NBA hears pitches for Kings
NEW YORK -- There was a full-scale boardroom battle for the future of the Sacramento Kings in a Manhattan hotel on Wednesday involving dueling billionaires, politics and real estate.
It included a push from the Kings' current ownership to move the team to Seattle and a pitch by a Sacramento group led by mayor Kevin Johnson that he believes is compelling enough to thwart the move.
A month after saying the Sacramento group needed to improve its offer, NBA commissioner David Stern said the monetary offers from the groups "is not one of the issues."
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There's no good way to move a team from one city to another, but Seattle and prospective owner Chris Hansen at least are going about it honestly, writes Henry Abbott. TrueHoop
But the league might have to delay its planned owner vote on a matter that was scheduled for April 19 so it can sort through construction schedules, lawsuits and other issues that will truly separate the bids.
With the offers now apparently so tight, the city that can promise to get a new arena open fastest might end up with the edge.
"We've never had a situation like this," Stern said. "There's a lot at stake here."
Franchise relocation has been a relatively constant part of NBA business over the decades. The Kings franchise itself has called five different cities home since starting in 1948. But this situation is unique because the two cities fighting for the Kings now both have assembled compelling bids that include new, deep-pocketed ownership and competing arena deals with support of taxpayers and local governments.
In a league that has made generating cash and getting publicly funded new buildings a long-standing priority, it appears to be a win-win situation. But there's going to be a loser and a fan base without a team. Stern reiterated Wednesday there are no plans for expansion at this time.
The two sides made their pitches to a small group of owners and team representatives that make up the finance and relocation committees. That group will make a recommendation to the league's full Board of Governors on April 18 and 19. It was hoped this would be settled at that meeting, but now it's not clear when a final vote will be taken.
The Seattle group is led by investor Chris Hansen and Microsoft billionaire Steve Ballmer. They started this process rolling in January when they signed a deal to buy 65 percent of the Kings from the financially troubled Maloof family for $340 million and immediately put in a bid to relocate the team.
We heard a day full of extraordinary presentations of a complex real estate, arena, construction time lines, potential obstacles and team funding in two really great cities. ... Both sides made, in my view, very, very strong presentations.” -- David Stern
They have an agreement with city and county officials to build a $490 million arena in downtown Seattle to be open in 2017. The team would play in KeyArena for the next two-plus seasons until the new building was done. The Hansen group is putting in $290 million of its own money, not including $50 million already spent to buy real estate near the Seattle Mariners' Safeco Field.
Hansen presented a detailed plan to owners Wednesday and Ballmer, who has become known for enthusiastic speeches to Microsoft employees, closed by making a high-energy pitch. In a move that immediately angered Kings fans, George Maloof spoke on behalf of the Hansen group in an effort to get their deal accepted.
"We're optimistic," Hansen said. "The ownership group is very enthusiastic, and we appreciate the NBA has got a tough decision to make, and we're hopeful for an outcome in our favor."
Despite what is believed to be a compelling offer from Sacramento, the Maloofs clearly would rather see the team sold to Hansen and moved to Seattle than kept where it has been since 1984.
The Sacramento group has been put together over the past two months in an aggressive campaign led by Johnson. It is fronted by software magnate Vivek Ranadive with support from supermarket king Ron Burkle, 24-Hour Fitness founder Mark Mastrov and the family that controls communication company Qualcomm.
Ranadive, who is a part-owner of the Golden State Warriors, stepped up to take the lead in the group after Stern publicly said Sacramento's first bid wasn't strong enough. A major part of Randive's pitch is his link to his native India, a market the NBA is trying to develop. Stern has planned a trip to India next week to push the NBA brand there.
We left it all on the floor. We feel very confident with our story, very confident, and ultimately it's in the owners' hands to make a final decision.” -- Kevin Johnson, Sacramento mayor
Last week, lawmakers in Sacramento passed a term sheet promising $258 million of a $448 million arena project set for downtown. They are hoping to get the building open by 2015, though all timelines are loose and adding to the complex nature of the decision.
"We left it all on the floor," Johnson said. "We feel very confident with our story, very confident, and ultimately it's in the owners' hands to make a final decision."
NBA rules require 75 percent of the league's 30 teams to approve a sale and a simple majority of the board to agree to move the team. It is rare for teams to block sales and moves. The last time a sale was blocked was 1994 when a group attempted to buy the Minnesota Timberwolves and move them to New Orleans.
Two years ago, Johnson successfully lobbied the owners to block a Kings move to Anaheim. But the Seattle deal is a much bigger threat because it includes a new arena and a signed contract that values the Kings at $525 million, which would be a record for a team sale.
In short, this is going to be a tough call for the NBA's owners, who are hoping to get more information from both sides over the next few weeks. Right now, it isn't even clear which city is in the lead.
"We heard a day full of extraordinary presentations of a complex real estate, arena, construction time lines, potential obstacles and team funding in two really great cities," Stern said. "It was a long day without any breaks, and both sides made, in my view, very, very strong presentations."