Note to Mayor Goodman: Las Vegas doesn’t need MLS franchise
This is Major League Soccer: If someone is willing to write an expansion fee check for $200 million and also build a stadium for another $200 million (at least), it would bring a franchise to Nome, Alaska.
It would go anywhere for the right price.
With the MLS, the devil is always in the details is right.
It’s just that nobody ever wants to know the details.
Here we go again with grand plans about Las Vegas and professional soccer, the City Council announcing it would consider a deal next week to build a new stadium on the site of Cashman Field to house an MLS franchise.
There is no guarantee one ever would be available, no certainty what would be the league’s 30th team in time comes to Las Vegas and not Phoenix or Charlotte or elsewhere.
But it’s the MLS and Las Vegas, meaning Carolyn Goodman will do everything possible, and then some, to make it part of her mayoral legacy.
Here’s the deal: The old model to get a franchise was for the league to convince municipalities to build stadiums in the suburbs, but then folks in such towns eventually figured out what a horrible use of tax dollars it was to support a venture that loses money.
That’s what MLS teams do. They lose money — $8 million to $10 million annually on average.
The way in which it appears Goodman believes Las Vegas can secure a franchise is via the new MLS model, which means a really, really rich investor (in this case, a hedge fund called the Baupost Group, managed by billionaire Seth Klarman) is represented by a second party (in this case, Renaissance Companies Inc.) to negotiate what is essentially a land grab for lucrative downtown property.
The model failed in Detroit. It was voted down in San Diego. It was approved in Miami.
How it would fare in Las Vegas is anyone’s guess.
If passed by the council next week, an agreement would be with Renaissance for a 180-day negotiating period to create a master plan to develop a stadium on 62 acres where Cashman Field exists.
Your typical MLS stadium sits on 10 to 15 acres.
You do the math.
Some critical points to wonder about as negotiations begin, because there is less-than-zero chance the council doesn’t vote to approve this first step: First, what is the financing portion of the stadium in its entirety? Is there one cent of public money involved?
Also, does the Baupost Group/Klarman get the land if they can’t deliver an MLS franchise?
We know, no matter what occurs, the Las Vegas Lights are reportedly here to stay.
Look. It doesn’t mean the model is wrong or that a development plan for urban housing and other such projects wouldn’t be good for this specific section of downtown.
But don’t think for a second — no matter what is said publicly — that either the Baupost Group or those from Renaissance are in this for the soccer. The land pays for the soccer because they know that part never turns a profit.
There is so much more to this, beginning with if the country’s 39th media market really needs to add another professional sports team and challenge for even more discretionary dollars.
Isn’t it time to pump the brakes a bit?
Where is an MLS team getting 20,000 fans to games in the middle of the summer here?
It’s not like there is a huge void for pro sports. This deal isn’t about market or community, which all the politicians and others involved will swear it is.
This is a personal move, be it for ego or economics.
The MLS is a closed-market league. Nobody knows how much any franchise is worth because it doesn’t say. Sell one, announce the price publicly, and then talk about how your league isn’t as bad off financially as some of the world’s leading economists say.
The league’s TV ratings have essentially remained flat since its inception in 1996, which means each team is earning annual TV revenue that’s on par with a Mountain West school.
These are the sorts of details a city such as Las Vegas should deeply consider before going down the MLS road.
My guess, though, is that any point against traveling it will be immediately countered with explanations in favor of such a project.
Why?
Goodman wants it for her legacy.
The hedge fund wants it for the land.
The Lights want it for their relevance.
Las Vegas wants it for, well … I’m not really sure about that one.
Contact columnist Ed Graney at egraney@reviewjournal.com or 702-383-4618. He can be heard on “The Press Box,” ESPN Radio 100.9 FM and 1100 AM, from 7 a.m. to 10 a.m. Monday through Friday. Follow @edgraney on Twitter.