New: Latest on Kroenke, Rams and NFL in STL

[Rmfnlt]

Stan Kroenke has a Masters in business...

He's a member of ROD? Please stop

 

[dbrooks25]

So you're willing to generalize that because a few people are quoted in an article that they don't care if they get an NFL team that the city/area as a whole don't care and don't deserve one. But we've seen poll numbers from St. Louis saying the same thing that not everybody cares if they keep a team and won't support it that doesn't mean anything?

An article like that about any city is a gross generalization and is lazy journalism. The fact that anybody would support such an article is comedy, that same article could be written from another perspective to counter it.

I didn't generalize anything, but that's what a lot of people did and continue to do when it comes to St. Louis. All I said was that when an article came out saying the same thing about LA, folks want to shut up or make up excuses. Also, the market survey said the fans of St. Louis would support a team, so those poll numbers you mentioned don't mean squat. Like I said before, had that article been about St. Louis, L.A. zealouts would have been all over it. You see how it feels to defend your city?

 

[bluecoconuts]

Yes, and that works for the short term. But, if the product is not appealing, the glitter fades away. Enthusiasm for JerryWorld was fading fast before the Cowboys had a surprise season.

I know, that's where the draw of a beautiful venue in a good location, comes into play. It also helps that the city is large enough that it's easier to draw fans.

That's not what I got out of the article... sounds like a depressed area, actually. Clearly, the race track couldn't be sustained. And doesn't sound like much new activity. Not as bad as the riverfront in STL, but not prime real estate... got to figure Kroenke looks for bargains... typically, they're not in prime areas. He's counting on a renaissance (like STL is).

It's not a depressed area, it was at one point in time, after the Lakers and Kings moved from the Forum, but the city of Inglewood has been growing, and an NFL stadium would fit in very nicely there.

Did you read the article? It said that the Lakers and Clippers attendance flip-flopped when the team's records did.

Yes I read the article... They flip-flopped meaning that the Lakers went from 100%+ capacity all the way down to 98.3%.

Based on the overall sentiment of the fans in the article, I'd say the opposite. Short term? Curiosity factor? Yes. But if the team doesn't win consistently, sure appears the fans wouldn't be interested.

Cherry picked comments? That would be like me picking cherry picked comments from fans in St Louis that don't follow football and using it as an argument. Or my girlfriends step father, who is a big Rams fan, but goes on about how much they suck and how he can't wait for LA to take them so he doesn't have to look at them anymore. I'm pretty certain if I had done that there would be plenty of people, you included, that would argue, and rightfully so.

Doubt he has that much cash on hand... and, even if he did, doubt he'd use it all on one investment. Not very business saavy.

I wouldn't expect him to.

That's all true. But there is also a lot more competition in L.A. than STL.

Not so much that he would have issues. His biggest competition is LA Live.

Want to know the truth? Investments fail in big and small cities. In fact, the bigger they are, the harder they fall.... more money invested.
http://www.businesspundit.com/the-25-worst-business-failures-in-history/
From all size cities.

And? I didn't say they don't fail in big cities, they fail in every city of all sizes. That has nothing to do with what I said, I said that there's more money to be made in LA because there is.

So, where is this homework? If you have these case studies that show a billion dollar stadium in Inglewood, CA can be successful, let me know.
I'm sure Kronke has an extremely detailed business plan for it... but - like all business plans - it's chock full of assumptions.

Did I say I have that information? I don't believe I did, but there has been a lot of work done by various different people, so I'd venture it's safe to say Kroenke isn't going into LA blind. He knows what he's doing, and if he wasn't confident then he wouldn't be pressing forward. Sure he might fail, but he might fail anywhere. The fear of failure hasn't stopped him before and it doesn't seem like it'll stop him now.

 

[bluecoconuts]

Could turn out he does end up owning that STL stadium! Stranger things have happened and, since we're into speculation and all...

It doesn't seem very likely at this point, but the city signaled they were willing to let him own and operate the stadium, I think the odds of him staying would increase greatly, as I think he would have a hard time convincing himself to leave. Until that happens however..

 

[MrMotes]

Gotcha, my bad, too many members here to figure out who said what. As you know, others have, and now that this article came out none of them have much to say about it.

I think most of us would agree that fans support is better when you're winning than when you're losing whether in St. Louis or L.A. And with all the shared revenue, it's just not as important to the bottom line as it used to be. Every team gets their 226 mil come rain or come shine.

And that brings me back to the Clippers, Dodgers, Lakers, all worth a lot more than their counterparts in smaller markets. That's real, and has nothing to do with fan support...

 

[dbrooks25]

I think most of us would agree that fans support is better when you're winning than when you're losing whether in St. Louis or L.A. And with all the shared revenue, it's just not as important to the bottom line as it used to be. Every team gets their 226 mil come rain or come shine.

And that brings me back to the Clippers, Dodgers, Lakers, all worth a lot more than their counterparts in smaller markets. That's real, and has nothing to do with fan support...

I can't argue with that. I will say that the worth of franchises doesn't do much if you're not going to sell them, however. It can be used for status or prestige, so whatever.

 

[MrMotes]

I can't argue with that. I will say that the worth of franchises doesn't do much if you're not going to sell them, however. It can be used for status or prestige, so whatever.

I'm concerned with the value of my meager assets. I imagine the richest men in the world are concerned with the value of theirs. An NFL team is a revenue creating business and an appreciating asset. It's a pretty great thing to own...

 

[drasconis]

There's a lot of events, and a lot of demand for events, he wont have issues renting the place out. Comic Con has discussed moving up to LA, E3 may decide to go to a bigger venue as they have been running out of space at LA Live, plus there's Final Four events, college bowls, etc. Even if he's taking on more debt load, it'll be easier to pay it off, especially as time goes on.
.

Lets be honest he isn't competing for Comic Con or E3...those need real convention sites not a stadium. He could do that if he built something like what Indy or STl currently have, but nothing in his plans that I saw includes a Large convention facility attached.
He will clearly be in the running for NCAA events, might be able to steal a bowl game, exhibition events, and large concerts (I think he will fight for the smaller concerts with the facility next door).
What will be interesting is the long term situation if it gets built...LA is very competitive and while he is the flashy new now, what about 5-10 years down the road...will he still be pulling them in or will another (newer) site start stealing them? It has gone well for him in CO but he is mostly the only game in town for his size venues, LA is much less of a monopoly for him....will be interesting....if it happens.

 

[The Ripper]

Yes, the shared revenue is all the same so the teams make money but local revenues which is un-shared is the key. Teams with higher local revenues have more money to spend on operations, coaches, management and facilities. One of the main things that the Rams in Anaheim showed was that even with poor attendance in the last 6 years the team was in the top quartile for local revenues in the league for 5 of those years and even in 1994 there were in the top half, teams can and have made money in LA even in tough years.

 

[bluecoconuts]

Lets be honest he isn't competing for Comic Con or E3...those need real convention sites not a stadium. He could do that if he built something like what Indy or STl currently have, but nothing in his plans that I saw includes a Large convention facility attached.
He will clearly be in the running for NCAA events, might be able to steal a bowl game, exhibition events, and large concerts (I think he will fight for the smaller concerts with the facility next door).
What will be interesting is the long term situation if it gets built...LA is very competitive and while he is the flashy new now, what about 5-10 years down the road...will he still be pulling them in or will another (newer) site start stealing them? It has gone well for him in CO but he is mostly the only game in town for his size venues, LA is much less of a monopoly for him....will be interesting....if it happens.

Part of a larger complex, with a theater, etc. They could put an E3 there pretty easily, but it would be difficult to pry them away. Same with Comic Con, they're looking for something bigger and the entire City of Champions park could potentially be the answer.

It'll be interesting how things change over time, I know that LA Live is looking to add onto their convention center and fix it up a bit. I'm sure he'd figure things out if it came down to it, but it would be more competition for him. I'm sure he knows this though, and has done his own risk analysis on it. He already owns areas in LA, so he should have an idea of how the game works.

 

[Rmfnlt]

I know, that's where the draw of a beautiful venue in a good location, comes into play. It also helps that the city is large enough that it's easier to draw fans.
It's not a depressed area, it was at one point in time, after the Lakers and Kings moved from the Forum, but the city of Inglewood has been growing, and an NFL stadium would fit in very nicely there.
From the article:
"About six miles east of LAX, edged by the intersection of Freeways 405 and 105, Inglewood upholds (present tense)its reputation as a city in turmoil. In 2010, longtime mayor Roosevelt Dorn pled guilty to public corruption. Two years later, the state took over control of the financially troubled public schools. Last year, Roderick D. Wright, who represented Inglewood in the California Senate, was found guilty on eight felony counts of perjury and voter fraud. More than 100,000 live in the city’s nine-square mile radius, where the median household income is less than $50,000. The population is over 90% minority. Crime, unemployment and poverty rates tick higher than state and country averages.

Yes I read the article... They flip-flopped meaning that the Lakers went from 100%+ capacity all the way down to 98.3%.
Do you have a link that shows this?

Cherry picked comments? That would be like me picking cherry picked comments from fans in St Louis that don't follow football and using it as an argument. Or my girlfriends step father, who is a big Rams fan, but goes on about how much they suck and how he can't wait for LA to take them so he doesn't have to look at them anymore. I'm pretty certain if I had done that there would be plenty of people, you included, that would argue, and rightfully so.
The easiest thing to do is attempt to discredit the interviewees. From the article:
"We posed that question to more than 100 Angelenos from all walks of life. We talked to a struggling actor and an A-list entertainer, a bus driver and a barista, natives and transplants, lawyers and self-described hipsters. We also spoke to people like Urbano, residents of Inglewood and Carson who might have a large, loud tenant moving into their backyards. We found pockets of passionate sports fans who felt jilted by the NFL’s extended absence. But that paled to one overarching theme: apathy."

And? I didn't say they don't fail in big cities, they fail in every city of all sizes. That has nothing to do with what I said, I said that there's more money to be made in LA because there is.
Again, stating conjecture as fact... neither you nor I have any idea what the projected income might be in L.A. And yes, it could be more in STL. No one knows exactly why Kroneke is contempleting moving... for most of this thread, L.A. proponents have said it's because of value... I never said a stadium in L.A. isn't worth more than a stadium in STL (all things being equal)... but income? the TRUTH is... no one knows which site might bring in more cash. The article suggests that, if he builds it, they may not come.

Did I say I have that information? I don't believe I did, but there has been a lot of work done by various different people, so I'd venture it's safe to say Kroenke isn't going into LA blind. He knows what he's doing, and if he wasn't confident then he wouldn't be pressing forward. Sure he might fail, but he might fail anywhere. The fear of failure hasn't stopped him before and it doesn't seem like it'll stop him now.
I guess I asked because you are stating these things with such certainty, I assumed you had some proof. OK, more of what we all have... speculation.
And we agree that Kroenke is no fool... and has done tons of projections to make sure he has a strong sense that it can work. But, like I said, those projections are based on assumptions.

Donald Trump is considered a very successful businessman... real estate... in New York no less. Yet, he has declared BK more than once. Mark Cuban (another billionaire) called out The Donald yesterday... called him a paper tiger... said The Donald likes to tell everyone how wealthy he is... talk about his net worth. Cuban said that's hogwash... he likened it to owning an expensive painting... if you never sell it, it's all paper. Cuban has it right... cash is king!
http://www.foxsports.com/nba/story/...-has-enough-money-to-run-for-president-072115
Now... I'm certainly not saying Kroenke is on the verge of BK... that'd be silly. But he's not infallible. But moving to L.A. is not the slam dunk some are saying it is... nothing in business is a slam dunk. Now.. that IS a fact.

 

[Rmfnlt]

I think most would agree that trying to survive mostly on shared TV revenue and other ancillary income streams, while paying significant debt service, would be a difficult endeavor.

I think most would agree that the true value of an asset is only realized at time of sale.. in fact, that's a fact.

 

[Rmfnlt]

It doesn't seem very likely at this point, but the city signaled they were willing to let him own and operate the stadium, I think the odds of him staying would increase greatly, as I think he would have a hard time convincing himself to leave. Until that happens however..

If it ever came to pass that the city gave Kroenke the option to own and operate that stadium and he left anyway?

Boy...

 

[dieterbrock]

I can't argue with that. I will say that the worth of franchises doesn't do much if you're not going to sell them, however. It can be used for status or prestige, so whatever.

We are talking about a real estate developer here though, not a property flipper. Stan's dream stadium increases value and also opens up major revenue streams that the St Louis stadium does not (IE Potential NFL Team Tenant and AD space on roof)

 

[The Ripper]

I think most would agree that trying to survive mostly on shared TV revenue and other ancillary income streams, while paying significant debt service, would be a difficult endeavor.

I think most would agree that the true value of an asset is only realized at time of sale.. in fact, that's a fact.

It depends. The 49ers have done extremely well and some of the debt has been paid back early. There are just to many unknowns to make a determination at this point but generally speaking that's correct. At least from the numbers from both the Chargers and the ones that the City of Carson did it seems that it would be the case for Carson. Inglewood it's just too complex and we don't know where the revenues go, the team, Stockbridge, KSE or one of the other various companies.

Last statement of course. No debate.

 

[ChrisW]

We are talking about a real estate developer here though, not a property flipper. Stan's dream stadium increases value and also opens up major revenue streams that the St Louis stadium does not (IE Potential NFL Team Tenant and AD space on roof)

He'd also be out of the picture before the whole thing started making any profit.

 

[Alan]

So here's a story about LA and the NFL which I won't post because there's too much other stuff and it might already have been posted so check it out and if it's interesting someone else can post it.
http://mmqb.si.com/2015/07/21/nfl-los-angeles-st-louis-rams-stan-kroenke/

 

[Rmfnlt]

It depends. The 49ers have done extremely well and some of the debt has been paid back early. There are just to many unknowns to make a determination at this point but generally speaking that's correct. At least from the numbers from both the Chargers and the ones that the City of Carson did it seems that it would be the case for Carson. Inglewood it's just too complex and we don't know where the revenues go, the team, Stockbridge, KSE or one of the other various companies.

Last statement of course. No debate.

Agree.
To say that Kroenke will definitely make more money in L.A. because... well, it's L.A. doesn't wash with me. Building a state-of-the-art stadium in L.A. has high potential for rewards... and high risks. It cuts both ways and, like I said, nothing is a slam dunk... even for that genius we call Stanley Enos Kroenke. Remember, the NY Mets thought Bernie Madoff was a genius too!

Like you say, each and every deal is different and extremely complex. Can't simplify it by making sweeping statements or bold assumptions.

 

[Rmfnlt]

We are talking about a real estate developer here though, not a property flipper. Stan's dream stadium increases value and also opens up major revenue streams that the St Louis stadium does not (IE Potential NFL Team Tenant and AD space on roof)

I hear STL is gonna have some of the niftyest bi-planes flying advertising banners over Riverfront that we've ever seen! Replicas of the Spirit of St. Louis!

 

[dieterbrock]

He'd also be out of the picture before the whole thing started making any profit.

Hard to say that for sure.