In which case the COG does not, in fact, continue to have an asset after 30 years for which they have paid $100 million. My understanding of your point on this issue is that for the $100 million, the COG does not only receive the revenue for the term of the lease, but also retains a durable asset thereafter. Logically, if the parking rights belong to the arena manager, that is not the case.
To repeat: the parking rights belong to the City if the lease is renewed. If not, the arena manager will never again own them. They renounce them under the MH/CoG transaction.
I would be prepared to acknowledge a small discount in the
residual value of the rights at this time to reflect the small likelihood that a team which will have been in PHO for
45 years by then,
AFTER Hulsizer will have likely been compelled to buy the arena for $40M, might move. Such a discount would be very small, though. Vanishingly small. I suppose it is possible that PHO could be a ghost town in 2041.
I must say that I am a bit surprised that you have chosen not to re-engage on the issue of the "arena management fee". Can I take this as an indication that you agree with my interpretation that Coyotes Team costs are indeed included as eligible expenses for which Hulsizer can claim his fee, even if the rest of the arena operations break even or even make a profit?
But I did re-engage!!
Did you not read my reply from yesterday evening? It was a juicy one!
http://hfboards.com/showthread.php?p=31444511#post31444511
Enjoy.
Regarding Hocking vs. Walker and the parking analyses... Beyond the actual parameters, in which case I think that Hocking has used overly optimistic assumptions as I have explained,
I followed your posts closely at the time (as you were dominating the discussion at the time, it would be hard to follow the conversation without reading your views), and I recall no such explanation, and certainly recall nothing of any empirical nature. Is my memory faulty, or did I miss something?
I think we do well not to ignore both the timing and collateral evidence that casts some doubt about Hocking's analysis. Three city councilors (including Martinez, who supports the deal) have been quoted publicly as saying that the $100 million figure was the "transaction cost" required by Hulsizer, and the figures presented to them by city administration were from Hocking, which showed that the city could recoup that amount over 30 years. What is suspicious about Hocking's analysis is not only that it justified the required transaction cost, but also that it was completed 3 weeks after the Walker study. Since the COG had already paid for Walker's study, and had received a professional and credible projection, why wasn't the agreement with Hulsizer based on Walker's assessment? I think it is not illogical to propose the hypothesis that Hulsizer's demand for the parking was $100 million, and the COG needed an analysis that justified that lest they be clearly in violation of the gift clause. The COG's administration compounded this by neglecting to make councilors aware of Walker's study before they voted on the lease. (By the way, previously I worked for several years in government, involving many government analyses and negotiations on large projects, and I can tell you that any civil servant that withheld that sort of information from elected officials before they had to take a decision would have been fired on the spot... no questions asked). In any case, when the COG couldn't get Hulsizer to reduce the transaction cost, they asked Hocking to do another analysis. That his figures essentially matched the $100 million naturally raised some eyebrows, particularly since Hocking has been on an $8000 per month retainer by the COG. You can say that this is irrelevant as much as you like, but I expect that many an observer would find this to be not only odd process, but somewhat suspicious.
I referenced your theories (albeit not mentioning you by name) in a previous post discussing how this meme became the conventional wisdom in my absence. Had I been around, I would have pushed back strongly at this assembly of non-evidence. It was based on what I view
IMO as out-of-context statements by councillor Martinez and statements by a councillor who was against the deal and presumably unhappy about being outvoted (councillor Clark), combined with unfounded speculation based on the perfectly normal consultation process.
Since you have worked on large projects, I assume you are familiar with consultants' reports. I further assume that you are familiar with the iterative nature of the consulting process. It is universally standard operating procedure that consultants issue several drafts of a report which the consultant and the client then review and revise as more and more information becomes available or assumptions get adjusted. That is particularly the case when the parties are operating on the fly, as is the case here, but it is SOP either way. Both Walker and Hocking did so (Walker did so as late as the end of January, when it added significantly to its cash flow estimates by adding the missing five years at the end).
Your theories regarding the dates of consultants' reports is fanciful and unsupported, given the above standard process. Rather than attack (as you could have) Hocking's specific estimates, your position simply focuses on the dates of issuance of various versions and casts aspersions on professionals simply on that basis alone. I reject the approach of argument by innuendo.
Your further suggestion that somehow a consultant's report is dubious simply because they are on retainer is spurious and outright distasteful. You are impugning the entire field of consultancy, I hope you realize, as there is no significant consultancy practice that does not have retainer relationships with any number of key clients. I guess when they are on retainer they are full of it, but when they are doing a one-off they suddenly become paragons of their field.
THe rest of your analysis of the credibility of any report was based upon prior assumptions regarding the credibility of the assumptions in the first place, as evidenced above:
Since the COG had already paid for Walker's study, and had received a professional and credible projection, why wasn't the agreement with Hulsizer based on Walker's assessment?
You are opining on the credibility of reports by first assuming that Walker is a credible projection.
THe capper, of course, was the reveal by GWI of a lawsuit where Hocking is one of over a dozen co-defendants in a bond default lawsuit. I read many posts articulating your revulsion. It might interest you to know that .... oh, but I'll wait a little longer.
This is, needless to say, the conversation we would have had a while back when this issue was more current (except I would have been much more intemperate than my kinder, gentler me now before you
). It is stale now, but that's the way she goes.
