Rocks open in new arena-KRIV Fox sports reports that the Sports authority has reached an aggrement with Watson and co for a buyout out of the last month of the compaq center lease as well as a lease for the Houston Areos to play in the new arena next year. from what the rocks said before it was just a formalit but its good to hear its been done
Fox: Rockets Work Out Lease with Chuck Watson According to Fox 26, the Sports Authority and Aeros owner Chuck Watson have agreed to a buyout of the last two months of the Rockets lease at Compaq Center allowing them to play all their pre-season and regular season games in the new arena. In addition, the Rockets and Aeros have agreed to a deal that will allow the Aeros to play in the new arena. The report stated the Rockets are expected to pay the Aeros $1.5 million for the buyout.
June 25, 2003, 9:45PM Compaq squabble resolved Rockets get clearance to open in new arena By BILL MURPHY Copyright 2003 Houston Chronicle The Harris County-Houston Sports Authority agreed Wednesday to pay $1.5 million to buy the Rockets out of their Compaq Center lease, clearing the way for the team to open the 2003-04 NBA season in the new downtown arena. The Rockets, meanwhile, have been negotiating with three companies for the arena's naming rights and could seal a deal by the middle of next month, said sports authority chairman Billy Burge. "The sense I get is that it might be an international company, as opposed to one that is based in Houston," Burge said. The lease buyout resolves a dispute involving the sports authority, the Rockets and operators of Compaq Center that has been going on for more than a year. Naming rights are one of the major issues officials hope to have settled before the new arena opens. The Rockets must seal a deal before the end of July if signs installed on the arena for a Sept. 4 ribbon cutting are to carry the name of the company that buys the naming rights. Otherwise, signs will begin being made saying "Houston Arena" -- which will be the facility's name until a deal is reached. Burge said the market for naming rights of sports facilities went "soft" several years ago during the recession. That soft market, he said, apparently has made it harder for the Rockets to reach a deal. But 7-5 Rockets center Yao Ming, whose presence has led television stations in China to air games, has sparked inquiries, especially from international firms, Burge said. "Having the Chinese guy has made it easier to attract international interest," Burge said. Said Rockets president George Postolos: "The Rockets have a very high profile because we've added Yao Ming." Naming rights bring different marketing opportunities to a company, depending on whether it is a local, regional or global firm, and all types are under consideration, Postolos said. "A global brand may be in the best position to take advantage of all the benefits that come with naming this arena," Postolos said. Minute Maid Co., a subsidiary of Coca-Cola, last year agreed to pay the Astros an estimated $170 million over 28 years to rename the downtown baseball facility Minute Maid Park. Reliant Energy is paying $300 million -- the biggest naming rights deal ever -- to have its name stamped on every building in the former Astrodome complex, including 69,500-seat Reliant Stadium, for 30 years. Recent naming rights deals signed elsewhere didn't approach the amounts paid by Minute Maid and Reliant. Petco will pay $60 million over 22 years to call the new baseball field in San Diego Petco Park, said Don Henchey, vice president of the Bonham Group, Denver-based consultants on sports and entertainment sponsorships. In February, U.S. Cellular agreed to pay $68 million over 23 years for naming rights to the Chicago White Sox's home park, Henchey said. Arenas, he said, can command more money than baseball parks because they book far more events, including concerts and circuses. The public will be invited to tour the arena on a yet-to-be-named date at the end of September. A concert in September or October likely will serve as the first event and, hence, grand opening of the arena, Postolos said. The Rockets' home opener, he said, will become another in what amounts to staggered grand openings at the facility. The buyout of the Rockets' Compaq Center lease followed a complicated legal dispute involving the team, Arena Operating Co., which operates Compaq Center and is owned by Chuck Watson, and the sports authority. The Rockets had signed an iron-clad lease with Arena Operating Co. that runs through November. Watson sought $1.2 million to $2 million in a buyout -- the amount he said his company would have made if the Rockets played three or four preseason games and seven or eight regular-season games before the lease ran out, said sports authority secretary-treasurer Ric Campo. The Rockets argued the team should not have to pay for the buyout because the sports authority agreed to do so in a pact signed before voters approved the building of the new arena. The pact states the sports authority would exercise its "best efforts" to get the Rockets released from their lease. As late as January, sports authority chief executive officer Oliver Luck was taking the position that "best efforts" entailed no more than climbing a bully pulpit and trying to convince Watson to let the Rockets out of the lease. "Our revenue is from tax dollars," Luck said then. "That's why, while we want to be fair to the Rockets, we also must be fair to the taxpayers." But Luck on Wednesday said the law would not have been on the sports authority's side if it had argued for such an interpretation of "best efforts." "Best efforts," he said, makes no sense unless it means the sports authority ultimately would pony up money for a buyout. The Rockets, who will rent the new arena from the sports authority for $8.3 million annually for 30 years, would have paid the sports authority $1.5 million less this season if they had honored the Compaq Center lease through November. The sports authority was going to pay Watson in a buyout or lose the same amount in rent, and it opted for the buyout, the easier alternative, Campo said. Watson, he said, sought no more than what his company would have been paid. "Watson wasn't trying to skin the sports authority," Campo said. "He was very positive in the negotiations. He really believed the Rockets should open in the new arena." Watson couldn't be reached. The sports authority Wednesday also approved a long-term lease for the Aeros, the American Hockey League team owned by Watson, to play at the new arena. Details of the lease had been worked out more than a year ago.
