How September 2010 could shape the future of professional soccer in DC and Baltimore
Posted on August 16, 2010 10:55 am
As DC United’s historically dreadful season has wound itself to its merciful end, the one question I get from everyone is not whether the team will actually get better, or whether Ben Olsen will make any difference, but whether the team will be moving to a new stadium in the DC area, Baltimore, or even elsewhere.
Here’s my attempt to layout what I see are the likely options and timeline for United to stay in the DC-area, move to Baltimore, move elsewhere, or even fold.
The situation as it stands now:
United cannot stay in RFK as the team pays rent to the stadium’s owners (the DC government), doesn’t keep any ancillary revenue and cannot afford to renovate the crumbling edifice even if they wanted to. Just like the Red Bulls did at Giants Stadium, United hemorrhages money each time it pays to open the doors at RFK. Owner Will Chang has admitted that he alone doesn’t have the money to make a stadium happen and thus needs to find new, additional investment in United in order to build a stadium in the DC area, where the large-scale use of public money on stadiums is unpopular and unfeasible considering the financial states of so many of the local jurisdictions.
Recent stadium efforts in Southeast DC and Prince George’s County, Maryland have failed at very early phases. Since then, Kevin Payne has said very little other than to say that “we have options” and “we don’t want to talk until have we something to talk about.” One key difference from the previous MD and DC efforts, is that while Payne has gone silent, there have been none of the usual leaks coming out of local development or Government circles. Talk of a DC United stadium in the DC metro area has gone entirely silent. United says that’s because they want to keep talks quiet, but folks like me say that the silence is because there are no serious talks going on and that Payne is either stalling or lying depending on how charitable you want to be.
What I think is going to happen:
The first big event for the stadium effort is September 14th, when the DC democratic mayoral primary is held. This pits incumbent Adrian Fenty against Council Chairman Vince Gray. As no Republicans are even on the ballot for the general election in November, the primary serves as the de facto general mayoral election. Fenty, who has backtracked on a 2007 stadium promise and is seen now as a someone opposed to the city spending money to help United build a stadium in DC. Vincent Gray has had virtually nothing to say on the subject. Kevin Payne and the United front office will be hoping for a Gray win if only so it gives them a new set of officials to work with. Fenty appeared to stymie United repeatedly on the previous Poplar Point proposal, and Gray, merely by saying nothing, has probably emerged as the organization’s preferred candidate.
If Fenty wins the primary, I expect that to be the end of DC United playing in the District of Columbia. His election will likely force the club into the suburbs or beyond. Having just defeated the Council Chairman, Fenty will have established that he, and he alone, runs the show in DC making it unlikely and that any councilman would ever be willing to defy Fenty and support an almost-certainly fruitless United stadium project in the city.
But, if Gray upsets Fenty in the primary and doesn’t rule out a DCU stadium in the process, I expect United to stay in DC until at least the end of 2011 to try and work with the new administration while also keeping Baltimore alive as an option as a possible incentive to keep DC officials interested. That means DC will stay in the DC-area through 2011 and possibly longer, depending on stadium negotiations progress.
After the mayoral primary, the next date that matters for DC United’s future is somewhere between September and October 2010 when when a marketing consulting firm will release the findings of a $100,000 feasibility study requested by the Maryland Stadium Authority about building a soccer stadium in Baltimore to attract either DC United or a USL club.
That study is important because it will show whether the Baltimore door remains open to United. If the study supports the idea of a soccer stadium in Baltimore, things could start happening very quickly. If the Baltimore door is opened, then I would expect the club to start talks with the stadium authority, Maryland government, and Baltimore city officials fairly quickly. If the support in Baltimore is high enough and the Baltimore officials are enthusiastic enough, the city could even try and get United to move to the Ravens’ home at M&T Bank Stadium for 2011. If I were DCU management, I’d jump at that immediately. That stadium is owned by the stadium authority, not the Ravens club itself, thus opening the door wide for that temporary option. United would announce that after 10+ years of trying, they have exhausted all options to stay in the DC area and will move to M&T Bank Stadium for at least the 2011 season. This makes sense on a lot of levels. The excitement of getting the team in town would provide a good platform for United and the stadium authority to get the deals done on a soccer stadium in the city while allowing them to build their brand and create fans in the Baltimore area. United would come into a marketplace that would be excited to have another major league team in town and one with public officials willing to support the club, something United can accurately say they’ve almost never had in DC.
If I were United, I’d time the announcement around the Superdraft, which conveniently is taking place in January at none other than the Baltimore Convention Center. If the Baltimore officials are excited enough about the prospect of a major league team moving to town (and being able to put the screw jobs to their snobbish neighbors down I-95), I could see this deal being wrapped up as soon as January, believe it or not.
As an aside, if the team does move to Baltimore, I expect the club to maintain the United identity and colors, probably becoming Baltimore United. If they were to move out of the area completely or fold, I’d say that they’d leave all the branding and records here like what happened with the Earthquakes, but if it’s only to Baltimore, I expect the branding and records to go too.
But if at any point after a Fenty election, the Baltimore door is closed on United, that leaves the club with having to work with the DC suburbs. All has been quiet for months out of suburbs in Virginia and most recently, Kevin Payne said that Baltimore is the only site in Maryland under any consideration. If the suburbs, especially the most likely candidates of Fairfax and Loudoun counties in Virginia stand firm to their past policies of no funding of stadiums for anyone at anytime, then this puts DC in an ugly spot. I can see United trying to budge one of the suburbs during a desperate 2011 season and simultaneous “save the team” campaign (like the Capitals in 1982).
But if that doesn’t work, I believe the team will either be sold to the highest bidder and moved or, if a buyer cannot be found, the team will suspend operations/fold after the 2011 season. By taking that unconventional step, the other owners would pay off Chang to get him to walk away, put the league back at an even number of clubs in 2012, and find itself with the prospect of two expansion fee windfalls available after 2012 rather than just the one everyone assumes will be New York.
Here are the two outcomes, in order, that I believe are most likely:
Outcome #1. Fenty is reelected and MLS folds the team after Baltimore decides against building United a stadium and DC fails to convince a Virginia suburb to support a stadium. In most times, this would be the “move the team” option, but MLS gobbled up all its viable threat markets when it signed up Portland, Vancouver, and Montreal as expansion teams. Plus, they won’t move the DC franchise to NY because the league doesn’t want to give up the hefty expansion fee that any NY club would have to pay the league and its existing owners.
In this economy then, that leaves MLS with very few options in terms of moving United out of DC or Baltimore. The USL ownership in St. Louis just proved to everyone that it doesn’t have the money. Also, once the Saputos were sated in Montreal with team #19 in Montreal, that really exhausted the list of legitimately rich folks who want to buy an MLS team. Sure there are markets, especially across the Southeast, that MLS would love to fill, but not one of them has an owner or even anything much more a website or two. Maybe by 2011-12, something will have emerged in Phoenix, Atlanta, or Miami but I doubt it.
Thus after the 2011 season, I think MLS shuts down United until the economy gets better and an owner in DC or elsewhere emerges with the deep pockets and political backing to build a stadium.
Outcome #2. This is the Baltimore option. Baltimore’s officials might be so excited at the thought of getting another major league team in town that they make United a deal to move to M&T Bank Field in 2011 with terms that are more favorable than those at RFK. Once in Baltimore, the team moves to build the soccer stadium in that city leaving Washington DC for good with only the hopes of a white knight owner coming in, buying another team (since we all know that the 20th team will be New York), and getting approval to both build a stadium in the DC area (extremely hard) and to get MLS approval to potentially cut the legs out from under the Baltimore market by moving to DC (extremely unlikely).
I should add that I think an MLS team would do quite well in Baltimore. It would do with a far less crowded market with only the nearly hopeless Orioles to compete with in the summer. In terms of media coverage, I could see a Baltimore team being covered far more comprehensively by the local media than United is currently in DC. This team, assuming it’s less hopeless than the Orioles, would become a real event in that town if marketed just halfway decently. Plus, at least on weekends, it would still attract a significant percentage of its old fans from the DC area. It saddens me to say it, but it would probably be good business for United to move to Baltimore.
In conclusion, unless something really drastic changes such as new, very deep-pocketed local owners purchasing the team, I don’t think the DC metro area will have a top-flight professional soccer team any later than 2011.
In al lhonesty, I see United moving to Baltimore. This looks to be the best long term option for the team due to the stadium issues alone. Plus, as you said, many DC fans would trek to Balti on the weekends to catch games. But keeping the “United” name and colors is a must. Even the logo must remain essentially the same.
I can not think of M&T’s layout. Is it set up like a traditional football stadium or is it more like Qwest? That is, would tarping off the top be feasible enough to create a more intimate atmosphere? Could M&T work as a sustainable option for a few years with a decent lease? It’s not like anybody uses it during the bulk of the MLS season anyway…
How about DelMarVa United for a name? I kind of like it
Parkway United?
Pretty bleak stuff; hope they find a home. That would be a real black mark against the league to lost its flagship franchise. And bad for the DCU fans, of course.
You offer a very bleak view of a once strong MLS franchise. It’s a shame to think that the league wouldn’t even step in to help because they could get more money out of a expansion club. I understand it’s business, but that doesn’t make it right.
If they can’t make a go of it in the DC area, then I hope they do go to Baltimore, and not to rag on DC, but Baltimore is a pretty fun place to spend a day, and then go see a game at night. I’ve been to Baltimore countless times, and I think that if they can get the current United fan base to trek up north, Baltimore would be a great asset to MLS.
Umm … Baltimore Bays,anyone?
Reading this makes me want to go drink turpentine.
If the team does temporarily shut down, as in option 1, at least that would mean we’d get to start over eventually with new players. That’s how depressing this season is- I’ve turned the worst possible scenario into something positive, and it honestly doesn’t bother me too much that we may get shut down. Ugh.
“Thus after the 2011 season, I think MLS shuts down United until the economy gets better…”
I don’t want to sound like a political hack, but the economy IS getting better.
http://www.fivethirtyeight.com/2010/…-overview.html
This should in no way be any attempt to support the safety of DCU, but to suggest that its problems are much deeper and broader than the 2009 recession. In fact, the DC metro area has rebounded much more quickly than other metro areas.
http://www.washingtonpost.com/wp-dyn…123003262.html
“United cannot stay in RFK as the team pays rent to the stadium’s owners (the DC government), doesn’t keep any ancillary revenue”
That’s factualy untrue. United does keep some ancillary revenue at RFK, just not as much as they’d expect to keep as part of a new stadium deal. 10 years ago the ancillary revenues were not shared with DCU as much as they are today.
As for your M&T in 2011 theory, part of your premise is that the MD Stadium Authority will offer DCU a better deal on ancillary revenues at M&T than the DC government will ultimately offer them at RFK. That very well may be true, as the incremental cost to M&T to putting a secondary tenant in is likely less than the cost to DC of keeping RFK running, but it’s speculation nonetheless.
It’s quite possible that DC, when push comes to shove, will have a strong interest in keeping RFK up and running whether DCU stays or goes. For example, losing DCU and basically shutting the place down would mean they lose their new bowl game, and I don’t see the city bailing on that this quickly. In addition, it may raise issues under the NPS ground lease. Hence, it’s quite possible that DCU has a lot more leverage with DC than you think in terms of what concessions the city would offer on a short-term lease in comparison to what would be available at M&T (assuming the city will end up keeping RFK up to code and operational etiher way).
The main point is that there’s a lot none of us know about the exact economic implications of DCU’s current tenancy, and how that compares to other options (like M&T, contraction, etc.).
I sure hope so.
As an outsider without an MLS team anywhere near to me, I also consider DC United as the flagship franchise.
However, I could totally see and not be averse to the economic relief that would immediately be afforded to MLS without money pit the current DC financial situation is.
Ugh, depressing. Ted Leonsis, save us!!!!
i wonder what percentage of United fans would still support the team and make the drive to Baltimore for games?
i still like the idea i first saw at MatchFitUSA to get some investors involved with refurbishing RFK as a National Soccer Stadium like Wembley or Azteca. the USSF must have a few millions squirreled away by now. the USSF could run the stadium and give DCU a favorable lease. could it be done?
Theoretically it could be done, but why would you want it to be? That would deprive the nation of soccer. We aren’t as small as England or even Mexico (which has a huge population, but MC is very much the centrifugal location), and we have no real “capital” city in the sense that it is the most commonly frequented place or most important. In that regard, it’s a tossup between NYC, LA, and Chicago. But limiting games to one venue simply isn’t fair to fans in every other city. Putting the National Stadium in DC is fine for East Coast fans between NY and NC, but everyone else gets left out then. LA, Chicago, NY, NE, Texas, Columbus, Seattle, Miami, Portland, Philly, etc. simply can’t be ignored.
In an idealistic world, I’d love to have a National Stadium, with the specialness of a Wembley or Azteca that makes all the citizens of the country tremble with awe at its very mention. But realistically, it’s not fair and won’t happen.
It could… if it weren’t a completely stupid idea for a nation the size of the USA.
Jefe is completely right. I don’t understand why this National Stadium things keeps popping up…
Oh wait, yes I do… just the usual bit of Euro-apeing.
And let me fill in some detail on that. The authority that used to run the stadium, DCSEC, was folded into another city agency. About that time, they also decided to go a little easier on United, and they sold the concession rights to DC for an additional $200k/yr in rent. This is partially because the old concessions were run so badly that DCU was pretty sure they could make more money running it themselves.
So anyway, DCU gets concession revenue. I believe they do not get any parking revenue (and the government jacked up parking rates threefold between about 2003 and 2010). They also don’t get any significant premium seat revenue, as RFK’s mezzanine level is not up to the standards you’d want to sell to those customers.
Fwiw, back-of-the-enveloping it, I figure capturing the premium audience, as well as parking, naming rights, and not having to pay rent would be worth $5 or 6 million a year vs now, not counting any general increase in ticket sales or franchise value. Of course, you’d probably be paying a lot of that back one way or another (the MSA basically proposes to do it through a ticket tax) to finance the building. It’s not quite as dire as the team’s rhetoric, though it’s not fun.
Now, to the general question, there’s a real chance DC United won’t be playing in DC 5 years from now. I don’t think the chance is as high as Aaron does, because there are three assumptions in his article I question:
Assumption 1: that Fenty will never work with United, and thus if he’s re-elected it spells doom.
OK, first it assumes that this was personal in the first place. In politics, it seldom is, and yesterday’s foe becoming today’s friend happens all the time.
It’s just as easy to believe that Fenty didn’t want to get out in front of a stadium proposal that was going to be controversial (the Post especially hated the hell out of it) without strong Council support as because of this nebulous, unsourced ‘Fenty and MacFarlane don’t like each other’ business. But if you do believe the latter story, well, MacFarlane is out of the picture, anyway.
Basically, Aaron has seen Payne either stalling or lying, and assumed he’s stalling for the election. But there are other possibilities as to what he might be stalling for:
* An improvement in (the public perception of) the economy, and/or an improvement DC’s finances due to the Nats finally starting to draw.
* Having Baltimore as a negotiating chit, since he has almost none now. (Now, I’m about to call Baltimore a relatively poor place to put a team, so you’d think that would make it valueless as a chit. But then, you’d have thought Saint Louis had no value as a chit in the Real Salt Lake negotiations, and that didn’t turn out to be the case.)
* Winning the World Cup bid and dangling hosting games as a carrot.
Assumption 2: that Baltimore, if they decide to work with DC, is a desirable option.
Baltimore has more sports competition per the size of the economy than DC does. Portfolio Magazine measured exactly that question, and came up with 40+ cities in North America that have leftover personal income to strongly support a new pro sports franchise. Baltimore was not among them:
http://www.portfolio.com/resources/SportsChart.pdf
Now, they aren’t as bad off as the ‘over-extended markets’ (the ones with negative numbers in the chart), but they would be in the ‘soft market for a new team’ category.
Yes, they ‘only have baseball in the summer.’ But 5 years ago, DC didn’t even have that. Baseball ‘drains the pool’ more than any other sport, in terms of ticket purchases and newspaper coverage, because it plays 81 games. And DC’s market is much bigger than Baltimore’s, especially measured income-vs-income.
Baltimore is considering this not because they have any confidence in their ability to support another team, nor because of any confidence in soccer, but because they see this as their one shot. Baltimore is nowhere near the conversation in any league’s expansion plans, including those of MLS.
Assumption 3: that MLS can stomach the blow to its corporate image of folding a team.
This one’s mostly self-explanatory, but MLS is gaining traction partially on the belief that it’s doing pretty much everything right in a business sense (they were Street & Smith’s League of the Year in 2008). The image of strong, stable growth takes a big hit if a team gets folded.
If Baltimore decides they want DCU and offers a bit of help on stadium construction, I think doing that versus swallowing hard and building the thing with entirely private money in the DC area is actually a close call, and would depend on the actual amount of help Baltimore is offering. If the options are pay your way in DC or fold, I don’t think the latter is a real option. The league won’t be paying back Chang’s $30M+ investment and hurt its image in the process, and neither will Chang be eating it.
This…+
Until around 2005, DCSEC kept all of the parking revenue. IIRC, around that time KP stated to Goff that they’d gotten a concession where DCU got a dollar per car. I’m not sure if the split ever went any further than that, or if DCU got any of the additional revenue when rates were increased a couple years ago.
This is a good point.
We have to remember that annual operating profit/loss is not the only factor in what will happen in the end. Team owners can finance temporary operating losses, often for long periods, especially when their investment equity is appreciating. The value of MLS teams has been rising over the last decade, and a team’s value is not necessarily just tied to its own profitability, as the portability of franchises in the USA makes it so you can use other teams’ financial success to boost the equity value of a team that is underperforming in the short-term in a particular market.
As much as Chang may be losing money on an annual basis operating the team, the rising value of his equity may be offseting that to a large enough extent that he’ll gut it out longer than we think. Similarly, the operating losses may be small enough in comparison to the overall hit the league would take losing a historically successful franchise (which Garber only a couple years ago called the most “authentic” soccer culture/fans) that the league will show a lot of patience, at least until the overall US economy has turned.
For years I assumed that Carl Pohlad would ultimately move the Twins after their ballpark hopes were stuck in neutral for over a decade. In the end though he just kept incurring the losses, knowing that the value of his franchise was rising thanks to the league’s operations as a whole. In the end, his patience was rewarded with a stadium deal and now the Twins are raking in money and more popular than ever (even if he’s not around to see it). It wouldn’t surprise me if DCU’s future was less dire than popularly assumed.
Also, as Stan says, don’t underestimate the possibility of working with Fenty, especially when he’s no longer thinking about re-election.
The biggest factor in all of this is, of course, the Washington Redskins. Dan Snyder would love to have the District tear RFK down and build him a palace bigger than the Cowboy’s Stadium, and if DC bent over for that proposition Snyder would vacate FedEx field so fast the shockwave would do the demolition job for him.
And DC would love to do it for him, too. DC is a Redskins town, no two ways about it. But there is the small issue of cost, and after the Nationals Ballpark debacle, there’s little money and less political will to raise it. Sooner or later, the issue of RFK will need to be settled, and if building a stadium for the Redskins isn’t an option, then the picture becomes a whole lot brighter for United, since there is no better place in the entire DMV for building a soccer stadium, including Poplar Point.
Any possibility of using FedEx Field?
oh yeah? keep reading the flyers from the DNC. everything is getting so much better out there. http://www.cnbc.com/id/38691272
I still in no way believe the Baltimore option is going to happen. I’ll have to put together my thoughts on it in the next couple days and post that here.
it’s not Euro-apeing and it’s not a stupid idea. i think it would raise the profile of soccer nationally to have to have a big, fancy stadium in the capital for big games. and it would help out DC United at the same time. isn’t anyone else a little embarrassed when the best homefield advantage we can find for the national team is 20,000 fans in an erector-set stadium in Columbus, Ohio? all the games wouldn’t have to be at the same stadium of course. but i think having a national stadium with real homefield advantage is the next step in the evolution of the USMNT. now, whether it could realistically happen is another question…
If they move to Baltimore and keep the name/colors (I live in Baltimore and really would prefer they remain in DC), they could just drop the DC and call themselves United.
It doesn’t make that much less sense, when you think about it.
I’m not getting how a white elephant would help soccer’s profile at all. Then again, the ladies do think I have a huge penis when I drive a Hummer.
MLS matches in a half full stadium with tarps covering the upper deck? Sounds awesome!
Could you care to name the national stadiums of the last three World Cup champions?
And really, it’s not Euro-apeing, since most major European nations don’t have a national stadium. Germany, the Netherlands, Spain, and Italy all spread their games around the country. In Germany, for example, why would you hold all your team’s games in Berlin when you can hold them in huge cities with great stadiums like Munich, Frankfurt, and Hamburg? And you can do the same exercise with Italy and Spain pretty easily.
France, Portugal, and England do hold their team’s game at a single site Paris, Lisbon, and London, but that’s not nearly enough of a sample to throw an entire continent under the bus.
Never mind that having a single national stadium in the USA would be a dumb idea, but putting it on the East Coast just compounds the dumb.
You overestimate how much people in the rest of the country cares about what happens in Washington, aside from what happens in the federal government. I mean, if you want us to buy your notion that a big fancy soccer stadium would raise the profile of soccer nationally, you’re really going to have to show your work.
Stadiums don’t give homefield advantage. Fans do. And if those fans happen to be at Crew Stadium, so be it.
Then it wouldn’t be a national stadium, would it?
If the goal is to evolve to be more like England, I guess. We’ve already got the “fans whose mouths write checks that their national team can’t cash” part down pat. I guess we just need more high-profile WAGs and baby mama scandals. And a white elephant national stadium!
You know why it’s not realistic? Because we’re not ********ing England, where it’s a few hundred miles from one end of the country to the other. We’ve got huge ********ing cities thousands of ********ing miles away from the capital.
It is a stupid idea for a country with the size and population distribution of the United States.
Washington, DC isn’t Glasgow, Scotland.
It’s a mid-tier city that is more than a day-trip drive from the vast majority of the U.S. population. The only reason to have a “national stadium” is if it’s meant for the “national team” to play most of their games there, because otherwise you’re trying to justify the expense for a venue that gets used, what, twice a year? Really?
1) No
2) Your erector set doesn’t resemble the one I had when I was a kid. Crew Stadium, while not a $200 million dollar stadium, isn’t likely to be confused by the scaffolding erected stands at your neighborhood high school.
Chesapeake United?
If they unscrew those fakey bouncing seats from the concrete wall, they could widen the stadium. This might work.
Good news for DCU!
http://www.clarusrg.com/sites/defaul…%20release.pdf
Speaking as a European, the idea of a national stadium for the USMNT is Euro-apeing.
1) National Stadiums are more usual in small or poor countries where developing a 50k stadium is not viable for a club in the domestic league, so much/all of the funding comes from the central government.
2) In larger countries, where there is a national stadium, it’s multi-purpose with a running track (i.e. building it was justified by having an Olympic bid in mind), and those stadiums suck for atmosphere.
3) Most bigger countries in Europe (Spain, Germany, Italy) don’t have a national stadium and prefer to rotate cities to keep the different regions happy and/or engaged.
4) These stadia cost mucho $$ and often run significantly over budget (Wembly). Continental FAs think it’s a waste of $ and distracts attention from things like youth coach development, a wining MNT, etc
It may be a cliche, but the US genuinely is a “continental nation” & that alone dictates that the MNT plays in as many cities as possible so as to to keep the fans there engaged. The only football playing countries on the same geographic scale are Australia, Russia, and Brazil and all play NT games in different cities, for that very reason. To my mind this logic applies in spades for a marginal(ized?) sport like football, where there are dozens of major metro areas with no MLS team and a MNT game would “fly the flag” for football and its fans, as well as expose the casual sports fan to top-class footy and maybe whet their appetites for more.
Last, even the biggest European country is a lot smaller than the US and has much better rail links, so to take a train from Newcastle to London or Marseilles to Paris is a shorter and better proposition to their fans. For a Sam’s Army LA or Chicago chapter coming to DC, it’s a plane or bust.
Apologies for banging on, but too many Americans footy fans think there is a European way of doing the game when there isn’t – there’s many of them – or that that any one of those ways is the “one right way” that will be template for building soccer in the US – they ain’t.
Bullseye!
At least no one says stupid shit like, “The rest of the world plays a fall-spring schedule, therefore we should too.”
lol so how many games would be in this stadium? 2 every four years?
baltimore city sounds good
Let Snyder build his palace on the RFK site, have the upper deck hang over the lower, then have a retractable field (or two) so the football and soccer fields are separate.
Sure, it’s costly, but when you’re talking about the Redskins, you’re talking about some serious cash.
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