When I started this blog, I had no intention of ever covering the Magic's quest for a new arena, mostly because it has more to do with politics than it does with basketball. Now that the vote on the arena, performing-arts center, and Citrus Bowl renovations is under a week away, it's become an elephant in the room; it commands my attention, as the future of our beloved Magic, and of the city as a whole, hangs in the balance.
The Orlando Sentinel's Scott Maxwell posted in his 'Did You Know...?' piece this week that an out-of-town businessman offered the DeVos family $410 million for the franchise last year. The family declined and kept news of the offer under-wraps. Alex Martins, the Magic's Chief Operating Officer, is making that news public now in hopes of showing Orlando's citizens that ownership is committed to keeping the Magic in the City Beautiful. Maxwell offers a more detailed look at that situation in this post on his Taking Names blog:
I understand that it's Martins' job to make the DeVoses and the Magic look good, but if all this is indeed true, it should put to rest any concern Orlandoans have that the DeVos family are only interested in money. I may not be happy about Rich DeVos' contributions to Republican public-office candidates -- did I just get too political? -- but I am happy that he values the team enough to want to keep it here.As a backdrop, let me tell you the reason I wanted to talk with Alex in the first place: My curiosity about whether this whole arena deal was really just a way to help the DeVos family sell the team.
I had looked at the numbers and projections for a new arena over and over. And estimates from Forbes suggest the Magic will make a boatload of money over the life of the arena -- even if they tripled their current contribution. So I kept asking myself: Why wouldn't the Magic agree to pay more upfront, get the deal done and then laugh all the way to the bank as they rake in the dough for the life of the arena?
And then it hit me: Maybe because they're not going to be around for the life of the arena. Maybe because they just need a bucketload of taxpayer money so they can dangle a shiny new arena in front of prospective buyers.
That's the premise I wanted to run by Alex. I asked. He said no. I think I shrugged a bit, thinking "Well, what else is he going to say?" And then Alex said that he would reveal something he hadn't before: that the DeVos family wanted to hold on to the team so much that they turned down an offer to buy the Magic nine months ago ... for $410 million.
[....]
So what's the point of all that? Well, Alex said that if the DeVoses wanted to sell the team, they would've taken the $410 million offer, made up for all their losses (and more) and run.
Now that we know that the Magic organization is committed to the city, it's time that we show our commitment to it. David Whitley, also of the Sentinel, wrote yesterday of the consequences of not getting the venues built:
Our commissioners should call their counterparts in San Antonio and Tampa [cities which have recently built new venues for their teams] to see whether taking short-term political heat is worth the long-term gain. Because a "yes" vote will not be popular for one major reason: Class envy.He also points out that citizens cry foul when DeVos makes money, but not when his equally rich International Drive hoteliers do so. The only difference between DeVos and those other businessmen is recognizability; whereas DeVos is a household name, the fat-cat businessmen on I-Drive are anonymous. Newsflash: they're just as rich as DeVos, and they're more interested in expanding the gargantuan Orange County Convention Center, which caters to out-of-towners, than they are with revitalizing downtown, which benefits the people who actually live here.
Rich DeVos is very rich. His players are rich. You're probably not.
That doesn't bother some of you. Many venue critics have legitimate objections. But it's obvious from public hearings, e-mails and feedback over many years that a whole lot of people just want to show that DeVos a thing or two.
Who's an evil, greedy fill-in-the-blank now?
Magic fans, if you want to ensure that your team stays in Orlando for good, and if you want Downtown to be relevant again, I urge you to contact your district representative on the Board of County Commissioners. To find out in which district you reside, click this link to download a district map in PDF format. There are seven commissioners, and five votes are needed to secure funding.
When Dwight Howard signed his $85 million extension two weeks ago, he expressed a desire to retire in Orlando. "Me and Mickey Mouse will be here forever," he said.
For our sake, I hope he gets his wish.
3 comments:
To play devil's advocate for a moment, perhaps the reason the DeVos family did not sell the franchise for $410 million is because they knew it would be worth much more in a few years if a new stadium is built.
Maybe it would be best to look at it from this point:
Your neighbors ask you to go in with them on building a nice fence along the backyard you share.
You argue that they're only doing it because they want to increase the value of their home before selling.
"No, that's not true," Neighbor Ned says. "Why, just last month a prospective buyer offered me $500,000 for this house and I said no!"
Reassured, you fork over the $5,000 it costs for your half of the fence.
A week after the fence is finished, Neighbor Ned puts his house up for sale and pockets a cool $600,000 because the fence made his home more palatable to people with kids and pets.
Perhaps I'm overly cynical and DeVos isn't a greedy billionaire looking to fund his 15th mansion on the backs of taxpayers, but just remember that these owners are businessmen first and citizens of the community second.
You sure you don't live in Central Florida, Nuss?
Kidding.
I see what you're saying, but I still think DeVos is being genuine.
Have you stopped laughing yet?
Anyway, I don't pretend to understand economics, but Alex Martins told Scott Maxwell that the team will lose value once it gets its new arena:
But Alex argued that a new arena deal would also force the team to stick around (or face steep fines) through the term of the lease. And when a team loses portability, it loses value, he said. As evidence, the team cites recent hubbub around Nashville's hockey team, where buyers threw out bids much higher than the team's estimated worth, largely because they could take the team with 'em.
Again, I'm not an economic expert, but what he says seems reasonable.
I just don't want this team to move, and maybe that's clouding my judgment.
Well, I think if Alex Martins is your key witness in the defense trial of supporting building a new stadium, you really need to get another witness, because he's so obviously biased that his testimony would be thrown out of court.
By his logic, the New York Yankees will sabotage their team's value by building a new stadium next door to Yankee Stadium, the San Francisco Giants destroyed their franchise's value by building Pac Bell, the Mariners killed themselves by building Safeco, etc., etc.
In fact, all of those franchises ENHANCED their value with the building of their stadia. Why? Because they can now earn greater profits. Yes, portability can add to the value of a team (see Sonics, Seattle), but not as much as building a new arena.
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