Riders would draw as well here as in Dallas) but otherwise, you have it pretty much right. A venue of this size is used maybe 2.5 times a month as far as I can tell.