SBD/17/Franchises

NETS AND SPORTS AUTHORITY PREPARING FOR LEASE NEGOTIATIONS

          Lease negotiations between the Nets and the N.J. Sports
     & Exposition Authority (NJSEA) "are set to begin" in the
     next few weeks, according to Jon Gelberg of the Newark STAR-
     LEDGER.  The Nets hold the option of opting-out following
     the '99-2000 season and Sunday's STAR-LEDGER featured 
     separate Q&As with NJSEA CEO Robert Mulcahy and Nets
     President & COO Michael Rowe.  Rowe, on possible renovation:
     "The Sports Authority has to prove to us they can
     successfully renovate it and (that) the kind of cash flows
     that are needed will be there."  Rowe said that the Nets
     paid $1.5 million in state sales taxes last year and added,
     "[Y]ou can buy at least one player with that."  Rowe, on the
     threat of relocation: "There have been a number of
     unsolicited offers to purchase the team in the last few
     years.  The shorter the lease, the more attractive the
     franchise.  We've not been on the footsteps of any city hall
     in the Sun Belt or the Midwest.  The Sports Authority is
     smart enough to know what's out there" (STAR-LEDGER, 11/16). 
          NJSEA VIEW: Mulcahy said that he expects the Nets talks
     to be "frank and cordial."  Mulcahy, asked if the state
     could provide a subsidy or tax break to the team: "There has
     to be another stream of revenue to keep the complex as
     competitive as it is now. ... That's a significant question
     that has to be resolved."  Mulcahy, on whether NJ would "be
     better off" with a new arena: "You have to take a close look
     at the economic realities.  I'm not sure what the market is. 
     You can talk about having a facility with 200 luxury boxes
     and hundreds of club seats, but that won't do you much good,
     in terms of producing revenues, if those boxes and seats are
     empty" (Jon Gelberg, Newark STAR-LEDGER, 11/16).
     
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