THE NEW COMBINED STADIUM: Woody Talks....

[BaumerJet]

How PSLs have turned Jets' & Giants' field of dreams into a nightmare

BY GARY MYERS

DAILY NEWS SPORTS WRITER

Saturday, November 1st 2008, 11:28 PM

Evans/AP/AP From left, Giants co-owner John Mara, Jets owner Woody Johnson,

Giants co-owner Steve Tisch all signed off pn PSLs in the new Giants Stadium.

With each passing day, it seems another sector of our wobbly economy stumbles to its knees.

Mortgage companies. Global markets. City and state governments. Entire communities who hung their hopes on the empty promises of money managers.

All reduced to rubble or left teetering on the edge of fiscal disaster.

Yet, in the dust of all the ruin — and in the shadow of their soon-to-be-completed ivory tower — the Giants and Jets have handed down this ultimatum to their loyal fans:

Bail us out — or else.

And in a move that would have made P.T. Barnum proud, the two teams have sidled up to those put-upon patrons and said, "Don't worry, friends, step right up. Do we have a deal for you. It's a little something we call personal seat licenses, and, boy, are you gonna love 'em!"

MONEY ON THE TABLE

In theory, the Mara and Tisch families, who own the Giants, and Woody Johnson, who owns the Jets, are splitting the cost of their new $1.7 billion stadium that opens in 2010. But if you cut through all the sideshow selling points and big-top bluster, here is the Blue and Green elephant that comes tip-toeing out of the tent:

Through the sale of PSLs — the prices of which range from $1,000-$25,000, with two seats garnering $200,000 in a private auction held by the Jets recently — the Giants and Jets are netting $360 million toward the cost of the new stadium construction. That, in effect, makes the fans who pony up for the PSL — and the privilege of purchasing season tickets that many have had for decades — 20% owners of the state-of-the-art football palace going up just yards away from Giants Stadium.

Yet look at the deed on the new digs and you won't find Joe the Fan anywhere. So what does the fan get other than the right to buy season tickets and control the seats for the life of the stadium? Essentially, the burden of a shareholder's investment without an equity stake.

The result is an emotionally charged issue for season-ticket holders, many of whom argue that they have already helped fund the new stadium through their loyal patronage and view the PSLs as little more than corporate welfare. Fans, however, do have the right to sell their PSLs for a potential profit, depending on the market.

The teams, of course, say the seat licenses are necessary to cover vast cost overruns in the stadium construction and that the project could not have been completed without the PSLs.

Marc Ganis, the president of Chicago-based sports business consulting firm SportsCorp Ltd., agrees.

"Here's the most important reason the Jets and Giants had to issue PSLs: Because the stadium costs too damn much," says Ganis, who has been involved in the financial planning of two dozen stadiums, including the new Yankee Stadium. "It was only six years ago that we had great open-air stadiums built in New England and Philadelphia that cost a little over $300 million each.

"I don't care if Woody (Johnson), Steve (Tisch) and John (Mara) get mad at me," Ganis adds, "but if they built a stadium for $1.2 billion instead of $1.7 billion, they may not have needed this."

The Giants and Jets both cite unforeseen spikes in construction and material costs, coupled with faltering credit markets, for the ballooned cost of the stadium.

"We're asking our fans to pay 20-25% of the cost of the building," Mara said. "After all is said and done, the Giants are left with $500 million in debt. That's a hefty number to pay."

None of those explanations softens the harsh reality facing people who want to continue to attend Giants and Jets home games.

In addition to the PSLs, fans still have to purchase season tickets each year. For the very best seats in the lower level, each team's tickets will cost $700 per game. A majority of the seats for each team in the new stadium will be priced between $85-$160 per game.

Despite all this revenue being generated through ticket/PSL sales, plans for a retractable roof — the one amenity that would have eliminated the brutal winter conditions of late-season games and most likely brought a Super Bowl to New York — were deemed too expensive. The roof would have jacked the price of the project over $2 billion.

But here's some interesting news for those crying in their portfolios about the small fortune it will cost them to move from the old stadium to the new one: Mara and Johnson say it could have been worse.

"I probably left a lot of money on the table," says Johnson, referring to the Jets' decision not to issue PSLs for upper-deck seats in the new place. "I know I did. I could have done more."

Adds Mara: "Our financial advisers told us we were leaving a lot of money on the table."

"DO YOU UNDERSTAND ECONOMICS?"

Forbes Magazine recently valued the Giants at $1.178 billion, the fourth most valuable franchise in the NFL, with the Jets right behind them at $1.17 billion. Johnson, who comes from the Johnson & Johnson empire, was asked why a team worth that much money would need its fans to contribute to the financing of the stadium.

"Do you understand economics?" Johnson said. "Just because something is worth a billion dollars, how does that translate when it comes to paying off debt? That doesn't answer the question how to pay the bill.

"If current fans don't want to pay the price, others will step up off the waiting list," Johnson adds. "Those are fans, too. They've just never been able to purchase the ticket."

While Johnson is right about the demand for season tickets — the Giants have 150,000 fans on their waiting list and the Jets' list is 13,500 fans long — there had not been much of a public outcry for a new building.

"The new stadium is not being built because the fans clamored for it," Ganis said. "It's because the two teams needed premium revenues generated from club seats and suites."

Giants Stadium opened 32 years ago, and even though it lacks bells, whistles and five-star restaurants, it's still considered one of the best stadiums for watching a game.

But the teams have lousy leases and the revenue generated from the stadium puts them in the bottom half of the league in the biggest market in the country. Both the Jets and Giants argue that they need the new revenue streams that accompany a cutting-edge stadium in order to compete in free agency with division rivals like the Patriots, Eagles and Redskins, who all have big money-producing stadiums. Fourteen other NFL teams (see chart) have used PSLs to help pay for new stadiums. The Cowboys open a new stadium with PSLs next season.

"This building makes us very strong financially, which should allow us to remain very strong on the field," Mara said. "The No. 1 thing fans want is for us to win and they will do everything in their power to help you win. The alternative was to stay here and maybe five years from now it would be very tough to compete."

DID THEY REALLY NEED PSLs TO BUILD IT?

Johnson and Mara's perceived goodwill aside, the total cost of the new stadium is still a staggering $1.7 billion.

Where exactly is the money coming from? Let's do the math:

n$300 million in loans issued to the teams from the NFL's G-3 stadium funding program. The money is repaid from the visiting share of the club seat revenue.

• $360 million will come from PSLs sales.

•$750 million will come from naming rights at a rate of $25 million per year over a 30-year period.

•$290 million is what the Giants and Jets combined will pay.

Each team will also make $50 million per year from luxury boxes compared to $5 million they each brought in at Giants Stadium. In addition, the Giants and Jets are now owners instead of tenants of a stadium, with its high-end restaurants and lucarative sponsorship deals, that will serve as an ATM spitting out millions rather than 10s and 20s.

Mara said PSLs were not in the Giants presentation to the league when they applied for the G-3 loan, which was granted in December of 2006. At that time, the stadium was expected to cost closer to half of the $1.7 billion price tag it carries Sunday, due mostly to higher construction costs. "I'd really not like to have any PSL program at all," Mara said.

Most Giants and Jets fans have suggested, through their outrage and protest of PSLs, that they would rather pay their current ticket prices and stay in Giants Stadium as opposed to moving to the new building and paying for the PSLs.

One Giants fan, who has had season tickets since 1964 at Yankee Stadium, says that he doesn't have a problem with PSLs, per se. It's the gouging that is being attached to them.

"I'm not upset about having to pay for the right to buy the tickets," he said. "I don't think $1,000 is exorbitant. But $20,000 to sit downstairs is crazy. Is it 20 times better seats? And you have to pay $700 per game on top of the PSL. People who have been in those seats now have to come up with a lot of money."

The league's take on PSLs has been pretty straightforward and consistent: they work.

"The reality is we're always sensitive to what our consumers, what our fans, are paying for anything associated with the NFL," says commissioner Roger Goodell.

"That's obviously a factor in the minds of both the Jets and the Giants. This is new to them. They have to fully educate all the fans with respect to the positives of the PSL. It's been used very effectively in other stadium constructions around the country. We understand the initial reaction to it, but encourage our fans to understand all aspects of it so they can make a good decision going forward."

After all the numbers are crunched and all the new fans who Johnson claims are clamoring to get into their PSL-padded seats in 2010 "understand all the aspects," did the Giants and Jets really need the seat licenses to build this stadium?

"I can't say it would be impossible," Ganis said. "If they found ways to reduce the cost significantly, they could have. If they were willing to absorb more of the cost and have less money available for team operations, that would be another possibility."

http://www.nydailynews.com/sports/football/giants/2008/11/01/2008-11-01_how_psls_have_turned_jets__giants_field_.html

"If current fans don't want to pay the price, others will step up off the waiting list," Johnson adds. "Those are fans, too. They've just never been able to purchase the ticket."

The only difference Woody is that these days, they may not be able to afford it either!

[Green DNA]

"If current fans don't want to pay the price, others will step up off the waiting list," Johnson adds.

This pretty much sums up the attitude of the Jets and the Giants. I love my Jets but I hope this whole PSL things blows up in their faces.

[JETSFAN5180]

I put my name on the waiting list with hopes the PSL fee is dropped for seats other than lowers.This I can see happening if the sales are sluggish and the economy continues to struggle.

[floridajet]

"If current fans don't want to pay the price, others will step up off the waiting list," Johnson adds.

This coming from a clown that never had to do an honest days' work...

[JETSFAN5180]

"If current fans don't want to pay the price, others will step up off the waiting list," Johnson adds.

This coming from a clown that never had to do an honest days' work...

Woody is in for a rude awakening if the economy continues to remain sluggish.The recent auction may have netted some buyers but not as many as predicted early on.Woody needs a wake up call.Many will pay the price,I think MORE wont.

[Larz]

I read somewhere some of the early buyers of PSL's have already sold them for a profit

I think woody deserves credit for making the entire upper deck PSL free, and the creative idea of auctioning off the coaches club

but

it sucks the long time loyal fans will get pushed out or to the upper decks

I just hope a lot of the lower deck seats don't wind up as investments that get sold to the visiting team's fans every week or corporate perks

[war ensemble]

I read somewhere some of the early buyers of PSL's have already sold them for a profit

I think woody deserves credit for making the entire upper deck PSL free, and the creative idea of auctioning off the coaches club

Nope, no credit for him. After ten years, the cost for going to Jets games in the upper level is much higher than the same for the Giants because of the higher ticket prices. I would much rather pay the PSL (if I was buying season tickets) than worry about the rising ticket prices. It's all just a marketing plot designed by Woody to please the average fan who thinks he's saving them from PSL's at Woody's expense, when in fact it is the opposite.

*That 10 year figure might be a bit off. Frankly, I just don't feel like looking it up.

[Bugg]

Figures anyone stupid or crazy enough to shell out that ridiculous a sum isn't such a great guy-

HE'S A JET-'DEBTOR'

400G-SEATS GUY STIFFED PAL ON LOAN: LAWSUIT

By JOE MOLLICA and JEANE MacINTOSH

Last updated: 12:17 pm

November 3, 2008

Posted: 5:02 am

November 3, 2008

The mortgage broker who shelled out $400,000 for the two best seats at the Jets' new stadium has been sacked with a lawsuit by an ex-pal who says the man borrowed money from him and - pleading poverty - hasn't repaid it.

Free-spending David Findel borrowed $380,000 from fellow New Jersey businessman Michael Rapf "on a short-term basis" in September 2004 to help with "a temporary cash-flow problem," according to the suit.

The fraud and breach-of-contract suit, filed Friday in Monmouth County Superior Court, claims Findel "promised [to] repay the loan in full within 60 to 90 days." Four years later, he has paid only about $100,000, "despite repeated demands," the suit charges.

The suit asks the court to order Findel to immediately fork over $281,500, plus interest.

The Post reported last week that Findel paid the record price for the rights to buy the seats at the new Meadowlands stadium in an Oct. 16 auction. Findel's company is a corporate sponsor and the preferred mortgage lender for the Jets.

Findel has the option of spreading payments for the Jets tickets over as many as 15 years.

Rapf first learned about Findel's seats purchase by reading The Post.

Just days earlier, Findel told him "that he did not have the funds to repay [Rapf's] loan in full," according to the suit. Findel does not deny he owes Rapf the money.

But he told The Post yesterday, "I'm disappointed that it has come to this," and said he thought they had reached a payment deal.

"We settled this six months ago," Findel said. "I'm paying him back."

"So far, I've given him over $100,000, so I'm ahead under the terms of that payment schedule," he said.

Meanwhile, Rapf's suit claims Findel misrepresented himself and withheld "material facts" that, if known, would have caused Rapf to "refuse his request for a loan."

Findel, the papers allege, didn't disclose that his firm, Worldwide Financial Resources, was "undercapitalized and insolvent" and that he was "personally insolvent" at the time of the loan.

Separate court records show that at the time of Rapf's loan, Findel was in the midst of a bitter, $6 million-plus racketeering and mortgage-fraud lawsuit filed against him by Ohio Savings Bank.

That suit - which also cited a "pervasive" fraud pattern and alleged Findel used his firm as a personal piggy bank - claimed Findel's company duped the bank into buying more than $20 million in bogus, high-risk mortgage loans.

Findel settled that suit in 2006; financial terms weren't disclosed.

jeane.macintosh@nypost.com

[Green DNA]

Figures anyone stupid or crazy enough to shell out that ridiculous a sum isn't such a great guy-

HE'S A JET-'DEBTOR'

400G-SEATS GUY STIFFED PAL ON LOAN: LAWSUIT

By JOE MOLLICA and JEANE MacINTOSH

Last updated: 12:17 pm

November 3, 2008

Posted: 5:02 am

November 3, 2008

The mortgage broker who shelled out $400,000 for the two best seats at the Jets' new stadium has been sacked with a lawsuit by an ex-pal who says the man borrowed money from him and - pleading poverty - hasn't repaid it.

Free-spending David Findel borrowed $380,000 from fellow New Jersey businessman Michael Rapf "on a short-term basis" in September 2004 to help with "a temporary cash-flow problem," according to the suit.

The fraud and breach-of-contract suit, filed Friday in Monmouth County Superior Court, claims Findel "promised [to] repay the loan in full within 60 to 90 days." Four years later, he has paid only about $100,000, "despite repeated demands," the suit charges.

The suit asks the court to order Findel to immediately fork over $281,500, plus interest.

The Post reported last week that Findel paid the record price for the rights to buy the seats at the new Meadowlands stadium in an Oct. 16 auction. Findel's company is a corporate sponsor and the preferred mortgage lender for the Jets.

Findel has the option of spreading payments for the Jets tickets over as many as 15 years.

Rapf first learned about Findel's seats purchase by reading The Post.

Just days earlier, Findel told him "that he did not have the funds to repay [Rapf's] loan in full," according to the suit. Findel does not deny he owes Rapf the money.

But he told The Post yesterday, "I'm disappointed that it has come to this," and said he thought they had reached a payment deal.

"We settled this six months ago," Findel said. "I'm paying him back."

"So far, I've given him over $100,000, so I'm ahead under the terms of that payment schedule," he said.

Meanwhile, Rapf's suit claims Findel misrepresented himself and withheld "material facts" that, if known, would have caused Rapf to "refuse his request for a loan."

Findel, the papers allege, didn't disclose that his firm, Worldwide Financial Resources, was "undercapitalized and insolvent" and that he was "personally insolvent" at the time of the loan.

Separate court records show that at the time of Rapf's loan, Findel was in the midst of a bitter, $6 million-plus racketeering and mortgage-fraud lawsuit filed against him by Ohio Savings Bank.

That suit - which also cited a "pervasive" fraud pattern and alleged Findel used his firm as a personal piggy bank - claimed Findel's company duped the bank into buying more than $20 million in bogus, high-risk mortgage loans.

Findel settled that suit in 2006; financial terms weren't disclosed.

jeane.macintosh@nypost.com

Classic, after the Jets rolled this guy out as the Uber Jets fan. What are the odds that his PSL get's repossessed withn two years?

[4HCrew]

I love the difference in waiting list...150,000 to 13,000

[JETSFAN5180]

I love the difference in waiting list...150,000 to 13,000

Is it at 13,000 wow where can I find out my number.

[Maxman]

"If current fans don't want to pay the price, others will step up off the waiting list," Johnson adds.

This pretty much sums up the attitude of the Jets and the Giants. I love my Jets but I hope this whole PSL things blows up in their faces.

Whatever you say Poster # 412. If you don't like it we can always just replace you with another poster.

[Maxman]

I read somewhere some of the early buyers of PSL's have already sold them for a profit

I think woody deserves credit for making the entire upper deck PSL free, and the creative idea of auctioning off the coaches club

but

it sucks the long time loyal fans will get pushed out or to the upper decks

I just hope a lot of the lower deck seats don't wind up as investments that get sold to the visiting team's fans every week or corporate perks

You can't sell them yet, not for a year after the stadium is built I believe. I don't even think the entire PSL contract has been finalized yet for the fans.