No answers for, as in??
(Yeah it’s a loaded question)
I hardly seen anyone talk about the actual documents of the deal itself. This is where I miss someone like 1CasualFan who can translate the legalese contained within them.
Well I didn't even stay at a Holiday Inn Express last night but here we go......
Like her blog post, it's in two separate parts. With regards to the deal, there are still a lot of questions surrounding what's actually going to be paid by the builders and what the city is going to have to pay for. The city we know is paying for the cleanup part which is substantial. I know there's the argument that they'd have to do it anyways but it's still something they're paying for. You can always make the argument that a different developer for a different project might offer to pay part of all to get their project off the ground and we don't really know that since Tempe only negotiated with Muruelo. I also know that the deal has been modified from it's initial release to put less onus on the city so I'll be honest and say I'm not fully up to date on that.
What I will say is that a lot of it boils down to economics. This is, to put it lightly, a massive project that's going to take a long time to build and a crazy amount of money. Things can change in terms of economics at any level (global, national, state, etc...) and there are no guarantees a project like this gets completed. Since I'm fairly certain this is in different phases with regards to the construction, what's stopping them from scrapping the rest of the plan once the arena is built? I'm sure they would be this penalty and that penalty but we all know things are more complicated than that and most likely nothing would happen.
Along with that, the deal changed once, it can change again. Groups are always pressuring governments to pay more and they're going to try and get as much as they can even after the deal is "final"
The other main question is about the economics of the whole situation. Firstly is that, to my knowledge, we still don't know what role the Wisconsin Public Finance Authority has to do with all of this. Are they still involved? Is it with the team operations or the arena/district project? Unless the answer is "no they're not involved", the little we do know about them is that anyone doing business with them should be very wary based on public reports.
To continue that theme, I will reiterate that the economics do not make sense. We know without a shadow of a doubt that the team is hundreds of millions of dollars in debt. We know that they will continue to increase that debt because of poor economic conditions over the next 4-5 years and even in a new arena. That's on top of the money it's going to cost to actually build the arena and entertainment district. Even then, if we looks at teams like the ones in California and Texas, the hockey team itself are most likely just going to come to breaking even plus or minus a few million (this is team itself not the arena or the owner).
Even resale value the debt load imo makes it a highly unattractive asset.
So again, I ask for someone to make sense of the economics of it all. By the way, I've been asking these questions for years and can back it up with my post history though that's for others I'm pretty sure you TL are aware of me asking these questions.
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