This is really depressing...
- Thread starter Merdiesel
- Start date
The empty land north of Arco is part of the 100 acres. Do you know where the other part is? Here's a hint: It has asphalt and white lines covering it. Here's another hint, when the Maloofs built the practice facility, they had to get approval from the city. Which was a bit more than a building permit.
The land bounced around and ended up with Fred Anderson and Buzz Oates. After Anderson passed away, Oates donated the land to the city.
Without a doubt it would be cheaper to build an arena on this land. But IMO, there would be next to nothing as a benefit to the city in spurring development in the surrounding area. Whatever accusations are being tossed at the creators of Q & R, they have the city's best interests at heart. The new arena would have done EXACTLY as advertised for the railyard. There will be no winners after Tuesday... we all lost.
The land bounced around and ended up with Fred Anderson and Buzz Oates. After Anderson passed away, Oates donated the land to the city.
Without a doubt it would be cheaper to build an arena on this land. But IMO, there would be next to nothing as a benefit to the city in spurring development in the surrounding area. Whatever accusations are being tossed at the creators of Q & R, they have the city's best interests at heart. The new arena would have done EXACTLY as advertised for the railyard. There will be no winners after Tuesday... we all lost.
Not as easy as it seems would be my short answer. The list of things to consider:
- It takes money up front to build a new arena. You can't sell the current arena land, get the cash and then start building.
- Value of the land. The current zoning of the land doesn't yield as much per an acre as commercial or residential. The Maloofs have asked for it to be rezoned to increase it's value. Rezoning is a bargaining chip that isn't handed over quickly. Ask Angelo Tsakopoulos how complicated and vital land rezoning can be. You have to "donate" lots of money for rezoning favors. I wouldn't agree to rezone the Arco land unless I had a new building going up with a signed 30 year lease already in pocket.
- The Maloofs have a loan to pay off. The city holds the deed to the Arco land until it's repaid. That whole loan back in '97 has all sorts of impact on this issue.
So while us armchair negotiators see things in such easy terms, most don't even have all the facts and make some assumptions that just don't fly. That's why we elect and employ people who supposedly do have a clue.
- It takes money up front to build a new arena. You can't sell the current arena land, get the cash and then start building.
- Value of the land. The current zoning of the land doesn't yield as much per an acre as commercial or residential. The Maloofs have asked for it to be rezoned to increase it's value. Rezoning is a bargaining chip that isn't handed over quickly. Ask Angelo Tsakopoulos how complicated and vital land rezoning can be. You have to "donate" lots of money for rezoning favors. I wouldn't agree to rezone the Arco land unless I had a new building going up with a signed 30 year lease already in pocket.
- The Maloofs have a loan to pay off. The city holds the deed to the Arco land until it's repaid. That whole loan back in '97 has all sorts of impact on this issue.
So while us armchair negotiators see things in such easy terms, most don't even have all the facts and make some assumptions that just don't fly. That's why we elect and employ people who supposedly do have a clue.
Voteno: If you are talking about the downtown arena proposal, the tax dollars received each year might be more than the lease payments, but at the end of 30 years, the city would have nothing, but the tax payments.
If they leased it they get the lease payments every year, have absolutely no responsibility for any losses the business suffers and accrue 30 years of equity in the increased value of the land. I can just about give you a solid guarantee the equity will end up being worth more than the taxes you might collect over the years. Why? For one because of good old Proposition 13 that limits property taxes increases to no more than 2% per year. I'd easily wager the value of the land and improvements will increase in value more than 2% a year.
So no, just giving them the arena is not the same as leasing them the arena. As to the Maloofs should have to provide the place for their own business. Most businesses do that How? By LEASING. The vast majority of businesses do not own the land and building they do business at. Landlord collects the rent and doesn't share in profits of the businesses, nor do the suffer losses when the business does.
As to the Maloofs just providing the money to build an arena, even on the Natomas site. How do you think they "provide" it? The have to get a commercial loan, similar to how people have to get a loan to buy a house.
Guess what? A lender (at least a fair, non-hard money lender) will not loan you more than you could ever hope to be able to pay every month based on your income. Same with MSE. No commercial lender will loan them enough money to build the arena on their own based on the cash flow MSE has. They wouldn't touch it with a ten-foot pole, unless they are truly unscrupulous lenders. And the Maloofs would be stupid to put all their other businesses at risk, by running a good chance of banktruptcy.
Paul Allen in Seattle is the 6th richest man in the entire world. He went bankrupt on the Rose Garden. And the Maloofs can't even sniff that much money from where they are.
If they leased it they get the lease payments every year, have absolutely no responsibility for any losses the business suffers and accrue 30 years of equity in the increased value of the land. I can just about give you a solid guarantee the equity will end up being worth more than the taxes you might collect over the years. Why? For one because of good old Proposition 13 that limits property taxes increases to no more than 2% per year. I'd easily wager the value of the land and improvements will increase in value more than 2% a year.
So no, just giving them the arena is not the same as leasing them the arena. As to the Maloofs should have to provide the place for their own business. Most businesses do that How? By LEASING. The vast majority of businesses do not own the land and building they do business at. Landlord collects the rent and doesn't share in profits of the businesses, nor do the suffer losses when the business does.
As to the Maloofs just providing the money to build an arena, even on the Natomas site. How do you think they "provide" it? The have to get a commercial loan, similar to how people have to get a loan to buy a house.
Guess what? A lender (at least a fair, non-hard money lender) will not loan you more than you could ever hope to be able to pay every month based on your income. Same with MSE. No commercial lender will loan them enough money to build the arena on their own based on the cash flow MSE has. They wouldn't touch it with a ten-foot pole, unless they are truly unscrupulous lenders. And the Maloofs would be stupid to put all their other businesses at risk, by running a good chance of banktruptcy.
Paul Allen in Seattle is the 6th richest man in the entire world. He went bankrupt on the Rose Garden. And the Maloofs can't even sniff that much money from where they are.
great posts kennadog!! i'm with ya 200%
one other tidbit:
the only other arena older than Arco is Madison Square Garden. MSG was built badly as well (the arena starts on the fifth floor). Land is almost impossible to come by in NYC and the cost of building an arena will be exorbitant (land + construction = at least $1000/sq ft). But the Knicks enjoy an endless revenue stream. The company that owns them, Cablevision, owns the Garden, Knicks, Rangers (NHL), Liberty(WNBA), manages Radio City Music Hall, has over 2 million cable subscribers and a season ticket base that is willing to fork over between $280 - $2000 per seat per game
one other tidbit:
the only other arena older than Arco is Madison Square Garden. MSG was built badly as well (the arena starts on the fifth floor). Land is almost impossible to come by in NYC and the cost of building an arena will be exorbitant (land + construction = at least $1000/sq ft). But the Knicks enjoy an endless revenue stream. The company that owns them, Cablevision, owns the Garden, Knicks, Rangers (NHL), Liberty(WNBA), manages Radio City Music Hall, has over 2 million cable subscribers and a season ticket base that is willing to fork over between $280 - $2000 per seat per game
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great posts kennadog!! i'm with ya 200%
one other tidbit:
the only other arena older than Arco is Madison Square Garden. MSG was built badly as well (the arena starts on the fifth floor). Land is almost impossible to come by in NYC and the cost of building an arena will be exorbitant (land + construction = at least $1000/sq ft). But the Knicks enjoy an endless revenue stream. The company that owns them, Cablevision, owns the Garden, Knicks, Rangers (NHL), Liberty(WNBA), manages Radio City Music Hall, has over 2 million cable subscribers and a season ticket base that is willing to fork over between $280 - $2000 per seat per game
one other tidbit:
the only other arena older than Arco is Madison Square Garden. MSG was built badly as well (the arena starts on the fifth floor). Land is almost impossible to come by in NYC and the cost of building an arena will be exorbitant (land + construction = at least $1000/sq ft). But the Knicks enjoy an endless revenue stream. The company that owns them, Cablevision, owns the Garden, Knicks, Rangers (NHL), Liberty(WNBA), manages Radio City Music Hall, has over 2 million cable subscribers and a season ticket base that is willing to fork over between $280 - $2000 per seat per game
great posts kennadog!! i'm with ya 200%
one other tidbit:
the only other arena older than Arco is Madison Square Garden. MSG was built badly as well (the arena starts on the fifth floor). Land is almost impossible to come by in NYC and the cost of building an arena will be exorbitant (land + construction = at least $1000/sq ft). But the Knicks enjoy an endless revenue stream. The company that owns them, Cablevision, owns the Garden, Knicks, Rangers (NHL), Liberty(WNBA), manages Radio City Music Hall, has over 2 million cable subscribers and a season ticket base that is willing to fork over between $280 - $2000 per seat per game
one other tidbit:
the only other arena older than Arco is Madison Square Garden. MSG was built badly as well (the arena starts on the fifth floor). Land is almost impossible to come by in NYC and the cost of building an arena will be exorbitant (land + construction = at least $1000/sq ft). But the Knicks enjoy an endless revenue stream. The company that owns them, Cablevision, owns the Garden, Knicks, Rangers (NHL), Liberty(WNBA), manages Radio City Music Hall, has over 2 million cable subscribers and a season ticket base that is willing to fork over between $280 - $2000 per seat per game