A city’s predicament

I fear for Trib reporter Matt Artz’s email inbox, because it’s about to get pummeled.

In today’s edition, Artz tries to explain why Oakland’s three teams are varying shades of noncommittal with regards to staying at the Coliseum, or even in Oakland in general. For most of us who follow the situation closely, the information is pretty much old hat. Still, it’s good to read someone in the local media deal it as plainly as Artz did, even if the truth is unpleasant.

As Oakland fights to keep its teams, industry leaders say it’s hampered by the fact that its main lure was a site more attractive 40 years ago than it is today.

“I think that’s a real problem,” Smith College economics Professor Andrew Zimbalist said. “The times have passed it by.”

Exactly. No one questions how devoted or hardcore Oakland and East Bay fans are, they are among the best in the nation. Unfortunately, the business of pro sports has become such a high-stakes affair that economically, Oakland is practically a AAA market while San Francisco and San Jose/Silicon Valley are major league markets. Nowadays money trumps hardcore seven days a week.

Yesterday I was looking into how Orlando’s Amway Center was built, hoping to understand how it surpasses Oracle Arena in terms of amenities. Oracle does well in having four premium seating options: courtside seats, suites, and two different club options. Amway Center has an astounding seven options: courtside seats, founders suites, presidents suites, legends (party) suites, MVP tables, 4- and 6-person loges, and club seats. All seven options are priced specifically to target certain well-heeled demographics, whether they are big corporations, prominent small businesses, or rich people who simply want more elbow room. A future post will go into how all of this works. For now let me tell you that there’s no going back. All four North American pro sports leagues are multibillion dollar outfits. So are NASCAR and NCAA football.

Oakland Mayor Jean Quan talked Thursday about having a huge Cowboys Stadium-like facility in the Coliseum complex, to be co-anchored by a convention center. One thing she didn’t mention was the price tag for such a complex, or even just the stadium itself. Lest we forget, Santa Clara’s Stadium Authority is on the hook for $700 million of the 49ers stadium costs. Zygi Wilf and the Vikings will be paying 49% of the Metrodome’s $1 billion replacement, leaving the rest to public funding sources. Even if you buy the somewhat dubious argument that the 49ers are paying for the lion’s share of the cost (who runs the Authority, again?), Santa Clara had to put up $144 million in hard dollars initially. What price will Oakland/Alameda County have to pay to stay in the game? $200 million? $500 million? Quan cites the $200 million NFL G-4 fund, but that’s available to every team, every market. Any new stadium will cost at least $1 billion.

Also today, a sobering analysis by the Atlanta Journal-Constitution shows how cities struggle to make their money back even with glistening new stadia, characterizing these efforts as an “arms race”. Good thing that the leagues appear to be bedrock solid for the foreseeable future, because if they weren’t municipalities would be wading into their own “mutually assured destruction”. So dream big, people, because it’s not your money! Until there’s a price tag. Then it’s definitely your money.

12 thoughts on “A city’s predicament

  1. Its good to point out that the economic climate is was it is. Oakland is no longer a viable economic option if the A’s are going to stay in the Bay Area. This along with the anti-trust exemption & “territorial rights” having no real teeth to it, the A’s or the city of San Jose need to get Bud Selig’s attention through filing or the threat of filing a lawsuit to get this process moved along. I am a life-long A’s fan who no longer lives in the Bay Area but doesn’t want the A’s ever to move out of the Bay Area. The numbers don’t lie. San Jose Athletics of Oakland anyone?

  2. A little OT but somewhat pertinent seeing as the floundering Coliseum City is currently the city of Oakland’s only plan on the table, I wonder why no one has heard from Knauss yet. It’s been nearly 48 hours since he met with Wolff and the papers have all got their soundbites from Wolff on the meeting. But so far not a peep out of Knauss who was supposedly going to be bringing “new ideas” to the meeting with Wolff.
    Wonder if he found out his ideas weren’t so new and that they weren’t going to work in Oakland.

  3. Also good on Artz. Nice to see someone in the press come out and say what the reality of the Coliseum City plan is… that it’s a plan 40 years too late and not likely to work now that the Warriors have bolted (not that it was going to work before they bolted with the requirements that the teams pay for the entire thing).

  4. At first glance, it really seems like Coliseum City is dead without the W’s there building an arena. After all, without concerts and basketball games, there isn’t anything drawing people there once the baseball season ends. Football is only there every other Sunday ’till January at that point. Then nothing to keep the restaurants, bars, and shops afloat there for several months. But maybe they can work around Oracle and turn it into a venue that specializes in putting on concerts and underbidding the arena in SF. After all, it’s almost paid for. I read that the Sharks are only 20% of the events at HP Pavilion. Otherwise, without an arena, Coliseum City RIP.

  5. @Dan- I expected Knauss to be awfully quiet after his meeting with Wolff. I am sure Wolff pointed out his efforts in the East Bay over a decade and why each site (7-8 total) were all eliminated because of unique problems with each site.

    These 7-8 sites have nothing to do with corporate dollars or $$. It is because of physical issues such as businesses unwilling to move, freeway access, utilities that can not be moved etc….

    Knauss being a business man now understands Wolff’s efforts over the years in the East Bay and why the BRC has been so quiet over 1170 days.

    Knauss knows what is fact…..San Jose is the only way in the Bay for the A’s to survive.

  6. How about the Warriors can move to San Jose until their new arena in San Francisco is built.

    Then we knock down the Oracle Arena and build a new ballpark for the A’s on that site?

  7. It’s amazing to me, now that the Warriors have made their plans known, that the local media’s to e appears to be changing. Oh, you mean Lew Wolff isn’t some cartoonish super villian lighting cigars with hundred dollar bills anymore? Now they choose to point to economic realities? Wow.

  8. About time for a little realism, isn’t it Jeffrey? I don’t think we’ll see any retractions from Dickey, Poole, and Cohn for the insane columns they wrote when Billy traded the pitchers, however.

  9. Dave, sure but who is going to pay for it? Wolff and even Knauss don’t want to build at the Coliseum site. It’s a non-starter due to it being a crappy location 40 years out of date. If it’s not downtown it’s not worth building.

  10. I was looking at the list of Fortune 500 companies earlier tonight, and the highest listed California-based company is actually headquartered within the A’s territory: Chevron, which is #3 nationally and is based in San Ramon.
    FWIW, Clorox is #49 statewide (#456 nationally).
    I also thought it was interesting that the Bay Area has 8 companies listed higher than any company in Southern California (Walt Disney Company is #66 nationally).

  11. Pudgie, it isn’t about one single company (one that you may have noticed hasn’t been very vocal about where the A’s should play)… It isn’t about MLBs territory, either. Ever notice who has a cartoon car plastered down the left field line at AT&T Park? MLB Territories don’t restrict the Giants from getting sponsors in the A’s Territory or vice versa.
    What is important is the depth of corporate support for keeping the A’s in Oakland or moving them to San Jose. Take the dozen companies that were at Knauss’ press conference and compare them with those that wrote a letter to Bud Selig supporting a move. It’s not even close.

  12. Look at the Chron 200 list of the largest Bay Area companies. Over 100 are in San Jose, and Oakland has three. There are more in Pleasanton than in Oakland. As Jeffrey said, it’s not even close.

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