On Monday the NBA Relocation Committee unanimously voted against relocating the Sacramento Kings NBA franchise to Seattle, marking a turning point in the long saga to secure a home for the struggling NBA franchise.
The effort to buy the Sacramento Kings franchise from the Maloof family was led by a group of Seattle investors including Chris Hansen, a hedge fund manager from San Francisco who quietly purchased land in the Sodo District in South Seattle where he had hoped to build a new 19,000 seat arena for the Kings to be relocated to Seattle.
Hansen admitted earlier that if he acquired the Kings from Sacramento he would seek to rename the franchise the Seattle Supersonics, resurrecting the former NBA franchise that abruptly left Seattle in 2008 after Supersonic owner Howard Schultz sold the franchise to Oklahoma oil businessman Clay Bennett who received approval from the NBA Relocation Committee to move out of Seattle and relocate the NBA team to Oklahoma City despite facing strong public disapproval across Seattle.
In 2008 when the Seattle Supersonics were being sold to Clay Bennett and his Oklahoma group of investors, NBA Commissioner David Stern said that Seattle’s 17,000 Key Arena, which was built in 1967 for the Seattle Fair and later used to host NBA games for the Seattle Supersonics, was unacceptable by current NBA standards.
Stern and Bennett had a difficult task convincing state and city lawmakers in Washington State that they should approve funding of a new arena at a time in 2008 when the Great Recession was picking up momentum across the state.
City and state officials in Washington State were reluctant to spend their shrinking public funds on a new arena deal in 2008, although it is true that Stern had identified problems with Key Arena even before the recession hit the region and did not like the revenue-sharing lease with the City of Seattle.
Stern and the NBA Relocation Committee later approved the relocation of the Seattle Supersonics because Oklahoma City already had a bigger and modern arena. The Oklahoma investment group also reminded the NBA that following Hurricane Katrina in 2005 the residents of Oklahoma City were successful in adopting an NBA team from New Orleans and selling out NBA games.
Meanwhile, the case was made by the NBA that government officials in Washington State were unwilling to work with the NBA to build a new arena and keep the team from relocating.
Yet when the New Orleans Hornets NBA franchise was officially “for sale” from 2010-2012 NBA Commissioner David Stern tightly guarded this NBA franchise from outside groups, allowing the team to be sold to local Saints owner Tom Benson who agreed to keep the NBA team in New Orleans.
The NBA also overlooked the fact that the New Orleans Arena only seated 18,000 and the struggling New Orleans franchise had attendance levels at the bottom of the league.
To many former Seattle Supersonic fans stung by the decision from the NBA, allowing their former team to be relocated to Oklahoma City while the NBA safe-guarded the New Orleans’ franchise from relocation, it all appears to be hypocritical and insincere.
The NBA seemingly went above and beyond the call of duty to safeguard the New Orleans Hornets from outside groups hoping to lure the team away from New Orleans while the same preferential treatment was not given to the Seattle Supersonics who were fast tracked out of the Pacific Northwest with no dissent from the NBA Relocation Committee.
The Move to Acquire the Sacramento Kings
In January 2013, Chris Hansen’s Seattle group, which includes Microsoft CEO Steve Ballmer and members of the Nordstrom family, announced that if the NBA approves their deal with the Maloof family they will buy 65 percent of the Sacramento Kings franchise, offered at $525 million, the highest bid of any NBA franchise, and then move the team to Seattle.
Hansen was successful in working with Seattle and King County officials to obtain $200 in public funding and approval for a $490 million proposed arena with his group funding the other $290 million.
Sacramento Mayor Kevin Johnson, a former NBA guard, played full court defense against Chris Hansen’s Seattle Group in an effort to keep the Kings in Sacramento.
Mayor Johnson scrambled and was eventually successful in assembling a group of local investors who have shown resolve to keep the Kings franchise in Sacramento.
The Sacramento group includes 24 Hour Fitness founder Mark Mastrov, the Jacobs family which founded Qualcomm, and Vivek Ranadive, a minority owner for the Golden State Warriors and founder of the $4 billion software company Tibco.
The Sacramento Group matched the $ 525 million offer that the Seattle Group made for the Sacramento Kings, received direct support from NBA Commissioner David Stern, and gained the approval from city politicians for the construction of a new arena in downtown Sacramento.
The Seattle Group made a counteroffer for another $ 25 million to purchase the Kings, raising the final bid to $550 million. The Maloofs told NBA officials that there is a binding offer from the Seattle Group to purchase the Kings and it is their preference to sell the team to them instead of the Sacramento Group with their non-binding offer.
The relocation decision was finally reached yesterday by the NBA Relocation Committee who decided to prevent the Kings from relocating out of Sacramento.
After hearing Monday’s decision to keep the Kings in Sacramento, Mayor Johnson celebrated with his supporters.
Johnson wrote on Twitter: “That’s what I’m talking about SACRAMENTO!!!!! WE DID IT!!!!!”
But Johnson later voiced some words of caution to his supporters.
“It is not over yet,” Mayor Johnson said. “I feel like we have won a round in the playoffs. There is still work to be done. We do not want to dance in the end zone” he explained.
Sources have told the Sacramento Bee that the Sacramento group intends to put 50 percent of its proposed $341 million purchase price in an escrow account by Friday.
Disappointment in Seattle
Meanwhile, the reaction in Seattle from NBA basketball supporters has varied from anger to disappointment.
Lenny Wilkins, a Hall of Fame NBA Player and former NBA coach who was instrumental in trying to keep the Seattle Supersonics from leaving Seattle in 2008 told King 5 Sports in Seattle that he is disappointed in the NBA.
“I am disappointed in the NBA, I really am. The owners… certainly you want to do what is best for the league and everything else. And Seattle is a Tier I city” Wilkins explained.
“How do you not let that happen? I don’t know and so I am a little disappointed in the NBA today” Wilkins said.
Microsoft CEO Steve Ballmer was quoted by KJR-AM stating that he was “horribly, horribly disappointed” at the news.
Seattle Group Investor Chris Hansen released a statement Monday night to his supporters, claiming that the fight for the Sacramento Kings is not over.
“We have a binding transaction to purchase the Kings for what would be a record price for an NBA franchise,” he wrote, “have one of the best ownership groups ever assembled to purchase a professional sports team in the U.S., have clearly demonstrated that we have a much more solid Arena plan, have offered a much higher price than the yet to be finalized Sacramento Group, and have placed all of the funds to close the transaction into escrow. As such, we plan to unequivocally state our case for both relocation and our plan to move forward with the transaction to the league and owners at the upcoming Board of Governor’s Meeting in Mid-May.
“When we started this process everyone thought it was impossible. While this represents yet another obstacle to achieving our goal, I just wanted to reassure all of you that we have numerous options at our disposal and have absolutely no plans to give up. Impossible is nothing but a state of mind.’”
The Board of Governors, consisting of NBA owners will convene during the week of May 13 to vote on the final approval of the sale to the Sacramento Group.
Commissioner Stern reported on Monday that he “can’t predict” how the full Board of Governors vote will turn out in mid-May.
However, he ruled out the potential of granting an expansion team to accommodate Seattle’s desire for an NBA team.
“That discussion will have to wait for commissioner Silver (future NBA Commissioner) to oversee,” Stern said.
“Right now, expansion is not on the agenda. I would never say never. It doesn’t make a lot of sense unless we know what the new TV deal is.”