Market Relegation: The New Era of Neutral Site Baseball

Numerous great institutions are coming to an end over these last two weeks. The Lakers’ and Celtics’ playoff runs ended, killing Adam Silver’s dream NBA Finals matchup. Another Sun Belt Stanley Cup Final is about to start. English football ended their season in their respective leagues, with the joy and agony of promotion and relegation to come. Great TV shows like “Succession” and “Barry” had their series finales on Sunday, with “Ted Lasso” finishing tonight. And the A’s, whose 2023 season ended before Opening Day, may be saying adios to Oakland in a week if the State of Nevada passes SB 509, which would cement Vegas’s effort to lure the club to the desert.

That’s a lot of drama (and some comedy) to wrap up in two weeks. Series, whether fictional TV or real sports, all have endings, and I can’t help but feel a little wistful. While teams can rebound and rebuild, the A’s as an Oakland entity is on the precipice. In the past I haven’t been eager to overly dramatize that, but this feels real. Judging from last night’s sole public hearing on SB 509, it’s starting to feel like a fait accompli. Oakland’s (or California’s) process is glacial compared to Nevada, which is happening at light speed. We still can’t say how bad a deal this will be for Nevada and Clark County since the projections are too rosy at a glance to seem real and there is no input from a state appointed economist or non-partisan analyst. Yet there may be a method to this madness. The problem is that it includes a future without Oakland on the MLB map. For you, probably an old school baseball fan, you may have to expand your thinking.

The first clue came from last night’s hearing, when LVCVA’s Steve Hill noted that the new scheduling format allows every team to play every other team one series per year, alternating home series for interleague matchups. In previous years you often had to wait three years to see any particular team in the other league, and because of unbalanced divisions it was not necessarily guaranteed that team would come to town at regular intervals. This format change creates stability for travel planning, so much that when I saw that I stopped making the Travel Grid. If you can reasonably expect to see every team at least once every other year or schedule road trips in alternating years, there’s no surprise or delight left in making those schedules. Sorry about that everyone. It’s still good for baseball in that it’s predictable and easily programmable, with the only real sacrifice being some midseason intra-division series.

Next is news out of Orlando that they want to build a domed MLB ballpark for an expansion team. Of course, given Florida’s history with MLB teams it’s preposterous to even consider a third team, so the focus is quickly shifting to St. Petersburg, which is trying to work out a deal with the Rays and developer Hines. The plan includes a fixed dome instead a retractable dome and includes 775 units (23%) of affordable housing. Sounds promising until you remember that the subsidies that provide affordable housing come out of the same general project budget that helps subsidize the ballpark, just like Howard Terminal. As the project is still young, no one is claiming doom yet. The challenge is there, along with the pre-existing fan access problem at the Tropicana Dome site. Regardless, the Rays are locked into the Trop through 2027. Orlando couldn’t open this ballpark until 2028 at the earliest, and FWIW the current CBA runs through the 2026 season.

Yeah, Orlando’s ballpark looks like The Battery in ATL, though the ballpark is oriented… WEST?

Let’s take this a step further and assume that Oakland and St. Petersburg can’t get ballpark deals done, leaving the A’s bound for Vegas and the Rays set to depart for Orlando. Both teams will be in new domed stadiums by 2028, the next CBA will set the stage for a new round of expansion, presumably providing a heretofore unknown level of financial stability for the Rays and A’s. Like it or not, that’s what baseball wants. They’re not afraid to step on some toes to get it. They have their antitrust exemption in their back pocket. And based on the patience MLB has shown towards both clubs and their current home cities, there is no feasible antitrust challenge in sight for either city.

You may ask where that financial stability comes from, knowing that both clubs are headed for historically small markets. Well, they’re gonna get help. Due to Las Vegas’ and Orlando’s status as mid-sized cities, both teams are likely to be classified as small markets, which makes them eligible for full revenue sharing for the foreseeable future no matter how the plan evolves. This is where a potential relocation fee would come into play. It may be $1 Billion, or $500 million or $300 million, or it may be nothing. There is probably a sliding scale on how this works. I suspect that a special mechanism will be made available for these two teams – and only these two teams – because of their tourist-trap locales. The relocation fee could depend on their willingness to part with more of their locally grown revenue.

The current CBA calls for teams to share 48% of their locally-derived revenue including gate receipts, suite sales, and local TV revenue as their main sources. That money would go into a pool that would be split into 1/30 shares. Big market teams were ineligible for the pool of shared revenue based on a formula that changes on an annual basis. After 2016 the A’s were phased off revenue sharing in anticipation of Howard Terminal or another Oakland ballpark, with the idea that they would have requisite revenue to hold their own as a big market franchise. As that failed to result in a new ballpark, the A’s were placed back onto a partial revenue sharing plan with the most recent distribution last winter, though I’m not clear on how much that actually is. In any case, as I’ve mentioned before, to lose revenue sharing would be noticeable but not debilitating thanks to the growing amounts of national revenue (TV, streaming, merchandise, sponsorships). I’m guessing this year’s amount is around $20 million and could grow to $35-40 million next year. If the A’s get a full share it’s worth over $100 million annually plus the national revenues. By keeping the A’s and Rays classified as small markets going forward, all these revenue sources will help to give them ballast as they cultivate local fanbases. 

82 games seems conservative for a venue that could host a dozen more annually

The A’s/Rays situation calls for an exchange. They could minimize their relocation fee in exchange for giving up a percentage of their ticket sales. This is outside the 48% pooled revenue. Here’s how this could work: upon building the Vegas ballpark, the A’s could designate some number seats to be sold directly by the visiting team. The revenue from those sales would go to that team. The visiting teams could choose to take a full allotment of those tickets by game or series which they would sell to their season ticket holders or as part of vacation packages. If that sounds exotic, consider that teams have already started doing these kinds of sales of spring training games. The difference right now is that they’re selling their own Cactus/Grapefruit League tickets instead of another team’s regular season. 

When you go to a MLB game, there is no dedicated road/away supporters section. European soccer and some American college football stadia have away sections, often for fan safety. For baseball, the natural place to implement road sections is the area behind the visiting dugout. Depending on how large a visiting team’s fanbase is, those sections could expand or be reserved for advance or gameday sales. In their projections the A’s expect 405,000 visitors to games each year, which translates to 5,000 visiting fans per game. While this could certainly work for the NY/LA/Chi teams, it’s more of a reach for say, Pittsburgh or Baltimore. That’s okay, because if the visiting team doesn’t claim a full allotment, it will go back into general sale. There would be rules on how advance sales would work for that, but it can be folded into existing season ticket packages or sold as standalone or vacation package deals, which if you haven’t noticed, Vegas and Orlando are par excellence at doing. The actual revenue would be claimed under the visiting team’s local share, 48% of which by rule would go into the revenue sharing pool. The scheme basically allows the home and road teams to call dibs, which harkens back to the old ticket splits that were done prior to revenue sharing. In the end, it’s all accounting.

There’s another wrinkle to the A’s/Rays relocation. The Orlando ballpark plan looks similar to the Braves’ The Battery development with a huge indoor mall-like canopy on top. That may not be possible in Vegas due to the nine acres afforded to the ballpark. Still, Bally’s is figuring out ways to maximize that adjacent space, so if they want to have an air-conditioned public area right outside the ballpark, it’s not like Vegas isn’t chock full of those. 

From a baseball playing standpoint, new events will increase usage of the ballpark. Sure, there will be 81 home games plus at least one spring training warmup game. Beyond that, we got a taste of the future from the exciting World Baseball Classic in March. Once opened, Vegas and Orlando could serve as the pool play and championship round hubs for the WBC every three years. This year, Miami’s LoanDepot Park and Phoenix’s Chase Field hosted 10 pool play games. Miami also hosted two quarterfinal games, two semifinals, and the championship game (Japan hosted the other quarters). In the future, Orlando and Las Vegas can replace Miami and Phoenix to host the pool games while alternating the knockout rounds every 3-6 years. Plus there’s one last wrinkle. Baseball (maybe this is a Manfred initiative) has wanted to put together some sort of in-season tournament for some time. It’s unclear how expansive this tournament would be or how it would affect standings and statistics. Having Las Vegas and Orlando in place takes care of one very important variable: climate control. Because both are domes, there’s no worry of rainouts or postponements as there is at the outdoor parks. I imagine this isn’t something they would implement until baseball expanded to 32 teams, but once it did they could run it annually just like the All-Star Game. The NBA is already considering its own in-season tournament, so it’s only a matter of time for baseball to create their own.

Is there room for Oakland and Tampa Bay in this future baseball fantasy? Tampa perhaps, if it can get its replacement dome together. If it can’t, expect MLB to quickly pivot to Orlando. There are no minor league teams there and spring training vacated Orlando years ago, so no territorial conflicts exist there. Oakland isn’t known as a major tourist destination so it doesn’t fit this concept well. Sadly, the sports world is leaving Oakland behind. Oakland has tons of great sports history and it was a pacesetter in the 60’s. It will have to prove itself again as a worthy competitor in the pro sports world through what it builds, not what it promises.

As for the Vegas ballpark, can you hold your breath for an entire week? You may have to. They probably won’t take the full floor vote until June 5, and only if the NV legislature comes to a budget deal first.

5 thoughts on “Market Relegation: The New Era of Neutral Site Baseball

  1. If the Nine acre ballpark gets approved, what if the retractable roof doesn’t work??????????

    • Roof is very unlikely to be retractable in Vegas imo. It will be a permanent roof with lots of ancillary entertainment inside the stadium. Video poker at your seat, slot machines around the concourse, a high-rollers section up in luxury box level.

      Assuming home plate faces out toward the Strip and the roof is glass to see the nighttime strip view from the stands, I can’t think of any reason you’d ever want the roof open.

  2. Good analysis. English soccer cups often feature backups like #2 keepers, and I wouldn’t be surprised if MLB teams that were in the pennant race called up AAA starters for it while non-contenders really tried to win it.

  3. I’m confused as to why things got pushed back to 2028 if the A’s are indeed going to settle on the Tropicana site. You would assume that the stadium would take 3 years to build so you’re looking at a 2024-2027 range. They say that tearing down the Tropicana is the reason why but we’re in May of 2023. Do you really need over a year to tear it down

    Another theory was that Bally’s has to go through the approval process for their part of the project and nothing could commence with the stadium until that. If so, would it be possible for demolition of the Tropicana to go simultaneously while Bally’s went through the approval process, a parallel path of sorts, pun intended?

  4. If SB 509 is approved, will FAA considerations be challenging? Thanks for the write up.

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