I frequently look to San Diego for inspiration, whether for the weather, the beer, my brother’s wonderful Rottweiler, Jojo, or major league baseball. No, I’m not saying that the Padres are baseball’s model franchise. Instead, San Diego – the market – is a good comparison to the way the A’s are situated in the Bay Area. Consider the following:
- With a population of 3 million, San Diego is slightly larger than the East Bay’s population.
- The gross metropolitan product (GMP) of San Diego is slightly larger than that of the South Bay. (The East Bay is considered part of the San Francisco region from a Census perspective).
- San Diego has a broad economy, from the military and government services to healthcare to technology.
San Diego will never be able to have a large share of the Southern California television and radio market because of the presence of the two Los Angeles teams. That hasn’t stopped the team from inking a 20-year TV deal with Fox Sports, worth $25-30 million per year. It pales in comparison to the Angels’ new deal and the upcoming Dodgers’ deal, but it’s still a major improvement over the $15 million per year the Padres were getting from broadcast station Cox-4. The deal starts in April.
Of course, this is MLB, where any snag that can be hit will be hit. Commissioner Bud Selig tabled the sale of the Pads from John Moores to Jeff Moorad as other owners raised numerous questions about financing that weren’t satisfactorily answered. Both Selig and Moorad say the snag won’t jeopardize the sale. It sounds like Moorad will take Jim Crane’s recently vacated hot seat, as the sale gets dragged on for several more weeks or months while outgoing majority owner John Moores stews.
According to this summary from Gaslamp Ball, Moorad has all of his money lined up, including the last $100 million of cash in escrow. That’s somewhat impressive, given that Moorad was given an unusual five-year phase-in plan to acquire all of the team. Moorad sold his minority stake in the Diamondbacks, got Bob Piccinini and others (many of whom are Modesto based) in a 12-member investor group, and seemingly got the money three years ahead of schedule. Yet there remain questions about what debt instruments Moorad used to raise the capital, and perhaps additional questions about where some of that TV money is going to go when the Padres start getting paid (some of it may go to pay down debt instead of the team). All of this harkens back to the McCourt debacle, where Frank kept borrowing against the team and related properties to fund an extravagant lifestyle for him and his ex-wife. With new debt rules in places thanks to the new CBA, Moorad’s group may be Exhibit A in ensuring that teams, especially mid-markets, stay true.
A decade ago, Piccinini-Dolich group experienced similar troubles when trying to buy the A’s. They brought in numerous new partners over several months, trying to appease Selig and the owners. Whether you believe they were shafted or there were lingering unanswered questions about how the group would finance and run the team, their bid was denied. Though it’s interesting to consider for a moment that with the makeup of the Padres’ investor group and Moorad’s place as the managing partner, it’s not hard to see that had things turned out differently, Moorad might be the A’s owner now, perhaps phasing out Dolich over time. Would the group have been so steadfast to stay in Oakland, or would Piccinini have become a Ken Hofmann-like weak supporter of the East Bay? Would Moorad, smelling the money in the South Bay, have gotten his agent juices flowing again and pushed for San Jose? We’ll never know. If you want to see how the Piccinini group would’ve operated the A’s with limited resources (like those in San Diego), all you need to do is see what Moorad does in the future with the Padres.