NBA Financing?

[Section 101]

One thing that hasn't ever been mentioned is the possibility of the NBA floating the loans on construction. They had a ton of money that owners were able to borrow at a low interest rate. So why not float the loan for a building?

 

[whozit]

Didn't the Maloofs already tap that line?

Secondly, I would be sure that the NBA would not want to set that precedent.

 

[kennadog]

NBA won't do that. What needs to be settled is how much the Maloofs are going to put in and I think Stern/NBA will be involoved in those negotiations to make sure the Maloofs don't screw up the deal.

 

[Superman]

Secondly, I would be sure that the NBA would not want to set that precedent.

I don't understand why not. They'd clean up on it. The NFL has a loan program for teams that are building new arenas. They provide $75 million to every team that builds a new arena. If two teams share, it's $150 million. And it's a loan.

 

[whozit]

I don't understand why not. They'd clean up on it. The NFL has a loan program for teams that are building new arenas. They provide $75 million to every team that builds a new arena. If two teams share, it's $150 million. And it's a loan.

The NFL is very profitable, the NBA just had a lockout to fix the system because of teams "losing" money. Additional loans are just an additional expense.

 

[Superman]

The NFL is very profitable, the NBA just had a lockout to fix the system because of teams "losing" money. Additional loans are just an additional expense.

Small market teams want profit sharing, and that would be an excellent way to provide it. NBA arenas don't cost as much as NFL stadiums, so you don't have to loan out $75 million, but maybe $20 million or something to subsidize the cost -- on a loan -- wouldn't be that big of a deal. Especially not when you're talking about maybe one or two new arenas every three years. You have cities that desperately need new arenas, and are struggling to get financing. If the NBA wants to keep those cities active, it would make sense to help them with some arena financing.

 

[Section 101]

The NFL is very profitable, the NBA just had a lockout to fix the system because of teams "losing" money. Additional loans are just an additional expense.

Yes the league is, but are their stadiums? The domes can be used year round, but others can't. Whereas, NBA arena's are available 365 days a year.

 

[Superman]

Yes the league is, but are their stadiums? The domes can be used year round, but others can't. Whereas, NBA arena's are available 365 days a year.

Right. Why can't the NBA have a lien on the building, where they get a certain percentage of all gate receipts from all events at the venue for the next ten years, or until the building lien is paid off? No reason the NBA can't make this kind of program work.

 

[JB_kings]

The NBA did get a line of credit that was split among the teams. From the stories I've read, the Maloofs dug deep into their allocation and that well is dry. If memory serves, the NBA had a role in facilitating the restructure of the infamous city loan to the Kings a few years after it was given. The NBA tends to look after their teams primarily and not get involved with the arenas. Their type of involvement is going to come from the team leasing the arena long term.