What if Burkle or other Investor Group Steps in with 73M for Arena?

rainmaker

rainmaker

Hall of Famer
#1
#1
What is Burkle or another investor group steps up to the plate and funds the Maloof portion of the ESC? NBA would probably front the money as they offered with the Maloofs. No way Maloofs could ever leave with new arena being built.

In that scenario, they wouldn't be entitled to much of the revenue at all as they wouldn't part of the negotiations or agreement going forward. In this scenario, they stay at PBP for the time being while on financial life support. New arena being built without them negates any chance of them ever moving, and they also don't get the opportunity to make the profit in the new arena that they would have if they stuck with the original deal.

So, can't leave, but also can't make enough money in a new arena they aren't a part of to stay afloat and pay back loans/debt they owe. Wouldn't that basically force a sell, and have the team then move into new arena under new ownership?

Trying to be positive...
 
T

The Hammer

All-Star
#4
#4
jpsls said:
The problem is that there would be no anchor tenant for the new arena.
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Which would likely negate the possibility that the NBA fronts any money... but not a different investor. There's nothing stopping a Burkle or an AEG, or ****, a David Taylor or ICON, to come in and put up the other 73M. Course they'd have to negotiate something that would make it worthwhile. Perhaps some real estate development rights to the Taylor group? Also with half the naming rights (obviously not worth quite as much w/o an NBA team in it, yet).
 
nebs

nebs

Starter
#5
#5
That would be hilarious if there was a brand new arena downtown and the Maloofs had to play their games at Arco and can't go anywhere. lmao Just imagining it.
 
ParniValjak

ParniValjak

All-Star
#7
#7
This is a scenario that I have thought about.

KJ has said that Sacramento would be looking to build the ESC with or without Kings. Granted, it becomes a lot more difficult without the Kings because more often than not, you need that anchor tenant.

However, KC has an arena that is profitable without anchor tenant and KJ mentioned this in his press conference the other day in NY. The idea is not so much to "help out" the Maloofs but more so to play a game of chess with them where their attempts to relocate down the track are squashed.

They say they won't go anywhere but who exactly believes them?! They have told too many lies for anyone with half a brain to start believing them now. This is an attempt to position the team for relocation in the next 2-3 years when the dust settles a bit.

Obviously a lot the funding from all parties is dependent on having the anchor tenant which will have to be re-assessed. But if we can manage to drum up enough investors into this thing, then even if we do it without the Kings, the Maloofs pending request for relocation becomes even less legit.

Imagine we are having a ESC being built and its due for a completion before the 2016-2017 season. The Maloofs try to relocate saying that their building is no good and they need better arena to compete financially. The NBA and the BOG laugh their collective asses off when they hear this and point to their sabotaged deal and advise them that there is a ESC being built in Sacramento so they should go over there an negotiate with the same people they backstabbed so many times in the past.

This is one way the City of Sacramento would be able to have some sort of control over keeping the team. We have an arena and we are building it without a dime from the Kings. They are more than welcome to use it but we would have to agree to terms of lease. If the Kings didn't like this deal, there is no way they would like the deal where they did not assists in building the darn thing. So they would either have to pony up some cash on a long term lease or sell because there is no way in hell the NBA would allow the team to move under any circumstances if there is an Arena in Sacramento or if there is one in the works.
 
bajaden

bajaden

Hall of Famer
#8
#8
From what I understand, they built a new arena in Kansas City, and the arena is quite successful even without a major tenant. And, once again, the arena would be available for the olympics, which would bring in some serious revenue's for the city. In the meantime, the Maloofs who own PBP, would lose all the revenues that they would get from the Ice Capades, concerts etc., since they could be booked at the new arena. At some point they would have to agree to a lease agreement at the new arena, or sell the team.
 
ParniValjak

ParniValjak

All-Star
#9
#9
bajaden said:
From what I understand, they built a new arena in Kansas City, and the arena is quite successful even without a major tenant. And, once again, the arena would be available for the olympics, which would bring in some serious revenue's for the city. In the meantime, the Maloofs who own PBP, would lose all the revenues that they would get from the Ice Capades, concerts etc., since they could be booked at the new arena. At some point they would have to agree to a lease agreement at the new arena, or sell the team.
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No doubt but it would be extremely difficult to fund an arena without the anchor tenant. Not impossible mind you but really hard with the current financial situation. The City basically scrambled for the last cent in this deal and the whole framework would have to be re-done for the deal without the anchor tenant. In order to bring in the private investors, there would have to be something in it for them and not sure the city would get as much from the parking tender if there is no guaranteed 41 NBA games over the next 30 years.

Without the anchor tenant, I don't think the City can come up with as much as $255 million and also doubt that AEG would contribute as much as they have in this deal so the overall gap is not in the $73 million range but would likely be in excess of $100 million range which is one heck of a figure to come up with.
 
upinsmoke

upinsmoke

All-Star
#10
#10
Okay the maloofs played their card basically letting the NBA know that they are going to stay and collect revenue sharing checks. Now lets play ours and get back to the drawing board something im sure KJ is already exploring and finance the "owners" portion all by ourselves. With the maloofs out of the equation now is the time to take it back to the voters because it will truly be for Sacramento. I can see it now big name concerts and events downtown and those idiots getting laughed at by the BOG's when they try to file to relocate.
 
ParniValjak

ParniValjak

All-Star
#11
#11
upinsmoke said:
Okay the maloofs played their card basically letting the NBA know that they are going to stay and collect revenue sharing checks. Now lets play ours and get back to the drawing board something im sure KJ is already exploring and finance the "owners" portion all by ourselves. With the maloofs out of the equation now is the time to take it back to the voters because it will truly be for Sacramento. I can see it now big name concerts and events downtown and those idiots getting laughed at by the BOG's when they try to file to relocate.
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If you take this to the public this thing will NEVER happen. What KJ and his team needs to be looking at is how to get other investors interested and do what Kansas City did with their Sprint Center and that is have a profitable arena without anchor tenant.

In this scenario I am sure that AEG's contribution would be less than what they agreed to with Kings as the anchor tenant and I am also pretty sure that the City of Sacramento would not get as much from its parking tender than they would if there were guaranteed 41 NBA games each year plus all the other events. That is the big issue here. I don't think it is as simple as finding an investor that is willing to put in $74 million for the deal to go ahead. The whole financials would have to be re-done from the beginning to come up with a new financing plan and the projected revenue without the Kings as the anchor tenant.

It no doubt is easier with the Kings as the anchor tenant because they would pinch in $74 million, AEG is offering more because they have a guaranteed revenue stream for the next 30 years from the Kings games and Council would get more money from the tenders for parking as those that are bidding on the carparks can rely on there being 41 NBA games every year for the next 30 years. Take the Kings out of the equation and every party is willing to bring in a little less to the table which makes it a heck of lot more difficult to finance the darn thing. Public vote would kill it before it even starts.
 
hrdboild

hrdboild

Moloch in whom I dream Angels!
Staff member
#12
#12
Well, there's no precedent for this, but the NBA is about to get a check for $338 million from Tom Benson. Just sayin.
 
rainmaker

rainmaker

Hall of Famer
#13
#13
upinsmoke said:
Okay the maloofs played their card basically letting the NBA know that they are going to stay and collect revenue sharing checks. Now lets play ours and get back to the drawing board something im sure KJ is already exploring and finance the "owners" portion all by ourselves. With the maloofs out of the equation now is the time to take it back to the voters because it will truly be for Sacramento. I can see it now big name concerts and events downtown and those idiots getting laughed at by the BOG's when they try to file to relocate.
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Take it to the voters? Never. All we need is 73M from an investor which the NBA will likely loan if needed.

Voters are ignorant and uniformed for the most part. Have you not watched the city council meetings? You want those people voting on this?
 
kennadog

kennadog

Dog On It!
#14
#14
The NBA is not going to loan anybody money to build a new arena, except and NBA team owner.

Having said that, I've wanted a new ESC in Sacramento with or without the Kings ala Kansas City. It would serve the Maloofs right if the city builds a new arena anyway and they lose most of their non-NBA events. I don't see how they could survive as NBA owners without the other revenues and major capital repairs/replacement needed at PBP (like the roof). And they would have to keep making payments to the city on their loan or be foreclosed on.

And I don't see how the NBA could approve a move, if Sacramento was going to have a nice, new arena available. We'd have to build the arena to meet NBA standards, tho.

Anyway, I'm still in favor of building a new arena in Sacramento. Screw the Maloofs.
 
Warhawk

Warhawk

Give blood and save a life!
Staff member
#15
#15
kennadog said:
The NBA is not going to loan anybody money to build a new arena, except and NBA team owner.

Having said that, I've wanted a new ESC in Sacramento with or without the Kings ala Kansas City. It would serve the Maloofs right if the city builds a new arena anyway and they lose most of their non-NBA events. I don't see how they could survive as NBA owners without the other revenues and major capital repairs/replacement needed at PBP (like the roof). And they would have to keep making payments to the city on their loan or be foreclosed on.

And I don't see how the NBA could approve a move, if Sacramento was going to have a nice, new arena available. We'd have to build the arena to meet NBA standards, tho.

Anyway, I'm still in favor of building a new arena in Sacramento. Screw the Maloofs.
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I agree with this. I bet that is already being discussed.
 
Section 101

Section 101

All-Star
#16
#16
kennadog said:
The NBA is not going to loan anybody money to build a new arena, except and NBA team owner.

Having said that, I've wanted a new ESC in Sacramento with or without the Kings ala Kansas City. It would serve the Maloofs right if the city builds a new arena anyway and they lose most of their non-NBA events. I don't see how they could survive as NBA owners without the other revenues and major capital repairs/replacement needed at PBP (like the roof). And they would have to keep making payments to the city on their loan or be foreclosed on.

And I don't see how the NBA could approve a move, if Sacramento was going to have a nice, new arena available. We'd have to build the arena to meet NBA standards, tho.

Anyway, I'm still in favor of building a new arena in Sacramento. Screw the Maloofs.
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The question is what is the cost of building an arena that is not NBA ready, but can be made ready with additional money/buildout.
 
J

Jose

Bench
#17
#17
Section 101 said:
The question is what is the cost of building an arena that is not NBA ready, but can be made ready with additional money/buildout.
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^^ This. It would be the smart and fiscally responsible thing to do. Make sure it meets NCAA and other entertainment standards. Build it now for what we will use it, make it so it can be built up to NBA standards in, for example, a 1 year project.
 
D

Dreamtiger

G-League
#20
#20
I know, but there is once again talk of NHL expansion, particularly to another western market or two. But yeah it wouldn't be Burkle since he already has an NHL team.

Apart from that, what are some ideas as to how the railyards arena can be funded? It's not just coming up with the $70+ million that the Maloofs would've contributed. The parking lease wouldn't be worth as much without the guarantee of all of the NBA home games. So how does this thing get built?
 
Hoovtrain

Hoovtrain

All-Star
#21
#21
I think we are pretty much screwed. Listening to Amick on KNBR today, sounds like the Maloofs cannot afford to sell because they are already underwater so unless someone like Burkle really makes a Dodger type offer, they are not going to sell. There in lies why we are screwed. Just as they cannot afford to sell, they also cannot afford to be apart of this new entertainment complex. They are more than willing to ride it out in PBP, not spend the money to improve the team, continue to cut costs at the arena, collect revenue sharing, make a small profit with the team and continue their Sterling-esque style. Then down the road when PBP is completely obsolete, they may to allowed to move. So while we are probably going to keep the team for the next couple years (maybe), we are going to have to dealWith more cost cutting crap and continue to endure a mediocre product on the floor, despite what brilliant George thinks. Our best shot is for Petrie to continue drafting well, but we certainly cannot count on any help from the Maloofs, and may actually have to deal with more sabotage.
 
J

jpsls

Bench
#22
#22
Hoovtrain said:
I think we are pretty much screwed. Listening to Amick on KNBR today, sounds like the Maloofs cannot afford to sell because they are already underwater so unless someone like Burkle really makes a Dodger type offer, they are not going to sell. There in lies why we are screwed. Just as they cannot afford to sell, they also cannot afford to be apart of this new entertainment complex. They are more than willing to ride it out in PBP, not spend the money to improve the team, continue to cut costs at the arena, collect revenue sharing, make a small profit with the team and continue their Sterling-esque style. Then down the road when PBP is completely obsolete, they may to allowed to move. So while we are probably going to keep the team for the next couple years (maybe), we are going to have to dealWith more cost cutting crap and continue to endure a mediocre product on the floor, despite what brilliant George thinks. Our best shot is for Petrie to continue drafting well, but we certainly cannot count on any help from the Maloofs, and may actually have to deal with more sabotage.
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Are there any safeguards that would prevent the Maloofs from pocketing money received from revenue sharing?
 
Hoovtrain

Hoovtrain

All-Star
#23
#23
jpsls said:
Are there any safeguards that would prevent the Maloofs from pocketing money received from revenue sharing?
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Good question. That I am not sure of, but I would think not. I know with the amount of cost cutting they have been doing, they are actually turning a profit with the Kings. Deplorable. These bums have no business owning a ream.
 
rainmaker

rainmaker

Hall of Famer
#24
#24
jpsls said:
Are there any safeguards that would prevent the Maloofs from pocketing money received from revenue sharing?
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Not sure, but a good question. Another question. Some estimate the Maloofs borrowed 100M from the league, maybe more, maybe less but either way it was a lot. Just where the hell did it go? Sure didn't end up going to the roster, nor the coaching staff. Not the FO either.
 
slugking50

slugking50

All-Star
#25
#25
Dreamtiger said:
I know, but there is once again talk of NHL expansion, particularly to another western market or two. But yeah it wouldn't be Burkle since he already has an NHL team.

Apart from that, what are some ideas as to how the railyards arena can be funded? It's not just coming up with the $70+ million that the Maloofs would've contributed. The parking lease wouldn't be worth as much without the guarantee of all of the NBA home games. So how does this thing get built?
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Theres more likely to be contraction then addition.
 
slugking50

slugking50

All-Star
#27
#27
eflat said:
So the league can't force them to sell, but they can contract the Kings out of existence?
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No. I was saying there is more likely to be contraction in the NBA and NHL then adding 1 or 2 more teams.

I highly doubt that the NBA or NHL could contract a team without a teams blessing or the Players Associations.
 
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J

JB_kings

Starter
#29
#29
Contraction is not really an option despite some report from ESPN. If you can't force a team to sell, you certainly can't just make it go away. It's still an asset with enormous value even with the clowns running up a bunch of debt.
 
kennadog

kennadog

Dog On It!
#30
#30
I think the city should definitely consider finding another partner for a downtown arena. Basically I believe that, because I've always felt this was bigger than basketball. It would still be good for redevelopment of the railyards and downtown. Kansas City built an arean without an anchor tenant. So it's clearly possible.

To me, it would leave the Maloofs in a lurch. I can't believe they could get enough non-basketball events (that would prefer the new ESC). It would have to make staying at PBP financially untenable for them. PBP just could not complete with a new ESC downtown for events, especially the higher-end events that would bring in more money.

I would also think it would be hard for the NBA to approve a team move, if there was going to be a wonderful arena abvailable to them in Sacramento.
 
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