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May 6, 2008
Newark a Good Backup Plan for Nets
The NY Sun
By Evan Weiner
Moving the NJ Nets to Newark sounds like a sensible idea to a lot of people, especially the fan base, but is it feasible and how would the deal be financially structured?
Moving to Newark, on the other hand, is not necessarily going to be easy, and it may be a very tough sell. The way the NBA and NHL work financially may mean that Ratner will have to sell his team or become a part-owner of the Devils.
Getting the Nets into Vanderbeek’s building is simple on paper, but it is also extremely complicated, because of how revenues generated inside his building are distributed. Ratner would need access to monies from luxury boxes, club seats, and in-arena concession areas. Vanderbeek would theoretically have to give up lucrative revenue streams from NBA games that he would normally keep from non-Devils events in the building. But Ratner could not financially survive without getting the lion’s share of those revenues.
Vanderbeek and Ratner would have to create a partnership along the lines of those in Chicago, Dallas, or Washington to succeed. In 1988, Bulls owner Jerry Reinsdorf and the late William Wirtz, owner of the Blackhawks, decided to build jointly a new Chicago arena, sharing in its cost and sharing the revenues generated in the building. The partnership has grown over the years to include a share in a Chicago sports channel that is owned by Comcast, Reinsdorf (who also owns the White Sox), the Tribune Company (which owns the Cubs), and the Wirtz family. Reinsdorf and the Wirtz family are also cross-promoting the White Sox and Blackhawks, with events at both the arena and at U.S. Cellular Field, the White Sox ballyard.
Posted by lumi at May 6, 2008 5:51 AM