Last week, Oakland Mayor Libby Schaaf declared that the City was close to approving a framework for a potential stadium deal for the Coliseum. The framework would allow for Oakland’s exposure to be limited, while bringing in a big money financier to bridge the lingering (and growing) funding gap.
Today, media were assembled to cover yet another closed session of the Oakland City Council to further discuss the deal. The thought was the Council would come out of the meeting announcing the approval of the framework. What happened?
Okay, there’s always next week. Regardless, Council members sounded confident, especially Noel Gallo. Soundbites sound practically ebullient, despite the fact that the Raiders aren’t a participant in these talks. So what were they ready to pop the corks over? Matier and Ross revealed an outline of the framework (a more tenuous-sounding description is hard to come up with). I’ll summarize:
- Total cost of the project is $1.3 billion
- $600 million would come from Fortress Investments of New York, the group brought in by Ronnie Lott
- $300 million from the Raiders
- $200 million from the NFL’s G-4 stadium fund
- $200 million from the Oakland and maybe Alameda County, mostly to cover infrastructure
The inflated price of the project is due to the inclusion of 35 acres of ancillary development (retail/commercial). As usual, costs tend to rise over time thanks to inflation and other factors. What I like is that the whole project’s cost is being considered, an improvement over previous proposals with lots of hidden public costs.
The stadium remains a venue with a projected capacity of 58,000 or so, too small for the Super Bowl, right-sized for Mark Davis in Oakland. Davis remains committed to the Las Vegas stadium project, his sugar daddy being
MGM Sands mogul and LV Review-Journal owner Sheldon Adelson. Whether Vegas is approved or Davis is forced to go back to Oakland with his tail between his legs, he will require a benefactor to effectively subsidize the stadium over the short term. Long-term, Davis will either have to give up a piece of the team or a percentage of stadium revenues. Otherwise, Davis and the Raiders are a charity case. Most of the time the taxpayers are the benefactor as their tax dollars subsidize that gap. The NFL even prefers that kind of arrangement as the municipality acting as an equity partner, even though they see little in the way of event revenue.
If you saw how the Vegas stadium was rammed through various levels of government over the course of two weeks once it was drawn up, you can appreciate how, well, different Oakland operates. Oakland is mostly working the process on its own, the pace and work has been less than impressive and for all but the most faithful Raider fans, not particularly inspirational. Even the celebratory tone taken by the Council feels more like bravado than actual confidence. They “got it done” according to CM Gallo, but what exactly did they get done? While Coliseum City suffered through its own bouts of stuttering and stalling, the City has gone silent this round, scrambling after the last sugar daddy, Egbert Perry, embarrassed Lott by going behind Lott’s back to make a lowball offer on the Coliseum complex. We should see more details in the coming days, though we’re still talking about a framework, so most of the details we might want to scrutinize won’t be worked out. The play is to wait for Vegas to get rejected, present the plan to Davis, and have him work out the private-side details with Fortress and Lott, with all parties believing they have leverage over the others.
That’s about as forward an approach as Schaaf can take given her previous statements about not putting any public money towards construction – which given the paucity of information, we should still believe to some extent. Infrastructure, if that’s where the $200 million is destined, is technically not stadium construction, though it goes right up to the line. Will that satisfy the NFL owners enough to vote in Oakland’s favor? Unless they collectively have an overwhelming desire to keep the team in Oakland, probably not. They didn’t like how the pie was getting split in St. Louis, so why should they like Oakland’s less committal plan? If the idea for Schaaf and the Council is to present a united front and declare that they putting their best foot forward, they can celebrate. To keep the Raiders, the NFL’s gonna make you take more than a step or two.
The policy of the NFL, just like MLB, is to avoid the precedent of teams being expected to finance stadiums on their own, because doing so makes it more challenging to justify squeezing tax dollars out of the good citizens in other markets when they eventually need a new stadium.
I think the NFL values preserving and enforcing that precedent even more than it loathes helping the Davis family get a free stadium in Vegas.
I expect owners to approve Raiders to Vegas, citing lack of financial commitment from Alameda County/Oakland.
Sheldon Adelson is old. The political influence he wields to hold Vegas taxpayers hostage won’t last forever. If the league strikes now, they get a $2B stadium out of it in a new market.
10 years from now, if Vegas isn’t working out for the Raiders, they could always flirt with coming back to Oakland again. They’d done it before.
@ Jacob Jackson
“I think the NFL values preserving and enforcing that precedent even more than it loathes helping the Davis family get a free stadium in Vegas.”
Not sure that stadium is going to be free, any association with Adelson sort of says it won’t be free.
The Raiders can’t do anything on their own. Question is dose the NFL, and more importantly the owners want the Raiders to partner with Adelson, or a group led by Lott? There are other internal political questions as well, that being said that’s a lot of public money Nevada is offering.
The Raiders aren’t going to be able to bail on Vegas in 10 years. They will have a lease for 30 years or more. If they break it, they will likely be on the hook for Nevada and Adelson’s unrecouped costs – which would basically amount to losing control of the team.
Another interesting side note: The NFL/Raider contribution to the stadium is the same under both the Vegas and Oakland plans. The $750 million from Nevada basically covers the difference in cost between the two stadiums. But just because the Vegas stadium will cost $750 million more doesn’t mean it will generate significantly more revenue.
One would expect sponsorship opportunities would be greater in the Bay Area. Also, there is a real question how big the market is for suites and premium seating in Vegas. In other markets, the target market for premium seating is local corporations looking to entertain VIP clients. In Vegas, the dominant local industry already owns VIP entertainment facilities of its own and has a strong interest in not sending VIPs off-property.
Finally, there’s the TV market issue. TV revenue is the NFL’s bread and butter. Given ratings are already down, it is questionable whether the NFL will be best served by trading the #6 media market for the #40 media market. Davis may not care about this issue, but the other NFL owners surely do.
In terms of TV revenue, the counter argument is that the NFL still has the Bay Area market with the 49ers. They’re not losing a market they’re gaining a new one even if it is small.
From the TV perspective, it comes down to whether the NFL thinks there are more people in Vegas who would start watching the NFL on TV with a local team than there are people in the Bay Area that would stop watching the NFL on TV if the Raiders leave.
Because the NFL is much more of a national sport than MLB, I don’t think TV market size really matters and more than likely this is a wash either way.
The direct stadium revenue absolutely does. Besides the direct dollars that can be driven from suite sales and the such, the other big item is the ways the deals are structured between Adelson and Davis vs the Lott Group and Davis. Which one will give Davis a better cut of stadium revenue?
@ Slacker You make some fair points, but I think the NFL does view TV market size as a significant factor. This was a big reason for the push to get back to LA, and a big reason why putting a team in Jacksonville was viewed as a mistake.
Although the Bay Area would still have a team if the Raiders leave, I think two teams still help the NFL with TV ratings in this market. For a lot of households, it means watching at least two NFL games each week rather than just one.
“I expect owners to approve Raiders to Vegas”.
From your lips to God’s ears.
Also, the NFL already has precedent for stadia built with little or no public contribution. Public contribution to New Meadowlands was limited to $250 million in infrastructure, similar to what Oakland is offering. For Gillette Stadium, the public contributed only $72 million in infrastructure. FedEx Field, $70.5 million in infrastructure. Levi’s Stadium, $113 million, a large chunk of which was the cost of building a garage they were going to build anyway and the cost of relocating a substation.
The Raiders already left the Bay Area in 1982 while the A’s remained here. The Raiders came back and badly screwed up the Coliseum, which Alameda County tax payers are still on the hook for. Now they threaten to leave for Vegas unless they are given $$$ for a stadium and the land around the Coliseum, essentially leaving the A’s homeless. Why the hell should I be rooting for the Raiders to stay? Tell me, because I can’t think of a single reason.
Sheldon Adelson owns the Sands corporation (Venetian, Palazzo, the Sands convention center), not MGM. He also owns the Review-Journal, Las Vegas’s largest daily newspaper.
Ah, thanks Ed.
Does this mean the A’s get $200 mill for infrastructure also, perhaps to clean up Howard Terminal? If that happens we can look forward to seeing the A’s in a new stadium in about 2025. Where does Oakland have all this money to pay for infrastructure?..This is a Raiders deal being made with no cooperation from the Raiders. OK. Does Davis want to give Lott a share of the team? We haven’t seen any indication that he does. And as noted, the NFL expects a public contribution for stadium construction. That’s not being offered here.
Libby Schaaf did a RattoCast interview last week, and stated that funds for infrastructure (and amounts of said funds) are bound to specific locations, so no, we don’t know that the A’s will also be offered $200M in infrastructure funding at HT. Could be more, could be less … a gambler would probably bet ‘less’.
$200 million for the Raiders in ’95, $200 mill for the Raiders again in ’16, $121 million for the Warriors in ’97 A’s – still zip
The article mentioned that the Fortress Investment group will talk with Davis about selling shares of the team (meaning they want a share)
It’s not clear however whether the Lott-group’s ask will be more or less palatable to Davis than whatever Adelson is asking of him. In both cases, you have a third party contributing upwards of $600 million, and in both cases that third party is going to want their cut.
1. As a result of the Rams relocation the NFL said it would contribute an additional $100 million if the Raiders built a new stadium in Oakland. Is that figure reflected in the posted numbers?
2. Am I correct in understanding the City is basically saying it will give the Raiders the entire Coliseum site? If so, that seems a major concession that satisfies one of Davis’ key demands. Maybe the train has left the station, but earlier he was saying if he could have the whole site maybe he’d be able to get something done in Oakland.
We can probably assume both Adelson and the Lott group are going to want a big cut of the team before they proceed. If Davis wants to keep control of the team and not sell any more shares, he’s probably looking at one remaining stadium option: Levi’s.
It doesn’t look like Davis will need to sell shares of team for the Las Vegas deal, there has been zero mention of that. Las Vegas officials also are interested at using the stadium for several other uses besides hosting an NFL team. They don’t need a stake in the Raiders to make the deal profitable.
@duffer It has been reported that Adelson is demanding more than the Raiders are willing to give, and is willing to walk away if he doesn’t get it. Whether he’s demanding a share of the team, we don’t know, just as we don’t know whether he’s demanding more or less than the Lott group. But you can rest assured, anyone who’s putting $600 million into a project is expecting to get their cut. http://profootballtalk.nbcsports.com/2016/10/27/sheldon-adelson-playing-hardball-with-raiders-over-las-vegas/
As far as financing being easy because officials are interested in using the stadium for other uses besides hosting an NFL team, that’s utter horseshit. We hear the same crap every time local officials are promoting public funds for a stadium and it never pencils out. There simply aren’t enough events that require a 70,000 seat venue. Vegas is saying they’re going to fill the stadium several times a year for rugby. If you buy that, you need to put down the crack pipe for a little while.
Disagree, Las Vegas officials want a large capacity domed stadium, for whatever purposes. Vegas is a totally different market than Oakland, it draws huge revenue from tourists, also a NFL team there could draw big sums of corporate dollars. Vegas also appears to be able to build sports stadiums at a whim. (It built an NHL type stadium, 100% privately financed before being nowhere close to acquiring a NHL franchise). Las Vegas taxpayers won’t pay a dime for the NFL stadium, it will be 100% funded by hotel taxes (That’s Oakland’s disadvantage – it doesn’t have the tax revenue, or potential corporate (gambling, hotel industry) that Vegas offers.)
“a NFL team there could draw big sums of corporate dollars.”
As noted above, this is highly questionable. Vegas is a unique market in that the local corporate base already has private, entertainment playpens for their VIPs and has a strong, economic incentive to keep those VIPs on site. It’s a HUGE risk to bet that MGM is going to spend money to send its VIPs in a rival casino owner’s playpen for an entire day at a time.
“Las Vegas taxpayers won’t pay a dime for the NFL stadium, it will be 100% funded by hotel taxes”
We’ve heard that song before. It’s questionable whether enough Raider attendees in Vegas will be from out of town to fund a $2 billion stadium, and if they were that wouldn’t really be good for the long term health of the team. If there’s a shortfall, Nevada taxpayers are on the hook for it. Even if there’s not, that’s still $750 million in tax money that could have been spent on other purposes. I’m sure Nevada has roads that need repairing, schools that could be improved, and so forth.
“It’s a HUGE risk to bet that MGM is going to spend money to send its VIPs in a rival casino owner’s playpen for an entire day at a time.”
Not if you take into account that MGM spent money lobbying FOR the stadium bill. They’re in.
“It was an unprecedented gallery of Las Vegas corporate leaders that led the charge in favor of the Sands proposal to build a domed stadium in Southern Nevada, to house both the Raiders and UNLV. Casino titans Steve Wynn, Chairman and CEO of Wynn Resorts and Jim Murren, Chairman and CEO of MGM Resorts spoke to the Nevada Legislature during day one of the special session.”
@ ccctl “Not if you take into account that MGM spent money lobbying FOR the stadium bill. They’re in.”
Lobbying for a project that will help fill your hotel rooms for 10-20 days a year but will be built on someone else’s time is one thing, providing meaningful financial support for it is something entirely different. Once the stadium is built, MGM has ZERO incentive to spend big bucks on suites or club seats to send their best customers over to spend money all day at Adelson’s playpen. If you show me something that says MGM is making a big multiyear commitment to suites and club seats at the new venue, that I might find persuasive but I’ve seen nothing of the sort.
He’s not asking for an ownership stake. He knows the NFL is dead set against it, and really, does not care how he gets his 15% return, as long as it’s in writing that he gets what’s “his”.
Right now, it’s just a squabble between Adelson and Davis on who gets how much of the stadium revenue.
@ccctl Where did you get the 15% figure from? I’ve seen nothing of the sort.
The squabble between Adelson and Davis over who gets how much of the stadium revenue is a big deal. Football stadiums have a hard time breaking even to begin with, and this one would be the most expensive ever built in the US. Adelson is in for $650 million to begin with, plus cost overruns, plus now you guys are saying he’s going to loan Davis the relocation fee. If so, he could easily be in this thing for billion dollars or more. That’s hard to support if you’re getting ALL the stadium revenue, let alone if you’ve got to find a split with another party.
If both deals Nevada/Oakland are about even for Davis, I really don’t see why he or any existing owner would want Vegas. Talk about not having a home field advantage, if a fan lives in Kansas City, Denver, or wherever and wanted to go to a road game it’s going to be to Vegas right?
Half the stadium is going to be filed with the visiting teams fans. I know a lot has been made by Davis and others, that Raider fans travel, and they probable do more than most fan bases but you do run the risk of moving too much, after a while some of the hard core fans are going to say forget it. (That would include me, if the move again)
Another factor is that up to this point the Raiders have only moved within state (Oakland, LA), some fans both in LA, and in the Bay Area have tolerated the moves because while they may not have liked the move, it was a move that has only been down/up the state of California.
Which brings me to another point/question? Can Oakland expect any help from Sacramento? I know on the surface that seems silly, but think about it. This is Another state trying to take one of your sports franchises, it’s not Oakland vs LA, or San Diego vs LA, which the state would usually let those within state municipalities fight it out.
@LSN “If both deals Nevada/Oakland are about even for Davis, I really don’t see why he or any existing owner would want Vegas.”
I tend to agree. Another aspect not yet discussed: Presumably there would be a location fee to move to Vegas. Maybe not the $550 million Kroenke paid to go to LA, but one would think at least a few hundred million dollars. This would be another factor that would tend to weigh in Oakland’s favor.
To your point about the relocation fee, which as you point out may not be as high as the Rams paid but it will still be costly. The Raiders would also be forfeiting the 100 million that the owners granted to them and the Chargers, if each team were to build in their existing city’s. That along with a sizable relocation fee, is money that’s going to come straight out of Davis’s wallet, or not find its way to his wallet in the long run.
Relocation fee can be paid back over 10-20 years, and Adelson has offered to finance it.
Will the other owners want Adelson in the league, as a partner?
I’m sure they are ok with Lott.
See my above comment. Again, Adelson knows he can’t have an ownership stake. He owns casinos (of course), which is prohibited by NFL bylaws. He wants a 15% return on his investment, and it looks to come out of stadium revenue.
@ccctl “Relocation fee can be paid back over 10-20 years, and Adelson has offered to finance it.”
You’re blowing that off like it’s nothing, but it’s actually a very big deal. The fact that it will get paid back over time doesn’t make the whole thing go away, plus Adelson will expect interest. If the relocation fee were $300 million, that doubles Davis’ investment and debt service. A ten year repayment term would mitigate the sting of that very little.
“he can’t have an ownership stake. He owns casinos (of course), which is prohibited by NFL bylaws. He wants a 15% return on his”
I did not say “ownership”, I said partner. There may be owners that are not comfortable with Adelson being a partner in anything a team is doing, that’s my point. The Raiders may play in Vegas, they may not but having Adelson involved in any way may be too much for some owners.
With 5 MLB teams, 4 NBA teams, 4 NBA teams and 3 NHL teams in California, Sacto cannot be expected to do anything to help with stadiums and arenas given the state’s other priorities. If the Raiders get state $$, the Rams, Chargers, etc will want it, too. What was the first thing Jerry Brown did as governor? Got rid of redevelopment, which was used to help build new pro sports facilities.
Yes. I hear what you’re saying, and I would not expect Sacramento to help in a big way. However, redevelopment (funds) is/are making a bit of a comeback and while we probably won’t see redevelopment agency’s for each city like in the past, I think seeing redevelopment dollars reintroduced in a different form is not an unreasonable thing to expect. Which potentially could help the Raiders with this project, if they choose to undertake it.
Not only that but what’s the benefit to the state of California of having the Raiders?
California is the 6th largest economy in the world. It’s also an international tourist destination as is.
Even though I totally disagree with cities funding pro sports teams, I can at least understand the idea that the team gives a city an identity. This might apply at the state level in certain scenarios like the Packers and Wisconsin. In no way though would the Raiders leaving have an impact at the state level.
“I can at least understand the idea that the team gives a city an identity. This might apply at the state level in certain scenarios like the Packers and Wisconsin. In no way though would the Raiders leaving have an impact at the state level.”
I don’t disagree, but I was only talking about a little help concerning the possibly of redevelopment dollars. I certainly wouldn’t expect a lot out of the state.Lord knows, Oakland could use all the help they can get if this even happens.
There have been rumors that Al wanted to move the Raiders to Vegas long ago. Mark may want to move the team there to accomplish something his dad wanted but couldn’t get done.
Vegas could also up the brand of the Raiders by making them more of a national (and even international) team given the nature of Vegas.
While there are obviously other big personalities in Vegas, Mark would be more of an icon in the town than he is in the Bay Area. Big fish small pond.
Factoring in that Mark has completely rejected every other opportunity in Oakland and so far doesn’t seem to be engaged with the Lott group, at least not to the extend he is with Adelson, I don’t think it’s that much of a stretch to say that Mark prefers Vegas over Oakland.
@Slacker It’s not obvious how much “upping the brand” of the Raiders nationally or internationally really benefits the Raiders, since all the TV and merchandising revenue gets shared equally across the league. The opportunity for an NFL team to separate itself from the pack comes in terms of stadium revenue, which is inherently local.
Having said that, it’s clear at this point that Davis does favor Vegas; it doesn’t really matter what his reasons are. However, he still needs to reach a deal with Adelson and he still needs approval of the other NFL owners to make that happen. If Oakland and Lott can present a viable proposal to the NFL, it’s entirely possible they can get 9 to vote no on a move. That’s the end game.
Agree on the shared revenue side. My point about the brand had more to do with ego.
I get the sense that Davis wants to get out of his dad’s shadow and expanding the brand beyond what Al did would play along with this.
Either way though, key point of my post is that for as much crap as the A’s get about not wanting to stay in Oakland, in reality Davis might be even less interested. You’re right, that the NFL might force his hand, but I don’t think he should be looked at as some champion for Oakland.
@ slacker “I get the sense that Davis wants to get out of his dad’s shadow and expanding the brand beyond what Al did would play along with this.”
That could be true.
“Either way though, key point of my post is that for as much crap as the A’s get about not wanting to stay in Oakland, in reality Davis might be even less interested.”
Can’t disagree there, either. The fact that Davis has put minimal effort into trying to find a solution in Oakland has been extremely frustrating to me. As has his blithe assumption that “Raider Nation” doesn’t care where the team plays and will follow wherever.
“You’re right, that the NFL might force his hand, but I don’t think he should be looked at as some champion for Oakland.”
I certainly don’t look at him as a champion for Oakland. I’m just hoping he runs out of other options.
Meanwhile a new MLB-MLBPA deal cuts the A’s revenue-sharing. From ESPN: Oakland’s revenue-sharing funds will be cut to 75 percent next year, 50 percent in 2018, 25 percent in 2019 and then phases out.
-Ability to eventually host a Super Bowl
-$750M in public money
-Davis doesn’t have to yield team control (if he did, he wouldn’t be telling everyone Vegas is his top priority and that he committed to their mayor.
Oakland offers none of those three key things. Lott’s financial group will want equity in the team, the city/county will offer no money towards a stadium, and there will be zero chance of ever hosting a Super Bowl.
Those who are saying that Davis should prioritize Oakland because he would lose his home field advantage in Vegas with half the stadium filled with road fans:
1) this is far less important to Davis than money and keeping full team control.
2) worse home fans in Vegas is probably offset on the field by how distracted, exhausted, and hung over every visiting team would be during their one-week bender in Vegas each season. The Raiders would do pretty well at home against a team full of Johnny Manziels.
What also surprising is all the Vegas billionaire casino/hotel owners very interested in the Raiders move (and they don’t even appear directly involved in financing the stadium), Steve Wynn, also the MGM owner, etc these people are loaded with cash and appear to be heavyweights – similar to Adelson. It will likely be very difficult for Oakland to compete with the mega-bucks Vegas Casino owners
@duffer “It will likely be very difficult for Oakland to compete with the mega-bucks Vegas Casino owners.”
You are jumping to wild, unsupported conclusions. The fact that Vegas Casino owners have money does not mean they will spend it in a competitor’s venue. Further, the corporate wealth of the Bay Area is more than a match for the Las Vegas casinos. And unlike the Vegas casinos, Bay Area companies do not have private playpens on site to entertain their VIPs, and have much more use for the premium seat amenities of an NFL stadium.
-Ability to eventually host a Super Bowl”
It is not certain that an Oakland stadium could not host a Super Bowl. While 58,000 is too small, the stadium could be designed in such a way that allowed temporary expansion to the requisite capacity (e.g. large end zone plazas with room for temporary seating).
“-$750M in public money”
The public money is not a good unto itself; the only things that are meaningful are the Raiders contribution and revenue bottom line. The Raiders’ financial contribution would actually be less for an Oakland stadium due to its lower overall cost, the extra $100 million the NFL has promised to kick in and the lack of relocation fee. The public money mainly covers the extra cost of the Vegas stadium over an Oakland stadium, which is only meaningful to the Raiders to the extent it enhances revenue possibilities. A lot of the extra cost of the Vegas stadium will go to making it a dome and/or retractable roof, land acquisition, infrastructure and other items that do not necessarily increase it’s revenue potential.
“-Davis doesn’t have to yield team control (if he did, he wouldn’t be telling everyone Vegas is his top priority and that he committed to their mayor.”
No one has stated Davis would have to give up control to build a stadium in Oakland. The Lott group is interested in an equity stake, but that could be a minority stake and it’s not clear if it’s a deal breaker or not. And it is certainly possible the Lott group could offer Davis more favorable financial terms overall than Adelson even if they did take a minority stake.
@bartelby – I don’t mean to be rude, however you are way off on this one (you were 100% off about St Louis keeping the Rams -(the NFL wanted them out of there and LA instead big time, Kroenke personally slam dunked St Louis and Davis/Spanos on that deal) you are 150% about this. You claim that the Vegas casino owners want no part of an NFL team because the NFL games keep fans out of casinos – yet may Vegas big-shot billionaire casino owners are surprisingly 100% backing the move .
Contrast what Davis is experiencing when negotiating with Libby Schaff vs Adelson, etc. Schaff glumly explains to Davis “we Oakland” have no funds available to support professional sports. While a billionaire such as Adelson possibly offers to pick up Davis and fly Davis to Vegas in his private 747, gets whisked away in a plush 40 ft limo, then stays at a Penthouse suite while negotiating (quite a different scenario than Schaff and Oakland offer) Now it appears, with many big-bucks Vegas billionaires behind the Raiders move, besides Adelson, the Raiders to Vegas is a lock.
Bartleby: ‘The public money mainly covers the extra cost of the Vegas stadium over an Oakland stadium, which is only meaningful to the Raiders to the extent it enhances revenue possibilities.’
Not true! The most meaningful thing it does from Davis’ perspective might be the increase in the Raiders’ franchise valuation. If he’s playing in a $2B crown jewel, gets to host the Super Bowl, potentially brands a new national or international market of touristy fair-weather Raiders fans, and continues to keep some of the loyal Raider following in LA and Oakland, and wields greater political influence than he ever would’ve in Oakland, that’s a slam dunk.
His franchise valuation might jump several hundred million with a jump to a brand new stadium in Vegas. Enough to offset a relocation fee and the unrealized $100M the league would give him to build in Oak.
@duffer “(you were 100% off about St Louis keeping the Rams”
You seem to struggle with nuanced distinctions. I never predicted St. Louis would keep the Rams; like everyone else I had no idea how that would play out. My argument was that St. Louis is a viable NFL market, especially with a publicly financed stadium. That remains true today.
“You claim that the Vegas casino owners want no part of an NFL team because the NFL games keep fans out of casinos – yet may Vegas big-shot billionaire casino owners are surprisingly 100% backing the move.”
Here is another nuanced distinction you are missing: There is a big difference between “backing” the move by speaking in favor of it and “backing” the move by actually putting money into it. Except for Adelson, the “backing” provided by Vegas casino owners thus far has been exclusively of the former type.
And why not? Speaking in favor of the project costs them exactly NOTHING. If it comes to pass, a project is built with someone else’s money that helps fill hotel rooms a few nights per year. If not, no big deal.
You have not provided any logical reason why those same casino owners would sink a lot of money into suites or club seats to send their VIPs to spend money at Adelson’s playpen for an entire day at a time, rather than giving those VIPs some comp tickets to their own showrooms and having them back on the casino floor in 90 minutes.
“Contrast what Davis is experiencing when negotiating with Libby Schaff vs Adelson, etc. Schaff glumly explains to Davis “we Oakland” have no funds available to support professional sports. While a billionaire such as Adelson possibly offers to pick up Davis and fly Davis to Vegas in his private 747, gets whisked away in a plush 40 ft limo, then stays at a Penthouse suite while negotiating (quite a different scenario than Schaff and Oakland offer)”
This is idiotic. Davis is an NFL owner, he can fly in a private jet whenever he wants. There are a lot of reasons the move to Vegas very well might happen, but it won’t be because someone put Davis in a private jet.
“Now it appears, with many big-bucks Vegas billionaires behind the Raiders move, besides Adelson, the Raiders to Vegas is a lock.”
Raiders to Vegas very well might happen, but it’s far from a lock. If it does happen, it won’t be because a bunch of casino owners spoke out in favor of the project. Show me something that says any of those casino owners are putting any actual money into the project, and then you might have something.
@bartelby: Disagree completely, that many wealthy billionaires, who likely carry plenty of clout in that city, along with $30 billion Adelson ( also Davis also appears very interested in Vegas). Oakland, even with the Fortress Group plan, appears to behind the eight-ball about building a new Raiders stadium.
@ duffer You are free to disagree, but you ought to be able to offer a logical reason why. Start with a premise, analyze, and show how your premise supports your conclusion.
I don’t doubt that “other wealthy casino owners” were influential in persuading Nevada to put in public money to support a stadium, but we’re past that now. It’s understood that a Las Vegas stadium can be financed. The next step (assuming Davis and Adelson can agree how to share the pie) is convincing 24 NFL owners that the Vegas deal is better for the league in the long term than an Oakland deal would be. If those other casino owners were making long term financial commitments to buy premium seating or sponsorships that would be one thing, but their verbal support for the project is going to be more or less irrelevant to the NFL in this regard.
Oakland is behind in the game for sure, but with the support of the Fortress Group an Oakland project can also be financed. Davis is not on board right now, but he doesn’t need to be. All Oakland needs to do is persuade 9 NFL owners to vote no on a move. If that happens, it will immediately be in Davis’ best interest to engage with the Lott group.
Because you struggle with reading comprehension at times, let me be clear: This is not a prediction that Vegas won’t happen. It is an observation that lots needs to happen before it does, and Vegas is far from a “lock.”
@bartelby: You’ve go zero credibility. You previously claimed that St Louis had a good chance of retaining the Rams and that St. Louis is a good NFL market (Look out that turned out – the NFL and Kroenke quickly stopped that nonsense.. Also, St. Louis has screwed it up twice (losing 2 NFL teams in 29 years) St Louis is not in the NFL expansion plans period.
Furthermore, you claim that the Las Vegas billionaire casino owners aren’t interested in luring an NFL team to Vegas because going to an NFL game in Vegas would remove the fans from the casinos. You were 100% off about that one also – several of the big name Vegas casino owners in fact publicly explained just the opposite of your claim – they are very interested in the Raiders move to Vegas!
@duffer “You’ve go zero credibility.”
I’m not terribly worried about my credibility with the most consistently fact and logic challenged person currently posting on this board. However, because I sympathize with your struggles in this regard, I will try to help you.
“You previously claimed that St Louis had a good chance of retaining the Rams”
The fact that an event did not occur does not disprove that it had a good chance of occurring. For example, if you roll two dice, the most likely outcome is that you will roll a seven. Nevertheless, you will roll some other number more than 83% of the time.
“and that St. Louis is a good NFL market. (Look out that turned out – the NFL and Kroenke quickly stopped that nonsense.
What I specifically said was that St. Louis, with a publicly funded stadium, is a good NFL market. And it is. The fact that the NFL owners concluded Kroenke’s LA project was a better overall economic opportunity does not mean St. Louis was a bad economic opportunity. Just that in this instance the LA project was better.
In fact, the Rams situation should give Raider fans some hope, as it shows that throwing a big wad of public money into a project does not automatically make it a better economic opportunity.
“Also, St. Louis has screwed it up twice (losing 2 NFL teams in 29 years) St Louis is not in the NFL expansion plans period.”
The idiocy of this argument is evident in the fact that Los Angeles previously lost two NFL teams and just regained a team. The fact of losing two teams is irrelevant to anything. The only thing that is potentially relevant is the reason for losing those teams.
As for St. Louis being in expansion plans, it’s simply too early to tell. In any event, I stated that St. Louis being a good market is contingent on providing a publicly funded stadium. Right now, the city is understandably feeling burned and that is not on the table. But in the future, who knows.
“Furthermore, you claim that the Las Vegas billionaire casino owners aren’t interested in luring an NFL team to Vegas because going to an NFL game in Vegas would remove the fans from the casinos. You were 100% off about that one also – several of the big name Vegas casino owners in fact publicly explained just the opposite of your claim – they are very interested in the Raiders move to Vegas!”
It’s your reading comprehension that’s 100% off. My point is that it is questionable whether Vegas is a good market for suites and premium seating, because the usual target market for such things already has their own VIP product and are economically incented not to use Adelson’s. The fact other casino owners have offered verbal – not financial – support for the project does not change this fact.
“Not true! The most meaningful thing it does from Davis’ perspective might be the increase in the Raiders’ franchise valuation.”
I think you are misunderstanding how franchise valuation works. The cost of a new stadium doesn’t translate directly to franchise valuation. (For one thing, the Raiders aren’t going to own the stadium). Rather, it increases franchise valuation to the extent it increases revenue potential and that increase exceeds any additional costs.
Put another way: The cost to Davis of moving to the new Vegas stadium looks like it may be more than double his cost to stay in Oakland. A lot of those increased costs have to do with the cost of acquiring land in Vegas, building infrastructure in Vegas, building a third deck in Vegas (the most expensive part of the stadium to build and the part that generates the least revenue), making the stadium a dome or retractable roof stadium and relocation fees. Those additional costs add little or nothing to the revenue potential of that stadium.
“If he’s playing in a $2B crown jewel, gets to host the Super Bowl, potentially brands a new national or international market of touristy fair-weather Raiders fans, and continues to keep some of the loyal Raider following in LA and Oakland, and wields greater political influence than he ever would’ve in Oakland, that’s a slam dunk.”
You’re listing a lot of stuff that sounds great, but you’re not taking the next step to explain how those items actually translate to additional revenue. I know a $2 billion stadium sounds great, but if the extra $750 million is spent to cover items that aren’t needed in Oakland for various reasons (e.g. because the site in Oakland already exists and has much of the needed infrastructure or because an Oakland stadium doesn’t need to be covered), that’s not going to do much additional for franchise valuation.
Hosting the Super Bowl is a much bigger deal for the city or region than it is for the team owner (which is why it is used as a carrot to get public investment for stadiums). For the city, a Super Bowl means a lot of out of towners coming in and filling hotels, restaurants and bars for a week. For the team owner, the economic benefit looks a lot more like it would adding any other big event to the calendar.
And again, assuming it were even true that moving to Vegas would enhance the Raiders brand (a questionable assumption), the Raiders wouldn’t directly benefit. The benefit of such enhanced branding would presumably come in the form of increased TV ratings and merchandise sales, both of which are shared revenue streams.
“His franchise valuation might jump several hundred million with a jump to a brand new stadium in Vegas. Enough to offset a relocation fee and the unrealized $100M the league would give him to build in Oak.”
His franchise valuation is likely to double with a new stadium in either location. Which location increases it more will depend on which one increases his non–shared revenue streams more after accounting for any increased costs. A new stadium in Oakland could actually increase his franchise value more than Vegas, even in a less expensive stadium, if it turned out he can charge more for suite and premium seat sales.
The San Diego Chargers are expected to exercise the team’s option to move to Los Angeles in 2017.
so it’s basically between oakland and las vegas if the chargers are the ones allowed move to la alongside the rams.
the idea of sd ever building an nfl stadium for any team is all but dead now after their ballot measure went down in flames last month.