News Article: MSG gets 10 year permit

[GordonGecko]

Which is exactly the point. The threat isn't the eminent domain. The threat is not renewing the permit which allows the Garden to host large events. The Rangers/Knicks respond with threatening to not play there, forcing the city to acknowledge the only way they could do anything with the site is through eminent domain. Essentially, the Garden would be calling the city's bluff on the eminent domain front, leaving the council with the choice of an empty building or giving into the Garden's demand.

As I said, if the city just works with them and agrees to move the tax exemption with the team, there's no reason this couldn't get done.

Depends on who's mayor - DeBlasio wouldn't be bluffing, he would easily let the garden sit empty knowing MSG corp has a lot more to lose. The city (plus state & federal) would need to have the cash ready to buy out and build the new station. Probably not feasible in our lifetimes

 

[Made Dan]

You're aware of the salary cap, right?

He might not be, considering it's never really applicable to the Isles.

 

[GordonGecko]

Article can be found at http://www.crainsnewyork.com/articl...rden-said-to-explore-split-into-two-companies
Madison Square Garden said to explore split into two companies

One publicly traded company would house its sports teams and cable networks, while another would be home to its real estate assets and concert and entertainment business, sources say.

Bloomberg News

Buck Ennis
Madison Square Garden Co. is exploring splitting into two publicly trade companies, sources say.​

Published: October 27, 2014 - 7:21 pm
(Bloomberg) -- Madison Square Garden Co. is exploring splitting into two publicly traded companies to unlock value in the New York Knicks and New York Rangers sports franchises and buoy its entertainment business, people with knowledge of the matter said.
MSG, controlled by the Dolan family, has been considering since July a plan to house its sports teams and cable networks in one company and move its real estate assets and its concert and entertainment business into another, said the people, who asked not to be identified because the information is private. An announcement may be made as soon as Monday, the people said.
Activist investor Nelson Peltz, the co-founder of Trian Fund Management, and Scott Sperling, co-president of private-equity firm Thomas H. Lee Partners, will join the board, the people said. Trian doesn't own a stake in MSG, one of the people said. The Dolan family owns about 69% of the company's voting shares.
The $2 billion purchase of the Los Angeles Clippers by former Microsoft Corp. Chief Executive Officer Steve Ballmer—who paid almost four times the previous record amount for an NBA team—was one of the catalysts for exploring the split, the people said. Mario Gabelli, whose family of funds own more than 7% of MSG's outstanding shares, said on Twitter in May that a buyer of MSG would get the Knicks for free, given the Clippers valuation.
John A. Thaler's JAT Capital Management, which disclosed a stake in MSG in August and has pushed its holding to more than 9% of shares outstanding, has said that it may seek talks with the board or management to recommend ways to boost value.
Entire contents ©2014 Crain Communications Inc.

 

[Hi ImHFNYR]

Your last paragraph is simple to explain... People will let ownership get away with murder because they don't want something that brings them a huge amount of pleasure, pro sports teams, to go away. Losing a sports team is like losing a loved one.

I have no doubt that this is the truth for some people. It's glaringly sharp evidence for how absolutely unintelligent a (way too) large portion of our species is. It's also pathetic.

I can imagine some idiot losing sleep because grown men will be playing sports a few hours away instead of a few minutes.

 

[Hi ImHFNYR]

I am aware of that, but again that is not the point. If the building had a tax abatement that all of a sudden expired, the money is not coming out of the building owner's pocket. They will raise rent and the renter will in-turn either raise their prices or shut down. Raising prices hurts the customers. Having the business shut down is not good for obviously the building owner or the surrounding area.

So I should pay more in taxes so that some idiot can buy a cheaper pair of already overpriced foam hands? If people want to pay the exorbitant prices then let them suffer. I don't need to give MSG a tax break to spare those fools from their idiocy. Then again without anything resembling transparency and with debt constantly skyrocketing the extra 17 mil would get pissed away anyway

 

[Gardner McKay]

So I should pay more in taxes so that some idiot can buy a cheaper pair of already overpriced foam hands? If people want to pay the exorbitant prices then let them suffer. I don't need to give MSG a tax break to spare those fools from their idiocy. Then again without anything resembling transparency and with debt constantly skyrocketing the extra 17 mil would get pissed away anyway

Just out of curiosity to see if I am understanding this right... Are you saying that you believe there is a correlation between you paying more in taxes and MSG getting a tax exemption status?

 

[Hi ImHFNYR]

Just out of curiosity to see if I am understanding this right... Are you saying that you believe there is a correlation between you paying more in taxes and MSG getting a tax exemption status?

Read the last sentence. The one you didn't bold. Also read the argument I was responding to.

I was responding to someone who claimed that there was a correlation between MSG raising prices and MSG receiving a tax break (or not). My point was if there IS a correlation then it works both ways:
MSG tax break = gets passed to us in taxes.
No MSG tax break = gets passed to fans and concessions.

Why would I hypothetically (based on his proposed correlation) have to pay more in taxes so that someone pays for cheaper concessions?

I was pointing out his argument was flawed. I was not saying that there is a correlation. Did you look at what I was responding to? I don't mean that in a snarky way I'm genuinely asking b/c I suspect you might've not fully read it and that's why you thought I was the originator of this idea. Plus I'm so overly nasty about the foam buyers that it invites folks to automatically assume the worst in my post I think

 

[Gardner McKay]

Read the last sentence. The one you didn't bold. Also read the argument I was responding to.

I was responding to someone who claimed that there was a correlation. My point was if there IS a correlation than so what? Why would I hypothetically (based on his proposed correlation) have to pay more in taxes so that someone pays for cheaper concessions? I was pointing out his argument was flawed. I was not saying that there is a correlation

Fair enough. I wasn't sure. Hence why I asked

 

[Hi ImHFNYR]

Fair enough. I wasn't sure. Hence why I asked

I am one nasty mfer when it comes to the general population now. I'm trying to make sure and explain because I suspect that the nastiness is going to distract from my point or cause me to say stuff the wrong way. But yea I have a total and utter lack of respect for most people (not all!) lol. Probably came across in some form or another here. I'm also embracing what I call "get off my lawn" syndrome

 

[Hunter Gathers]

The MSG tax breaks are dumb. I agree. Ditch them.

 

[Doctyl]

The MSG tax breaks are dumb. I agree. Ditch them.

Would they raise ticket prices if they lost the tax break?

 

[Gardner McKay]

Would they raise ticket prices if they lost the tax break?

I would think so.

The MSG tax breaks are dumb. I agree. Ditch them.

Why do you think they are dumb?

 

[GordonGecko]

Why do you think they are dumb?

The tax breaks are dumb because they are subsidizing an extremely profitable private corporation under the false pretense that they would have moved without them. If a team can't compete with others in the league and may have to move, that's one thing. But the Rangers & Knicks are easily top three in their respective leagues in terms of revenue and they also operate in a salary capped league.

MSG corp may threaten to move, but it's 100% dumb to give them property tax breaks to "keep them here" because they're never going anywhere

 

[patnyrnyg]

The tax breaks are dumb because they are subsidizing an extremely profitable private corporation under the false pretense that they would have moved without them. If a team can't compete with others in the league and may have to move, that's one thing. But the Rangers & Knicks are easily top three in their respective leagues in terms of revenue and they also operate in a salary capped league.

MSG corp may threaten to move, but it's 100% dumb to give them property tax breaks to "keep them here" because they're never going anywhere

At the time it was granted, it was a VERY legitimate threat. Giants had moved to NJ a few years prior. Jets were on their way to moving. There was an arena at the Meadowlands that didn't have teams. Now that they have it, they do not want to give it up, just like anyone else in a similar situation. If they lose the tax-emption, they will pay it. However, it is not going to come out of Dolan's or any other shareholders pockets. They will figure out another way to cut costs (cut payroll) or simply raise prices to make up the revenue.

 

[patnyrnyg]

So I should pay more in taxes so that some idiot can buy a cheaper pair of already overpriced foam hands? If people want to pay the exorbitant prices then let them suffer. I don't need to give MSG a tax break to spare those fools from their idiocy. Then again without anything resembling transparency and with debt constantly skyrocketing the extra 17 mil would get pissed away anyway

You think you are paying more in taxes because MSG is getting a Real Estate Tax Break? If they are saving $17MM per year, that equates to less than $2 per year per person in NYC. The city grants tax breaks for all different reasons. Remember when people went nuts because ARod bought a tax-abated condo? Of course, those going nuts didn't understand the tax abatement was granted by the city to the builder in exchange for the builder also putting up so low income housing. The builder than passed the abatement onto their buyers. BUUUUUT, since it was ARod and he is already rich, he shouldn't get the abatement.

 

[Hi ImHFNYR]

You think you are paying more in taxes because MSG is getting a Real Estate Tax Break? If they are saving $17MM per year, that equates to less than $2 per year per person in NYC. The city grants tax breaks for all different reasons. Remember when people went nuts because ARod bought a tax-abated condo? Of course, those going nuts didn't understand the tax abatement was granted by the city to the builder in exchange for the builder also putting up so low income housing. The builder than passed the abatement onto their buyers. BUUUUUT, since it was ARod and he is already rich, he shouldn't get the abatement.

***damn brother I JUST answered this! Come on now. I mean ya gotta pay a LITTLE bit of attention now...

 

[Giglio NYR15]

MSG isnt going anywhere, the city doesnt have the money to pay them for the land and find them new land. I wouldnt be opposed to a brand new arena being around the corner or wherever, ofcourse until my blue seats become 80 dollars a piece and im moved somewhere else.

 

[Ola]

Penn Station is terrible and it sucks that one of the main ways into the city is cramped and unimpressive. That said, this should've been discussed before Dolan started the renovation process. If they wanted MSG to move, then they should've been more supportive of the Farley Post Office plans.

Discussed? With whom?

Dolan got himself a free renovation, the city will have to compensate him for the arenas value when he is kicked out.

Imagine if you knew you would get "just compensation" for your house in 10 years, any investment you made in it would be coming right back.

 

[Ola]

A 10-year renewal makes sense. A perpetual lease doesn't. The city reserves the right to evaluate the site years down the line and determine if it still makes sense for an entertainment center to be located on top of a major transportation hub. Capacity and access change over time.

That said, I don't see MSG moving for a long long time. The city might claim eminent domain but they're going to have a hard time getting around the 5th Amendment Takings Clause. Can you imagine what the "just compensation" would be? It would make Bill Gates sweat. It might even be cheaper for NYC to move Penn Station than it would be to give Dolan fair value of the building and a new plot of land in the heart of Manhattan. I think the city is just getting their ducks in a row so that they can revoke the tax breaks MSG is currently getting.

I think you are right.

But I have a question, is capasity really a big problem at Penn Station today?

Doing this, ie removing the MSG and putting it somewhere else, along with building a new arena is going to be massively expensive. When you have a big capacity problem in your communications you just gotta fix it, but I never got the impression that this mainly is a capacity problem.

 

[Levitate]

I could be wrong but I think there is a capacity issue...but relocating MSG wouldn't fix it. The relocating part has more to do with people that want to restore Penn Station to its former glory and make it a more user friendly experience.

 

[trueblue9441]

I could be wrong but I think there is a capacity issue...but relocating MSG wouldn't fix it. The relocating part has more to do with people that want to restore Penn Station to its former glory and make it a more user friendly experience.

partially correct. there is a capacity issue, there needs to be a better flow of pedestrian traffic and easier to navigate concourses. this can be done without moving the garden and part of the problem will be alleviated when amtrak moves into the post office in a few years. there will be a new waiting room and concourse in the post office which is scheduled to open some time next year. a few years after that, phase two will be complete which will have a light filled hall that is the size of grand central.

but train traffic is at capacity which also makes a ton of trains late. in order to increase train capacity, additional new platforms need to be constructed and new rail tunnels need to be built under the hudson river.

the best solution in that study that was posted a few days ago is removing the theatre at msg, so there can be a grand hall on 8th avenue in addition to the moynihan station project. the theatre can be relocated elsewhere, possibly into the post office.

 

[patnyrnyg]

***damn brother I JUST answered this! Come on now. I mean ya gotta pay a LITTLE bit of attention now...

I didn't read most of your non-sense. Just not interested in what someone with your attitude has to say. But, I will play along. YOU said, "So I should pay more in taxes blah blah blah, blah blah blah." I pointed out you are not paying more in taxes, nor will you pay less if they lose the tax exemption. [MOD]

I could be wrong but I think there is a capacity issue...but relocating MSG wouldn't fix it. The relocating part has more to do with people that want to restore Penn Station to its former glory and make it a more user friendly experience.

Because that is what the area needs, turn Penn Station into a tourist attraction so there are more people hanging out there.

I have no doubt that this is the truth for some people. It's glaringly sharp evidence for how absolutely unintelligent a (way too) large portion of our species is. It's also pathetic.

I can imagine some idiot losing sleep because grown men will be playing sports a few hours away instead of a few minutes.

Losing sleep is a bit of a stretch, but for people who enjoy going to games, it is is an issue. But again, if that is how you feel, then why bother following sports?

 

[Brooklyn Ranger]

I think you are right.

But I have a question, is capasity really a big problem at Penn Station today?

Doing this, ie removing the MSG and putting it somewhere else, along with building a new arena is going to be massively expensive. When you have a big capacity problem in your communications you just gotta fix it, but I never got the impression that this mainly is a capacity problem.

Penn Station was built to accomodate around 150,000 people a day (when the original train station was torn down the trend was to cars, train travel, even commuting was on the decline). Now over 600,000 people a day use it and projections are for further increases.

There are several improvements being made, but it can be elbow to elbow when there are delays and trying to get in and out during peak periods is very difficult on a daily basis. The reality is something needs to be done because more people are using both commuter trains and long-distance trains and the thrend is not expected to change going forward. The Gov of NJ ended a project to build another tunnel under the Hudson, but it too will have to get done at some point.

We're fans here and obviously have strong opinions (as did my parents and grandparents about moving MSG from Broadway to it's current location). And corporations do have quite a lot of power beyond the economic sphere here. But, having a major expansion of one of the main railroad stations will benefit the city AND the region a great deal in the long run. In the end, there will be a lot of kicking and screaming, but the need to keep people moving around the Tri-State area (NY, NJ and CT) will win. Maybe not in 10 years, but sometime after that.

 

[GordonGecko]

MSG isnt going anywhere, the city doesnt have the money to pay them for the land and find them new land. I wouldnt be opposed to a brand new arena being around the corner or wherever, ofcourse until my blue seats become 80 dollars a piece and im moved somewhere else.

FYI if the city wanted to take the land by eminent domain, they would not have to find them new land. MSG would be on its own

 

[Ola]

Penn Station was built to accomodate around 150,000 people a day (when the original train station was torn down the trend was to cars, train travel, even commuting was on the decline). Now over 600,000 people a day use it and projections are for further increases.

There are several improvements being made, but it can be elbow to elbow when there are delays and trying to get in and out during peak periods is very difficult on a daily basis. The reality is something needs to be done because more people are using both commuter trains and long-distance trains and the thrend is not expected to change going forward. The Gov of NJ ended a project to build another tunnel under the Hudson, but it too will have to get done at some point.

We're fans here and obviously have strong opinions (as did my parents and grandparents about moving MSG from Broadway to it's current location). And corporations do have quite a lot of power beyond the economic sphere here. But, having a major expansion of one of the main railroad stations will benefit the city AND the region a great deal in the long run. In the end, there will be a lot of kicking and screaming, but the need to keep people moving around the Tri-State area (NY, NJ and CT) will win. Maybe not in 10 years, but sometime after that.

Thanks!