OKC-Sonics agree to form Ford Center lease
Oklahoma City officials today announced an agreement with the Seattle SuperSonics on a letter of intent to enter into a lease for the use of the Ford Center. The lease, which is expected to be finalized before the NBA Board of Governors vote on the Sonics relocation application next month, will have an initial term of 15 years and will begin no sooner than the 2008-09 season and no later than the 2010-11 season.
The letter of intent is here. A couple of key points…..
* At the end of the initial 15-year lease, the team will have the option to extend the lease for five additional three-year periods.
* The team must pay the city $28,000 in game day expenses and additional rent of $12,000 per game
* The team will have priority to the Ford Center’s schedule for all preseason, regular season and postseason NBA games as well as priority for up to 10 non-game day events.
* The team will receive 40% of the first $2.5 million in concessions; 42.5% of next $2.5 million and 45% of the balance. The team will receive 25% of first $1.25 million in suite revenue; 27.5% of next $500,000 and 30% of the balance. The team will receive 10% of clubs and restaurants revenue and 15% of bar revenue.
* The team will have the right to negotiate a new naming rights deal, but the team must pay the city the $409,000 annually that it currently receives under existing deal with the Oklahoma Ford Dealers.
* The team must pay the city $100,000 per year for use of the practice facility. The city must pay for all capital repairs and replacements at the practice facility.
* The team can opt out of the arena lease, the food and beverage agreement and the practice facility lease at the end of six years and at one or more other undetermined point in time during the initial 15-year lease if the average of team ticket revenue for the preceding two years fall below 85% of a benchmark of average ticket revenues in the first two full seasons following completion of arena renovations.
We will have much more coverage on NewsOK.com and in Saturday’s editions of The Oklahoman.
-DM-
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Comments
Two very interesting points in the letter…
1) the use of the phrase “good faith”. In Clay Bennetts world that phrase means nothing. In Seattle he defrauded Howard Shultz out of $75 million by agreeing to make a good faith effort for one year to keep the team in Seattle. He never operated in “good faith”, forming the PBC LLC in Oklahoma rather than Washington was the first sign, and his entire effort was one half baked idea that he pushed for less than 3 months. He then claimed he was out of ideas. Wow. Some idea man there. OKC needs to understand that there will never be any “good faith” on Clay Bennetts part.
2) You are being set up for a new facility after 5 years. Clay will demand a full on, state of the art, half a billion dollar Events Center like he demanded here in Washington. He will site the losses he is suffering and either you pay up or he will opt out and take the team to Kansas City or some other place hungry for a team.
Also keep in mind that getting in bed with Bennett means you could lose out on getting an NBA team. With several in play that Clay will make you pass up waiting for his team when he is unable to move the Sonics you will end up with nothing.
Doing business with Clay is like being married to Lorana Bobbitt… You better sleep with one eye open.
Not jumping the gun, Joey…..just getting ready to slam the door on Seattle.
It is inevitable, sonics……there’s nothing that anyone in Seattle can do to stop it.
And Andy…….blah, blah blah. A good faith effort requires two willing sides. Ask Ballmer if Bennett ever stood a chance of getting something done with the state.
The truth is Gregoire and Chopp are representing the wishes of the majority of taxpayers. I-91 spoke loud and clear. Most people in Seattle would rather see the Sonics leave than see one penny of their tax dollars go to providing a decent arena for them to play in.
Now the Key can set there and rot while Seattle holds there collective breath waiting for someone to come build them a new arena.
Good luck with that…..
Philip,
We’ll see how long Bennett and PBC hold their collective breath when they’re desperate to get out of the Ford Center lease because you guys can’t provide the 17,000+ fans per game regularly after the first two years and they start hemorrhaging money until they’re allowed to bail after the sixth year. That’s some ballsy confidence saying that they can’t leave until after six years. But then Bennett must be sporting some confidence with respect to breaking leases assuming his ownership of the team is dependent upon breaking the lease here…
kdizzle…
Nobody knows the future but we certainly know the past and that tells us that the average paid attendance for the two years the Hornets were in OKC was a higher number than the Sonics have had in twenty five years.
We also know that the Sonics have lost money every year in this decade in Seattle forcing one ownership group to have to sell because of mounting loses and a the next ownership group to have to file for relocation.
He won’t break the lease there…..Seattle is about to accept a buyout,
Be careful what you wish for…
http://www.nbaroto.com/2008/03/its-no-fun-being-seattle-supersonics.html
If you understood anything about the recent unfortunate transition from poor management to saboteur management, NBA Roto, you wouldn’t be as gloomy about the future of the Sonics in the A. They went from overpaying dudes (McIlvaine, Baker) to blundering draft picks to being sold by a careless owner to being gutted and deliberately undermined as far as talent. Sad story but in no way a representation of the entire history of the team or where it is headed (competitively speaking). Remember the early-mid nineties at all? 50+ win seasons regularly?
If I were a Clippers or Hawks fan, yeah, I’d give up on them and want them to relocate too…durrr.
“He never operated in “good faith”, forming the PBC LLC in Oklahoma rather than Washington was the first sign, and his entire effort was one half baked idea that he pushed for less than 3 months”
Chair of the Ways and Means Committee in the WA legislature disagrees with your assessment of the proposal
Ballmer not operating in good faith either since his was introduced with just one week left in the session?
your jumpin the gun okc.