Sports is big business. I can hear you now, we’ll duh, tell us more genius. Most owners of major sports franchises are billionaires and they didn’t get to be billionaires without finding a way to get others to pay most of their expenses whether that’s in the form of ticket prices, concessions, or in-stadium advertising.
Oh yes, there’s that word…Stadium. Every owner wants a new one because someone else has a new one and guess what, most owners want the taxpayers of the cities in which they call home to pay for it. It’s the ultimate dog-and-pony show. Either the owner gets his way or he threatens to leave town. In early 2016, the Rams said goodbye to St. Louis because the city couldn’t come up with a plan to replace the Edward Jones Dome which by the way was built in the mid 1990s for the Rams. The Rams returned to their original home in Los Angeles.
The Minnesota Vikings made noise for years under two different owners that they needed some place else to play other than the aging Metrodome or maybe they’d move to San Antonio, Texas for example. Minneapolis caved and this year the Vikings moved into the brand new ultra-modern U.S. Bank Stadium. The Atlanta Falcons home in the Georgia Dome was just built in 1987 but that made the stadium the 10th oldest in the NFL. Not good enough for Falcons owner Arthur Blank. While in all fairness Blank (who made his billions by founding a little company called “Home Depot” in the 1970s) never made any noise about moving the team, the City of Atlanta never gave him a chance and agreed to help fund the new Mercedes-Benz Stadium which will open next fall right next to the Georgia Dome. Before it meets the wrecking ball, the Georgia Dome will see it’s final NFL game this weekend when the Falcons host Green Bay in the NFC Championship game. Since 2000, the Bengals, Browns, Titans, Steelers, Broncos, Texans (a new organization), Patriots, Seahawks, Lions, Eagles, Cardinals, Colts, Cowboys, Giants/Jets, 49ers and Vikings all got new stadiums. The goal is not only a ultra-modern environment, but adding all the whistles and bells that you can find to increase the “fan experience” like free Wi-Fi. Studies have shown that in college stadiums, the number one reason students stay home is the lack of Wi-Fi access because you just can’t go 10 seconds without posting something on a something called “Instagram.”
Last week, the owner of the San Diego Chargers – fed up with not getting his new stadium in the City – pulled up stakes and overnight turned the San Diego Chargers into the Los Angeles Chargers. This is the Chargers second stint in L.A. The franchise was one of the original AFL teams and played in Los Angeles in the AFL’s inaugural season in 1960. A year later, the team – fighting for relevance with the NFL’s L.A. Rams – pulled up stakes and moved south to San Diego. I’ve never been to San Diego so I can’t speak about the City but anyone I’ve talked to who has been there swears it’s the best place on earth. The weather is always nice and up until last week, it had both Major League Baseball and NFL franchises, not to mention some of the nicest golf courses in the country.
But the Chargers had a serious stadium problem. Qulacomm Stadium is the fifth oldest NFL Stadium in the league, first opening in 1967. For years, Chargers owner Dean Spanos had been sabre rattling that his team needed a new stadium to enhance both the fan experience and I guess encourage free agents to come play there. Perhaps players would come play there if the Chargers weren’t such a mediocre organization. Spanos figured since San Diego had NFL Football for 56 years, they’d do anything to keep it and would build him a new home at taxpayer cost. Last November the City of San Diego put the question of tax payer funding for a new home for the Chargers on the ballot and the voters promptly voted it down. The new stadium would have been paid by raising taxes on hotel guests only. That would have hit right at the heart of the city’s convention business as let’s face it, most of the people who go to San Diego Chargers football games are from…San Diego and don’t necessarily stay in hotels.
So when Spanos didn’t get his new stadium, he took the NFL up on an option the league presented to him last year. When the NFL approved the Rams moving back to Los Angeles from St. Louis, the NFL gave the Chargers the option of joining the Rams in a brand new stadium to be built by Rams’ owner – multi-gazillionaire Stan Kronke. Kronke – who has a terrible rug sitting on top of his melon and features a mustache that clearly makes him look like an out of work 1970s porn star – made billions in the real estate business and he’s building a $1.9 billion dollar home for the Rams outside of Los Angeles in Inglewood. He’s building it with his own money because, well he has the money. He also had the money to do the same thing in St. Louis, but clearly didn’t want anything to do with St. Louis anymore.
The Stadium which is set to open in 2019 will not just be a stadium, but also include attached retail development and reportedly will have a studio that will be the new home of the league’s owned NFL Network. Kronke reportedly has no interest in sharing his home with another team and he won’t be gaining financially from sharing space with the Chargers. The NFL is requiring San Diego to pay all of $1 per year in rent to Kronke.
In the meantime, the Rams – a flaming cow pie of a team – are playing their home games in the L.A. Coliseum, which is now officially the oldest stadium in the NFL, having opened its doors in 1923. The return of the Rams to L.A. was met with much fanfare among the locals and they did well at the box office at the beginning of the 2016 season, but when the team started playing poorly and firing a head coach just 4 days after giving him a contract extension, the fans started staying home. Now, the Rams will be joined by a second team in Los Angeles, and for true football fans in the L.A. area, the only thing worse that having one bad NFL team is having two. When Los Angeles had no NFL team, fans in Los Angeles got the opportunity to watch the best game in the league every Sunday on television without having to pay for Direct TV’s overpriced Sunday Ticket. Now, they’ll be forced to digest both the Rams and Chargers on television every week and if they want to see the league’s best game they’ll have to pay out for it or find a Buffalo Wild Wings somewhere.
I’m not convinced that Los Angeles will support two NFL teams. It’s been tried =and failed = before with the Rams and Raiders sharing the L.A. Coliseum. It’s not like New York where the Jets and Giants ate both ingrained into the city’s culture and the weather turns cold. It’s Los Angeles where the weather is nice, and there’s always something else to do. We will find out quickly. While the Chargers wait with the Rams on the Kronke-ma-hal to be finished, they’ll play 2 seasons in a soccer stadium, the 30,000 seat Stub Hub Center in Carson, California. The team is billing its move as the most intimate atmosphere in the NFL, but after 56 years in San Diego, will anyone in Los Angeles actually care? I doubt it.
The kicker to the Chargers’ move is that there was a proposal on the table for a new Stadium to be build in San Diego for about $1 billion. The city would have found a way to fund about half of that amount, rather than the full amount that Spanos wanted the City to pay. The NFL guarantees a franchise $200 million toward the cost of new stadium, and that would have left Spanos on the hook for about $450 million of the price. Spanos didn’t want to reach into his own pocket, but by moving his team to Los Angeles, he’ll have to pay the NFL a $550 million relocation fee. This sounds like more like giving San Diego the celebrated one-finger salute for not playing the game the way Spanos thought the city should play. Like most billionaires, Spanos will probably find a way to make someone else pay that amount and San Diego will be just fine without the NFL. The move was met with dismay by Chargers’ Hall of Fame Quarterback Dan Foutz, but St. Louis is doing just fine without the NFL having increased convention business for the Rams’ former home and cutting the costs associated with hosting NFL football.
Spanos is not going to be the last NFL owner to move his team. Already the Nevada Legislature has approved $750 million to be put to building a new stadium that will have the Oakland Raiders moving the team from the bay area to Las Vegas. Like San Diego’s stadium, the Oakland Coliseum is an armpit. It’s the fourth oldest in the NFL having opened in 1966.
The famous saying from the baseball movie “The Field of Dreams” is that if you build it, they will come. As we are learning from the billionaires who own NFL Franchises, if you don’t build it, they will go.
Then there’s the proliferation of new MLB stadiums. I’ll have some thoughts on those next week. Peace everyone.