04 August 2005

Gems from the AN Interview Part I

In today's post, I'm going to cherry pick some of Wolff's stadium-related quotes and analyze them. There's much to glean from the interview, so if you haven't read the entire transcript yet, check it out.

Wolff: "We have something like 7,000 season ticket holders and the Giants have 25,000. We have comparable records, comparable division wins and wild cards, but since the new venue was built over in San Francisco-- I'm not a scientist, but I think that does have some factor."
  • Both of the statements are a big deal. The last statement - that was the first I had seen anyone in the A's ownership discuss SBC Park's effect on the A's attendance. That's important, because it acknowledges that the Bay Area is one large market, not a split into SF/Peninsula, East Bay, South Bay, etc., with hard drawn lines.
  • I had been wondering why the A's didn't release the season ticket numbers, and Lew does just that at what is arguably the best venue: AN. 7,000 is a paltry number for a big league franchise. There are good marketing opportunities in the future should they choose to take advantage. One promotion that seems obvious is using the purchase of full season tickets at the Coliseum, and even multiple years' worth, as a way to get better positioning for season tickets at the new ballpark. By establishing a pecking order - established season-ticket holders first, then the aforementioned "transition" ticket-holders, then those who elect to buy full or partial plans when the ballpark opens - demand should be driven up among the fence-sitters, including yours truly. It could yield a good deal of upfront funding without the term "PSL" hanging over it.
Wolff: "Then the size of the market. I think with a great venue and great venue support--and I'm not talking about the city writing me a check for the venue-- I think we could do a lot better. We're the smallest two market team in baseball. And even the White Sox, and my good friend owns the team, suffers attendance in Chicago. You would think Chicago would have more than enough people to be selling out and they're 14 games ahead right now!
  • The experience of the South-Siders should serve as a cautionary tale: Don't site a ballpark just anywhere without further planning in mind. If you don't develop a social community around it (entertainment district or ballpark village concept), the chance that you'll struggle with attendance is higher. It's easy to have such hindsight considering the fact that The Cell was built in 1991, before the Camden Yards boom. Still, the parallels between A's and White Sox' market positions are striking, and are worth noting if only to prevent a repeat of the White Sox' situation.
Wolff: "We have some challenges and I don't think Steve and Ken Hofmann spent a lot of time on that. They were busy trying to make the team work. We need a new venue and we'd like it to be in the city of Oakland. If not, then in Alameda County. One of the things you're going to see in the next few weeks is that as soon as I say I need government help, everybody thinks I'm talking about a bond issue and a check. What I'm really talking about is someone who will say, my God if we can do a new venue here, what can we do to make it work financially for the developer and the owner? How do we clean up the environment and where is the site? So those are the things we're looking for."
  • Wolff is being nice to the previous ownership group. It was Steve Schott, after all, who spent as much, if not more time looking for a site in Santa Clara County as he did in Alameda County. On his way out, Schott admitted that he could have done things differently. His methods, including negotiation through the press, had alienated much of the existing fanbase.
  • Wolff has started to become pretty forceful about defining what he means by "public assistance." It's extremely important to get citizens to think about the project positively, so he's not just avoiding, he's downright denouncing, the idea of the blank check. This is in keeping with his previous statement about having most of the financing come privately, but it doesn't mean there won't be some public share, though that might be more hidden than upfront. Rezoning, partnering on cleanup, easing relocation of existing owners and tenants - these are all hallmarks of large redevelopment projects, and Wolff has done many of those. It wouldn't be a surprise to see Maritz & Wolff or associated companies get options to develop area around the ballpark once it's rezoned. That would pave the way for new residential or hotel development, or even office towers, though Oakland isn't hurting for office space right now. Developers would then get a good deal on land along with promises of less red tape or regulatory issues (ex.: percentages of affordable housing in new projects). It's being done in San Diego, Brooklyn, and to a lesser extent, in Oakland as well (Uptown and Oak-to-9th have both benefited from city help to resolve potentially sticky legal situations).
"Blez: So what you're saying is that you aren't necessarily looking for funds to build the stadium?

Wolff: The answer is this. Cities have things that are better than funds. I'll give you an example. They have the power to clear property. When you look around Oakland, it's a pretty built-up community. And when you look around the 880 corridor, it is not the world's leading aesthetic (laughing). But all kidding aside, it has BART, it has transportation. What we're hoping for down the road is that there will be some leadership on the public side, and when I say that people immediately say, oh, you want them to pay for it and hand it to you, but that's not true. We're going to get a lot of spins soon saying that if I want some city help on zoning or entitlements, meaning zoning, right away people will be writing letters saying that he wants us to do the same thing that we did for others and the schools suffer and so forth which is true. But we need to have as much creativity on the public side as we do on the private side."
  • This is probably as close as A's ownership will get to actually endorsing a mayoral candidate. Wolff's being intentionally coy, but it's not hard to interpret this as a plug for Ignacio De La Fuente, who so far has been the only Oakland official to have regular contact with Wolff. Wolff has been in touch with members of the Coliseum JPA as well, but it's the City (and maybe the Port) of Oakland that are getting first crack, then the JPA, then Alameda County.
  • The comment about zoning and entitlements is surprising in its candor. Wolff deserves credit for acknowledging the controversy surrounding entitlements. Though he doesn't mention it by name, it's quite likely tax increment financing would be used to provide some measure of funding for cleanup, improvements, and land acquisition. It is controversial because it is a redirection of a portion of projected higher property tax revenues to the project, instead of the city's general fund (which means potentially less money for services). TIF tends to be used in blighted or underdeveloped areas that need a jumpstart to promote economic growth. In North Oakland, there is a debate about the merits of having a TIF district in a place that clearly isn't blighted. Depending on where in Oakland a ballpark is located, it could be a sticky situation, since some of the redirected money could instead go towards city services. There is also the threat of eminent domain being used to acquire land, as was done with Uptown.
"Blez: I wanted to ask how your relationship is with Oakland's public officials right now?

Wolff: So far, it's been terrific, including the county too. Right now we're operating under the JPA (Joint Powers Authority). The reason for that is that they're our landlord and it does include both county and city officials. I think everyone is for doing something. We recognize that the area, especially the city of Oakland, has huge and much more important priorities from school systems to safety. But we're still going to need some acreage to build this ballpark and it was in a blighted area. Do we have the resolve to clear out the blight? Even if we pay for it. The problem is that there are too many of these little blip statements and I need somebody to interact with. And we'll find that person or group. There's been a lot of willingness to help and I think it's up to us to say what we would like if we had a magic wand. We'll be doing that very soon.

Blez: Where do you think the process stands right now?

Wolff: Unless there's a change, I'll be giving an update report soon to the JPA which will be a little more specific than it was a few months ago. That's all I really want to get into at this time."

  • The report to the JPA should be interesting, partly because of the nature of the venue development committee's discussions: they are working with the City of Oakland and the Coliseum JPA in parallel. The timetables will probably be different just because the JPA only has the Coliseum under its control, while Oakland has numerous potential sites to offer. The report should clearly indicate what the VDC's assessment regarding Coliseum feasibility really is.
"Blez: (Laughing) At first, the talk of location for the new stadium was the parking lot of the Coliseum, then it was a waterfront location and the latest that I've read is the Coliseum south area.

Wolff: There's a number of possibilities. All require some significant action on the part of the owner and the public body involved. For example, there are some easements and some power lines involved in the Coliseum land itself, which are things we could probably get by, but at the same time the dislocation of parking while we were building a ballpark would not be very fair to the Warriors, assuming they would agree to it. That isn't the point, but we'd have to be very careful on how to do that. So there's a bunch of balancing acts. We'll need to have private development to build just a ballpark and not take advantage of what it could do aesthetically around it. It seems like a lost opportunity to me."
  • The last two sentences together are the biggest indicator of what the A's are intending to do, i.e. a ballpark village concept.
  • Funny that the Warriors' parking issues are being considered, but the Raiders aren't mentioned, even though it's the Raiders' parking requirements that are greater.
I'll cover the walk-up situation and Blez's "Sacramento plug" in the next post.


The Cactus Leaguer said...

That guy from AN pulled off quite a coup in getting such a detailed, fascinating interview. Great stuff!

livinging on said...

absolutely differentiating analysis.
i almost missed it, thinking it might be just a rehash of the AN piece.

couple of comments/queries:
could the A's be able to make a case for a monolithic market? and thereby force their way into the southbay?

the stadium-hood concept is pretty convincing, but i think it would be more worthwhile in the south bay.
don't know much about the east bay, but imo the south bay might be the more affluent community, with sustainable revenues even in the off-season

Marine Layer said...

I doubt the A's will make any kind of case for the South Bay unless they have completely run out of options in the East Bay. And Wolff has said he won't challenge territorial rights. Making the case to other owners during the winter meetings is another matter. He could try to be diplomatic about it, but he's not likely to find many sympathizers.