SBD/May 2, 2013/Franchises

Stern, Silver Defend Committee's Vote To Keep Kings In Sacramento

Stern (r) said Seattle's bidders represent the perfect prototype for an NBA owner
NBA Commissioner David Stern and NBA Deputy Commissioner & COO Adam Silver Tuesday defended the NBA relocation committee's recommendation for the Kings to remain in Sacramento instead of moving to Seattle. Appearing on PBS' "Charlie Rose," Silver said, "Some people are surprised at the preliminary decision the relocation committee has made. They say, 'Look at Seattle -- there's more corporate headquarters, there's more TV households, there's the potential to generate more revenue there. Shouldn't you move a franchise to the market where there's more revenue?' And our response is, 'Not necessarily, that if you look at total value over time, and brand building, and community support, and that continuity is important.'" Still, Stern said the Seattle bidders, including hedge fund manager Chris Hansen and Microsoft CEO Steve Ballmer, represent "the perfect prototype for an NBA owner" ("Charlie Rose," PBS, 4/30). In Sacramento, Ben van der Meer noted following the relocation committee's vote to keep the Kings in town, "prominent downtown interests said it’s time to look seriously at what could be developed in and around a new arena." Sacramento developer David Taylor said that "suddenly there's energy toward development of new office, housing and retail downtown because there's a belief the Kings will be there." Taylor said, "Whether it generates actual projects being built, we'll see." He added that downtown investors and developers "may begin investigating various projects but won’t necessarily commit money to following through until it’s obvious an actual arena is moving forward" (BIZJOURNALS.com, 5/1). Meanwhile, the SACRAMENTO BEE's Kasler, Lillis & Bizjak address questions about what is next for the Kings.

TIME TO MOVE ON
: In Sacramento, Ailene Voisin writes the city's "arena drama has gone on long enough." With "respect to the disappointed folks in Seattle ... it's time" for Hansen and Ballmer "to turn the page, to find another city and another franchise to pick on." Voisin: "Be wary of taking on incumbents. NBA owners argue like siblings and even have been known to scream at their commissioner." And owners "hate the headaches that come with relocation." Voisin: "Two more words of advice for Hansen and Ballmer: Lose graciously." This is "Sacramento's time, Sacramento's first big break" (SACRAMENTO BEE, 5/2). A SACRAMENTO BEE editorial stated if Kings Owner the Maloof family "truly cares about Sacramento and the Kings, it ought to graciously step aside." It is "time to end the uncertainty and give the team and its city a fresh start." They "have to recognize that their best move now is to sell to a strong ownership group that would keep the team in Sacramento and work with the city to build a new arena downtown." The Maloofs "would still cash in." While the Sacramento group's offer is "said to be" $15M less than Seattle's, it would "still put a record value on the franchise." The Maloofs are "refusing to comment on their next step," which is "one reason why they have worn out their welcome." All the "hard work" by Sacramento Mayor Kevin Johnson will "amount to little ... if the Maloofs insist on hanging on." The "absolute last thing anyone should want is to repeat this wearisome drama again next year" (SACRAMENTO BEE, 5/1).

NEGOTIATING TOOL: MSN MONEY's Jason Notte wrote, "Congratulations, Seattle. You're now to the National Basketball Association what Los Angeles is to the National Football League." With Hansen and Ballmer "still determined to build a new arena in Seattle and planning to pitch the NBA's board of governors before it votes formally on the matter on May 13, the league and its Sacramento franchise now have something just as valuable as a major-market team in Seattle." They have a "bargaining chip." Notte wrote the owners "want to be able to make this kind of move over and over again. 'Give us a new publicly financed stadium, or we'll move to Seattle' is a threat that works as well in Portland or Milwaukee or Minneapolis or Salt Lake City or Memphis or New Orleans or Phoenix as it does in Sacramento." Author Neil deMause said the Sacramento deal maintains "an arena-subsidy business model that has helped make many rich NBA owners even richer." Notte wrote "unless the league expands ... Seattle is just an NBA code word for extortion" (MONEY.MSN.com, 5/1). Milwaukee Mayor Tom Barrett on Tuesday said that the Kings potentially staying in Sacramento "raises the stakes for Milwaukee leaders hoping to retain" the Bucks. In Milwaukee, Rich Kirchen noted the Kings news has "given rise to speculation that the Seattle ownership group might look to buy another franchise -- possibly" the Bucks. Team execs have said that the team is "not for sale." But the Bucks and the NBA have said that the team "will need to leave Milwaukee after the 2016-2017 season unless a new arena is built." Barrett said, "We need to be pro-active and get the Bucks to stay here" (BIZJOURNALS.com, 4/30).
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