New York Islanders to leave Barclays Center?

[mikecubs]

This is almost 3 months old but is still relevant. Here is how the Islanders/Barclays opt out clause works and how the deal overall works.


Islanders’ pact gives team a Barclays opt-out after 3 seasons

The Islanders could leave the Barclays Center after just three seasons in Brooklyn if the team triggers an opt-out clause in its license agreement, according to a summary of the pact obtained by Newsday.

The summary also reveals an approximate six-month window for the two sides to renegotiate the 25-year license agreement and mandates “good-faith discussions” from both sides before either can opt out.

The details of the opt-out clause come from a six-page summary of the Islanders’ agreement with Barclays Center. The document was included in the arena’s 1,000-page plan to refinance the municipal bonds that were sold a decade ago to build the arena. Barclays Center is refinancing the debt from those bonds because of historically low interest rates, saving it $90 million, according to a Bloomberg report in August.

Newsday reported in April that both sides had the ability to opt out of the deal and that the Islanders could leave Barclays Center after the fourth year. That information was based on multiple sources who had read the license agreement. But the six-page summary provides a more detailed and complete picture of the team’s contractual relationship with Barclays Center.

The documents also detail the contractual differences between the Islanders and Brooklyn Nets, which play home games at Barclays Center as well. The Nets get “priority” over the Islanders regarding scheduling home games, and they also have the ability to play as many as two home games at an alternate site.

The Islanders are required to play all of their games at Barclays Center. The 2013 lease between Nassau County and Bruce Ratner to renovate Nassau Coliseum included a clause that calls for the Islanders to play six games each season at their former home. If those games aren’t played, Ratner’s Nassau Events Center would owe the county an additional $1 million in rent.

When contacted about the Islanders’ contract stating the team has to play all of its home games at Barclays, a spokesman for Nassau County Executive Edward Mangano said, “We refer you to the contract between Nassau County and Nassau Events Center.”

A spokeswoman for Ratner’s Forest City Enterprises Inc. declined to comment.

The Islanders’ deal with Barclays Center is not considered favorable for the team in the long-term, experts said, because the arena gets the bulk of the gameday revenue, while the Islanders’ guaranteed take-home payment increases only by 1.5 percent each year.

The summary outlines the process involved in triggering the opt-out. After the Islanders finish their second season in Brooklyn, the two sides have until Jan. 1, 2018, to renegotiate the terms of the current deal. If no new deal is reached, the two sides can stay with the current deal or choose to opt out. Each side would have until Jan. 30, 2018, to deliver an opt-out notice in writing.

If the Islanders decide to opt out, the team can choose to leave at the end of either its third or fourth season. If Barclays triggers the opt-out, the Islanders would have to leave after the fourth season. The team just completed its first season in Brooklyn in May.

The opt-out clause can be triggered only if the two sides have engaged in “good-faith discussions” during the renegotiation window, according to the license agreement.

In June, Newsday reported that new Islanders owners Jon Ledecky and Scott Malkin have been in talks to build a new arena either next to Citi Field or at Belmont Park. Ledecky and Malkin took over control of the Islanders from Charles Wang on July 1.

National Hockey League deputy commissioner Bill Daly, who previously said the Islanders have given no indication that the move to Brooklyn “is or will be temporary,” said the opt-out clause is not a surprise to the league.

“Were we aware of the provisions of the agreement? Yes,” Daly said earlier this week. “Does it change anything we or the parties have said publicly on the subject? No.”

Daly deferred any further questions about the opt-out clause specifics to the team and arena. Neither the Islanders, Ledecky nor Wang returned messages seeking comment for this story. A Barclays Center spokesman declined to comment.

Ledecky said on Monday at a memorial for former Islanders coach Al Arbour that Barclays Center would be the Islanders’ home “for years to come.” But he declined to specify if it would remain the team’s home in the years after the opt-out date. “I’m not the predictor of the future,” he said.

“What this opt-out clause does is allow some time for the Islanders to re-evaluate what their economic circumstances are right now,” said Robert Boland, director of the sports administration program at Ohio University.

Experts who have read the documents obtained by Newsday said an Islanders’ search for a new arena could be complicated by the language in the license agreement that says an opt-out has to be preceded by “good-faith discussions” to renegotiate their deal.

“From my reading of the agreement, the requirement for good-faith discussions would be satisfied if the Isles scheduled several ‘sit downs’ with Barclays and had some exchange of proposals during the bargaining window,” Boland said.

One New York sports executive said this requirement could present timing complications for the Islanders if they decide to move. The person said the Islanders can’t agree to an arena deal now and still fulfill the “good-faith discussions” clause.

“It might be difficult for an agreement on a new arena somewhere else would truly be reached before the end of the next hockey season,” Boland said, “especially given all the potential devils hiding in the details of building in Queens or at Belmont.”

A new arena at either location would require financing, design, land and impact assessment before construction could even begin. That creates a scenario in which the window to have an arena ready if the Islanders leave Barclays will be limited. Experts said they could negotiate a short-term extension with Barclays or bide time at a temporary home. Most recently, the Brooklyn Nets spent two seasons at Newark’s Prudential Center while awaiting Barclays Center’s opening. Potential options for a temporary Islanders home in the metropolitan area would be Madison Square Garden, Prudential Center in Newark and possibly the renovated Nassau Coliseum, though any decision would need approval by the National Hockey League.

Sports business experts are not surprised that Ledecky and Malkin may be interested in pursuing other options because their revenue growth possibilities are limited at Barclays.

Among the financial considerations included in the current deal:

The Islanders pay Barclays Center an annual license fee of $2 million and reimburse the arena an unspecified amount for the operating cost of the arena for game days.
Barclays Center pays the Islanders an annual fee of $53.5 million, which increases by 1.5 percent each year. The documents say this amount can be reduced by non-game-day operating costs charged to the Islanders.
Barclays Center receives all revenue from preseason and regular-season tickets, luxury boxes, concessions, advertising, marketing and radio rights until the total reaches $53.5 million. For every dollar over that amount, the Islanders get 70 percent and Barclays Center receives 30 percent.
The Islanders get playoff revenue from tickets, single-game luxury boxes and postseason-specific advertising.
This type of setup is unusual for a professional sports team, experts said. Multiple sports executives and sports business experts said they know of no other sports team among the four major sports that has a deal similar to the Islanders’ in which the arena, acting as the landlord, has control over items such as ticket prices, marketing and even the team’s website. The deal was designed to provide the Islanders short-term financial stability with the $53.5 million annual fee that didn’t exist at Nassau Coliseum but also give the team an exit strategy.

“Charles Wang wanted to keep his options open, but at the same time he wanted to have the best short-term plan that he could, and Bruce Ratner wanted to have another tenant for another 45-plus dates a year,” said Andrew Zimbalist, sports economics professor at Smith College. “That’s the way in which the sides came together, and that’s why the deal is fragile for the longer term.”

According to the documents, the addition of the Islanders had a positive impact on the arena’s bottom line.

Barclays Center’ overall revenue rose to $176 million last year from $113 million in 2014-15, which it attributes to the addition of the Islanders. The team generated about $13.5 million of the arena’s $69.7 million in sponsorships and suites, up from $56.6 million a year earlier. Concession sales also benefited, jumping to $14.7 million from $9.2 million.

The deal between the Islanders and Barclays Center was made by Wang and Barclays Center developer Bruce Ratner and announced in October 2012, three years before the Islanders’ Nassau Coliseum lease expired.

Wang is now an Islanders minority owner, having sold an 85-percent share to Malkin and Ledecky. And Brooklyn Nets owner Mikhail Prokhorov purchased Barclays Center from Ratner’s Forest City Enterprises Inc. in December.

How the opt-out clause works
When the Islanders finish the upcoming season (the team’s second in Brooklyn), the Islanders and Barclays Center have until Jan. 1, 2018, to renegotiate the terms of the 25-year deal.
If no new deal is reached, the two sides can stay with the current deal or choose to opt out. Each side would have until Jan. 30, 2018, to deliver an opt-out notice in writing.
If the Islanders decide to opt out, the team can choose to leave at the end of either its third or fourth season.
If Barclays triggers the opt-out, the Islanders would have to leave after the fourth season.
The opt-out clause can be triggered only if the two sides have engaged in “good-faith discussions” during the renegotiation window.

www.newsday.com/sports/hockey/islanders/islanders-pact-gives-team-a-barclays-opt-out-after-3-seasons-1.12269479

[mikecubs]

This article says revenues rose 63M dollars with the Islanders but they are paying out 53.5M so you really gain 9.5M. Wouldn't Barclays also be better off opting for the 45 extra dates. Even if you get a handful of concerts while you'd have less revenue you'd still make more profit. Of course the problem would be if the Islanders stayed in market and you have a 3rd modern arena to compete with for concerts.

Citi Field site won't work if they are depending on the Mets owners the Wilpons to build the arena for them. The Wilpons have no money after the Bernie Madoff scandal. Wherever they go if they stay in New York area they are going to need a big arena subsidy because with MSG,Barclays and Prudential plus a renovated Nassau there aren't enough concerts to go around as it is anymore. Plus the Islanders haven't drawn in Nassau or Brooklyn. Their fan base is basically the size of the Coyotes fan base.

Barclays has been a total disaster. They can't sell the good seats let alone the horseshoe seats. Opening night last year vs. Chicago a lot of the good seats were empty. The Long Island fans hate the move and a good chunk of them are in favor of the team moving elsewhere(Seattle/Quebec) rather than be at Barclays. Nassau is being downgraded to 13,000 seats with no luxury boxes/amenities. Even if an arena magically appeared in Long Island(Belmont Park) the Islanders don't have enough fans and you have the problem of no corporate support in suburbia. Bethpage credit union for sponsorship isn't going to fuel a major league sports franchise.

The NHL made a mistake expanding to Vegas. The correct move was Islanders to Vegas/Quebec, Coyotes to the other. IF the Coyotes get their arena in Tempe it's NOT going to work. The market is too small for 4 teams and even if attendance improves some they won't get enough concerts with 2 other major arenas in a market that size to make it work. Karmanos should be instructed to sell for what he can get in Carolina(200M-ish), expansion should be called off and the Coyotes/Islanders should be moved.

[DowntownBooster]

^I don't think the NHL would want to see a 4 time Stanley Cup championship franchise like the Islanders move out of that market to Quebec or anywhere else.

[mikecubs]

Dec 15, 2016 15:58:40 GMT -6 DowntownBooster said:

^I don't think the NHL would want to see a 4 time Stanley Cup championship franchise like the Islanders move out of that market to Quebec or anywhere else.

I think you are right since it's the NHL we are talking about but there isn't a logical business reason to keep them in New York. 3 teams doesn't work. Islanders and Devils don't draw. The horseshoe thing is overblown since they can't even sell the seats with the good views. My guess is the NHL will buy time for the Islanders ala the Coyotes and wait until you get the right politicians to shovel money to a new arena. Then when the new arena opens that won't draw either just like Nassau/Barclays.

[Bruinsfan]

www.bloomberg.com/news/articles/2017-01-30/brooklyn-s-barclays-center-said-to-be-dumping-the-islanders

It's official.

Islanders screwed up not jumping on Brooklyn when they had the chance. They should have made sure it had hockey configurations

[Deleted]

Jan 30, 2017 19:01:26 GMT -6 Bruinsfan said:

www.bloomberg.com/news/articles/2017-01-30/brooklyn-s-barclays-center-said-to-be-dumping-the-islanders

It's official.

Islanders screwed up not jumping on Brooklyn when they had the chance. They should have made sure it had hockey configurations

So Quebec now has two "in's" in terms of relocation. The other being Carolina Hurricanes, as there has been no local interest in keeping the team in Raleigh.

[mikecubs]

Jan 30, 2017 19:01:26 GMT -6 Bruinsfan said:

www.bloomberg.com/news/articles/2017-01-30/brooklyn-s-barclays-center-said-to-be-dumping-the-islanders

It's official.

Islanders screwed up not jumping on Brooklyn when they had the chance. They should have made sure it had hockey configurations

That's not quite "official", an actual announcement is official but this isn't a surprise and at the end they will be kicked out. The biggest problem isn't the horseshoe. They couldn't fill the good seats. The problem is there aren't enough Islander fans ala the Coyotes. A move from the horseshoe Barclay Center will work to a new arena will work as well as when the Coyotes went from the American West horseshoe to Glendale. If you can't fill the good seats in a horseshoe then you can't use the bad seats excuse.

I'm sure that idiot Bettman will get NY politicians to build a 4th arena to try and save his boyhood team. The Islanders still won't draw fans in the new arena and concerts will be tough to get with 3 other arenas. Total waste of money just like the Tempe arena will be for the Coyotes.

The NHL NEVER should have expanded to Vegas. TERRRIBLE decision. Worst than the NFL moving the Chargers to LA. It should have been Coyotes to Vegas, Islanders to Quebec.

At some point Bettman is going to outright kill the league by building new arenas for teams that have no fans. Public funding will dry up for the NHL. The Glendale arena is going to go empty, Tempe will face the same fate once they can't afford their illegal arena management fee that is sure to come, the Islanders won't last in their new arena either.

[mikecubs]

Jan 30, 2017 21:04:09 GMT -6 @hannujarvenpaa said:

Jan 30, 2017 19:01:26 GMT -6 Bruinsfan said:

www.bloomberg.com/news/articles/2017-01-30/brooklyn-s-barclays-center-said-to-be-dumping-the-islanders

It's official.

Islanders screwed up not jumping on Brooklyn when they had the chance. They should have made sure it had hockey configurations

So Quebec now has two "in's" in terms of relocation. The other being Carolina Hurricanes, as there has been no local interest in keeping the team in Raleigh.

There is no local interest under Karmanos terms. No one is going to buy a team and let the old rotten owner run it for an insane price to top it off. People will buy Carolina for a cheap price and control. No way should Carolina be moved. Historically they've "killed" the Islanders/Coyotes financially/attendance wise. Raleigh has 3M people within a 64 mile drive, insane growth and no other pro competition(and most likely the NFL/NBA/MLB will never come due to Charlotte). Dumb to give up on that. Raleigh with local ownership can be saved. Also the arena is the only show in town so the team has no other competition for concerts.

Of course if Quebec gets a team I'm sure Bettman would do something stupid and save the Coyotes/Islanders and let Carolina move. If Carolina moves over an insane sales price NO ONE should ever build the NHL another arena.

[mikecubs]

LOL How bad can it get for the NHL? I'm staring to think the NFL and NHL are in a viscous competition to see who can destroy their league first.

Islanders discussed possible Coliseum return, Mangano says

www.newsday.com/long-island/nassau/islanders-edward-mangano-discuss-team-s-possible-return-to-coliseum-1.13039439

The renovation is only for 130M dollars. Not much at all for such a dump and it will seat only 13,000 but 2,000 seats can be added. I don't think there are any luxury boxes(no room). Of course this isn't a big deal since being so far away from the city they won't get corporate support. I'm sure Bettman in the end will be all for this and will shovel a bunch of money to prop them up since it's a suburban arena and we all know how much he loves those.

If Carolina moves I'm sure he'll be dumb enough to add Seattle over Quebec and their half @ss Key Arena renovation

So we will have the following soon
1. No Quebec
2. An old empty suburban Nassau Coliseum with no amenities hosting an NHL team
3. A 1962 renovated key arena which AEG says will be the "bear minimum" league standards hosting an NHL team
4. An empty Tempe Arena to match the formerly empty 2003 Gila river arena
5. The Florida Panthers solely surviving off the county
6. The 1983 Saddle dome living on indefinitely because Bettman isn't smart enough to use Quebec as leverage for a new arena

What a freaking mess! At what point do you just throw in the towel and give up and follow MLS(minor league soccer) instead?

[swervinmervin]

^^^^ MikeCubs, I hope you're wrong (of course). But how crazy is the NHL?!? Why would they even entertain discussions for such a subpar proposal for Nassau renovations - or for Nassau at all, if your point on corporate support is correct. No luxury corporate boxes??? The NHL has moved franchises for lesser problems!

The NHL acts like its corporate brain has been lobotomized. How can you behave like that with the Islanders (the Barclay Center is also a joke for a hockey arena), while you act like you're King Tut in other contexts? If you're a Las Vegas owner, or especially a Quebec (arena) owner, or any other well-heeled member of the NHL "club", why would you tolerate these things on the Island, or in Florida, or Carolina, or especially Arizona? The situation on the Island is a complete farce. If Bettman really does care about any kind of "legacy", he needs to actually end his tenure with some real logic, instead of wearing the "emperor's new robes".

As you can tell, I am also frustrated, mostly because of the complete lack of logic.

At least we have our Jets back. For the sake of all that is right with hockey (or could be right), I would like to see the Nordiques back as well. After the NHL's success with the Jets 2.0, I don't understand why they persist with insane solutions in subpar markets.

[rainmanrh]

There is no way the NHL will allow a team from the NY area to relocate. They will figure something out. I bet Charles Wang is having a good chuckle about this.

[mikecubs]

Jan 31, 2017 11:33:08 GMT -6 swervinmervin said:

^^^^ MikeCubs, I hope you're wrong (of course). But how crazy is the NHL?!? Why would they even entertain discussions for such a subpar proposal for Nassau renovations - or for Nassau at all, if your point on corporate support is correct. No luxury corporate boxes??? The NHL has moved franchises for lesser problems!

The NHL acts like its corporate brain has been lobotomized. How can you behave like that with the Islanders (the Barclay Center is also a joke for a hockey arena), while you act like you're King Tut in other contexts? If you're a Las Vegas owner, or especially a Quebec (arena) owner, or any other well-heeled member of the NHL "club", why would you tolerate these things on the Island, or in Florida, or Carolina, or especially Arizona? The situation on the Island is a complete farce. If Bettman really does care about any kind of "legacy", he needs to actually end his tenure with some real logic, instead of wearing the "emperor's new robes".

As you can tell, I am also frustrated, mostly because of the complete lack of logic.

At least we have our Jets back. For the sake of all that is right with hockey (or could be right), I would like to see the Nordiques back as well. After the NHL's success with the Jets 2.0, I don't understand why they persist with insane solutions in subpar markets.

The whole idea of moving to Brooklyn was they'd pick up corporate support being so close to wall street. The idea was they'd fill all the good seats(Didn't happen) by saving some of the long island fans and making new Brooklyn fans(they didn't switch from Rangers), sell out the boxes(at least the non-horseshoe ones), get what you can from the bad view seats. Barclays wasn't for hockey but that was NEVER the main problem. The main problem is their aren't many Islander fans. The few that they have live in Nassau too far away from the corporate support.

The only corporate support they got in Nassau was from the local credit union and small little companies etc.... It was a joke. The guys on HF boards say the renovation won't have boxes. Take a look at the ongoing renovation pics. Does this look major league to you?

www.newsday.com/sports/inside-nassau-coliseum-s-renovations-1.11635611

I think the big thing for keep horrible markets is Bettman thinks if some of these horrible markets work he will go down as a genius for sticking with it. Lot of "power of hockey" people think they can sell hockey anywhere. Some places things get over saturated and it just won't work. The reason NHL owners tolerate him is he tells them is revenue is at an all time high I'm great it's because of me. Revenue is indeed at an all time high but it's that way in EVERY sport including minor league soccer because of TV rights. Not because all 5 sports current have the best commissioner of all time. The NHL owners don't look at it as how much are they losing because of Arizona/Islanders/Panthers/no Quebec/Houston. They look at it like we are much better off than before Bettman, he must know what he's doing. He's a fraud!

I'm just as frustrated as you. Every freaking week it's horrible news from the NHL/NFL. I'm literally scared to log on to sports sites because the news is always just so bad. These 2 leagues can't afford this. As we learn more and more about the human brain contact sports are going to have a TON of trouble as it is. You can't top that off by stuff like Islanders/Coyotes/Panthers/no Quebec, Chargers to LA, Raiders blow biggest subsidy deal in history and get stuck at the Oakland Coliseum.

[mikecubs]

An old article from 2009 on the arena glut in New York area. This article is why Tempe won't work either without an illegal arena management fee. They later shut down Izod Center for 2 years and may tear it down.


As Arenas Sprout, a Scramble to Keep Them Filled

In the inaugural season for the new ballparks for the New York Yankees and Mets, the teams have been embarrassed by television shots showing vast areas of premium seats going unsold.

But those who study sporting facilities say empty seats may become even more commonplace here, as New York faces a glut of sports arenas.

Five major complexes — four existing and one planned — will soon be slugging it out within an area 30 miles wide.

At least two of the existing arenas already lose money, and experts say further casualties are almost guaranteed.

“Five arenas is not going to work,” said Mark S. Rosentraub, a professor of sports management at the University of Michigan. “I don’t think four works, even in a market as large as New York. There’s competition in every direction and there aren’t enough events.”

In Brooklyn, the developer Bruce C. Ratner is racing to start construction of a $772 million arena for the Nets basketball team, even as Newark woos the Nets for its money-losing Prudential Center arena.

In New Jersey, the owner of the Devils hockey team, which abandoned the Izod Center in the Meadowlands to play at Prudential Center, wants Gov. Jon S. Corzine to tear down the Izod Center, in the hopes of eliminating a competing venue.

On Long Island, Charles Wang is pressuring local officials to approve his plans to rebuild the much-maligned Nassau Coliseum for his Islanders hockey team by hinting that the team might flee to Queens, or leave New York altogether.

Then there is Madison Square Garden, whose owners are starting a $500 million overhaul of the 41-year-old arena. The Garden’s cachet helps draw performers, but the arena has another considerable advantage: three major professional sports teams play there, leaving the Garden with fewer dates to fill than the region’s other arenas, which all play host to only one major sports team apiece.

By the time the arena in Brooklyn, which will be called Barclays Center, is built, there will be a total of nearly 100,000 seats to fill, 365 days a year.

“The market is saturated,” said Professor Rosentraub. “In the long run, you’ve got serious challenges.”

For most of the last 30 years, there were only three arenas in the New York area: the Garden, Nassau Coliseum and the Izod Center, which opened in 1981 as the Brendan Byrne Arena. Each facility, at one time or another, was home to at least two major sports franchises. But in New York, as in the rest of the country, teams have sought and obtained new buildings — a trend that has contributed to a glut of arenas.

And stadiums and other nontraditional sites have become new rivals. For example, KeySpan Park in Coney Island, which opened in 2001, also hosts musical acts.

Similar battles are already taking a toll in smaller markets than New York.

In Glendale, Ariz., the city-owned Jobing.com Arena — which is losing money and events to US Airways Center in nearby Phoenix and a third arena at Arizona State — may lose its National Hockey League franchise, the Phoenix Coyotes, which filed for bankruptcy last month.

In the Minneapolis-St. Paul region, the Target Center, which is owned by the city of Minneapolis, vies with the publicly subsidized Xcel Energy Center in St. Paul. The Minnesota Timberwolves basketball team plays at the Target Center; the Minnesota Wild hockey team plays at Xcel Energy Center. Both sites are losing money, and they must also compete with the University of Minnesota, which has two arenas.

In Columbus, Ohio, the Blue Jackets hockey team recently opened negotiations to sell its money-losing Nationwide Arena to the county, but the recession has made the sale somewhat unlikely. Nationwide Arena competes for concerts and other nonsporting events with Ohio State University’s Jerome Schottenstein Center, which barely breaks even, according to a report by The Columbus Dispatch.

All of this competition can eat deeply into revenues.

At Nationwide Arena, concert promoters have been known to use the competition as leverage to get a better deal. In some cases, according to Mike Priest, president of the Blue Jackets and JMAC, which manages the arena, promoters have forced the management to guarantee as much as $1.1 million for a major band, even though the same act commands $350,000 less in Indianapolis, which has one main arena.


The competition in the New York area is not just for fans and performers, but also for public subsidies, corporate sponsors and well-heeled tenants for luxury suites.

And within the overall competition, there are subsets of more intense rivalries. In New Jersey, the owner of the $375 million Prudential Center has taken aim at the state-owned Izod Center; in New York, the proposed Barclays Center in Brooklyn is positioned to be a rival of the Garden and the Nassau Coliseum.

No one questions the Garden’s stature as the most venerable and busiest of arenas. It routinely books 275 hockey and basketball games (the Garden is home to the Rangers, Knicks and Liberty), circuses and concerts a year; most operators say arenas need to fill 200 dates to generate an operating surplus.

Still, the Garden’s owners zealously guard their franchise. They successfully opposed the city’s plan in 2005 to build a $2 billion football stadium nearby. The Garden is now embarking on a complete renovation of the arena at a cost of more than $500 million. The 89 existing luxury boxes at the top of the arena will be replaced by 97 plush suites much closer to the action.

The Garden, however, may be looking over its shoulder at Brooklyn, where Mr. Ratner has fought to build a new arena ever since he bought the Nets in 2003. His company has said it intends to host college basketball and boxing cards — both mainstays at the Garden.

Mr. Ratner must start construction by the end of the year in order to qualify for tax-exempt financing, but he faces a number of hurdles, including public approvals and a possible lawsuit.

If successful, Mr. Ratner’s arena would be built next to a major transit hub that involves 10 subway lines and the Long Island Rail Road, providing access for those who might normally visit Nassau Coliseum, 16 miles to the east. Mr. Wang, whose Islanders hockey team plays there, has publicly bemoaned his inability to redevelop the arena, while he spends more than $20 million a year to keep the team alive.

Still, Mr. Ratner’s arena would be the most expensive in the country, and his company has already sustained $111.9 million in pretax losses on the Nets. And critics contend that the tax revenues generated at Barclays Center will fall short of the $300 million in cash and tens of millions of dollars in tax breaks the state and the city have pledged to the arena and a related housing development.

In New Jersey, the owner of the Devils, Jeff Vanderbeek, and the City of Newark would rather have the Nets move from the Izod Center to the Prudential Center. The Devils played at Izod Center until the team’s move to Newark in 2007.

The Nets have rebuffed the invitation. “It’s flattering,” said Brett Yormark, chief executive of Nets Sports and Entertainment. “But we’re going to Brooklyn.”

So far, Prudential Center has not been a success. The Devils invested $155 million in the arena, while Newark put up $220 million and spent another $85 million on related projects. The team is supposed to pay a minimum of $2 million a year in rent, far less than the city’s $12.6 million annual debt service for the arena. But the Devils are disputing their rent bill and have yet to pay a dime.

Mr. Vanderbeek, who declined comment, touched off a political firestorm this month when he told The Record of Hackensack that the state needed to tear down the Izod Center. That, he told the paper’s editorial board, would boost the bottom line of the Prudential Center and the Devils by at least $10 million annually.

His comments brought a quick rebuke from Governor Corzine and the New Jersey Sports and Exposition Authority, which runs the Izod Center. Whether the Nets stay or go, the authority still needs to generate revenue to pay the bonds on the state-owned building.

www.nytimes.com/2009/06/29/nyregion/29arenas.html?hpw

[swervinmervin]

Thanks for sharing that article. Even though it's old, it's a great overview, and I'm sure it's still true today.

[mikecubs]

Islanders, Mets owners in talks with MSG-backed group to build at Belmont, sources say

The owners of the Islanders and Mets and a sports arena development company backed by Madison Square Garden are in talks to build a new hockey arena at Belmont Park, among other local sites, sources involved with the discussions confirmed Friday.

The sources, who spoke on the condition of anonymity because the talks are private, said negotiations involving Belmont and the other sites are underway among the sports executives as well as the offices of New York City Mayor Bill de Blasio, Gov. Andrew M. Cuomo and the not-for-profit New York Racing Association, which operates the racetrack.

The discussions are in the early stage and no decisions have been made on the future home of the Islanders. Several obstacles remain, the sources said.

Among the issues are placing a major entertainment venue between the nearby Barclays Center in Brooklyn, where the Islanders currently play their home games, and the Nassau Coliseum. All of the arenas need to rely on concerts and other entertainment draws.

Other New York City locations being considered, such as the Willets Point area adjacent to Citi Field, remain a possibility for a new Islanders arena, sources said.

The Islanders, who are owned by Jonathan Ledecky and Scott Malkin, and Mets, who are controlled by the Wilpon family, declined to comment about the talks, which were first reported by Bloomberg News. Malkin and Mets chief operating officer Jeff Wilpon have known each other for several years, sources said.

The Oak View Group, a company that develops, manages and provides content for sports arenas, is also involved in the discussions. Oak View started in November 2015 as a joint venture of sports executive Tim Leiweke, Madison Square Garden executive chairman James Dolan — who also owns the Knicks and Rangers — and Irving Azoff, who manages numerous recording artists.

Leiweke and MSG declined to comment Friday. Azoff didn’t return a call seeking comment.

The Cuomo administration referred calls for comment to the Empire State Development Corp.

Eric Phillips, chief spokesman for de Blasio, said, “We don’t have any comment.”

The Islanders are in their second season at Brooklyn’s Barclays Center in a deal that neither side has been pleased with. Barclays Center hasn’t seen the revenue expected. The Islanders are averaging 13,003 fans at Barclays Center this season, second lowest in the NHL. The Islanders have been unhappy with the quality of the ice, the marketing of the team and the atmosphere for the fans.


The Islanders and Barclays Center each have the ability to opt out of their 25-year agreement in January after a seven-month stretch in which they are contractually obligated to engage in “good faith discussions” about redoing their agreement. If the Islanders opt out, they can leave after the 2017-18 season or the 2018-19 season. If Barclays Center opts out, the team has to leave after the 2018-19 season.

Belmont Park is seen as a possibility for an Islanders arena following the state economic development agency’s decision in December to scrap proposals to redevelop the land, four years after the initial requests for proposal was issued.

“Any development at Belmont will occur through the normal process of an RFP, which has not been released yet,” said Amy Varghese, spokeswoman for the Empire State Development Corp., which handles major economic development projects. “Any talk of development at this point is speculative.”

Nassau County Executive Edward Mangano has tried to woo the Islanders to the renovated Nassau Coliseum, which is scheduled to reopen in April. The team left in 2015. Mangano met with Ledecky last November.

“While it’s certainly an interesting proposal for the Rangers to take ownership in the arena of their archrival, it would at least bring the Islanders back to Nassau County,” Mangano said of the Belmont proposal in a written statement. “The public has been loud and clear that they do not want tax dollars used to fund a sports team, and I believe the Islanders can return to their real home at the New Nassau Veterans Memorial Coliseum without taxpayer dollars.”

Barclays Center owners, who are spending $130 million to renovate the Coliseum, were selected by Nassau County over Madison Square Garden’s bid for the redevelopment rights to the Coliseum and surrounding area.

Kevin Law, CEO of the Long Island Association, the region’s largest business group, came out Friday against the prospect of building another sports arena within driving distance of the Coliseum. “The true home of the New York Islanders is the new Nassau Coliseum,” he said in a statement, “and the state should be facilitating their return to the Coliseum and not anywhere else, including Belmont.”

State Sen. Todd Kaminsky (D-Long Beach), whose district includes the portion of Belmont where an arena could be built, cited the property’s size and access to mass transportation as a significant positive.

“Considering that Belmont is easily accessible by the LIRR and has enough space for a major sports team, I think it makes sense to consider the site as a potential path to bring the Islanders back home to Long Island,” Kaminsky said.

www.newsday.com/sports/hockey/islanders/islanders-mets-owners-in-talks-with-msg-backed-group-to-build-at-belmont-sources-say-1.13174962