Farmers Field stalling is a short-term win for Oakland, San Diego

Yahoo! Sports’ Jason Cole wrote last night that the NFL is souring on AEG’s Farmers Field stadium plan for downtown Los Angeles. That may sound revelatory, but in reality the landscape hasn’t changed much since he wrote an article in October 2011 claiming that the NFL doesn’t like AEG’s terms for hosting a team (or two) at Farmers Field. With AEG’s future up in the air pending a possible sale, Farmers Field appears to be stalled. But this was to be expected with the sale, so why is this news? It isn’t. That shouldn’t stop us from trying to understand the NFL’s misgivings.

First, let’s start off with the supposition that Farmers Field is to be operated similarly to Staples Center. AEG wants as many tenants as possible using the stadium, taking up dates on the schedule. It also wants the flexibility to hold non-football events, hence the desire for a retractable dome to make the stadium an enormous exhibit hall for the LA Convention Center. There’s the potential for numerous sports events outside of a regular season NFL slate, such as the Super Bowl, NCAA Final Four or regionals, a bowl game, fights, soccer and rugby matches, plus motocross and monster truck raillies. Add a bunch of conventions and the schedule should be full, right?

The problem is that the Staples Center model isn’t congruent with the uses of a large stadium. Staples is famous for being able to hold two events in a single day thanks to its seating flexibility and existing infrastructure. For football, hosting a game takes a full day, and the Saturday and Monday surrounding a game can be expected to be blocked out because of the time required to install and remove a football field. Since the venue will be positioned to go after the largest, most lucrative events, prep time may not be that big a deal. Still, it’s indicative that the Staples model doesn’t exactly scale.

AEG has advertised for some time that the now-$1.8 billion stadium would be fully privately funded, the most expensive stadium ever built. Assuming that AEG would build the stadium without the benefit of low interest, tax-free bonds, the onus is squarely on AEG and its tenants to ensure that the place is paid for. AEG’s model takes a cut of a team’s stadium revenue instead of requiring a rent payment. AEG has apparently backed off its demands of a percentage interest in any team looking to move to Farmers Field. Either way, they’re getting their money upfront or at the back end. Essentially, AEG is taking the place of a large public subsidy, and unlike municipalities they need to make a profit. That’s understandable for everyone except the NFL and interested owners. Roger Goodell’s memo from last summer detailed the process for any team applying for relocation to LA in 2013, suggesting that two teams call the stadium home in order to defray the cost. Again, that would be compatible with what AEG is looking for, but as long as AEG and the NFL are in a stalemate over the terms of the revenue split, there’s no deal.

A stalemate downtown should create better chances for the other LA stadium plan, Ed Roski’s City of Industry stadium. However, Roski is mired in a dispute with the state over TIF that’s earmarked for $180 million worth of improvements to the undeveloped hillside stadium site. The state says that because the project didn’t finalize contracts and measures that were to be taken to fulfill environmental requirements, the deal doesn’t fall under the category of an “enforceable obligation” and didn’t need to be honored by the state. There’s no reason to think the state will lose that debate, so it’s a mystery how that infrastructure will be paid for.

The NFL is actively looking for other potential partners and stadium sites, pursuing the Dodger Stadium site through Guggenheim Partners and Frank McCourt. A discussed site swap to build a new ballpark downtown and a football stadium at Chavez Ravine seems like even more of a pipe dream due to the complexity and cost. That leaves a few sites in further out locales such as Carson. Roger Goodell would prefer more competition and more lucrative bids before seriously entertaining a franchise relocation or expansion (or both). The problem is that as rich as the LA area is, a stadium is so expensive that if there aren’t enough huge money stakeholders to carry some of the weight, that stadium can be termed in a similar state to so many other Hollywood projects: development hell.

For cities with old or “outdated” stadia and teams trying to get better stadia, LA’s struggles represent a bit of a reprieve. St. Louis, still reeling from arbitrators siding with the Rams, doesn’t need to fear the team pulling up stakes immediately. San Diego area interests can go back to working on yet another stadium proposal. And the Raiders and Oakland/Alameda County can continue to try to get on the same page. For the Oakland/Alameda County, the impact is different. If a retractable dome/convention center concept doesn’t work in LA due to the cost, why would it work in Oakland? AEG already operates the Coliseum complex, and if they were to partner on this they’d want the same deal in Oakland that they were offering in LA. If anything, this development is great for the Raiders since they can try to shift the discussion to a new outdoor stadium, which is what they and the NFL really want. The financing part is still severely problematic, but at least the parties could hone in on a singular vision they could all agree on moving forward. The big question is whether the public side (Oak/AC) decides the most cost-effective option is a renovated Coliseum as opposed to an entirely new stadium. If so, they’re all back at square one.

21 thoughts on “Farmers Field stalling is a short-term win for Oakland, San Diego

  1. Hey ML why u think s renovated Coliseum and Qualcomm would be so bad??? I think with California being run by Jerry Brown who hated on the downtown A’s, u can keep the stadium give it a major uplift inside and out, and still build things around it , extra convention center, restraunts, appts etc…. Anyway this news just gives Oakland and San Diego city leaders more time to stall themselves….

  2. The best option for the Raiders, city of Oakland and AC is to get the hell back to square one! Renovated coliseum.

  3. So if the Raiders can’t move to LA what makes one think that their fan base is willing to support a losing team in a new stadium if its in Oakland or Santa Clara?

  4. @berry – There isn’t enough happening next to an old stadium (even if it’s renovated) that will be filled only 12 times a year. An arena or dome makes more sense. So does a ballpark. For football there isn’t enough utilization. The only developments that have worked next to football stadia in the past are malls, and no developer’s clamoring to build one of those in Oakland.

  5. The Raiders still have a low risk option that could put further pressure on Oakland to find a way for a new or renovated Coliseum. The option is a short-term lease to share the Santa Clara stadium with the 49ers. If anything, this arrangement is a test for the Raiders to see if sharing the stadium as a tenant is doable, both financially and physically. A short-term lease arrangement at the Santa Clara Stadium will allow the option of possibly returning to Oakland to a new or renovated Coliseum, or to move to some other market such as LA.

  6. @Mike2,
    The Raiders would have to become a winning team; entirely possible with smart draft picks and free agent acquisitions. See the other team in SF for proof.
    BTW, swapping Farmers Field for Dodgers Stadium for baseball, football stadia is the best idea that will never happen. Ballparks belong downtown IMHO.

  7. @TonyD I completely agree about the baseball/football swap. The Chavez Ravine site has tons of parking, perfect for tailgating, and having all the baseball events downtown and closer to public transit makes much better sense. I agree it will never happen, unless Frank McCourt sells the parking lots and Dodger Stadium is destroyed by an earthquake.

  8. What? Mike2 – the Raiders sold out all their ’11 home games – Excellent, considering the team has not been over .500 since ’02. The Raiders were drawing 35,000 per game in LA before they moved back (even though they were succesful there – one superbowl win, also well over .500 and several playoff berths during their tenure in down there)

  9. Mike, actually the Raiders didn’t sell out the 2011 season.

  10. 2011 was 8-for-8 in televising home games, although many of those were 2-for-1’d.

    2012 was a different story.

  11. 8-8 in televising does not equal sellouts. They only had attendance of 94.2%.

  12. OT: ATLANTA — Atlanta city officials, Falcons owner agree on financing terms for new $1 billion stadium.

  13. Oakland, San Diego and St.Louis city leaders , u know what they have in common??? The citt leaders are reluctant to provide public funding and all 3 want a renovated stadium instead of a new one….I know all 3 owners are hoping L.A happens so they get new leverage….Congrads on the city of Atlanta on the new stadium…guaranted Superbowls FOR SURE for many years to come…great for the city

  14. The point I was trying to get across is this. You can build it, but people will not come. Unlike NYC, Chicago, and other major metropolitan areas, California sports fans are different from most in the country. The team better have a tradition of putting a winner on or off the field or the fans will not come. Also there are to many things to do in California to keep one occupied especially if the local team is under performing. Losing erodes a fan base, especially in a two market area where you have one team on the decline and one like the Niners who should be dominate
    for a couple more seasons.

    @Duffer
    The Raiders averaged between 40K-50K per game while they were in LA had spikes of 80K-90K depending on who they played. (Steelers, Cowboys, Bears, Broncos). 50K per game was not bad considering the team was building its fan base in the area, bad location, and the Coliseum did not have any luxury boxes that Al Davis desperately wanted.

    OT LA is not an NFL market. Its a Lakers town first followed by the Dodgers, Trojans, and everyone else. The NFL is just using LA as bait to get cities to improve their teams stadiums without the league/owners footing the entire bill for new or renovated stadiums. If the league was serious about getting a team in LA than one who would have relocated there or the city would have been awarded a franchise while the league was expanding to 32 teams.

  15. LA is worth more to the NFL as leverage than as an actual home to a team. It’s mostly working so far. The Deadspin article won’t help though. Hopefully Oakland doesn’t let itself get burnt twice by Raiders stadium subsidies

  16. re: the city would have been awarded a franchise while the league was expanding to 32 teams.

    …I believe the Houston franchise originally was awarded to LA. But when the NFL approached the city, state, whoever, about public funds for a stadium, the league was told to go pound sand. So compliant Houston, eager to open its checkbook and do whatever the NFL wanted, wound up with the expansion franchise instead.

  17. Recall that the Guggenheim/Magic Johnson group’s $2.2 bil. purchase of the Dodgers could have acquired both an NFL franchise and a $1.4 bil. state of the art NFL stadium – yet that group chose MLB instead. There could be other factors other than the AEG deal stalling the NFL returning to LA – puzzling.

  18. My questions about LA is: Why can two college teams fill their stadiums every Saturday but the NFL is demanding that LA needs to build a stadium to host one or two teams. What is wrong with the Rose Bowl or the Coliseum if one of the stadiums is renovated and more luxury suites are added?

    @duffer

    I think that group realized that there is more money to be made in buying the Dodgers especially with the new TV deals. Now if that group can get Frank McCourt to sell the parking lots at Dodger Stadium than the NFL might come back to play in the LA area. Chavez Ravine could be re-designed to hold both an NFL Stadium and the Dodgers. The other factor to consider is the neighbors. Do they really want the NFL in their backyard?

  19. I see no way that the NFL gets a stadium at Chavez Ravine. As it is the site is controversial. Residents in Elysian Park complain constantly, and rightly so about the traffic congestion off of Sunset, Glendale and the 5 that just clogs the heck out of the city for atleast 82 dates. Couple that with fireworks on occasion, people drinking and noise, they have a lot to deal with. Then you consider what EIR would entail there with TWO stadiums and attracting people to that area when there is parking but few avenues to get in and no public transpo except for the Dodger Express from Union Station, it makes it tough for me to see them supporting it. These are actively engaged residents and I think they will fight this to the teeth.

    I think the NFL has a lot of leverage, but I think not complete leverage, this is LA, not the Twin Cities. All the work has been done to downtown, if they want to go with Roski in the City of Industry or go to Carson and build next to Home Depot, go ahead, but I think this may be a bridge too far for Goddell. He should hope for AEG owners who want to buy a team, and a team willing to be sold to AEG.

  20. Swaping a Football stadium at Chavez Revine for a Downtown New Baseball stadium is STUPID AS HELL you MORONS I guess your BASEBALL HISTORY MEANS SHIT!!!!!

    YOU DO NOT RUIN A GREAT Tradition and History of a Ball Club what you are talking about ruining is the Dodgers who have played in the Same stadium FOR 50 YEARS at the same time as Fenway Park 100 Years… through the course of years Dodger stadium has gone through Renovations…

    the DODGERS at Dodger stadium were the FIRST TEAM to Draw 2 MILLION Fans in a YEAR for quite a Few years THEN 3 MILLION For Further years… what you are saying or thinking is like the YANKEES and Giants/Jets Swaping stadiums of the OLD STADIUMS!!!!

    i am Both a Dodgers Fan and a RAMS FAN i saw atleast 1 Rams game at the Coliseum! and quite a few dodger games at 1 of the MOST BEAUTIFUL Stadiums with a great view….

    on top of all of this the History of Chavez Revine is Both sad and Historic BEFORE Dodger stadium if the NFL Truely wanted that Location then they and MLB Would have ALLOWED Peter O’Mally To CREATE A NFL STADIUM ON THE SAME LOT AS DODGER STADIUM Back in the 90s.. and this is the SON of Walter O’mally WHO Brought the Dodgers to LA, Peter o’Mally was 1 of the POWERFUL OWNERS In the MLB At that time, EVERYONE LISTENED….

    this so called swap is 1 that i will DISPISE if this pipe dream became Reality and i would NEVER EVER Goto ANY Game if that happened.

    LA and Downtown Farmers Field will Forever belong to the RAMS as they are the RIGHT FIT and the right team with Many Fans even after 18 years and we are reviving the fanbase and many of us Rams fans from LA Rams fans past SUPPORT Farmers Field for the RAMS!!!!

    heres something else, how about you swap places of living with me and my wife, im sure we will Enjoy it, oh wait you dont like it??? SEEE DOESNT WORK!!!

    Both the raiders and chargers need to stay Put as the balance of the Cali with the Rams back thats the realistic dream!!!

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