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.