With the Maloof Family Fortune on the Decline We Look at Possible Destinations for the Sacramento Kings.
BackgroundThe origins of this franchise begins in 1945 when they started as the Rochester Royals playing in the NBL (National Basketball League). Since then they have bounced around from Cincinnati to Kansas City and finally in 1985 the team was relocated to it's current home in Sacramento. The team has been relatively successful despite never winning an NBA Title in Sacramento (they won NBL title in 1945 and the NBA Title in 1951 as the Rochester Royals) and their fan base is one of the more passionate in the league. The current owners (the Maloof family) purchased the team in 1996 and enjoyed the glory days of playoffs basketball in the 2000s behind their stars Chris Webber, Jason Williams, Mike Bibby, Vlade Divac and Peja Stojakovic. 2001/02 was their best season where they finished 61-21 and pushed the Lakers to 7 games in an epic Western Conference Finals series some say was fixed by the NBA due to the questionable calls made by the referees. 2005 saw the team start a decline that hasn't stopped and doesn't look like ending until they are either sold or relocate. The main reason for this has been the decline in the Maloof family fortune after they sold off all but a 2% interest in the Palms Casino in Las Vegas in 2011. Along with folding their WNBA team and selling their beer distribution firm in 2009 the family's assets have taken a big hit, which has adversely affected their revenue streams. Being an NBA owner is an expensive business (most teams do not make money and are hobbies for their wealthy owners) and without stable and substantial income the costs can be too much. The team currently plays in the old ARCO Arena (currently Power Balance Pavillion), which is one of the more outdated arenas in the NBA. At the end of the 2010/11 season the Maloofs were being wooed by the owner of the Honda Center in Anahein to move the team with an attractive financial package that didn't require much investment from the Maloofs. This didn't eventuate but started the rumours that the team was looking to relocate due to the financial problems of the Maloofs and their unwillingness to invest a lot of money in a new Sacramento based arena. Plans for a new arena were put to the Maloofs by former NBA player and current Sacramento Mayor, Kevin Johnson, in early 2012 but have since been rejected by the Maloofs. The plans were very well thought out but required an investment of $3.25mil from the Maloofs, an amount they weren't willing to pay despite a very generous funding plan by the City of Sacramento and the NBA. By failing to come up with a relatively small amount of $3.25mil the Maloofs effectively admitted they didn't want to stay in Sacramento and the future of the team is now up in the air. With the Maloofs becoming increasingly tight by running the team at the bare minimum it should only be a matter of time before the team is enticed out of town by an attractive financial package or sold to the highest bidder.
Possible DestinationsAnaheim, California Population - 3 million (Orange County) Arena - Honda Center (Capacity - 18,336) Long Term Likelihood - 8.5/10 This move was almost a reality back in 2011 when the Maloofs filed paperwork to register the names of Anaheim Royals, Los Angeles Royals, Orange County Royals and Anaheim Royals of Southern California. They also filed a request to officially move the team to the Honda Center but later recinded the request and chose to stay in Sacramento. One year later they turned down the Sacramento Arena Plan, which continued this whole mess and opened the door for them to relocate. The arena itself already houses the Anaheim Ducks (NHL) and UCLA Bruins (NCAA) and was the former second home of the LA Clippers from 1994-1998. The owners of the Honda Center had stated that they were willing to invest money into the arena to bring it back up to standard but as the Maloofs backed out the work was never started. Given the Maloof's financial situation, a move to Anaheim would most likely see them retain control of the franchise and move to a bigger market (something they desperately need). Verdict - After they were so close to moving in 2011 and the process was fairly straight forward this move seems the most likely. The Maloof's don't have to spend money on a new arena and they get access to the lucrative Orange County surrounds.
Seattle, Washington Population - 620,000 Arena - New Arena to Be Constructed, Awaiting NBA Team Long Term Likelihood - 7.5/10 The NBA fans of Seattle still feel a little bitter after their team was relocated by Clay Bennett in 2008 to Oklahoma City. They were one of the more passionate and engaged fan bases in the league but issues over a new arena (sound familiar?) were the basis for Clay Bennett to pay Seattle $45mil to move the team ahead of the arena lease expiry. After 4 years without an NBA team the fans of Seattle have a possible White Knight in the shape of Venture Capitalist MD, Chris Hansen. His proposal to the City of Seattle involves building a brand new arena next to the current home of the Seattle Mariners. His plan is for a multi purpose stadium near the port that will house both an NBA and NHL franchise and will be entirely funded by private capital and taxes created from the project (for the complete plan click here). The people of Seattle have received the plan well given their lust for the return of hoops to their corner of the Pacific North West but as with everything there has been opposition. The Seattle Mariners and Port of Seattle were the first to object stating that the new arena would ruin the area with the extra strain placed on existing facilities. Then in July 2012 the Seattle Times wrote an editorial to the City of Seattle opposing the plan. The complaints seem to surround the affect on the infrastructure around the new arena, which is something that can be changed over time with careful planning. The good news is that no one is against the funding portion of the proposal, something that drove the Supersonics out of town in the first place. If the new arena is given the go ahead the famous Supersonics name is still kept by the city so any new team will have access to the legendary green and yellow uniforms. Verdict - The arena plan is genius and will have the support of the city due to it's economic sense but the sticking point here is whether or not the Maloofs will sell the team knowing it will be relocated and given a different name. There is no way any Seattle fan will be cheering for the Seattle Kings when they loved their Supersonics so much. The likely scenario would involve the same investors that are funding the arena purchasing the team outright or at the very least, a majority stake.
Virginia Beach, Virginia Population - 438,000 Arena - New Arena to Be Constructed Long Term Likelihood - 5.5/10 This rumour is the latest one to come about with Virginia Beach annoucing a plan for an 18,500 seat arena to be built near the city's convention centre. City officials have apparently been trying to lure a pro sports team to the area for quite some time but without an arena it's a hard task. The latest franchise targeted has reportably been the Kings but so far the Maloofs have not commented on the situation. Verdict - The projected market size is stated at 3 million people (slightly higher than the 2.5mil in the Sacramento area) but it is a far cry from the Maloof's entertainment and gaming businesses. WIth no solid funding plan this will most likely end up as another city overspending to bring a pro sports team to the area. A similar situation to Seattle would arise where the team would be bought outright or a large stake would be sold by the Maloofs.
Las Vegas, Nevada Population - 584,000 Arena - New Arena to Be Constructed Long Term Likelihood - 2/10 Las Vegas has historically been linked with every team that has had a relocation rumour and Sacramento is no different. This one has more grounding given the Maloof's owned a casino in Las Vegas but given they were forced to sell most of their share the likelihood of them moving to Sin City is low. With no arena and no plans for an arena the city is currently in no position to woo a team to their neighbourhood. Las Vegas has also been hit the hardest by the GFC as it relies a lot on the tourism dollar and the families that would make up the fan base would find it hard to come up with the disposable income for season tickets. Verdict - Despite being the location for the Summer League Tournament and a bevy of off-season training centres for the NBA elite it simply isn't ready for an NBA team just yet.
ConclusionOne overbearing fact in the story of the Sacramento Kings future is the Maloofs are effectively going broke very quickly and won't be able to afford an NBA team shortly. They are already running it on a shoestring budget and making cutbacks left and right (click here to see their online store debacle) so any hope for this team lies in another city. Any good businessman knows that when you start selling revenue generating assets to pay off your debts things aren't going to end well. Sacramento put in a good offer to keep the Kings but the decision by the Maloofs wasn't based on the arena, more a need to move to a bigger market for their own personal gain. It's always sad when an NBA team is relocated as the fans and local businesses are hardest hit but it does give rise to new opportunities in another city. This mess needs to be sorted out quickly and I hope the NBA steps in soon as the current roster could be very dangerous given the right financial support and long term security a move would provide.
Where does everyone think the Kings will end up and how soon will it happen? Photo Credit: (top)