NFL

NFL To Los Angeles Observations

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The NFL is returning to Los Angeles.  Hallelujah!  Or not really.  For every city that gets a new team, there’s a city that loses one and that’s nothing to be celebrated.

Here are some observations about the NFL moving at least one team to Los Angeles.

Stadiums Rule The World

NFL teams don’t move because of attendance or lack of fan support, they move because the owner’s always need newer, better stadiums with more luxury suites.

Luxury suite revenue is not shared with the other 31 teams in the NFL and that is an enormous moneymaker in big markets, especially the second-biggest market in the country.  AT & T Stadium in Dallas has roughly 300 luxury suites.  If they rent for an average of $250,000 per year (low estimate), that’s an extra $75 million per year, at the very least.

Is it fair that NFL teams will keep leveraging cities and tax payers to assist in stadium renovations and building new facilities?  Probably not, but life isn’t fair.

Whenever you’re looking at the next city who is in danger of losing their team, don’t bother looking at the attendance figures, look at the age and condition of their facility.

Kroenke Won’t Make As Much Money As You Think

Rams owner Stan Kroenke got his way and the team is moving back to Los Angeles.  That you know.

The move and his fake press conference tears are predicated by the potential revenue made by moving to the second-largest market in the United States.

With that said, he’s not going to make as much money as you’d think.

It’s likely that Kroenke is going to spend about $1.3 billion on a new stadium in Inglewood, possibly much more when you consider the debt service.  He’s also paying a $550 million relocation fee so he’s into this project for almost $2 billion.

Sure, the returns will be significantly better in a bigger market, but it will take a little while for that return to start to bear fruit.

St. Louis Will Get Over It

This may sound callous, but the city of St. Louis will get over losing the Rams.  There are plenty of great, passionate Rams fans in St. Louis who are miserable today and will be for a while.  For them this is a horrible thing and it’s like being dumped by a spouse for someone more attractive.

With that said, St. Louis is a baseball town and many of the residents care more about the Cardinals and Blues (NHL), and the Rams were a distant third.  They will be over this by the end of the week as long as their Cards make another offseason move to add a corner outfielder or a lefty in the bullpen.

The NFL Is Not The Bad Guy

If this were solely about revenue, we would have seen at least two teams move to Los Angeles yesterday, and possibly three.

The Rams are moving back to a place where they spent the majority of their lifetime.  If this were a player returning “home,” he would likely be lauded (unless it’s LeBron James, who everyone who’s never met him hates).

The NFL is giving both the Chargers and Raiders an opportunity to stay in their current, respective markets by offering them an extra $100 million to try and get a stadium deal done.  If they didn’t care about the security of either market or city, they wouldn’t have made the offer.

The Raiders Have More Leverage Than The Chargers

The San Diego Chargers have put themselves in a position where begrudgingly or not, they almost have to take their one-year option to move up the road to Inglewood and share their facility with the Rams.  The additional $100 million that the NFL has pledged for them to stay won’t go far in the negotiations in one of the areas with the most expensive real estate and a city that seems lukewarm about being leveraged again.

Perhaps the biggest issue for the Chargers would be what would happen if they stayed in San Diego.  They would be in a position where not one, but two teams could be 120 miles away from them.  With a team that struggles to sell tickets and merchandise, that could be an absolute killer and cost much more than the $100 million grant would cover.

Oakland may not have the first option for Inglewood, but they do have options.  The Raiders could use the $100 million to help construct a new stadium in Oakland, or possibly try to get into Santa Clara with the 49ers.  They have a pretty established fan base in Northern California and they will be welcomed somewhere.

The Jaguars Are Not Moving To St. Louis

The only thing dumber than St. Louis losing their football team would be to immediately give them another one that people care even less about.

There have been rumors that the Jacksonville Jaguars would be moving to St. Louis because owner Shad Khan tried to purchase the Rams.

Those rumors are so unintelligent that they should not be entertained and here’s why:

  • Khan did try to purchase the Rams because he wanted to purchase an NFL team.
  • Khan is a billionaire with homes all over the world, not just in the St. Louis/Illinois area.
  • Khan has pledged hundreds of millions of dollars to upgrading Everbank Field and is currently building a new amphitheater and indoor practice facility for the team.  It would be pretty stupid to do that and then spend an additional $550 million just to leave.
  • The Jaguars are in an air-tight lease with the city of Jacksonville.  The only way to break it would be to show that they lost money for three consecutive years.  No NFL team is going to open up their books to legal scrutiny, after all they are a non-profit.

The Owners Are About To Bank Even More

When the television contracts are up for negotiation and renegotiation, the league will make a lot more money with a local team or teams in Los Angeles.  Since the league shares revenue, this is a win for all of the owners.

We also mentioned the relocation fees.  It’s $550 million per team split amongst the rest of the owners.  Assuming two teams move (which is a virtual certainty), that’s $1.3 billion divided among 30 franchises.  If you’re playing at home that’s $43,333,333.33 in additional money for each franchise.

That’s a pretty solid payday for allowing two teams to move to a bigger market.

Expect Super Bowls In L.A. and The Draft

Part of the league accepting Stan Kroenke’s Inglewood proposal is the massive facilities that are being built.  This will allow for a stage for the NFL Draft, and you can certainly expect the Super Bowl to be in town as early as 2020.

This is a major win for the league in terms of facilities and a wonderful venue for their biggest event.

Here are some artist renderings of the facility. 

 


About Charlie Bernstein

Charlie Bernstein

Charlie Bernstein is the managing football editor for Football Insiders and has covered the NFL for over a decade.  Charlie has hosted drive time radio for NBC and ESPN affiliates in different markets around the country, along with being an NFL correspondent for ESPN Radio and WFAN.  He has been featured on the NFL Network as well as Sirius/XM NFL Radio and has been published on Fox Sports, Sports Illustrated, ESPN as well as numerous other publications.