Montreal’s cost to lure back MLB: $1+ Billion

A feasibility study gauging the prospects of bringing baseball back to Montreal has been released, and while the numbers are a touch sobering, proponents continue to have hope that the Expos (or some other team) will be reborn. Led by former Expo player Warren Cromartie, the study indicates that the total cost would be over $1 billion to buy a team and build a ballpark. The study was written by Ernst & Young.

Why $1 billion? It’s assumed that some group will have to either buy an existing team (leading candidate: Rays) or pay an expansion franchise fee. Nevermind that franchise valuations continue to escalate, making a $525 million cost seem already outdated. Seven years ago Ted Lerner paid $450 million to take the Expos/Nats off MLB’s hands. A 36,000-seat, open air ballpark built in a similar model to Target Field would cost approximately $500 million, and would be two-thirds publicly funded. Montreal Homerun Project (the proponents) have followed the Target Field/Twins plan closely, calling it the “MLB Hybrid model” to act as a label for a public/private partnership.

montreal-hybrid_model

The complications of going with a public/private partnership model

At the end of the presentation, Cromartie makes a plea for a deep-pocketed champion to make Montreal baseball a reality again. At least one columnist thinks that champion could be telecom giant Bell Canada. The reasoning is that Bell, whose TSN recently lost NHL national TV rights to rival Rogers Sportsnet, could make a baseball investment to bolster its carriage portfolio. Rogers already owns the Blue Jays and the former SkyDome.

While the study is fairly thorough, I think it severely lowballs cost estimates, which have exploded the last several years. There are some other estimate oddities:

  • 47% of ticket sales would come from corporate sources. Considering this blog’s coverage of a corporate support-poor franchise like the A’s, the number seems rather high.
  • Attendance would be between 27,000 and 32,000 per game, and could drop to 22,000 as the honeymoon factor wears off. In the Expos’ last 21 years at Olympic Stadium, they averaged over 22,000 only twice.
  • The Montreal franchise would receive nominal revenue sharing, even though it’s supposed to be one of the top 15 markets.
  • Proponents claim that stadium debt would be paid off in only eight years.

The last claim seems awfully rosy, and ventures into extremely dangerously territory. Plenty of stadia have paid off their debt loads long before they were expected to, but that usually involves outside revenue sources such as hotel and car rental taxes. In this case, revenues would come directly from the ballpark.

I applaud Montreal for getting moving on this, and they could be well positioned down the road for a future team. But it would require a current owner selling at below market or moving away from his preferred market. With A’s ownership focused on staying in the Bay Area and Rays ownership locked into a lease at the Trop, there would seem to be no immediate path to a team for the Montreal group. At least they’re getting prepared. All they need is a sugar daddy.

13 thoughts on “Montreal’s cost to lure back MLB: $1+ Billion

  1. It *may* be more doable if they could convince the A’s or Rays ownership to move the team without selling. Then you’d only need to worry about the money for the stadium. Building the stadium with the public funds and corporate dollars. Then when the value of the team rises after a few years, find a buyer if they want out.

  2. RM,
    Since the Expos left Montreal has that metro/region been claimed by another franchise in terms of territory? Television or geographic? If so that will be interesting re getting a team back in Montreal.

  3. ding, ding, ding! DMOAS is thinking just like I am. I wouldn’t expect it to be the A’s, but the Rays could very well be an option if they can get Montreal to pay (or offset) the remainder of their lease rather than an expansion fee 🙂

  4. Montreal is not in any team’s marketing territory, not sure about media market.

  5. It will be interesting if they find that sugar daddy… or one of the two obvious targets gets annoyed enough with their current regional issues that they finally give Montreal a gander without Montreal interests having to outright buy the team. Frankly this is exactly what MLB wants, an obviously viable market to hang over cities like Tampa, St. Pete, Oakland and San Jose to say… here’s where we’re going if you don’t hurry up and cooperate.

  6. @Dan – that’s what it sounds like to me. The NFL’s Los Angeles threat has served them over the years. MLB wants one too.

  7. I think everyone; has figured out what Montreal probable is.

  8. This raises the the question, beyond the A’s and Rays, who’s the next most likely team to relocate? The Indians? Their lease can expire following 2023.

  9. Briggs, it will be the A’s or the Rays. And if not them then no one for quite some time. No other teams are in anywhere near as desperate a position regarding a ballpark as those 2 teams. And Montreal has much more value as a threat than as an actual MLB city right now.

  10. Dan, I wouldn’t be so sure. We’re talking about 15, 20 years down the road. It’s impossible to forecast MLB stability that far from now. Last year, if someone told you the Braves would leave Turner Field for a new ballpark in Cobb County, it’d sound pretty far fetched.

  11. Unfortunately for the Expos, they eventually became an indirect victim of the political changes in Quebec that were gradually taking place over the years the franchise played in Montreal. The french language laws that were being implemented by the provincial Quebec govt. had the effect of driving many of Montreal’s once sizable English speaking community to leave Quebec for other parts of Canada, or even to the USA. Montreal’s Anglo community had always been a significant part of the Expos fan base. What made matters even worse, was the fact that a significant part of Montreal’s business/corporate community were English speakers, and many had already left Montreal for other parts of Canada. As a result, the Expos lost much of their corporate sponsorship, and couldn’t maintain enough willing deep pocketed local based ownership. Without a significant and willing deep pocketed local based ownership to operate the team, the Expos no longer were able to effectively compete within MLB. Eventually, the Expos were purchased by Jeff Loria, who came on board in a last minute attempt to save the Expos in Montreal. However, that action was doomed to failure, since Loria was an American, and was not accepted by the Montreal media. Finally, the cavernous Olympic Stadium was even back then a substandard facility for the baseball fan to watch a ballgame. Montreal was unwilling or unable to get a new ballpark for the Expos during their stay there. A new ballpark today would be even more costly to build, and it likely would be even more difficult to get provincial or local public funding as well. I can see Montreal eventually getting a AAA minor league team, but a major league franchise in Montreal is a thing of the past.

  12. Jeff Loria is a crook. Not a savior of any franchise. This is a comical take.

  13. @Jeffrey, I can see why you are ticked off at Loria. He gives your name a bad name in the baseball world. While that fact may be true, Loria was an unknown when he came in at the last minute to try to save the franchise in Montreal. The Expos were a sinking ship, and there was nothing Loria, or anyone else, really could have done to save the Expos in Montreal.

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