BY Art Thiel 06:30AM 05/16/2014

Ballmer’s words, NHL’s deeds suggest change

Steve Ballmer says if he has to own an NBA team outside Seattle, “so be it;” NHL commissioner and prospective Seattle team owners press mayor to change MOU to dump NBA.

Legendary sports industrialist Alan Rothenberg may be among those interested in n NHL team in Seattle. / Rene Macura

News of separate developments Thursday suggest a changing landscape for the fates of the NHL and and NBA in Seattle.

An NHL delegation that included Commissioner Gary Bettman and Deputy Commissioner Bill Daly, as well the prospective owners of a Seattle expansion team, met May 6 with Seattle Mayor Ed Murray and King County Executive Dow Constantine, according to KING5 reporter Chris Daniels.

Both officials confirmed the meeting and Murray told Daniels in an interview that the NHL was interested in an arena in Seattle, not Bellevue. The purpose of the meeting was to get the city to rewrite a document that would allow the first tenant of the proposed arena to be the NHL and not the NBA, as written. Murray said the city council is not inclined to change the memorandum of understanding.

Independent of the hockey interest was an interview Steve Ballmer gave the Wall Street Journal about his life after Microsoft. He made clear his interest in owning an NBA team, one that doesn’t have to be in Seattle.

Asked about his interest in the Clippers in Los Angeles, where he attended a playoff game and sat next to NBA Commissioner Adam Silver, Ballmer said, “I have nothing definitive to say. Am I right on top of what’s going on there? Absolutely I am.

“I love basketball, and I’d love to participate at some point in the NBA. If the opportunity is outside of Seattle, so be it. I will learn about any team that comes up for sale at this point.”

Asked if he was interested in the Clippers, Ballmer said,If I get interested in the Clippers, it would be for Los Angeles. I don’t work anymore, so I have more geographic flexibility than I did a year, year-and-a-half ago. Moving them anywhere else would be value destructive.”

If the words are a true reflection of his attitude, the statement is a shocker for Seattle fans eager for the return of the Sonics. Ballmer has been Seattle native Chris Hansen’s partner in a controversial arena project in SoDo, as well as in an intense pursuit to buy and relocate the Kings from Sacramento, a bid that failed one year ago by a 22-8 vote of the NBA Board of Governors.

Since the vote, however, at least four developments have impacted the partnership:

*Hansen in September was fined $50,000 by California election officials after he admitted he allowed funds under his control to be spent secretly on an anti-arena campaign dedicated to stopping a publicly funded arena in Sacramento. NBA sources have said that the stunt, and its detection, put Hansen, as a prospective owner, in a poor light.

*Against his will, Ballmer was ousted as CEO of Microsoft. A source with knowledge of Ballmer’s attitude said as time has passed, Ballmer feels some alienation from his adopted hometown. As the source put it, “If Ballmer sits courtside in LA, he’s surrounded by Hollywood celebrities. He sits courtside in Seattle, he’s surrounded by Microsofties.”

*Hansen’s chief political ally, Mayor Mike McGinn, lost his re-election bid to Murray, who has been largely non-committal on the arena. The city council, with the election of socialist Kshama Sawant, is even less inclined to support a project that its opponents label corporate welfare, even though there are no new or current tax revenues sought in the project’s financing.

*The arena project’s final environmental impact statement has been delayed until at least September, in part due to the slow provision by the Hansen camp of additional information on parking and transportation requested by the firm doing the EIS. The delay has allowed site opponents time to prepare a more comprehensive opposition. They have already labeled the draft EIS inadequate and vulnerable to litigation.

In addition, there are no teams on the NBA horizon remotely likely to be seeking relocation. The sale of the Milwaukee Bucks, the one team with an arena problem, was completed Thursday from Herb Kohl to Wesley Edens and Marc Lasry, New York-based billionaire investors, for $550 million. The new owners claim they are committed to finding a new arena solution. Ballmer, a native of Detroit, was said to have been serious in a bid for the team.

The NBA’s Silver has been clear that expansion is not a near-term priority for him. A vacancy in Seattle actually helps the NBA, because it can use Seattle’s stated desire for a return to extort lease concessions for teams from their local municipalities.

Against that backdrop, the NHL clearly sees an opportunity to be the only winter pro sport in the 13th largest U.S. market. With a new collective bargaining agreement and more lucrative TV revenue, the NHL, with 14 teams in the West and 16 in the East, is more eager to expand, which it hasn’t done since 2000.

KING reported that in the meeting with Murray and Constantine were three Los Angeles-area businessmen: Victor Coleman, CEO of Hudson Pacific Properties; Jonathan Glaser, managing member of JMG Capital Management, and Jeff Marks, managing director of Premier Partnerships; along with David Zimmerman, NHL general counsel.

Coleman, 52, leads a publicly traded company and, along with Glaser, are believed to be principals interested in owning an NHL team in Seattle.

Coleman’s real-estate portfolio includes 26 properties and two movie studios, plus four buildings in Seattle. The company website says Hudson Pacific owns the 83 King Building, 505 First, Merrill Place, and Met Park North in Seattle, along with the Northview Center in Lynnwood.

Marks is the managing director of Premier Partnerships, but he reports to its chairman, a man who may be the most influential in this group — Alan Rothenberg, one of the most knowledgeable and influential figures in American sports.

He was the CEO of soccer’s successful 1994 World Cup in the U.S., as well as the 1999 Women’s World Cup. Before that, he was head of the U.S. Soccer Federation, and before that was the Lakers’ top executive when Jack Kent Cooke owned the NBA team, then was president of the Clippers from 1982-90 under Donald Sterling.

He has been an instructor in sports law at USC, and is former chairman of the American Bar Association’s committee on sports law.

Rothenberg was honored by the SportsBusiness Journal with both the “Champions in Sports Business” award for his career successes and the “Sports Industrialist of the Year” award.

There was no indication whether Rothenberg is an active participant in the deal, or just an adviser. His involvement would add serious heft.

The NHL’s annual meetings are in June, so the unprecedented visit by the commissioner to a market without a team suggests the inquiry is serious and immediate. An expansion would be, at the earliest, for the 2015-16 season, by which point the Hansen project presumably would be in the clear, or dead.

But any award of a franchise would be burdened with playing two or three years at KeyArena, which has only about 11,000 seats from which both goals can be seen. But the NHL has a recent history of playing in temporary buildings while a new one is built.

However, there is one solution that would eliminate the council’s obligation to move the MOU away from the NBA — funding privately a new building, whether partnering with Hansen; a purchase of Hansen’s approved site; attempting a vast remodel of the Key, or creating a new building elsewhere at the Center, most likely at Memorial Stadium.

That’s a lot of maybes. But a possible exit by Ballmer from a Seattle NBA bid, coupled with an apparent urgency by the NHL, has a real possibility to change the sports conversation in Seattle.


YourThoughts

  • jafabian

    The NBA made a mistake leaving the Seattle/Tacoma market. Since their departure the Sounders have swept in and not only took control of their fanbase but made a stamp of their own. If the NBA were to return or the NHL to come here they’ll have to go head to head with them for the fans sports dollar and the Sounders have the early lead on that. Hopefully Bettman has started something here. This is the first time I’ve seen any sort of semblance of an NHL ownership group and the NBA connections could help in getting the Hansen arena to happen which is integral in getting the NHL to come to Seattle. There’s a sliver of hope but not getting them up yet.

    Between Bettman and Rothenberg there’s something of an NBA connction here and its possible that Ballmer is trying to work with Silver on getting the NBA here. If Ballmer, like Hansen is with the Kings, can become a minority owner of another team that would help when expansion comes up or if another team might change cities. Like with the NHL I’m not getting my hopes up. The denial of Hansen’s bid for the Kings illustrated just how the NBA continues to sit in its ivory tower depsite the fact that Emperor Stern has been thrown down the Death Star shaft. Personally, I think he’s still calling shots to a degree.

    • art thiel

      From the NBA perspective, the move to OKC has worked, and so has the vacancy in Seattle, in terms of using it to drive up the value of every other franchise. They obviously bear a national scar from the foul deeds perpetrated in Seattle, but it hasn’t hurt its bottom line, which is the only concern.

      Ballmer knows the way forward for him is through minority ownership. I don’t think his disregard of Seattle is a tactic. He may think Seattle doesn’t want the NBA, and he doesn’t want Seattle.

      • 1coolguy

        Why Ballmer didn’t buy the Sonics when Schultz sold them has always been beyond me – did his position @ MS prevent that? The chump Schultz sold them for a bargain price, given the lack of suitors, and I thought Ballmer could have assembled a group, if need be, very quickly, let alone write the check himself. Now he’s chasing the NBA around like a dog chasing his tail – it won’t happen in Seattle so his ownership in another city may be how he quenches this thirst.

        • jafabian

          Because Schultz didn’t make the sale of the Sonics public. He purposely sold them to an out of town buyer in order to stick it to the city officials that he found difficult to work with. If anything, why didn’t Paul Allen buy the Sonics when Sam Schulman was selling them?

          • Kirkland

            Schulman sold to Ackerly in 1983, and I’m not sure if Allen was a Microsoft mega millionaire then. I’m certain Allen would’ve liked to have owned the Sonics, but with Ackerly eventually owning the team until 2001, Allen did in 1988 what Ballmer looks like he’s trying to do with the Clippers: buying another team.

          • art thiel

            Allen also tried to buy the Sonics from Ackerley, but Ackerley was offended and moved Allen’s season tickets off the floor and up into the stands. That move was quickly nixed.

          • art thiel

            Ballmer had to know the Sonics were for sale. Schultz had 57 partners and they all knew the club was for sale, and Ballmer knew many of them. He didn’t want to do it then.

            Schulman sold the Sonics to Barry Ackerley in 1983, three years before Microsoft went public and made Allen wealthy. Allen bought the Blazers in 1988.

          • RadioGuy

            But Schultz DID make it public. I clearly remember him stating that he was initially offering the team for sale to LOCAL BUYERS ONLY, and at a price lower than he could get on the open market. I remember as well that neither Ballmer nor anyone else in Seattle stepped up and bought the Sonics so Schultz had to make the team available to all qualified bidders.

            As much as Schultz has been painted as a villain for selling the Sonics to Bennett’s group, the fact is that there was a window of exclusive opportunity for locals to buy the team first. They sat on their hands instead, and no revisionist history will change that for those of us who haven’t forgotten. I’m not a Schultz fan (the guy must be the Barnum of our time to con so many people into spending $3 for a freaking cup of coffee), but I think he’s getting an unfair rap.

          • Jared S.

            Do you have a link to a news article of him publicly announcing that the team was for sale? All I remember is talk from the team of “exploring options” like going to Bellevue and building a new arena with private money.

            Here’s an article from about a month before the sale in which Stern indicated that Schultz would keep trying to get an arena deal until the lease ran out in 2010. No indication that the team was definitely for sale:

            http://community.seattletimes.nwsource.com/archive/?date=20060610&slug=soni10

            I don’t think the mayor or council knew the team was for sale, since they made several counterproposals that Schultz ignored.

            Also, before you waste any more time defending Schultz, you might want to read this article written by someone who worked for him:

            http://deadspin.com/5907371/howard-schultz-gave-out-350-starbucks-gift-cards-an-insiders-notes-on-the-shabby-death-of-the-seattle-supersonics

          • art thiel

            Schultz and all pro sports owners know there is a local price and and an out of town price, which is always higher. Once the Phoenix Suns sold in 2005 for $350M, Schultz was going to take the highest bidder regardless of his driver’s license.

            You’re right that no local stepped up, but it’s also true that he quit on seeking arena funding when the going got a little tough, and he refused to put much money in the project. He said he was merely a steward of a civic icon. Bullshit.

            He’s not off my hook.

        • art thiel

          Ballmer in 06 was too deep in his day job to consider the Sonics, but by 08 agreed to chip in on a fix for the Key that failed.

  • Joe Fan

    I would much rather see the NHL in this market over the NBA. I think Seattle would really get behind an NHL team. We are a northern city and close to Canada and a great rival in the Canucks. The NBA has left too much of a sour taste in all our mouths. To this day I just can’t bring myself to watch NBA games.

    • art thiel

      The bitterness toward the NBA in these parts is real, but I don’t know if it’s a majority opinion among sports fans. And since there is no modern NHL track record, any estimate on potential financial success is pure guesswork. Those who are already hockey fans aren’t objective observers.

      • jafabian

        If the Kings sale went thru I think the healing process would have begun right then and there but IMO Sonics fans view things in that failed attempt as sabotage on the NBA’s part and it drove the knife in deeper. I don’t know if they can return at this point. They probably can but they can’t have a Clippers-like beginning. Fans would start out with skepticism and would quickly find something else to spend their sports dollar on.

        • Jeanine Curtis

          I’ve managed to retain some hope, now that Silver is in charge. He doesn’t seem to have the same “attitude” towards Seattle that Stern had. Have not heard any snarky “I have to cut this presser short– I have to catch a plane to watch a playoff game in OKC” comments. After the Seahawks SB win, I am less pessimistic as a Seattle sports fan. Admittedly, a recent tweet from @SonicsArena helped tremendously. Hansen hasn’t given up, and since he actually puts his money where his mouth is, I still have faith. Go ahead, call me a fool for thinking so. I will keep the faith despite all the Eeyores in this town telling me I shouldn’t.

          • art thiel

            I don’t think you’re a fool. I agree Silver isn’t as petty or venal as Stern, but the identity of the commissioner is a trifle compared to the fact that there is no business logic in either expansion or relocation for the NBA in the foreseeable. For Hansen, it’s really bad timing.

          • Jeanine Curtis

            Not everything that happens is foreseeable, though, is it? Who saw the Sterling debacle coming? Lots of moving parts in a very fluid situation (sorry for the mixed metaphor). My point is, there’s always a reason to hope, and I’m not giving up, at least as long as Hansen doesn’t.

        • art thiel

          Logic rarely plays a part in sports’ fans passions. That’s why it’s fun to be a sports fan. Logic is for work or school. Most Sonics fans want the Sonics back, and those that deny them their Sonics are demons.

    • 1coolguy

      There’s a sucker born every minute………
      Just look at those who still buy M’s tickets!

  • Kirkland

    USA ’94 still holds the World Cup records for attendance and profits. Coleman’s real estate holdings look impressive. This group seems far more credible than the Bartozek, Levin and Roenick groups previously mentioned. Next step for them: Add something more than a token amount to the building’s cost along with Hansen (if they are planning on SoDo).

    • art thiel

      Upping the private ante and lowering the public share may get the discussion started. Don’t know if that will be enough.

  • Marcus

    Look long term, little has changed. There is not a long line of NBA teams for sale. When the Bucs were up, Hansen & Ballmer were there again, trying to buy the team. They will be there every time, until they get a sale or expansion happens. The Bucs arena is not a sure thing (they’re packing the proposal with extras) and if it fails in swoop Hansen & Ballmer. Do the other owners truly care that Hansen fired a torpedo at Sacramento after they dropped an atomic bomb of hypocrisy on him? I doubt it. Ballmer can stomp off if he wants to be impatient, but ownership opportunities don’t grow on trees. He’s also a big boy and his ouster from Microsoft is unlikely to play any sort of real factor. And the NHL delegation? An expedition to see if Seattle would deliver an arena on a plate. Seattle rightly said no. If you want to restart that conversation and seriously want the NHL first, you’d better pony up some $$$. If you’re not willing to do that, it’s DOA. Hansen may have spoiled the city, but that’s the way it is. Now the NHL knows it and won’t bring potential owners in playing dumb to the $$$ situation.

    The bottom line is that the NBA will come back, the only question is when. Expansion may be 5 years off even, but we’re at the head of the line. The NHL will either lead or follow from that. The rest is just window dressing to pass the time. We know where we will end up, it’s just how we are going to get there. :)

    • Jared S.

      When I first heard about Hansen giving money to that anti-subsidy group in Sacramento, I was sick-to-my-stomach angry at him. But now, while I still wish he hadn’t done it, I don’t really condemn him for it. Stern could have just told Hansen that he wanted the Kings to stay in Sacramento, but instead lured him into a drawn out circus of a bidding war that of course he was rigging against Seattle. If Hansen was feeling a little vindictive about spending all of that time, energy, and money, only to find out he was being used, I find that understandable. Plenty of NBA owners have done worse things (so, for that matter, has Kevin Johnson: http://tinyurl.com/k9j2yhu), and Sacramento actually tried the same thing in Orange County when it looked like the Kings might move there in 2011. Maybe it does hurt Hansen’s chances of getting a team, but the league probably finds him more useful as a stalking horse for Milwaukee, et al, anyway, so it may be moot.

      • art thiel

        The mistake Hansen made in the donation to the Sacramento anti-arena crowd was getting caught. Many owners have pulled many dubious business deeds, but they weren’t caught. Hansen looked like an amateur.

  • DixDachshund

    Plenty of questions: Is this the end of the line for NBA hopes in Seattle? Ballmer was the guy with deep pockets. And does Hansen want to go it alone after committing himself to the massive dollar commitment to build a new arena? Plus, now that the NBA’s franchises — all of them — appear to be firmly entrenched with fairly new or soon-to-be new arenas, how can the NBA continue to tantalize Seattle with dreams of a new/relocated franchise in order to get their way? Seems they’ve got everything they’ve wanted from all franchise municipalities..

    • art thiel

      A fair assessment. But keep in mind that things change. Until Hansen suggests a change of course, assume nothing.

  • Doug

    Ballmer said, “ Moving [the Clippers] anywhere else would be value destructive.”

    Exactly! You don’t move a team OUT of Los Angeles!

    • Rainmaker

      The NFL would beg to differ with that statement

      • art thiel

        Obviously, moving a team out of LA is not an absolute no. But the Clippers and Lakers work well to make Staples and downtown LA a success. The Clips are going nowhere.

        • iamwhoiamwhoiammk2

          Only a retard like Sterling would be stupid enough to go play in a building that is quite obviously the Lakers (and the L.A. Kings) building!

          Any sane person would take the Clippers to Anaheim and share with the Ducks.

          The odds of finding some idiot wanting to keep the Clippers in a Laker dominated building LONG TERM is very low. Heck, I wouldn’t be surprised if the Ducks owners end up getting a stake in the Clippers when it’s all said and done.

  • Doug

    “NBA sources have said that the stunt, and its detection, put Hansen, as a prospective owner, in a poor light”

    Since Hansen is unlikely to be an NBA owner, he has no reason to finance an arena.

    The NHL should not even entertain the possibility of a Hansen-financed arena at this point. If they want an arena in Seattle, it needs to happen through other means.

    • art thiel

      That could well be the case. The NHL is skeptical enough to look at its own options.

  • MichaelRayRidgison

    What exactly is a sports industrialist? Does Rothenberg own a steel mill and move a lot of iron in stadium construction? … I say NHL should come first; the return of the NBA is years away. Seems obvious the pro hoops circuit is down on our town.

    • art thiel

      So you can’t have an industry without a smokestack? Wait until Microsoft, Amazon and Google find out.

  • Count to 10

    Art, I’m interested in your thoughts on what it would take for Hansen, the city of Seattle and King County to agree to an NHL first situation? Looking at it, I would think they need to put up something close to $100M-$150M for the building. Hansen isn’t going to want that much risk without a promise of an NBA team, so his share needs to be reduced significantly and, with the current political climate, you would need to reduce the city’s portion by a third to a half to get the necessary votes on board I would think.

    • art thiel

      You’re on the right track. For the NHL to get in first, it has to reduce the public risk and Hansen’s risk, because the NHL is seen as a riskier business proposition. But I’ve seen nothing to suggest that Hansen wants to go to the trouble for an NHL-only facility. Which is where it stands for the foreseeable.