Sacramento or Seattle For NBA Basketball?

Sacramento Skyline Panoramicseattle skyline







On Wednesday at the St. Regis Hotel in Manhattan representatives from the city of Sacramento and Seattle met separately to make a last minute appeal before NBA relocation and finance committee members, claiming that their own city is better suited to be the home to an NBA franchise.

The NBA meetings in New York  this week are considered to be pivotal towards making the final decision, which was originally planned to be made by the NBA Board of Governors when it convenes in New York on April 18-19th.

However, according to a recent article from NBA.COM,  NBA Commissioner David Stern said on Wednesday that the expected vote in two weeks may be delayed because “questions remain about real estate and arena construction timelines, and owners may need more time to sort through them.”

New arena plans from both cities are on the NBA table but some lingering questions remain in the background, complicating the picture.

On Wednesday the Seattle group led by investor Chris Hansen, Microsoft CEO Steve Ballmer, Seattle Mayor Mike McGinn and King County Executive Dow Constantine articulated Seattle’s plans for buying 65 percent of the Sacramento Kings from the Maloof family and relocating the NBA team to Seattle after building a new arena, a feat that many NBA executives only a few years ago believed was next to impossible given Seattle’s often challenging political climate that was known for putting up barriers for public funds being used to support a professional basketball franchise.

George Maloof, representing the Maloof family, explained to NBA committee members that his family would like to deal with the Seattle group when it comes to selling the Sacramento franchise.

In January Chris Hansen’s Seattle group which includes Microsoft CEO Steve Ballmer and members of the Nordstrom family said that if the NBA approves the deal they will buy 65 percent of the Sacramento Kings franchise, which is valued at $525 million, and move the team to Seattle. A Kings sale price of $525 million would exceed the NBA record of $450 million for the Golden State Warriors set in 2010 and raise the value of the other NBA franchises on the block.

Seattle’s new arena proposal includes a $490 million arena for the Seattle Sonics in the Sodo district of Seattle, nearby their other two professional sports stadiums. The deal includes $200 million in approved public funds with the remaining money coming from the Seattle ownership group.

The $200 million in public financing would be repaid by arena related taxes, although the arena deal still faces some legal challenges from a longshoremen’s lawsuit and an environmental impact study.

The Seattle group announced during Wednesday’s meeting that they already had 1,000 businesses expressing interest in corporate sponsorships along with over 45,000 season ticket requests in a future Seattle NBA arena that has a seating capacity under 20,000.

Sizing Up Seattle and Sacramento

Seattle is a thriving northwest city with a metropolitan area of close to 4 million inhabitants, making it the 15th largest metropolitan area in the U.S. According to census reports, the Seattle-Tacoma-Bellevue Washington metro area had an average median wage of $64,085 in 2011.

Just an hour an half to the north of Seattle lies Vancouver, British Columbia the second largest city in Canada that was once home to an NBA franchise, the Vancouver Grizzlies, from 1995-2001 and still has many NBA fans willing to travel south to support a future NBA franchise in Seattle.

As the NBA seeks to expand its international marketing brand, a future NBA team in Seattle could provide a gateway for more international exposure in Canada and Asia. Seattle also has the 12th largest T.V. market in the United States and successfully supported the Seattle Sonics for 41 seasons until the team was sold to Clay Bennett in 2008 and relocated to Oklahoma City amid some public outcry. Five years later, Seattle is the nation’s largest city without an NBA team.

Proposed design of Seattle arena
Proposed design of Seattle arena

Sacramento is the capital city of California and has around 2 million metropolitan inhabitants, making it the 35th largest city in the U.S.  and the 20th largest T.V. market with 28 years of experience supporting an NBA franchise, the Sacramento Kings, currently the third worst team in the Western Conference.

Recent census reports indicate that the median household income for the Sacramento–Arden-Arcade–Roseville California metro area was $55,151 in 2011.

According to the NBA attendance record from ESPN, Sacramento ranks dead last  in 2013 among the 30 NBA teams in the league for supporting an NBA franchise, averaging only 13, 595 sports fans per game. In 2012 Sacramento ranked only slightly better at # 27.

On Wednesday the Sacramento group led by investor Mark Mastrov, investor Vivek Ranadive, Sacramento Mayor Kevin Johnson and California Sen. Darrell Steinberg attempted to convince NBA officials during their 2 hour presentation that Sacramento has a strong and viable NBA market with a brand new arena proposal.

Last week the Sacramento City Council voted to approve a $448-million Sacramento arena, consisting of $258 million in public subsidies that would potentially be built at the site of the Downtown Plaza.

However, a Sacramento group recently filed a petition to sue the city over environmental issues and the potential $258 million public subsidy. The rest of the money for the arena would come from investors within the Sacramento group.

The Sacramento group announced on Wednesday that they have $50 million in corporate sponsorships over the first five years in a new arena and 10,000 pledges for future season tickets to watch the Kings play games in a new arena.

Sacramento Mayor Kevin Johnson recently sprinted to the finish line and managed to assemble a collection of investors ranging from 24 Hour Fitness founder Mark Mastrov, the Jacobs family which founded Qualcomm, Vivek Ranadive, a minority owner for the Golden State Warriors and founder of the $4 billion software company Tibco, and Ron Burkle, a supermarket and retail titan.

The final decision rests in the hands of the NBA’s Board of Governors.

A sale of ownership must be approved by three-fourths of the 30 NBA Board of Governors (owners) while a simple majority is needed to approve a relocation of an NBA franchise.

Sixteen no votes are needed to deny the relocation to Seattle.

Only eight no votes are needed from the NBA’s Board of Governors to block the sale of the team to the Seattle group led by Chris Hansen and Steve Ballmer.

One of the crucial questions that the Board of Governors faces is the question about which city is better suited financially to support an NBA franchise in the future and promote NBA basketball among the other professional sports in America.

Another factor that the Board will have to consider before making their decision is the status of Sacramento investor Vivek Ranadivé who is the vice chairman of the Golden State Warriors.

Ranadivé would be faced with having to sell his stake in Golden State if his Sacramento group is successful in buying the Kings from the Maloofs.

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Johnathan Schweitzer


About Johnathan Schweitzer 1618 Articles
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