News: Expansion Bid News - catch all thread

This is pretty huge in terms of the vote margin. Tyus voting no was a no brainer. As was Green. I had Rice, Cohn, and Guenther pegged as nays and thought a couple more could have followed them. 23-5 to 21-7, in this vote, before all of the details regarding special taxing districts and port authority expansion got ironed out in future votes, would have cast a lot more doubt on the city's ability to get this done.

Biggest concern now: in MLS' view this resolution may not do enough remove roadblocks between agreeing conceptually to actually getting all of the tax districts squared. If that's the case, they're going to need to figure out how to button things up a bit better: lease details (contingencies/clawbacks, maintenance fund requirements, venue expansion stipulations, etc) or other community benefits that may need to be thrown into the mix, etc.

I'd like to think they've been in discussions with the league to determine the level of detail in this bill required to gain their confidence though.

 

Paul Tenorio‏Verified account @PaulTenorio 23m23 minutes ago
Garber said league will introduce idea of growing beyond 28 teams. I've heard 32 teams has definitely been discussed informally within and around the league.

 

Which should surprise no one, really. The product falls into a "sweet spot" in terms of $$$ commitments. 16-30K 17 times a year is pretty manageable. The venues aren't ridiculously expensive compared to the Big 4. The payrolls aren't outrageous. Even if that were to double, which would really elevate the status of the league globally, the $$$ requirements are quite manageable.

Cities and markets continue to grow, but there's a scarcity of opportunities in NBA/NFL. MLB requires huge markets to support 81 home events per year. NHL is a different beast because the game itself is pretty culturally isolated. Not a lot of school teams, weather dependent outdoors, ice time/equipment is crazy expensive.

Using a random example: Memphis. Memphis will never be an MLB town (too small). Hockey is not going to happen in Memphis (because hockey culture will never happen there). The NFL won't either (stadiums too expensive). But they could definitely be an MLS market as the game continues to grow in the US. MLS expansion is not going to stop. If they can put 40 or 50 teams out there 20-25 years from now, that's what they're gonna do.

 

I disagree with you. I think the "Soccer Don" is prepping us for 30 clubs. Of the 6 contenders only 4 are viable. Tell me, where did you heard about 32 ?

 

I really doubt that the league will grow that large. They will quit current expansion at 30 with a possibility of growing to 32 someday.

 

Team #MLS4THELOU presented a proposal update Monday at the RBC St Louis year-end meeting.
A finalized plan will be delivered to #MLS before the end of December.

#STL
@explorestlouis
@downtownstlouis
@SteveStenger
@LydaKrewson

 

Time will tell. I think we tend to revert to the American sports league mindet because that’s what works in other sports. In hockey, football, basketball and baseball the global supply of talent is low and the domestic talent pipelines are mature, so it is difficult to expand without watering down the league. Those leagues are also the best way in the world, so owners seek to protect their status. Owners also want relocation leverage, and open markets provides them with that.

With MLS, I don’t think it’s reasonable to assume we’re ever getting to Big 4 status. The gap is too large in terms of revenue/global broadcasting/CL revenue. MLS doesn’t need to compete there. It needs to compete vs all other leagues with France being maybe the absolute ceiling. To do that, the league needs to improve the domestic talent pipeline by filling out the domestic academy footprint...preferably by having more MLS clubs with academies in those cities. It can supplement that by importing cheap quality and differentiating the product. It also needs to simulate the overarching CL and domestic pyramids structures to make the competitions bigger than a league. Part of the is better coordination with MEX and elevating MLS quality. But part of that is recognizing that “minor league” and pyramids don’t work here. Because people don’t do minor league well.

There are alternatives to that though. Imagine a league of leagues we’re there are 48 MLS teams divided into 4 divisions of 12 teams. The season starts with 22 home/away fixtures with your local rivals. Imagine a division/league STL plays in with: KC, CHI, MPLS, MIL, IND, CIN, COL, CLE, DET, LOU, PIT all at/better than current MLS level. After those 22 matches, the top 3 of each division carry their results over from intradivison matches vs the other top 3 teams (4 matches). They then play the other top 3 from the other 3 divisions home/away (18 matches). Do the same with teams 4-6 in each division, 7-9, 10-12. The quality at the top is outstanding but even in the league dregs, it’s not “minor league”. And there is always next season to improve without the punishment of pro/rel.

It’s not pro/rel. Its not non overlapping separate divisions like MLS and USL now. Its sort of a league of leagues that offers a footprint to grow the game. It offers local derbies. And if you invest properly and grow the club well, you get better matches. A league like that which is broad and deep where maybe the cream is at the level of the better (but not best) non Big 4 league clubs and the bottom is maybe lower (but not bottom) Championship level is a league that is worth watching both locally and globally. It gives clubs a chance to find their level without punishing them via pro/rel.

I’m not saying this is how things end up, but MLS can be whatever it wants to be. MLS and MX need to become their own mini UEFA to grow the game and this is one path toward that. The bigger MLS clubs are already starting to gripe about smaller clubs holding them back, but they need a viable footprint of smaller clubs to create the national culture and to build out the footprint. If the country doesn’t have that footprint, it’s leaving a lot of broadcasting $$$ on the table because there is no local connection to the game. I don’t see USL being that. Add this need to the fact that venues aren’t that expensive and you don’t need crazy money to assemble a roster with the quality of say an FC Copenhagen and there’s a potential there in a wealthy market of 360 million (CAN+USA) that you can’t find elsewhere.

This isn’t a 5 year thing. But it is a 20-30 year thing. They wanted to stop at 20. And didn’t. Then 24. Nope. Now they’re saying not so fast at 28. I don’t have a reason to believe them at 30 or 32 or 36 either. If there was a viable path where they could lock up status as the 5th-6th best league in the world, maybe. It’s hard to hold that spot down though.

 

The only way they expanse past 32 is to create own rel/pro with a MLS1 & MLS2. I just can't image them risking everything with over expansion. I remember an interview with the "Soccer Don" when Orlando was announced that he felt at the time that 30 clubs would be the tipping point.

 

1) Garber has gone on record before saying the league will be capped at 20, 24, 28, 28 before. Why do you believe him when he says 30-32 teams is now the limit?

2) He has an incentive to say we're capping at X. That incentive is scarcity/expansion fees. Every time he crosses the line to create 2-4 more spots..."hurry up and get your franchise before time runs out".

3) Why would expansion past 32 require pro/rel with MLS1 and MLS2? I literally just posted something on that before you suggested this. But in fewer words: MLS already does not have a traditionally balanced schedule (home and away v. everyone else), so why would they concern themselves with balance going forward? Here's an easier format to digest with 36 teams. 4 divisions of 9 teams. Every team plays all other teams in their divisions home and away (8x2=16 games). To get to a 34 team regular season, each club would need to play 18 more games. Five different ways (off the top of my head) that could be achieved:

a) play a single division home and away on a rotating basis (every three years to cycle through all three divisions). That's 18 games
b) play 2 out of 3 divisions either home or away, but not both. Every third year a team would not play a particular division. 18 games.
c) play 18 more games based upon position within divisions (similar to what I said above). So the top third of a division would play the top third of the others. Middle third, middle third. Bottom third, bottom third. 18 games.
d) play 2/3 of each division either home or away. 18 games.
e) play 1/3 of each division home and away. 18 games.

There are multiple ways to create a "pseudo-balanced" schedule. with any number of teams. Even something goofy like 37 teams.

 

It's hard to take anything you say serious. It's like you pull this sh*t out of your a**. It must be nice to life in your reality. It's just not going to happen.

 

1 and 2 are indisputable facts. 3 is speculative...based on the patterns in 1 and 2. But if you want to take Garber seriously on pt 1 after he's gone back on his " team cap" every single time, there's a phrase for that. There's no use in having a constructive conversation if you can't grasp basic truths.

But do continue to troll on.

 

What I am saying is that their aren't enough billionaires who want soccer teams to support your theory. I believe the change from 28 to let's say 30 is being driven by the fact that MLS had to spend one of their expansion spots (#27) on Austin in order to clean-up the Columbus Crew moving to Austin mess. Also, with there being viable shovel ready stadium proposals and billionaire ownership groups from Sacramento, Phoenix and now St. Louis, they didn't want to waste these opportunities with plans to expanse further past 28 at a later date. As to the other current contenders in Detroit and San Diego, the league is going to past them up due to stadium issues. In Detroit, I think the "Soccer Don" is pissed at them for changing their stadium plans, especially when Detroit did the bate and switch to Ford Field. In San Diego it's a matter that the proposed ownership group was more interested is a "land grab development" deal than truly wanting a franchise for San Diego. If they truly wanted a MLS franchise they would be working with the SDSU stadium group, which passed the voters in November. But, yet they have done nothing.

 

Pardon my forthcoming novel:

-You don't need as much money to support MLS as other sports. You don't even need a single billionaire to pull it off. A group of 3-4 owners with a combined net worth of a billion or two would work fine. MLS-level rich prospective owner is roughly 5-10 times more common that NBA/MLB/NHL/NFL level rich prospective owner. That much smaller group of super high net worth people support 123 teams in those 4 sports. Now those leagues are more attractive to owners because they are at the top of their sports. For the sake of being conservative, lets say there are only 5x the number of MLS-level rich investors. To support a 48 team league (eventually), the relative supply of owners is almost 13 times greater than in the Big 4 US leagues.

-You're conflating a couple of things. 1) who is in the owner queue now vs. who could be over 20-30 years. You don't blow this up and/or add 50% or double the league in 5 years. Garber's strategy has been to add 2-4 clubs over short windows. 2) stadium issues are different than ownership issues. Currently, there is a lot of distaste for stadium subsidies. If that's temporary, problem solved in the long run. If it's not, then the problem is still solved in the long run. Because venues for MLB/NFL/NHL/NBA are much more expensive. So if an owner is going to be stuck holding the bag on venue costs, MLS is suddenly a much better deal.

-The number of people queuing for a team in the application process proves this is attractive to those people. San Diego, Detroit, Phoenix, Charlotte, St. Louis, Sacramento, San Antonio + Precourt/Austin + Miami (finally) + Nashville + Cincy. Not to mention 3-4 cities where the effort hasn't corralled the right kind of ownership (yet). Stadiums don't always work out, but speaking from experience in STL...a lot of that is down to who is in office at any given time rather than public will. Gov Greitens refusing to pony up 10-15 million led to the funding path STL initially pursued, which led to the stadium defeat. Other leagues don't have that sort of ownership in the wings. Looking at the startup costs: $150m expansion + $200m (owner stadium piece) +$10m misc. startup = $360 million. For probably $30m of revenue out of the gate. 12x revenue is expensive in relative terms compared to mid/small market teams in other sports (6-7x revenue). It's more expensive (relative to revenue) because the league expects to grow its economic profile much more quickly than the established leagues. To support those prices, it would need to more than double its revenue in a fairly short time (because no one will pay twice as much for a hypothetical revenue double that may/may not happen at some point in the future for the price to "pay off").

-Which brings me to the final point of this overwrought essay. There are two ways the league can go.

a) One is the approach that the league will remain limited in number, quality is going to skyrocket and clubs will find themselves able to compete for players to become a truly high profile global league...think maybe the French league. That will fail for so many reasons. There are simply too many clubs of a certain economic profile that can pay players far too much and offer them CL. Maybe 2-3 MLS clubs could possibly achieve that profile, but in reaching it they'd need to pay through the nose to draw players away from CL opportunities and they'd suck the competition out of the league (like Ukraine, Russia, Portugal, the old NASL). Keeping things financially responsible, they may be able to pay 40% of revenue as wages. To be PSV/Benfica/Porto/Ajax quality, that means $200 million of revenue. Add another $50 million because you'd need to pay players a premium to opt out of Champions League opportunities. That's a huge ask. It's something only a handful of NBA teams manage. You'd also need to grow some domestic players too. How do you grow players capable of PSV bench worthy status in sufficient numbers without a healthy stable of academies that a 28-30 club league is unlikely to provide? It's a numbers game. For every Barca superstar there are 10 PSV types and for every 10 PSV types, you can produce 100 good but not great MLS+ level domestic talents.

b) Don't try to grow to compete with the PSVs of the world. Instead exploit the wake that those clubs leave behind in leagues like Turkey, Russia, Netherlands, Portugal. The big clubs are sucking all the revenue and there is a huge gap between the top 2-3 and even teams 4-6. That's where you compete. A lot of markets can generate $40m-$120m revenue with some league maturity. At the top end of the range that's low level NHL revenue and the bottom is appreciably better than teams that are snagging UEFA cup spots outside of the Big 5. To do that you need to make the league culturally relevant by expanding the footprint. More academies to grow local players. More regional rivalries. Buying from Latin America/players currently at midtable leagues 6-12 in Europe. Selling players on to Big 5 leagues, or the elite 10-20 clubs outside those leagues. Basically any core starter of a mid table team in leagues 6-12 should view MLS as a clear step up and fringe starters/bench players outside of the power teams of the Big 5 leagues in the prime of their careers should view the league as an appealing alternative. From a revenue standpoint, some of MLS is already over the $40 million hump and I see no reason why a Louisville couldn't be there as well in 10 years. There are 60 markets in the US/Canada that could support a $40 million club. Some could easily support 2-3. You don't need all of them to get to 36 clubs, 40 clubs, 48 clubs. We shouldn't get all of them. If you're skeptical: assume in the US/Canada, we can get only 1/10 of the market penetration countries like Ned, Bel, the Swiss, Portugal get in soccer. Given population trends, that means the US/Can within 20 years could support 48 clubs with about 35-40% more cash than a club currently sitting 5th or so on their tables earns. Keep in mind this ignores future TV $$$ potential on the MLS side, which is something a 4th-5th place team in Belgium will never see.

This interim step is the only way a path to A truly opens up. Garber is currently selling vision A. Because it's fun and inspirational. But progress to date and expansion patterns suggest B. Ownership interest given the rich entry price suggests B. Economics suggests B too.

 

Or, with 36 teams, play everyone once and 3 'rivalry' teams each twice = 38.

 

There are 40 CSA's in USA/CAN with populations of over 2 million.

This does not account for MLS having 2 teams in some of them (NY/LA), nor the fact that some CSA's include two cities that could easily both support teams (SJ/SF/Oak or DC/Balt).

Nor does it include under 2 million markets that already support pro sports teams like Memphis, Jacksonville, OKC, or New Orleans.

32 is a given. Even money on 34/36. #29 and #30 will be announced before the end of 2019 with plans for 32.

Beyond that, you start to get into MLS2 and pro/rel stuff. Though if you went beyond 36 you could just do it like baseball used to. Two leagues of 20 with the winners meeting in the cup. Or two of 24.

 

It's pretty obvious, if not explicit, that MLS will continue to consider bids after 28.

MLS wants San Diego, St Louis and Detroit and I'm sure they'll all be considered when the right bid is on the table.

Louisville is building with MLS in mind, San Antonio has to pay back the city if they don't hook a MLS slot, Phoenix has firm plans, a stadium location and financing and Tampa Bay is just been sold to an organization with deeper pockets. There's also Indy to consider.

 

I look at it this way: MAC football teams get between $25 and $40 million of revenue per year. The state of Ohio is completely saturated with college football between Ohio State, Cincinnati, 6 MAC teams, a storied FCS program in Youngstown State, not to mention a strong following in the northern part of the state for Michigan and for Notre Dame among Catholics. If a Toledo can play in the third rate MAC and make $40 million, then in a mature MLS a market of roughly a million like a Louisville or Birmingham should be able to do the same as the sole top professional league sport in the market.

$40 million is roughly 40% of very low end revenue for franchises in the Big 4 US leagues. That level of revenue would allow an MLS club to spend $16 million on salary. You can put together a very good roster on $16 million. At the top end, MLS clubs aren't going to pull $200 million a year, which is what they need (minimum) to compete with the likes of the best outside of ENG/FRA/GER/ITA/ESP for players. $200 million is something that 2 NBA franchises and 27 of 31 NHL franchises don't do. $120 million? For 3-4 flagship franchises for sure. And for 40% of that ($48 million/year), that's an even better roster.

$40 million clubs can compete reasonably well against $120 million clubs. And that $40-$120 million range falls in the middle of the void between the haves and have nots of leagues like Netherlands, Portugal, Belgium, etc. That's the future of the league IMO, because that's where they can exploit the market...provided they can form a broad enough net to round out the league and poach players in sufficient numbers.

IMO, it's not wise to discount a pretty wide net of potential locations because the league (and USA/CAN's) market niche rests on building a big portfolio of big but not huge clubs. Once that is achieved, it could open up other possibilities (some taking off and competing against the cream of the crop for players, etc.). But the base comes first.

 

The competition for spot #28:

• Charlotte
• Detroit
• Las Vegas
• Phoenix
• Raleigh
• Sacramento
• San Diego

https://www.stltoday.com/sports/soc...al&utm_source=twitter&utm_campaign=user-share

 

The thing is, the existing owners have to believe that adding another team is going to increase their own revenue, because a lot of the league's revenue is shared. So, all else equal, a prospective new team would have to be worth at least the average value (in terms of expected revenue generation for the league, including the expansion fee) of the existing teams. If you're at 32 teams, adding more small-market teams that are likely to be in the bottom half of the league in terms of revenue doesn't make sense for owners, unless the prospective owners are willing to pay a much bigger expansion fee. It seems plausible to me that a 40-team league would get roughly the same number of people watching on screens as a 30-team league. Most fans will probably watch their home teams play, and whatever additional time they have for soccer viewing, they might watch Liga MX or Champion's league or whatever other league they follow, rather than two mediocre MLS teams from other cities. So ratings/streaming subscriptions wouldn't increase enough to justify splitting them 10 more ways. It seems like there would be much more growth potential from a stronger partnership with Mexico rather than continuing to expand to smaller US markets.

Another thought I had is that, because the draft plays such a small role in MLS roster building, and because the league is allowing owners to put more of their own revenue towards player salaries, it's quite possible that some teams will just be perennial doormats. There's no Lebron James or franchise QB waiting in the draft to revive a struggling franchise. As more new teams come in, it's entirely possible that the older, unsuccessful teams lose more fans as their teams become increasingly irrelevant. I'm definitely a St. Louis homer, but I see value in bringing St. Louis into the league because it's likely to be very successful. I'm just not sure that there are 12 more markets that can say the same.

 

St Louis is definitely the front runner for the 28th spot. Any additional spots would be in the future probably after Garbers' time.

 

I think the leaks about going past #28 hint strongly of two things:

1) MLS has a bid for #28 that they like a lot.

2) MLS has a bid for #29 they like a lot.

To my eye, that looks like St. Louis & Phoenix.

You know the league would like Detroit in. And SD. They need to hold the door for both. But that allows other markets to step up in the interim (Cincy, Nash).

Also, cities with warm weather (so you can start play earlier) and rapid population growth are going to be considered as well. As well as those who lack a team in each of the big4 leagues.

 

JMO
With the recent couple of announcements from the St. Louis team pursuing an MLS expansion team to the area.
I think Don will be making an announcement on them sometime in the next 6 months.
They appear to be making great strides with the city and the folks that live in that area.
The rest of the cities vying for expansion will be battling it out amongst them selves in the next round of expansion.
I could see possibly a few other cities jumping in as well and see the league eventually getting to 32 teams.
Not sure it will happen but if for some reason it does and there is great interest from cities I could see the league possibly getting to 36 teams but I in no way think the MLS will decide to go past that.
The only way that is likely to happen is with a population boom in this country and maybe Canada.

 

So as of today (Jan 6, 2019), where do things stand?

Jim Kavanaugh had stated in previous public interviews that the land acquisition piece was the next step to be completed before a formal expansion application would be submitted to MLS. He had been saying that he expected that to be completed before the end of 2018.

So has it happened? I anticipated that any further progress with local government (buying the land) would have been public news. But is there a chance that the acquisition of land was successful and the expansion application delivered without anybody hearing about it? Could the ownership group be waiting to make that announcement for some reason (maybe a coordinated media event with MLS?), or have those processes not yet been completed?

Kavanaugh and Carolyn Kindle Betz are also on record saying that they had hoped to bring Don Garber to town for a dog and pony show sometime in mid-December but that never materialized either. Are they waiting on the league, or is the league waiting on them?

Are things just moving more slowly than Kavanaugh and Kindle Betz had hoped? Was the ownership group too optimistic with their projected timetable, or have they hit a snag along the way?

Or has MLS quietly told them to pump the brakes and slow things down? Has the juggling of available expansion slots due to the Austin/Columbus deal delayed the opportunity for expansion hopefuls to rush their bids through the league?

Has some other expansion city been more active behind-the-scenes and given the STL group some unseen competition? Lots of pundits like to mention Phoenix, but I haven't been able to find any news about their bid since a meeting with the league office in July and a visit from league officials during the USL playoffs over two months ago. Is that bid legit or not?

Dan McLaughlin indicated he would have some news this coming week. What could that mean? Will it be news about some formal movement within the ownership group, or just an update from what he has personally found out?

Anybody here with speculation? Thoughts? Inside dirt?

 

Wait. What's your question?