Imagine that you’re Raiders owner Mark Davis. It’s December and your team is already out of the playoff hunt, headed towards a losing season and a top 10 draft pick. The team has one more season on its lease at the Oakland Coliseum, and while negotiations and studies are ongoing with Oakland and Alameda County, it’s not like you’re not taking calls from interested parties in LA. The 49ers are progressing quickly on their own stadium, which could be a decent temporary landing spot.
In other words, you have options. Prudent financial planning on your parents’ part appears to have kept the controlling interest of the team within the family, though there isn’t the money to put up a huge share towards construction of a new stadium. You could work a two or three-year deal to keep the team in Oakland while things are worked out, or experiment in Santa Clara for a few years.
At the same time, government handouts for stadia have all but dried up, at least in California. The growing number of minority partners will want their piece of whatever deal is made. The Raiders are currently the third least valuable team in the NFL, mostly due to the lack of revenue generated at O.co Coliseum. The 49ers, who were in similar straits a few years ago, are now worth $1.2 billion thanks to their coming stadium and a deep playoff run that generated enough interest and upfront sales to help pay for the stadium. Those upfront sales, which include an alleged $500k/year for high end suite leases, are the replacement for the big government handout.
That’s all well and good when you’re the 49ers and can tap into wealthy San Francisco and Silicon Valley, and have first-mover advantage to boot. When you’re Mark Davis, only a fraction of that kind of money is available to you – at least in the Bay Area. The 49ers are sucking much of the air out of the market. In Los Angeles that money’s there in spades. And with Phil Anschutz exiting stage left, negotiations with a stadium operator may not be as difficult as they were with Anschutz on board.
Problem for you, Mark, is that if you want to be a first mover on LA, you might want to act when the NFL opens its six-week relocation application window on New Year’s Day, 2013 (or if no one applies in 2013, 1/1/2014). Acting first could provide distinct advantages, such as better lease terms and preferred scheduling if a second team (Chargers, Rams) were to come in. Of course, other teams will be thinking the same thing so that may want to move early too. There’s also the problem of playing one or two years at an interim facility like the LA Coliseum. If you apply for an LA move, it’s almost a certainty that Oakland officials will cease work on Coliseum City, at least the football-centered version of it.
Better to keep your cards close to the vest. Good job on that, for now.