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08 October 2006

Matier and Ross: Fremont more and more likely

Not much new in Sunday's Matier and Ross column other than a few quotes from Alameda County Supe Scott Haggerty, who exudes confidence if not actual details. One sad note: the A's and the incoming Dellums administration have not spoken since the election.

I've stumbled upon a few things that may shed a tiny bit of light on the situation:
  • In recent interviews, Lew Wolff hinted that at the end of the ballpark lease, it would be owned by the City of Fremont, not the A's. That indicates that the land on which the ballpark would site would also be owned by the city - if not immediately, then later. Does this mean that part of the deal is the A's giving the ballpark to the city? Or that the A's would buy the land, give it to the city, then have the city arrange a cheap/free ground lease for the A's? Obviously, after 30-40 years the ballpark will have depreciated significantly. It may not sound like it makes a huge difference whatever way it's structured, but for the A's there could be sizable tax implications.
  • For those of you wondering how the existing Pacific Commons land deal works, here it is: ProLogis (formerly Catellus) owns the land. Cisco paid for a 34-year ground lease in advance, with the notion that they'd build a large campus there. The networking giant paid $105 million in prepaid rent as a result. If you're looking for a baseline for negotiations between the A's and Cisco, there you have it. There may be some inflation-related adjustment, but the figure itself is interesting. Consider this: Lucas Oil is paying $120 million over 20 years for naming rights to the new stadium for the Indianapolis Colts, while the University of Phoenix is paying $154 million over 20 years for naming rights for the Arizona Cardinals' new digs. If you're the A's, you can either swap the naming rights for ground lease transfer, or you can buy Cisco's lease rights and then get (some of/all of) the money back in the naming rights deal. Which sounds simpler? There are some complications in that the land on which housing would be built would have to be purchased instead of leased.
Right about now, I'm eager to see a plan.

21 comments:

Bleacher Dave said...

The A's can barely give away their naming rights, and the Warriors can't even do that?

$105 Million? Show me the money.

What do you make of Scott Haggerty being the quote meister in the M&R article? Since its his district - there's no news from him.

Wolff & Fischer droppin dollars acquiring the surrounding property is surely a sign of their belief.

Anonymous said...

Wolff and the current ownership don't care about Oakland. It's just like the Detroit Pistons. They feel Oakland is unsafe and a ghetto, so they move to the suburbs of Fremont. They don't want to invest in Oakland for redevelopment. This is like the "Detroit" Pistons moving to Auburn Hills.

Marine Layer said...

Thanks to some strange gerrymandering, Pacific Commons is not in Haggerty's district. It's actually in Gail Steele's district. So if you're not seeing Steele put up much resistance, there's a reason.

Jeff said...

Curious and Curiouser. It looks a little bit like the future picture of the A's is beginning to solidify. One supervisor speaking freely of a major construction project in another's area is slightly intriguing. I wonder why Mrs. Steele remains quiet about the deal?

All in all, I like the deal. It makes sense for the A's and for Fremont/San Jose. I wonder if there is a possibility of a last minute "reconsideration" on the part of Mcgowan concerning territorial rights to Santa Clara county? Surely he realizes that a move to Fremont is tatamount to the A's moving to SJ. And he gets nothing. Guess we will have to wait and see.

Georob said...

I don't think the Giants care so much about San Jose as much as they do about Palo Alto, Sunnyvale, Los Altos, and Cupertino. The further northwest from San Jose you go, the more you get into a more established and affluent fan base that historically has supported BOTH the Giants and 49'ers quite well.

That's what Peter Magowan really wants to protect. And while Pacific Commons is closer to Palo Alto than ATT Park, it's not as close as Great America, which is where the Giants really wanted to build a park, not Downtown San Jose. That's why the territorial rights
were created to begin with.

And I don't care how close Fremont is to San Jose. It's still in Alameda County, which still ties it to Oakland.

Anonymous said...

Poor poor Coliseum

ragged on to no end

actually it ranks right near the top of all mlb stadiums in one measure this decade

now this is a stat that you dont hear alot about, but one that I bet most people would agree is fairly important


what is this stat of which i speak?

WINS



I often envision this scenario where the A's finally get thier wonderful brand new shiny stadium, and promply win 60 games that year


LOL how the poor Coliseum would grin on that

Anonymous said...

Bleacher Dave, way to go over at Oaklandfans.com

BD has their panties in a blender pointing out their hypocrisy...

Hope you survive the ensuing assault on your character over there...

Anthony Dominguez said...

How do I say this politely Rob?...YOU'RE SO FRICKEN WRONG ABOUT THE SOUTH BAY! (notice no profanity R.M.). Must I remind you from the blogs of late August...IT'S THE SILICON VALLEY CORPORATE SUPPORT THAT IS OF UTTER IMPORTANCE TO THE GIANTS!! Others have stated the same; Magowan could care less about the single-game fans who fight up 101 (or take the slow train) every now and then to AT&T (I travelled up 101 this morning from S San Jose to SFO and it stunk!). Combine a Giants team that will resemble the Raiders very soon with a spanking new ballpark in Fremont, and the Giants loose Silicon Valley! Plain and simple. And regardless of county lines, Fremont is a part of Silicon Valley (Amen to Mark Purdy!). Rob, do you even live in the South Bay? No hard feelings brother, I enjoy your posts...PEACE!!

Bleacher Dave said...

Didn't the Pistons just build a new stadium Downtown Detroit? I'm pretty sure they've left the palace.

Pacific Commons development may not be in Haggerty's district, but it will surely benefit his district and increase his stature. He is the guy most identified, albeit erroneously, with that area.

jrbh said...

I don't know much about Scott Haggerty, but I know this: if he thinks being the guy who made the A's stadium in Fremont happen is going to help his political career, I'd like to introduce him to Mary King.

Anonymous said...

"Didn't the Pistons just build a new stadium Downtown Detroit? I'm pretty sure they've left the palace."

Nope--The Lions and Tigers built new facilities in Detroit, and the Red Wings would like to. The Pistons are in Auburn Hills for many years to come.

Georob said...

Tony, Silicon Valley corporate interests by and large see themselves as part of the greater Bay Area, not just Santa Clara County. And if they're inclined support the Giants, they'll continue to do so. Having the A's in the South Bay certainly makes it more convenient, and these companies will certainly re-consider sponsoring them and many will, but that's as far as it will go.

But for the umpteenth time, San Jose is NOT this big, undiscovered market waiting for major league baseball. If it were, then San Jose officials should have been able to make the case to Bud Selig and the owners to drop the territories. They didn't.

And leave the cheerleading to places like Charlotte and Nashville. (BTW, They're not getting a team either.)

Jeff said...

You may have a point concerning the cities north of SJ, but the A's will not neccessarily need those particular population centers. People will follow the path of least resistance, and if it's easier for them to go to ATT park, that's where they will go. If Pacific Commons is easier to reach, then they will go there. Corporations can be counted on to to with the "easiest" path. The A's will have little trouble selling all their corporate suites, especially since they will have the newest trinket in the area. Money follows money. It always has.

I don't quite follow your reasoning concerning the SJ city officials and Bud Selig. You make it sound as though Bud is an impartial arbiter and would have erased the Territorial rights if he deemed that that was the "fair" thing to do. Nothing could be further from the truth. Selig's job is to maintain peace within the owners group and to enhance their financial footing. Those are the only arguments he would lend credence too. If dissolving the TR's could be done without inciting the ire of Mcgowan, he would have done so as it would place the overall league in a better financial position. There would be one less team drawing on the revenue sharing which would please all the other owners. But he is not willing to pit owner against owner to do so. If Mcgowan could not be conviced to "sell" his rights, (and Wolfe tried) then the A's would have to settle for the next best option. Which is Fremont. Which will probably turn out to be good enough for his purposes....and never mind what's right for the citizens of SJ. That was never really a consideration. About the same as the citizens of Oakland.

It has been and will always be about money.

Kevin said...

To Anon: There's plenty of evidence that Ballparks don't really bring the economic boon that many of their proponents claim. So it's not like building a new park would help elevate any population in Oakland to prosperity. Also, it's not the Piston's fault Detroit's a shit-hole. I mean, I hear it's getting better, but the city had been terribly neglected and blighted.

Georob said...

The argument I hear over and over from the San Jose cheerleaders is that the area is so large, so dominant, and so wealthy, that it should be able to support a baseball team by itself.

I agree, it can and it should. The problem is that Selig and the owners believe that a baseball team in Santa Clara County would hurt the Giants significantly. All San Jose leaders had to do was to convince MLB that's not the case and I'm convinced the territories would have quietly went away.

But look at the comments from people like Tony. They know all too well that the Giants would be hurt by this, they don't care and instead say:. "SCREW THE GIANTS", "SCREW MAGOWAN!"

That's fine for blogging, but it's not going to get MLB owners to change their mind, which is why I compare them to how baseball boosters in places like Charlotte and San Antonio would act.

Fremont is different because it's IN THE A'S TERRITORY ALREADY! Oh sure, the Giants will still complain, but I've been convinced for years that what Magowan really wants is for the A's to leave the Bay Area altogether. He's not going to get that wish.

Dismiss the fact that the A's will still be in Alameda County all you want, San Jose fans! The fact is that it's good old Alameda Co that's keeping the A's from moving to Las Vegas, from moving to Portland, that's getting the South Bay it's baseball team.

So Tony, every day the A's play at Pacific Commons you get on your knees and thank the good Lord for Alameda County and it's county seat in Oakland.

anthony dominguez said...

The only people I'm going to thank while watching the A's play under the Fremont Sun are Wolff, Fisher, Schott, Beane, and San Jose's DiNapoli Family! They tried to make it happen in San Jose, but the Giants/Magowan wouldn't budge. Now they're going to make it happen on the Alameda/Santa Clara Co. line, 11 miles from Downtown San Jose, and I'll be thankful for that! The throngs from Baseball San Jose and Silicon Valley will be at Cisco Field at Pac Commons, I'll be their, Rhamesis, as well as many from this site...and we'll all live happily ever after! Coming soon Rob...Your SAN JOSE A'S OF FREMONT!

Jeff said...

Rob,

OK, that makes a little more sense to me. Anyone can see that SJ is more than capable of supporting a team entirely on its own merits. I wasn't sure you accepted that premise.

I don't quite follow your logic on the Giants being harmed by a move to SJ. Of course, I agree with you that a move to SJ will in fact hurt the Giants. That's probably one of the reasons I support the move! However, don't you think your argument may be implying that Mcgowan is a fool in business? If the A's go to Fremont (as looks likely), that is going to hurt the Giants just as much as a move to SJ proper. If there is nothing he could do to prevent a move, why wouldn't he negotiate the rights to Santa Clara? At least he would profit from the move. As it is, he gets hurt and gets nothing in return. I completely agree with you in that any move in the bay area is going to affect the Giants negatively. The A's will have the newer park and will get the typical "Oooh and Ahhh" reaction. That translates to lost buisness for Mcgowan. I find in unlikely that Mcgowan would think it possible to keep the A's in the dank and dingy coliseum. And really, where else is there to go except to the south bay?

James said...

It's funny, but I don't recall seeing or hearing any evidence that Wolff ever gave serious consideration to San Jose or SC County. There seem to be a number of posters on this site who operate under what I consider to be a misapprehension. Fremont in general, and Pacific Commons in particular, have several attributes that SC County doesn't and, at least in the forseeable future, can't offer.

First, BART WSX is going to happen. There may be delays and bumps in the road, but the plan is in place and the need for it is uncontroverted.

Second, Let's be clear, Wolff wants not only a stadium, but a village centered around the stadium. This is what will fund the ballpark! As with Oakland, the options in San Jose or Santa Clara are limited.

Third, if he can't fund the stadium with a ballpark village (which space limitations pretty much preclude), building the ballpark in SJ would require public funding, public approval and a several-year delay. Residents of San Jose have already demonstrated that citizen approval is unlikely. So why would Wolff waste time and money on something that probably won't come about anyway?

Fourth, I don't see any tangible benefit to moving the A's across an invisible line (Alameda/SC County line) over moving them two miles short of the invisible line.

Which leads me to...

Fifth, with no tangible benefit to being within SC County lines, why would Wolff pay Mcgowan one red penny? I've heard a lot of people say "Mcgowan should just negotiate with Wolff." But negotiations require at least two ready, willing, and able parties. There is no evidence that Wolff would be willing to pay for the "privilege" of bringing the A's over the imaginary line, only to encounter other possibly insurmountable obstacles down the road. I believe I've seen on this blog the hypthetical $50 million figure for buying Mcgowan out. $50 million for what? The privilege of moving next to Great America. All things being equal, that wouldn't be a bad location. But all things aren't equal. $50 million... that's probably pretty close to the construction costs of the hotel (and the hotel would at least probably be a money making venture for him whereas $50 million to Mcgowan wouldn't be!).

Here's to the Silicon Valley A's of Fremont!

Jeff said...

James,

Wow, interesting arguments and something to think about. Your argument from Wolfe's possible point of view seems to have a lot of merit. Why would Wolfe give money away if it wasn't neccessary. We know he did talk to Mcgowan about the TR's, but nothing came of it.

anthony dominguez said...

I agree with Jeff; those are excellent arguments James made regarding Wolff and San Jose. Before I counter, let me just get this out of the way (Rob!)...the A's aren't coming to Downtown San Jose and will set up shop (eventually) in Fremont. VIVA SAN JOSE, SILICON VALLEY, AND FREMONT! There, now I'll continue. For those of you who don't know, Downtown San Jose is Wolff's "baby." I've had an interest in San Jose redevelopment for over 20 years, and Lew Wolff's name (along with the DiNapoli's) has always come up when it comes to Downtown development and news. He created Park Center Plaza and has interests in numerous other Downtown properties. Mr. Wolff also has a history of trying to lure professional sports to San Jose; from the Giants to the Warriors. When it comes to meetings and discussions regarding the future of Downtown San Jose, Lew Wolff is always front and center. Now, what's the point to all my San Jose ranting? If Lew Wolff hypothetically had San Jose and Diridon South, he wouldn't need 100+ acres for a ballpark village. The "village" in San Jose would have been the Diridon/Arena redevelopment area (as well as other pockets scattered throughout the Downtown). In a sense, by bringing the A's to Downtown San Jose, Lew Wolff would have been helping his own cause; which is Downtown San Jose development ($$$!). That's why I think he would have paid Magowan for the rights to San Jose/SCCo; the returns would have been well worth it! Yes, Lew Wolff will make money in Fremont, but he would have made a heck of a lot more in Downtown San Jose! As a side note to end this barrage (I know you're loving it Rob), I present this: $5.9 million for 10 acres at Pac Commons, $5.7 million for ONE acre at Diridon South (with the City of San Jose making the purchases!). There's serious coin to be made in Downtown San Jose, and Lew Wolff knows this! Enough posting, GO A'S!!

James said...

Tony,

I don't disagree with anything you say, but I think we have different views of the possible outcome from Wolff's perspective. There is no doubt that downtown SJ is Wolff's "baby." But men of Wolff's calibre tend to have multiple children with multiple mistresses (metaphorically speaking, of course). To be sure, Wolff has a number of projects in a number of locations.

There is no doubt in my mind that Wolff, at one time, would have liked to bring the A's to San Jose and I also have no doubt that he made various overatures toward that end. But when you do the pro and con list, and begin costing out items to make it happen, I think that pretty much clinched it for him and for San Jose. I think that happened pretty early on in the process. And I think at this point, even if Mcgowan approached Wolff with an offer to transfer territorial rights, it wouldn't make a lick of difference to Wolff because of the obstacles he would encounter getting a stadium built in San Jose in the first place.

You are correct that Wolff is making serious money in San Jose. But I submit that he could make just as much or more in ballpark village-related development with the project he envisions in Fremont. The grandest of schemes for the Pacific Commons development would include highrise office buildings, thousands of housing units, and mega shopping facilities crowned by the ballpark. My bet is that Wolff is thinking big (evidenced by the fact that we now know he is buying up adjacent land).

Wolff also is in the enviable position of recharacterizing the mosaic of Fremont. He sees potential in the city, as have others before him but who have dropped their projects in the face of obstacles placed on them by city hall. Finally, the powers that be are working with someone and not placing the hurdles they have in the past, which caused project after project to fall by the wayside. (One need look no further than NewPark Mall for evidence of that!)