Ownership Cluster**** Thread: NHL and GJ, Put Up or Shut Up!
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10-02-2012, 09:33 AM
Join Date: May 2010
Originally Posted by
I may be wrong here but I believe a lot of it has to do with buying what has to be considered a distressed asset. While it wouldn't make sense now, purchasing the arena in the future could make a lot of sense in the event that Jamison is able to successfully turn the franchise around.
As the arena manager, Jamison would already be extracting almost all of the revenue potential of the arena, without having to purchase the building. In addition, as arena manager, he will receive about $325 million in arena management fees, which he would not receive if he purchased the building. Why would he pay money to purchase the Jobing.com arena if it doesn't provide him any substantial revenue and it causes him to forego $325 million in fees?
It would be a dream scenario for Glendale to sell the arena to Jamison. But I doubt that they would be able to give it away to Jamison when he has the current lease deal on the table.
Frankly, I'm not sure why this option keeps on being raised. My guess is that it is so that some city council members can suggest it as a potential benefit to the city, even though it is completely unrealistic.
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