Buck Harvey: Sell high, live low: Why Holt would stay on the train
Web Posted: 05/28/2005 12:00 AM CDT
http://www.mysanantonio.com/sports/c...2b86ffbec.html
San Antonio Express-News
Red McCombs will pocket about $350 million in profit after last week, when the NFL officially approved the sale of the Vikings. So isn't it time for Peter Holt to cash in, too?
After all, Holt will take his seat tonight in a corner on the first row, across from the Spurs' bench, and he will see what every sports owner loves to see: Big-money players creating bigger-money revenue streams.
The Spurs have a 2-0 lead in the series, with Holt, the CEO of the franchise, leading by more. The investors have basically paid their share of the SBC Center already, buffeted by both luxury-tax benefits and one of the lowest payrolls in the league, and they have the prospect of many more home playoff games for years to come.
If selling high is the smart business move, this is high time, right?
"No," says McCombs. "It's not the way a sports owner thinks."
They may think alike, but they sure don't act the same. The Sonics' owner, in the previous series, jumped around so much on the sidelines in Game6 that a Seattle columnist wrote that his behavior "evoked a barefoot Yosemite Sam on a hot griddle."
The Suns' owner? He merely flapped his arms earlier in the season, calling the Spurs "chicken" for not playing Tim Duncan.
Holt instead stays in the background as he always has, and maybe that's partly because of events last year. Rehab can have that effect.
But whatever personal battles Holt has had, the Spurs haven't been one of them. Those in the organization say he's enjoying the franchise as much as he ever has, and for good reason.
How many owners have had this kind of run? Others lose money while firing coaches and getting stuck with the luxury tax; Holt oversees the most consistently successful team in the league.
The franchise has earned at least $10 million a season since 2003, and some think the totals are higher. Not even a pending lockout puts much of a dent in this business.
The clucking Suns owner, Robert Sarver, enjoys similar dollar-for-win success. According to one Web site, the Spurs have the 24th-highest payroll in the league, the Suns the 25th.
Among those who spend more: Nine lottery teams, including the Knicks with a payroll more than the Spurs and Suns combined.
But Sarver also bought the Suns last summer for $401 million, and it's typical franchise escalation. For example, when Charlotte got its first expansion team, in 1988, the franchise cost $32.5 million. The latest one went for about $300 million.
Each deal has its own financial variables, but this is clear: The Spurs as a product have never been more lucrative. Holt could sell today and perhaps get four or five times his initial investment.
And what happens if he waits? For one, the contracts of Duncan, Tony Parker and Manu Ginobili would escalate. And what happens if, for whatever reason, trips deep into the playoffs stop, and attendance sags?
McCombs waves off all of it. "My mind is running while I'm talking," he said Friday, "but I don't know of a single sports owner who looks at it that way. It's not speculative in a sense that they say, 'The market is right and it's time to get off the train.'"
McCombs got off the Vikings' train for a specific reason: Stadium issues. And Thursday, when he issued a statement to the media in Minnesota, he sounded like a man still with regrets.
"The league approval hit me with mixed emotions," McCombs wrote. "I should have been excited — after all I had pushed for some time to get a buyer — but rather than feeling excited I realized I was walking away from a lifelong dream — an empty feeling at best."
McCombs has always filled up that empty feeling with a lot of money, and he did when he sold the Spurs in 1993. That time, he says, the reason was about him.
"I got disappointed," he said. "I didn't think I could take the team to the championship. I couldn't get there, and I didn't know how, and I got disappointed in myself."
That's why McCombs says sports owners sell. "If you lose your passion," he said.
He hadn't lost it in the '80s, when he sold the Denver Nuggets. He had no plans to sell until "a guy just flashed so much money in front of me I couldn't ignore him."
McCombs laughed. "I sold the team in a 10-minute phone conversation."
Doug Moe, then the coach of the Nuggets, didn't understand. "We're riding in an elevator to the ground floor," McCombs says, "and Doug calls me the dumbest man he'd ever met. He told me I was having fun, that we were going great, and I had enough money anyway."
McCombs says he was second-guessing himself before the elevator doors opened. "I still call selling the Nuggets the worst mistake I've ever made."
McCombs says he hasn't talked to Holt about selling, and he says he's never told him this story. But McCombs also says he doubts Holt has lost the passion, and tonight is a reason.
When Holt takes his seat across from the Spurs, on the cusp of another NBA Finals, why would he want this to end?
Where are the posters who were telling me Holt Cat was losing money? I said he was making money and that he could sell the team for much more than he bought it for ... and I was ripped.
He's rich and getting richer. There's no reason he should be pinching pennies.
As I've been saying for the last year.
"buffeted by both luxury-tax benefits and one of the lowest payrolls in the league"
buffeted by <good things> ??
Totally mis-used word. Buffet as instranstive verb has negative connotation, buffeted by the wind, adversity, problems, etc, while proceeds from the luxury tax and low payroll are both positive. Good ol' Buck, the writer who can't.
I read a artical last week that holt is only worth 80million, but damn spurs only make 10 million profit since 99 each year....oh well small market, taxes and paying half of ABA
You're not alone LJ - remember me calling him out over the small difference in Tony's salary?
The new building allowed for this. The Spurs have made money ever since they left the dome.Where are the posters who were telling me Holt Cat was losing money? I said he was making money and that he could sell the team for much more than he bought it for ... and I was ripped.
This is where you are off. ALL good businessmen should pinch pennies if their overall financial picture doesn't allow for free spending. The Spurs aren't the Yankees, Knicks, Jailblazers or any group or individual with Billions to play with. Everyone es about Steinbrenner throwing money around like candy. He made 180 million last year. Look what Cubans original free spending got him. Nothing. Over the past 2 years, he has scaled back payroll because his accountants told him to.He's rich and getting richer. There's no reason he should be pinching pennies.
All San Antonio fans should feel extremelty fortunate the team is suceeding in San Antonio and not New Orleans, Vegas, Memphis or St. Louis. The ownership group, in the 90's was selling the team. The group would ONLY sell to someone who would NOT move the team. The Maloofs would have this franchise RIGHT NOW in another city if the old group would have not cared. The were losing multi-millions a year in the dome. Every year. In '99, the Spurs won the championship and STILL lost money. I will always praise the ownership group for the principle of wanting our sleepy town to keep our only pro sports franchise.
Pop even called out management to give it to him. It's called negociations. People act like it's the end of the world if a franchise and a player are off by a few million.You're not alone LJ - remember me calling him out over the small difference in Tony's salary?
As long as the Spurs continue to put a compe ive team on the floor every year, have an organization that is rated at the top in ALL pro sports, have sacrificed financially in the past, and give us quality people to watch on the floor, how can you belly ache if they make a profit?
is it possible that Holt will be willing to incur additonal expense by extending Nazr, getting Scola, and showing Brown the money?
I think it would be a good fiscal move to find a new home for Rasho.
McCombs is full of . He could've moved that team and made money. He did the same thing with the Spurs.... Sold for more jack. He made a ton of money of the sell of the Vikings and Spurs.
McCombs is also notorious for selling his stock in his other companies for extreme amounts.
Dude is 100% entrepreneur..... He doesn't give a about anything else but $$$$.
I've known for years that the Spurs were cashing in. I think SW broke down the financials one time saying they were losing jack.
They ran me out last year. 10-15 games a season now for me.
Late.
If you're going to trade Rasho, you better make sure you've got Nazr's signature on a contract extension. To do otherwise would mean that the Spurs would have zero (0) capable centers on the roster.
I can see him spending a little for Scola because the Spurs either have to trade him or get him over here. Something is going to happen with him this offseason. They have to decide if they want to bring him over or move him. If Horry comes back (which seems likely) it might make trading Scola more attractive. But he's not going to cost much. It's not like he'll be s ing out $70 million or anything. It would be more like $7-10 million.
Extending Nazr is tough. He had the best season of his career. If he keeps playing well, extending him might not be that easy. He's pretty athletic and centers with size and athleticism are in demand. You're right though: if they get Nazr to sign on after next season, it's hard to imagine the Spurs being able to keep Rasho and his contract around.
I'm not convinced that Brown has a future in San Antonio. Other disagree with me, but the fact that he's having back problems and doesn't understand the team's offensive philosophy as well as most of the other swing players might trump the fact that he's local. He might accept a one year minimum deal simply because other teams might hesitate to offer a broken player anything more, but if another team gives him a two year deal worth four or five million, it's hard for me to believe that the Spurs would want to match that.
It's not that he was losing money since moving into the SBC, it's the money that was lost in the dome and was owed for the construction of the SBC. All depends on what they have to pay and when. That is something nobody knows, and I question the $10 million every year figure -- Forbes' estimates don't come anywhere near that. It's like he took last year's luxury windfall and assumed that happens every year.Where are the posters who were telling me Holt Cat was losing money?
I caught that too, Boutons. I think he meant "buffered". Maybe a one-letter-off typo?
"Maybe a one-letter-off typo?"
E-N is so small market it can't afford editors and proof-readers? I think not. Buck is just a poor writer.
In his confusion, he meant "bolstered".
You're probably right. However, the so-called editor should have caught that too, don't you think?
Whatever, he is a hack.
According to Forbes, Spurs had an EBITDA (a proxy for operating cash flow) of $26.7 mil for the 2003-04 season. I don't recall the Spurs being responsible for the debt service on the arena. What portion they were responsible for came from the naming rights that SBC ponied up for.
The Spurs don't have much in the way of debt service to speak of themselves. Owning a pro sports team is not exactly a capital intensive business.
Forbes had a valuation of $324 mil on the Spurs in 2004. If their EBITDA is $26.7 mil such a valuation is in the ballpark, if not a little low.
Last edited by SPARKY; 05-28-2005 at 10:34 AM.
[waiting for Sparcus' final edit]
Quite easy to spend other people's money.
Chump dont bother, people love to hate rich people. let them stew and hate all the other BS.
How much would be enough?
sales price? payroll?
first off, nice to see your retirement was about 18 hours.I don't recall the Spurs being responsible for the debt service on the arena
Second, if you dont recall easy things as that, then you shoudl STFU about telling "Holt Cat" to pay up.
Hes paid up.
Hes paying Brent Barry 21 million Parker 70 million Ginobili 60 million Duncan over 100 million
Id say hes "paying up"
To pay.
I would expect anyone who bought the Spurs to grossly overpay.
What should the Spurs payroll be?
The point is that the Spurs are not in such a bind that they have to be cheap when it comes to their basketball operations. Don't tell me that it's a great thing as a Spurs fan when the Spurs make a move to simply cut payroll because it saves them money. Peter Holt's pockets aren't hurting.
T Park, perhaps if the "rich people" didn't expect to get a handout from the public to help them make money might I think you actually have a point.
I'm expecting the Spurs' spending to increase by about a third to $60 million next season.
Enough?
Your only point seems to be keeping Malik no matter what. Wait and see if Nazr is retained. Chances are you won't complain if Rasho is traded to cut payroll.
perhaps if the "rich people" didn't expect to get a handout from the public to help them make money might I think you actually have a point
awww. Boo hoo.
How is this any different than any other developmental project.
They got Hotel MOtel Rental car , people from other towns paid it.
Big deal, name me other teams that HAVENT gone that rout to get an arena.
Thats reality, so STFU already.
Chances are you won't complain if Rasho is traded to cut payroll.
That is where his hypocrisy meter, already pretty in high, will hit overload.
would sparky complain if they trade barry and rasho to trim payroll
nazr is is better then rose
I won't have a problem if Rasho is moved because of basketball concerns.
So "rich people" make money off of public subsidies but they cannot be subject to criticism from the public? Nice how that works...
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