Refman-I'd venture to say that since the late 80s, owning a baseball team hasn't really been all that profitable (if you trust Selig). Or, it could be really profitable (if you trust Forbes). Either way, it really is hard for me to feel sorry for penny pinching Drayton. The Astros have not signed a FA worth a s#it since Drabek and Swindell 10 years ago. Leaving the team in a stale state, isn't exactly the best way to get fans to the ballpark. In baseball if you want to make money, you must spend money first.
I'm 99% sure that the new owner would be subjected to the same agreement. If the lease were able to be thrown out the window with a new owner, then I would be totally against new ownership. Since it's not, sell the team Drayton!
X34....indeed, the Astros can be sold but cannot be moved from Houston until 2030. Thats the pact that was signed in order to built Enron/Astros/Minute Maid Park
Let me see, owners make about 5 to 10 million dollars off of fans tickets, probably about 20 million dollars in merchandise, etc., meanwhile they shell out 60 to 80 million dollars in payroll, millions of dollars in bills and repairs, employee hundreds of other employees, as well as travel expensives and you think that evens out?
With over 3 million fans that attended, how do you figure they made 5-10 million off tickets???? Were tickets $1.50???? The average ticket is at least $10. Take into consideration everything you can buy at a game. As stated previously, McLane gets a percentage of this. Take into consideration Astros apparel. Take into consideration companies paying Drayton to Advertise in the park. Coca Cola alone gives about 10 million just for them to sell Coke at the games. Imagine how many other companies do the same thing. All of this more than covers the 67 million dollar payroll
All of this more than covers the 67 million dollar payroll Of course it does. Unfortunately, payroll is not nearly the only expense. In the NBA, for example, it is about 55%, I think. MLB also has entire minor league systems, things like the Venezuelan Academy (for the Astros), stadium leases, all the thousands of stadium & Astros employees, team travel/hotels/etc, etc. Business expenses add up really fast - many people don't believe it unless they have been on the other end of it.
Drayton gets: At least 30 million from tickets ($10 avg price) or 45 million from tickets ($15 avg price) or 60 million from tickets ($20 avg price) At least 75 million from advertising At least 10 million from concession stands At least 5 million in apparel Thats at least 120 million - 150 million in revenue.
Forbes estimate for 2001 was $125 million in revenues for the Astros. Of course, Forbes estimates the Astros had an operating income of $4.1 million before interest, depreciation and taxes. Add in taxes and interest on the team's debt, and I could see potentially getting to a $5 million loss.
If they have singificant debt on the team, then yes. (And if they had the same level of revenues. The Rangers make more money, so obviously their higher payroll would come out of a higher revenue stream) But that's kind of a phony loss for most of these owners. Drayton has debt on the team because he feels his money can make more for him than the debt costs him in interest. So while he has a significant amount of debt, according to Forbes, and significant interest payments along with that. That money isn't really a loss even though it would be reflected on the books as one. But I'm just repeating what an independent financial magazine has reported. You may make of it what you will.
The Astros have to get more than 10 bucks per ticket sold. Seeing how there are only a limited selection of 5 dollar tickets. After that, it jumps to 12 bucks to like 36 bucks. This isn't even including the luxury suites and the diamond level seating. I would say the average ticket price is around 20 bucks or so. Also, the Astros attendance is closer to 2.5 mill than 3.0 mill.
The Astros biggest financial shortcoming comes from the fact that they don't get much $ from the TV/Radio contracts. I read somewhere they earn the 18th most revenue in baseball from that avenue. We are the 4th largest city, and the 11th highest TV/radio market, the Astros should be getting more than 18th.
Last year they had 2,904,277 people attend games. Thats more than Texas, Atlanta, Arizona, NY Mets, or Boston.
Refman and Major, You guys were critical of an earlier judgement I had made. Check out mrpaige's post:
And all four of those teams reportedly had higher revenues than the Astros in 2001 (again, according to Forbes). Mets - $169 million Red Sox - $152 million Rangers - $134 million DBacks - $127 million
So, teams that have a payroll of 90 million+ , do you see them losing 30 million a year? Well, that would depend. Compared to other new-stadium teams, Astros ticket prices are relatively cheap. I guess Drayton could raise ticket prices, but we'd b**** about that too. Compared to other markets, the Astros' TV contract is relatively small. The teams like LA/BOS/etc have huge revenues from being in larger markets. The teams like ATL/CHC have huge national cable TV deals. Few other teams have $90MM payrolls. Those that do -- Texas and Cleveland, primarily -- are having huge financial losses and both owners have come out and said they are willing to trade any and all players. Both have said they are not spending any more. Cleveland has already begun the firesale and Texas is trying without a lot of success, because no one wants those high-priced players. Others, like Arizona, are in massive debt and teetering on bankruptcy. I don't think those models are the ones to follow.. There's no doubt in my mind owners are losing money as a whole. Whether Drayton is losing $5MM or making $5MM, I don't know, and I don't really care, honestly. I doubt he is fully honest with the number he presents, but there's no doubt he's not raking in the cash. To think he can just easily add $10 or $15MM in payroll and be more competitive is silly, in my opinion. The fact remains that he and other small/mid-market owners can't compete under the current system. If he adds $20MM in payroll, LA or ATL can counter with another $25MM. However, while McLane is now losing tons of money, ATL/LA are still OK. All he's done by adding payroll is leave the Astros in the same position competitively (compared to the top teams) while dragging up his losses. This is what Boston keeps trying. They keep upping their salary to compete with NYY, but NYY just responds and can do so infinitely, because they'll always have more revenues. BOS therefore gets no further but spends more and more money. Not good business by any stretch.
Drayton gets: At least 30 million from tickets ($10 avg price) or 45 million from tickets ($15 avg price) or 60 million from tickets ($20 avg price) At least 75 million from advertising At least 10 million from concession stands At least 5 million in apparel Thats at least 120 million - 150 million in revenue. Also, as far as Drayton lying about the numbers, he agrees with your revenue numbers... From the original article: <I>"When we first got here," McLane said, "the top teams were the Yankees and Mets at around $110-$130 million in revenues. I thought, `Man, if I can get $130 million in revenues, we're going to run with the big boys.' We moved into the new stadium, and all of a sudden, we had revenues of $135 million. Unfortunately, our expenses, especially our salaries, also went up.</I>
Our ticket prices are not relatively cheap by any stretch of the imagination. Of all the teams that have a 90 million+ payroll, we have the most expensive ticket prices.
Our ticket prices are not relatively cheap by any stretch of the imagination. Of all the teams that have a 90 million+ payroll, we have the most expensive ticket prices. Or not. The most expensive seat at Enron Field is $39. Cheapest is $1 or $5. The Rangers, for comparison, have 6 different sets of tickets above that price, with the highest being $75. Cleveland tops out at $40, cheapest is $7. Mets? $43 to $12 Braves? $40 to $1/$5 DBacks? $75 to $1/$6 Yankees? $65 to $8 (not counting the top-tiered seats which are sold out) Every one of these teams has a stadium at least 5 years older than the Astros, and every one of them has equal or higher prices. http://houston.astros.mlb.com/NASApp/mlb/hou/ticketing/hou_seating_pricing.jsp?club_context=hou http://texas.rangers.mlb.com/NASApp/mlb/tex/ticketing/tex_seating_pricing.jsp?club_context=tex http://cleveland.indians.mlb.com/NASApp/mlb/cle/ticketing/cle_seating_pricing.jsp?club_context=cle (All the $1 tix have special restrictions which differ by city)
