My new stadium funding idea

[Brazy]

This is my idea for a new stadium in Oakland. I emailed this to Amy Trask and Mark Davis on 10/17/12, with attachments.
Lets hear your thoughts on it and vote in the poll.

Greetings Mrs.Trask and Mr.Davis,

I have an idea around the funding for a new stadium/complex in Oakland, on the existing site where the O.co Coliseum currently is.
Create a corporation called Raiders Corp or something to that effect and go public, offering Raiders fans worldwide the chance to buy stock in this project.
Facebook recently had the 3rd largest IPO in U.S. history selling 421.2 million shares at $38 per, providing $16B of instant capital.
1.8M people have liked the Oakland Radiers official facebook page. Say every person who liked that page bought an average of 50 shares in this new company at $38 per, it would provide $3.4B in capital. I think an average of 100 shares is a conservate estimate, which would provide $6.8B in capital. My gut feeling is that with as many Raider fans there are all over the world, this number will be higher, possibly double, if not more.
The new corp would be indepedent of the Oakland Raiders and would pay the Raiders naming rights fees, so that way the stock certs us Raider fans get, have the official Raiders shield on it so we know that we are supporting our favorite team in the world. And it protects the Davis family from risking the Raiders franchise.
I think this new corp should purchase the land in and around the current site from the county, which is in dire need of an influx of cash.
I believe to clear the stadium authority balance sheet would cost about $300M, to pay off their debts and to settle any outstanding items, essentially to buy them out.
In 2010 8.8 acres of land in/around the Coliseum was sold from the city to the redevelopment agency for $3.5M, for 50% ownership of that land, see attached.
The current complex is 120 acres. Using the 2010 sale of 50% ownership of 8.8 acres at $3.5M, that puts the value of the 120 acres 100% ownership at $95M.
So my estimate of the cost to purchase the necessay land for the project from the county/city/agency/private parties is $200M.
That puts the total cost to own all the necessary land and facilities free and clear at $500M ($300M stadium authority buy out + $200M land purchase).
As part of the purchase of the land from the county, the new corp would promise to donate a fixed percentage or amount of it's revenues to the Oakland Unified School district as well as providing 100 or so annual college scholorships to at risk youth. Both of these activities will have tax advantages to the new corp.

I think the new corp should build, on the existing site, both a baseball only and football only stadiums. With one (the baseball stadium) or both having a retractable roof so they could host year round events, including concerts and events such as the NCAA Final Four. Using the new Cowboys stadium as cost bench mark, I estimate the cost to build both stadiums at $2B. Or if you didn't want to do retractable roofs and there was enough adjacent land, you could build a seperate indoor facillity similar to the current oracle arena. In that scenario, I still think the construction costs for all three would be $2B.

Total stadium costs and to be purchase land/site free and clear, total estimate is $2.5B, well within the range of even my most conservative IPO estimate of $3.4B.

I think the new complex can have a Raiders Hall of Fame that is open to the public year round. It can have new retail/hotel facillites along the shore line. Can even explore the possibility of moving the Raiders head quarters to that location. I like an idea of having retractable solar panels on/under the parking lots, so when facillites are idle, they can be storing energy to be used when needed.

Needless to say the community could use this project not only for initial construction jobs, but for the meaningfull permanent jobs it will create.
Attached is a project file I found from late 2011. It encompasses more area then I envisioned, but it gives an idea of what some previous ideas were for that area.
My main point is that this is all privately funded via the IPO and cuts out the beuracratic follies by purchasing the land/facilities free and clear.
I appreciate your time. I hope my info proved worthwhile and helps my beloved Raiders get that state of the art facility it deserves in Oakland.

[SF_Raider_Fan]

People buy stock in a company's initial public offering (IPO) , or any existing publicly traded company, because they believe that business has good future sales revenue and profit potential.
Operating a single stadium or two is not a growth potential business, or even a profitable business, so this stadium company idea would not be of interest to stock buyers.In fact , due to wear and tear , the value of the stadium would decrease every year.
To finance a new stadium, what has worked is asking season ticket holders to donate $10,000 to $100,000 per ticket (based on seat location).I expect that this type of personal seat license would be the plan for any new Oakland/Alameda stadium. Season ticket holders will pay for it, first with a large one time seat license fee and then each year with higher game ticket prices.

This is my idea for a new stadium in Oakland. I emailed this to Amy Trask and Mark Davis on 10/17/12, with attachments.
Lets hear your thoughts on it and vote in the poll.

Greetings Mrs.Trask and Mr.Davis,

I have an idea around the funding for a new stadium/complex in Oakland, on the existing site where the O.co Coliseum currently is.
Create a corporation called Raiders Corp or something to that effect and go public, offering Raiders fans worldwide the chance to buy stock in this project.
Facebook recently had the 3rd largest IPO in U.S. history selling 421.2 million shares at $38 per, providing $16B of instant capital.
1.8M people have liked the Oakland Radiers official facebook page. Say every person who liked that page bought an average of 50 shares in this new company at $38 per, it would provide $3.4B in capital. I think an average of 100 shares is a conservate estimate, which would provide $6.8B in capital. My gut feeling is that with as many Raider fans there are all over the world, this number will be higher, possibly double, if not more.
The new corp would be indepedent of the Oakland Raiders and would pay the Raiders naming rights fees, so that way the stock certs us Raider fans get, have the official Raiders shield on it so we know that we are supporting our favorite team in the world. And it protects the Davis family from risking the Raiders franchise.
I think this new corp should purchase the land in and around the current site from the county, which is in dire need of an influx of cash.
I believe to clear the stadium authority balance sheet would cost about $300M, to pay off their debts and to settle any outstanding items, essentially to buy them out.
In 2010 8.8 acres of land in/around the Coliseum was sold from the city to the redevelopment agency for $3.5M, for 50% ownership of that land, see attached.
The current complex is 120 acres. Using the 2010 sale of 50% ownership of 8.8 acres at $3.5M, that puts the value of the 120 acres 100% ownership at $95M.
So my estimate of the cost to purchase the necessay land for the project from the county/city/agency/private parties is $200M.
That puts the total cost to own all the necessary land and facilities free and clear at $500M ($300M stadium authority buy out + $200M land purchase).
As part of the purchase of the land from the county, the new corp would promise to donate a fixed percentage or amount of it's revenues to the Oakland Unified School district as well as providing 100 or so annual college scholorships to at risk youth. Both of these activities will have tax advantages to the new corp.

I think the new corp should build, on the existing site, both a baseball only and football only stadiums. With one (the baseball stadium) or both having a retractable roof so they could host year round events, including concerts and events such as the NCAA Final Four. Using the new Cowboys stadium as cost bench mark, I estimate the cost to build both stadiums at $2B. Or if you didn't want to do retractable roofs and there was enough adjacent land, you could build a seperate indoor facillity similar to the current oracle arena. In that scenario, I still think the construction costs for all three would be $2B.

Total stadium costs and to be purchase land/site free and clear, total estimate is $2.5B, well within the range of even my most conservative IPO estimate of $3.4B.

I think the new complex can have a Raiders Hall of Fame that is open to the public year round. It can have new retail/hotel facillites along the shore line. Can even explore the possibility of moving the Raiders head quarters to that location. I like an idea of having retractable solar panels on/under the parking lots, so when facillites are idle, they can be storing energy to be used when needed.

Needless to say the community could use this project not only for initial construction jobs, but for the meaningfull permanent jobs it will create.
Attached is a project file I found from late 2011. It encompasses more area then I envisioned, but it gives an idea of what some previous ideas were for that area.
My main point is that this is all privately funded via the IPO and cuts out the beuracratic follies by purchasing the land/facilities free and clear.
I appreciate your time. I hope my info proved worthwhile and helps my beloved Raiders get that state of the art facility it deserves in Oakland.

[Brazy]

The idea would be to have hotels/retail/etc locations surrounding the stadium, similar to Red Sox and Patriots stadiums, so that there would be revenue generating businesses outside of just the stadiums and the company would own the land, which would appreciate in value. As the Corp grew it could invest and grow outside of the stadium, similar to how Facebook is growing outside of just itself.
Appreciate the thoughts and discussion.

[SF_Raider_Fan]

1.8M people have liked the Oakland Radiers official facebook page. Say every person who liked that page bought an average of 50 shares in this new company at $38 per, it would provide $3.4B in capital. I think an average of 100 shares is a conservate estimate, which would provide $6.8B in capital..

^^^^^^^

I read this as you suggesting 1.8 million people would each donate $1,900 to $3,800 to pay for new Oakland/Alamdea stadiums. But what is it those people would receive in return for their donation ?

[SF_Raider_Fan]

I understand your concept, which is basically a real estate investment business which develops land and then collects rent from the tenants. The reason this has not been done before is because the amount of potential rental income is too small relative to the cost of construction. For example, it may cost $2 billion to build the sports stadiums/hotel/retail etc... complex which you propose. Once all that money is spent the rental income from tenants would only be a few million dollars per year.

The idea would be to have hotels/retail/etc locations surrounding the stadium, similar to Red Sox and Patriots stadiums, so that there would be revenue generating businesses outside of just the stadiums and the company would own the land, which would appreciate in value. As the Corp grew it could invest and grow outside of the stadium, similar to how Facebook is growing outside of just itself.
Appreciate the thoughts and discussion.

[agular9]

I bought a share of Green Bay Packer stock for $350 just to say I am part owner of an nfl franchise... better believe I'd make a nice donation for the team I love.

Not sure how realistic this would actually be, people actually buying in, but definitely a creative idea to generate revenue.

[MDR8ERFAN]

The difference is GB is owned by the public where as the Raiders are not. Why even bother creating Raider corp why not ask for donations and you get a certificate for your donation of a certain amount.

[LaRaider2010]

The difference is GB is owned by the public where as the Raiders are not. Why even bother creating Raider corp why not ask for donations and you get a certificate for your donation of a certain amount.

He is saying the Raiders are privately owned, but this new corp would be a separate company and selling stock, not donations from fans. This stock would intern pay dividends to the stock holders. I understand his concept but dont know if the numbers work out. Theres a lot of guessing in those numbers.
I'd buy some stock in a new Raider corp, but i dont know if as many people would that the OP is suggesting. Raider lovers will do it, the average investor probably wouldnt considering the the city and the market.

[MDR8ERFAN]

The difference is GB is owned by the public where as the Raiders are not. Why even bother creating Raider corp why not ask for donations and you get a certificate for your donation of a certain amount.

He is saying the Raiders are privately owned, but this new corp would be a separate company and selling stock, not donations from fans. This stock would intern pay dividends to the stock holders. I understand his concept but dont know if the numbers work out. Theres a lot of guessing in those numbers.
I'd buy some stock in a new Raider corp, but i dont know if as many people would that the OP is suggesting. Raider lovers will do it, the average investor probably wouldnt considering the the city and the market.

I got what he is saying but what dividends would it pay? It's not like you can make a company and immediately sell shares for $38. The company has to be valued to validate a $38 a share price. Plus it would take YEARS before Raider corp ever got back to the positive actually if they ever get back to the positive.

[Almaden]

They could create a stadium fund that fans could contribute to. They could set aside 1% of the stadium equity to be allocated to fund contributors. Lets say there are 20,000 contributors who each fork out $2,000. For the $2K, you get one share of Raider stadium stock, (.0002 ownership stake based on a billion dollar stadium), a seat from the old Coliseum, a square foot of sod from the old place, and your share certificate in a nice frame. I'd do it. That would raise $40 million, which when added to the "normal" sources of money (the Raiders, NFL, developers, PSL's, whatever), could make a big dent.

[Almaden]

Another idea: sell urinal naming rights. I'd pay $10K to have my name on a plaque permanently memorialized over a urinal.

[LaRaider2010]

I got what he is saying but what dividends would it pay? It's not like you can make a company and immediately sell shares for $38. The company has to be valued to validate a $38 a share price. Plus it would take YEARS before Raider corp ever got back to the positive actually if they ever get back to the positive.

Agreed. Im sure it would take 20 years atleast before it got to positive.

[XRamfan]

Just curious, did Mark or Amy reply?

[Brazy]

Just curious, did Mark or Amy reply?

No they have not.

[Brazy]

good points to help define the revenue streams. this company would own all land and stadiums, so they would be profit sharing with the Raiders and A's for their games and pocket all revenue from other uses of the facilities. you could have two naming rights deals, one for each stadium. the surrounding area would be made into a must see destination with world renowned retail, dining and hotels. the surrounding area in itself could generate multi-millions in revenue each year. now does the corp build/own/operate those or just lease land, probably a combination. getting it off the ground for a stock offering is one thing, but like facebook, it had users, but it wasn't necessarily generating revenue, so what were investors banking on when buying stock? this project is essentially the same, in that it has users, but it differs in that has identified its revenue in the Raiders and A's. and surrounding development.
for the stock purchase assumptions, some people like me may buy only 20 shares, while others like say Ice Cube may buy 500 shares, but all things considered, total shares purchased divided by total persons who purchased stock, the average per person could be 100 shares. the standard accounting equation is Assets = Liabilites + stockholders/owners equity. Upon first issuance of stock, the cash goes to assets and the offset is owners equity. When someone buys stock, it's not a liability, cause it's not a debt, you don't owe them anything. And you don't ever owe them anything, until you declare a dividend to be paid and at that point, the dividend per share becomes a liability. When you buy that stock, it's essentially worth what you paid for it initially and then it's value fluctuates with the market. when you sell it, the corp doesn't pay you, whoever buys it does. So you never have to make that money back to pay anyone from that initial stock sale. But you do have to manage you corp right, so its viable. As long as the project was running on time and within defined budgets identified to the market, your stock would have no reason to lose value. Like wise when the project is finished and revenue begins to roll in, as long as you make your targets, your stock value will not diminish. Quantifying the revenue from all streams is the challenge. Your revenue would only have to pay your expenses and never what anyone paid for your stock.