Friday, January 5, 2018

Looking Inside the Loria-Jeter Sale

    In the mess that the new owners are making of the Miami Marlins, some revealing information is emerging.
    Let's start with a conspiracy theory: Derek Jeter, Mr. Yankee, is destroying the team because he wants to move the Marlins somewhere else,

helping top shareholder Bruce Sherman make a quick, huge profit by flipping the team.
    Thanks to County Commissioner Xavier Suarez's staff, I've seen the various contracts the team signed with the city and county in order to get their shiny new ball park (which was supposed to fix all their revenue problems). Not well versed in legalize, I found key provisions confusing, so Suarez's staff boiled it down to this:
    Marlins have vowed to stay 35 years -- meaning to 2047, measured from the opening of the park in 2012. No provision to wiggle out of that.
    BUT: An interesting provision is intended to keep former owner Jeffrey Loria from making too quick a profit from taxpayers' largess, embedded in a poorly named Relocation Agreement.
That made owner Jeffrey Loria promise that if he sold the team within 10 years, he had to give the county a slice.
    Under terms of that agreement, Loria must pay 5 percent of the net proceeds to the county. The county attorney doesn't yet a dollar figure, says Suarez' office, but should within a few weeks. An auditing firm is examining the deal.
    Interesting: If the county reveals details (and shouldn't it under public records laws?) this audit could serve as a window into the details of the deal Loria and Sherman struck.
    The highly publicized number is that Loria sold for $1.2 billion -- more than seven times higher than the $158 million he was supposed to have paid in 2002.
    Now, some county insiders have told the Herald that they're guessing that Loria will present figures that show this-and-that expenses to be deducted, meaning that the county will get little or nothing.  
     BUT: In December, MLB Commissioner Rob Manfred revealed on Dan Le Batard's radio show two fascinating details: The Marlins sale was "the single largest commitment of equity ever in the history of the game."     AND The debt level didn't change from Loria's ownership to Sherman's.
    Why is this important? The Herald's Barry Jackson has been reporting on how the new owners are continually seeking new investors to reduce their $400 million debt they needed to buy the team.
    Dayn Perry at CBSSports.com notes about Manfred's equity remark: "OK, that's probably true. However, the Marlins are the first team sold since the Dodgers and Padres back in 2012. MLB franchises appreciate at an incredible rate, especially in recent history, and that's a lot of inflation built in. Basically, he's saying the Marlins new owners paid more cash for their $1.3-ish billion purchase than the Dodgers owners did for their $2 billion purchase (the only higher-priced sale in MLB history) six years ago. That's notable, sure, but it's not exactly amazing. Citing it also doesn't prove the Sherman group has sound finances at the moment."
    The central issue -- as Le Batard kept hammering Manfred -- is why did MLB accept a new owner who was so money poor that he needed to immediately slash payroll?
    Manfred insisted he had no information on the new owners' intentions in advance -- Le Batard called that an outright lie. Jackson cited inside sources that it was a complete falsehood.
    "Rob," Le Batard said at one point, "I think you cared more about the $1.2 billion asking price than you did the fans of South Florida."
   
As Barry Jackson has pointed out, local groups -- Mas and Bush -- wanted to buy the team for less than $1.2 billion, but didn't intend to gut the team the way Sherman-Jeter has.
    My take-away: Loria was a bad owner. He backloaded over-priced contracts trying to get another championship. (Former Marlins President David Samson complained recently on another Le Batard show that agent Scott Boras sweet-talked/conned the Marlins into an outrageous deal for nearly worthless pitcher Wei-Yin Chen, who will get more than $50 million over the next three years.)
    But Jeter-Sherman may be even worse. It looks like their basic plan is to do nothing more than hold on to the team for a few years and then selling at a huge profit.
    Most interesting revelation (to me at least) in the continuing Barry Jackson exposes: "According to a source, even though the National League announced the Marlins’ attendance at 1.6 million last season, only 820,000 were paid tickets."
    Finally! Since Marlins Park opened, I've been going from 10 to 20 games a year. I've also been seeing games in other parks -- 29 of the present 30. (Still missing Seattle.) Time and again, I've felt that an announced 20,000 attendance in Miami felt like a half or a third of what 20,000 seemed in other ball parks.
    Jeter's plan -- according to Jackson's viewing business plans dubbed Wolverine (Michigan! Not even a nod to Miami Tropical, or Palm or Mango!): "Wolverine projects the paid figures to rise to 1.1 million, 1.2 million, 1.35 million, 1.5 million and 1.65 million over the next five seasons."
   
By getting rid of the league's MVP? Here's how the NY Post describes the Wolverine plan:  "First: Make your team unwatchable. Second: See an immediate boost in ticket sales with this eye-sore squad. Third: Convince your TV network it should pay more for a team no one wants to watch. Fourth: Coax more millions from corporations, thinking they will be further inspired to support a franchise that is now much worse on the field.

       "How could you possibly get from Step One to Step Four? A Jeterian leap, of course."

Monday, December 11, 2017

Looking for Lawyer

      Is any Miami lawyer willing to launch a lawsuit against Major League Baseball for consistently providing South Florida with second-rate Marlins owners who do not have the funds to pay for a Major League payroll? 
      Class action? Representing county that contracted with the team to build Marlins Park on the assumption that the Marlins would field a Major League team? 
       First MLB did this sleight of hand, getting rid of Expos, setting up the Nats -- and dumping a small-funded New York art dealer on the Marlins in order to cement the arrangement. 
       Then in 2017 MLB approved a new owner groaning with $400 million in debt to make purchase. His only stated goal is to cut payroll. How could MLB have approved this?

Sunday, December 10, 2017

Jeter colludes with Yankees -- no need for Russian middle man

         
Jeter can walk into any sports bar in Manhattan tonight and everyone will offer to buy him a drink -- Mr. Yankee has just given his main allegiance a huge Christmas present with Giancarlo Stanton -- setting up what may be a dynasty that will rule baseball for the next decade. I've just tweeted to Red Sox, Blue Jays, TB Rays and Orioles that they must demand MLB stop this outrageous collusion. This summer I re-read (for the first time in decades) The Year the Yankees Lost the Pennant. I'd forgotten the final twist: (Spoiler alert!) The devil is a Yankees fan.
       The people who are really to be blamed here are the leaders of the MLB. First, they wanted to get rid of the Montreal Expos and so they handed the Expos cash-poor owner the gift of the Marlins at a big discount. Fast forward to 2017 and MLB rejects local groups like Jeb Bush and others from new ownership -- people that would have to walk into Miami restaurants and look fans in the face. And instead has brought in a Naples investor (who's had to borrow a lot of money to do the deal) and Mr. Yankee (who's making sure his primary loyalty gets his help).
      One key detail -- within 24 hours of Stanton giving Marlins a list of four teams, Jeter had done a deal with Yankees -- the most important deal in Marlins history.  No complex negotiations, just here's your Christmas gift.  

Thursday, November 23, 2017

New Owners: Bean Counters

By John Dorschner
    Every day the new owners of the Marlins are revealing added details about how they view their purchase as an investment --not a quest for championships.
    The latest revelation comes that lead investor Bruce Sherman is still seeking $250 million more from investors, as first reported by fanragsports.com. And it's all put in money terms, with "payroll discipline" being a top priority.

    What's clear is that Sherman has bought into the Marlins with the idea that sports teams tend to soar in value over time.  If he just holds on to his investment, his money might double or quadruple in five or 10 years. Consider Loria paid $158 million in 2002 and sold for $1.2 billion this year.
    Among Sherman's top priorities: "Payroll discipline."  Investor talk for cutting salaries.
    Contrast that with Mark Walter buying the Dodgers in 2012 for $2.15 billion. The team president at their first meeting, according to Wall Street Journal, told the billionaire there two ways to build a winner -- high-priced free agents or developing young players. "Let's do both!" said Walter.
 

    With the Marlins all we hear is that Sherman has $400 million in debt that he has to pare down. Every move the owners have made so far seems focused on money, not victories. Heck, they even kept on Michael Hill, the guy responsible for innumerable bad drafts, trades and free-agent signings -- perhaps because he has a lengthy contract that they'd have to pay off to dump him.
    And still, the pitch to new investors starts with the promise that Sherman-Jeter will "significantly improve ticket sales." How? By dumping Stanton?
    Now, to be clear, Sherman inherited a mess from Loria.  I'm sure Loria knew he planned to sell the team and was looking to get another championship -- without caring about long-term costs. Stanton's ultra-long-term contract for $325 million -- back-loaded so that the team just starts to feel the hurt with the first big hit of $25 million in 2018 -- really never made sense for a team with poor attendance and awful TV contract.
    Then there's Chen -- due $12 million in 2018, and $20-plus million for the following two years. Tazawa gets $7 million next year, Ziegler $9 million, Prado and Volquez $13 million each.
    Marlins fans needed a deep-pocket owner, semi-insane, willing to spend big bucks for a championship -- and instead we got bean-counters just biding their time till the value of the club goes up.
    Note: I first saw the investor pitch at https://www.fanragsports.com/heyman-marlins-seeking-investors-with-project-citrus/

Thursday, May 11, 2017

Marlins pitchers pay scale

Loria upped the payroll this year, perhaps knowing it would be his last attempt to get to the playoffs. But how wisely did they spend the money? ERA is just one of many measures, of course, but just for a rough look, it's an indication there seems to be no correlation between pay and performance with this team. (Salaries from Herald report.)

NAMEERASALARY
Chen4.33    $15.5 mil
Volquez    4.71    $9 mil
Ziegler4.49        $7 mil
Ramos3.01    $6.5 mil
Koehler5.61    $5.75 mil
Tazawa 4.49   $5 mil
Phelps4.76   $4.6 mil
McGowan4.58   $1.75 mil
Straily4.03$552,000.00
Conley7.53$537,000.00
Urena1.69$535,000.00

Tuesday, October 25, 2016

2016 Batting -- Yellich Yes! Hech No!

Woody Allen said "80 percent of success is showing up."  Here's what Marlins batters did in 2016 -- total bases (singles, doubles, triples, HR) plus walks, plus hit batsman. Note how poorly Hechavarria does, compared to the injured Bour and injured Stanton -- And Dietrich was around for only part of the season.  And Prado was Mr. Steady.
TB  W  HB  TTB
Yelich 279 72 4 355
Prado 250 49 4 303
Ozuna 252 43 4 299
Stanton 202 50 4 256
Realmuto 218 28 5 251
Dietrich 149 32 24 205
Hech        158 33     1     192
Bour  133 38 0 171

Monday, August 15, 2016

A Gloomy Look at Marlins for Next Decade

    Giancarlo's injury isn't just a disaster for this year's play-off hopes -- it's an indication of the worsening disasters that await Marlins fans for the next decade. 
    As I have noted before, Stanton is often a wounded warrior. Last October, I wrote a post based on the Woody Allen comment:  "Eighty percent of success is showing up." Stanton was showing up for work only 75 percent of the time. Pujols in his first years, by contrast, was playing 95 percent of the time.
    Now that Stanton's once again done for the year, we can see that he's averaging 118 games for his six full seasons -- or 73 percent of games played. (All figures in this rant based on numbers from baseball-reference.com.)
    

            Stanton Contract + Attendance = 
                            Crushing Numbers

      But another figure is just as depressing.
    Here's the background: The Marlins have been playing exciting baseball up to this point, even after losing the league's batting average leader of 2015, Dee Gordon, for a lengthy stretch. In the middle of August, they're still in serious contention.
    And yet... yet ... they are drawing a mere 21,753 fans per game (through Aug. 14), down about 500 from the average of 22,220 at this point last year, when the team was pretty damn hopeless.

     Miami is just a crummy sports town, except when a championship is on the line, while people in places like Denver and Chicago get much larger, devoted attendance for all sports, even when the teams are dogs. (And I suspect the attendance is inflated with Chevron discounts, free senior Thursdays and those mid-week day camp games that are listed as 25,000-30,000 but those kids are getting in with group discounts meaning that Marlins average price of ticket-sold is much lower than many other teams.)
  

             Loria Counting on Attendance Boost 

     Here's why this attendance is particularly devastating: Loria, in his infinite wisdom, back-loaded Stanton's contract -- cheap years at the beginning, expensive at the end. Stanton received $6.5 million to start his $325 million contract, $9 million this year and $14.5 million next year. For the decade starting in 2018, he will be receiving $25 million to $32 million a year.
    Loria's theory is that the cheaper years at first would allow the team to build a solid contender around Stanton, creating excitement leading to soaring attendance that would pay for the expensive years later on.
    So not only is Stanton missing a ton of playing time, but attendance isn't soaring -- meaning that in the years ahead, the Marlins won't have the big bucks to build a team and may have to scrimp on other players in order to keep fulfilling the huge Stanton contract.
                 

             As long as I'm ranting... Latos et al.
 
            I should step back to say the organization has made some good moves. Prado is decent, though he doesn't provide the power that championship teams ordinarily have at third base. Dee Gordon had one great year, although long term, I'll still not sure how valuable he will be. I like Mattingly as a manager, with plenty of good ideas, such as finding lead-off hitters while Gordon was out.  BUT ... BUT ...
          Marlins are paying Wei-Yin Chen $12.5 million this year, $15.5 million next year. So far, he's 5-4, 4.99 and injured. 

          The minor league cupboard is close to bare. The big San Diego trade was pretty much a disaster, and I (along with many fans) don't have much confidence in the Marlins executives making the right decisions.
    Just one example: While the Marlins struggle to find starting pitching, they're off to Cincinnati, where on Tuesday they will be facing Anthony DeSclafani, 6-1, 3.11 ERA, earning $540,000 this year.
    You remember that December 2014 trade? We gave up DeSclafani and a minor leaguer for Mat Latos, who was such a disaster with his $9.4 million contract we dumped him to the Dodgers last year in mid-season.
    And who will be the Marlins pitcher facing DeSclafani? As of Monday morning, it's TBA.