Question of the Day - 09 September 2024

[Editor's Note: This answer is provided by our inimitable business writer, David McKee. The opinions expressed herein aren't necessarily those of management.]

And the winning unicorn is … !

Seriously, there are shirkers and then there’s John Fisher. The man has a net worth of $2.1 billion and he’ll be damned if he puts one red cent of it into a new baseball stadium, based on his conduct so far. He spent years going through multiple Oakland mayors and moving the goal posts, to mix a sports metaphor. of what it would take to keep his cellar-dwelling team in the Bay Area. He’s proven no easier to pin down in Sin City.

If Fisher gets the vanity park he craves, it will probably be by suckering someone else into building it for him. Since Gaming & Leisure Properties owns the underlying land, it’s first in line to take the dive. 

In the unlikely event that GLPI decides to sell the land instead, don’t look for Fisher to buy it. We’re talking about 35 acres of prime Strip real estate that will go for top dollar (upwards of $1 billion). The jeans billionaire didn’t get rich by spending money on his baseball team, obviously, and he’s not shown the inclination to part with any long green — not even the $100 million that would trigger a public subsidy — to get a stadium built in Las Vegas.

Fisher would need to part with at least $850 million, presumably to be recouped from luxury skyboxes, sky-high tickets for the average fan, and pricey beer and popcorn. However, not only is Fisher spectacularly disinclined to open his own wallet, the firm he hired to scrounge up investors (Galatioto Sports Partners) has come up empty. As did Fisher’s offer to sell pieces of the team to prospective minority investors, who would have the privilege of paying for the stadium instead of Fisher. No takers on that one either.

The Athletics have asserted that various financial institutions are “excited” to lend $300 million. That excitement and seven bucks gets you a cuppa Joe at Starbucks. Not only is excitement not fungible, $300 million doesn’t even come close to getting the job done.

Also, the $380 million in public dollars that Fisher extracted from Clark County is contingent on the private-sector largesse that Fisher hasn’t been able to conjure up. Fisher’s mouthpieces claim they won’t need all $380 million, but that’s easy to say at this stage, with no cost overruns looming in their faces.

Ditto the supposed participation of Bally’s Corp., a company that has roughly $150 million cash on hand and is tapped out as a borrower. Bally’s made the grand gesture of “donating” nine acres to the A’s, but it wasn’t Bally’s land to give and the plan (taken for granted locally) that Bally’s will build some synergistic resort beggars credibility. Bally’s talks big, but is awash in debt, is going through a buyout that will leave it even more indebted, and couldn’t finance its Chicago megaresort without being rescued by GLPI.

Fisher having effectively taken himself out of the picture, the stadium will all but certainly be built (if one is built) by a third party, possibly on a different site. The Rio is willing to cannibalize some of its back acreage (of which it has plenty; our office looks out onto the entire lot) to put up a ballpark and it appears that it could be done there. 

Then there’s the huge collection of unused real estate that Station Casinos owns a mile to the west of the Tropicana site. The former site of the Wild Wild West was originally the site of the A’s stadium, but since that would've cost actual money, that deal quickly disappeared after Bally’s Chairman Soo Kim offered up the land he doesn't own. 

Ultimately, this whole mess lands in the lap of MLB Commissioner Rob Manfred, architect of the present crisis. He queered the pitch for Oakland, putting a heavy thumb on the scales of the negotiations, in part by making it clear he wanted the Athletics moved to Sin City, all other considerations be damned. 

Since his agenda was Vegas-and-nowhere-but-Vegas, we have nobody better than Manfred to blame for the standoff between a pinchpenny owner and the banking industry.

As for Vegas itself, it wanted baseball in the worst way — and that’s how it’s going to get it, if at all.