Monday, February 9, 2015

Rays President Addresses Elephants and Economists in Room

Thanks to loyal reader Scott Myers, who passed along the Q&A Rays' President Brian Auld held with the Economic Club of Tampa today.  Some key takeaways:






CLARIFICATION: Myers points out Auld indicated 5,000 fans per night might mean $15-20M in revenue per season; the profit, and thus payroll influence, would depend on the cost of the new stadium.
I'd call this a good start to my New Year's wish for the Rays: increased transparency.

11 comments:

  1. These comments are aligned with what Sternberg said in the past 12 months. Sternberg is not the one that will move the team.

    Once that said, at least 5K-10K more fans per game is a big challenge considering that St. Pete is out of question in my mind. So St. Pete council must accept this fact and facilitate the search of a pitch perfect site with mass transit. Sternberg will not wait 5 years. 2-3 years maximum to get a new stadium agreement and a clear plan.

    Otherwise, Sternberg will sell partially or completely the Rays.

    Funny that all the comments from MLB (Selig and other) in the past 2-3 years are no longer mentioned. Does that mean those comments were not real ones or serious?

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    1. If the Rays do move to Montreal, it is a given that Sternberg would sell part of the team to a local (preferably French) business partner. He'd be foolish not to.

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  2. Clarification:
    15-20 million in increased revenue - no guidance from Brian Auld in how or if that translates to increased payroll.

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    1. My understanding is that a new stadium with higher attendance will increase revenues by 15-20M, so payroll will be higher 15-20M because of that. Once that said, depending on debt (payment for rent/paying their portion of the stadium), it may be lower than 15-20M.

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  3. Simple math
    $600 million cost for stadium = $38 million per year for 30 years at 5% interest. Rays will be looking for major bailout from taxpayers.

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    1. Especially if attendances are lower and lower in the next 2-3 years.

      For every dollars the Rays will invest into a stadium, they need some kind of warranty that there will be more money at the gate to compensate the additional cost

      Even worse, what Auld said is that it will take a generation (20-25 years) before young fans will have kids and will show up at the new stadium so attendance will stabilize and revenue stream will be more stable.

      This is why Montreal is way more appealing for MLB. With more than 100 years of baseball tradition and history, the story is completely different and no need to wait for a complete generation.

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  4. Based on the very very low number of news on this event over internet, just wondering how many journalists attend the event and how many people were attending the event too?

    0, 1, 2, more than 2?

    Does such appearance by Auld at this stage of the negotiation process was generating any hype or expectations?

    I have the feeling that the word apathetic is back again. Maybe I'm wrong.

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    1. Approximately 100 folks attend the weekly Economic Club of Tampa luncheons

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    2. Great crowd. So how many journalists in the room? I assume you were the only one taking notes to relay the information, right?

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    3. No journalists. ECOT members are business folks including bankers, lawyers, health care, accountants, real estate, a political person or two, etc.

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  5. Statement 1: Our attendance assumptions when we invested in the team in the current stadium were wrong. Statement 2: But here are our attendance assumptions for the new stadium we need you to purchase. Inference: Although our first assumptions were wrong, we need you to bail us out for our first assumptions and bet $600M that our second assumptions are right.

    And Auld obviously knows the MOU compensates St. Pete ZERO DOLLARS in exchange for the Rays exploring Tampa. The vote was a NO to an unfavorable deal. It was not a misunderstanding.

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