For the past two years, the word around Los Angeles was that with billionaire Phil Anschutz involved, the NFL was sure to return in no time flat.
On Wednesday, the word around L.A. was that with Anschutz, viewed as a roadblock by some, planning to sell Anschutz Entertainment Group, the chances of the NFL returning immediately improved.
Fact is, with the L.A. City Council set to approve an environmental impact report later this month on a downtown stadium that AEG was supposed to build, this bit of news clouds the situation once again.
The NFL badly wanted Anschutz to be part of the deal, whether he just built the downtown stadium or bought the team. The reason is simple: Anschutz is worth an estimated $7 billion, although some people in the NFL think that estimate is drastically low.
How badly did the league want Anschutz? In December, NFL Commissioner Roger Goodell, New England Patriots owner Robert Kraft and Los Angeles Mayor Antonio Villaraigosa met with Anschutz at his home in Denver in an effort to convince Anschutz to improve his terms for a team that might want to move to L.A.
The rule of thumb in the NFL is that the league doesn't go to anyone. It has people come to the league. That wasn't the case with Anschutz. Thus, removing him from the process is not a positive.
"Anyone who thinks this brings more clarity to that project is not dealing in reality," an NFL team source said. "Dealing with Anschutz was hard, but at least you knew who you were dealing with. Do you think anybody is going to negotiate a deal [to move to Los Angeles] if they don't know who is going to run AEG or if that person is even interested in building that stadium?"
The counter to that, as L.A. Times columnist T.J. Simers noted, is that many people hope that billionaire doctor/biotech entrepreneur Patrick Soon-Shiong will buy AEG. The presumption is that Soon-Shiong (who is believed to be worth $7.3 billion) will then open his wallet, sweeten the deal for some team to move to L.A. or just buy one.
Yeah, just like that.
Here's an important lesson to be taken away from the whole Anschutz affair: Rich people are generally in the business of getting richer. If Anschutz thought he could make money by building a stadium in Los Angeles, he would have done it. He wouldn't be walking away from AEG in the middle of this process.
The downtown stadium proposal may be only days away from taking an important next step in the development process, but it's still light years from actually being built or from being an attractive enough proposal that some team will want to move there.
Despite all the confidence expressed over the past two years by AEG President Tim Leiweke (who said more than a few times that Anschutz was fully on board with this project), making a deal work is problematic. One team's estimate is that the downtown stadium is going to cost at least $1.5 billion and will likely be closer to $1.8 billion to make it the type of state-of-the-art facility that the NFL and Los Angeles would expect.
In fact, the team source said that the league might have to kick in $500 million to $600 million if it really wants to get this deal done. Don't expect that to get done without a lot of fighting around the league.
"Can you imagine what some other owners might say?" the source said. "Especially when you consider that the cost of a stadium in Carson or City of Industry would be a lot less and being downtown doesn't mean that much to the success of a team financially."
Thus, any hope of Los Angeles getting a team to agree to anything in the next six months is basically non-existent. As it is, the EIR legal process is going to take roughly six months to complete, meaning that no real negotiations between a team and AEG or AEG and the city can take place until the end of March. Sure, there can be plenty of talk, but nobody is signing anything before then.
But the bigger wrench is Anschutz, rumored to sell AEG for at least 18 months, dropping out and the questions that result.
Those questions go way beyond who is going to take over, be it Soon-Shiong or Larry Ellison or someone else. The deeper question is whether the next person in charge of AEG is going to be anywhere near as confident about the ins and outs of this project. Is that person going to be all that interested in the NFL?
Or there's this ominous question: What does Anschutz know that's causing him to drop out?
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"You have so many things that can cause doubt in the process," a Los Angeles-based source said. "Approving the EIR is probably not that big a deal because it doesn't put the city in a serious bind just yet. But if you think it through, it does commit the city to being part of the project emotionally. You can't build up all this hope and then have it come crashing down."
In other words, if AEG is able to convince a team to come to Los Angeles, the city is going to look really bad if it backs out on anything at the last minute and kills the deal. City politicians would be wise to think that through a little bit between now and the end of the month.
Then again, thinking clearly about the NFL doesn't happen much in Los Angeles these days.
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