The city of Anaheim, California is doing everything it can to play the part of Clay Bennett in a made for television movie about team relocation. Only the city is not as prone to backroom deals as Bennett was and prefers to air their interests and willing underhandedness out in the open. On Tuesday night the Anaheim city council unanimously voted in favor of a $75 million dollar bond package in yet another attempt to sweeten the deal for a potential move of the Sacramento Kings to their city. It appears that the Mighty Ducks and Angels were just not enough to quench the thirst of the less than 400,000 residents of the suburban city.
However, nothing is set in stone as yet. The Kings’ owners, Joe and Gavin Maloof, have until April 18, after requesting and receiving an extension from the NBA’s Board of Governors, to file the necessary paperwork for relocation.
Despite many believing that the Kings move to Anaheim is all but inevitable at this point, many obstacles could stand in the way of the Maloof’s business dealings. The Kings currently owe the city of Sacramento $77 million from a 1997 loan. Joe Maloof publicly stated that the Kings would repay all the money they owe the city of Sacramento if the team were to relocate.
That statement, however, means little to California state Senator Darrell Steinberg. Steinberg is looking into legislation that could block the Kings move to Anaheim unless they first repay their debt to the city of Sacramento. Clearly, a fight is brewing that will leave wounds for quite some time.
There is one man who looks to gain the most from this whole ordeal and that man is Henry Samueli. Samueli, a billionaire, owns the Mighty Ducks (yes, they have dropped the “mighty” but I grew up watching the movies that the team was invented from so it sticks) and is also manages the Honda Center, where the Mighty Ducks currently play and the future home of the Anaheim Royals. That is if a relocation occurs.
Samueli is pumping in $25 million of his own money to make upgrades to the Honda Center to appease Emperor Stern, who’s only concern is the quality of a facility and not that of basketball. It is not like players are the main attraction of basketball or anything. The upgrades would include new locker rooms and a practice court. On top of that, Samueli is also willing to front another $50 million in relocation fees which would be paid out to the other NBA owners. (Since the NBA currently owns the New Orleans Hornets one can only assume that they will also receive a cut of the relocation fees if and when the Kings eventually move.) Gee, this Samueli sure is a generous guy!
The potential profits that Samueli will stand to make if the Kings relocate are staggering. Being the manager of the Honda Center, he will oversee, and get paid for, 82 regular season games with both the Ducks and Royals combined. That is potentially twice as much revenue being brought into the arena on what would be an almost nightly basis.
Forbes estimated the revenue of the Kings at $103 million for the 2009-10 season. That same season the revenue for the Ducks was placed at $85 million by Forbes. If these numbers were to remain constant and the Kings were to relocate and play in the Honda Center, the combined revenue of these two franchises would net $188 million for the 2011-12 season, barring an NBA lockout, of course.
There is a clearly defined winner and several losers in this whole ordeal. Unfortunately, Sacramento is on the short end of the stick. Everything the Maloof’s are currently doing to secure a move to Anaheim is exactly what they refused to concede in 2006 to the Kings. Toss the Maloofs into the losers column as well. They are giving up everything to try to save their financial lives while alienating an entire fan base that has been loyal since 1986. Kings fans will likely find themselves the bedfellows of Sonics fans in what is sure to be a relationship based on spite.
“I hope we come up with some creative way to replace the cowbell,” Anaheim city council member Kris Murray said after the 5-0 vote in favor of the bond package. Murray must not understand the big picture or just simply has a knack for being coy with the media. Anaheim has already replaced the cowbell, they replaced it with Samueli.
Marcos Breton of the Sacramento Bee reported on the concessions that the Maloofs have made to Samueli in order to help facilitate a move to Anaheim. The brothers Maloof will only net 50 percent of the parking and food and beverage revenue from the arena. They will not have naming rights to the arena, Samueli alone has those. However, if the arena were to change sponsors the Maloofs would be entitled to one-third the money from a new naming deal.
The one pseudo bright spot for the Maloofs is that they will have 100 percent of NBA advertising inside of the arena and would receive 92 percent of the revenue from NBA ticket sales. Yet, they would receive no revenue from NHL games nor any other event or concert held in the arena. Can you guess who will receive the revenue not allocated to the Maloofs in the potential deal to relocate the Kings?
Anaheim should not consider itself a winner if the Kings do in fact move there. They are merely a tertiary element in the whole ordeal. Yes, they have the arena but they do not run it. When the legal squabbling stops and the dust settles Henry Samueli will be the one winning if the Anaheim Royals ever become a reality.