Agenda Item: AutoZone Park

Posted by Frank Murtaugh on Mon, Dec 16, 2013 at 11:13 AM

Autozone_Park.jpg

An open letter to the Memphis City Council:

Talking baseball in December can be challenging. No standings to check. No game schedules to plan around. No line for a cold drink or barbecue nachos at AutoZone Park. The Hot Stove League isn’t what it once was, blockbuster trades having been supplanted by free agents leaving one team for another to be paid salaries that would make Gordon Gekko blush.

But baseball season is coming. Pitchers and catchers report to spring training less than two months after Christmas. Temperatures will rise, grass will get greener, and prospects will don new uniforms on their journey to fulfillment of an American boy’s dream. And we’ll see many of those prospects at AutoZone Park, players like Michael Wacha (last April a Memphis Redbird, last October the National League Championship Series MVP), Carlos Martinez, Kolten Wong, and Oscar Taveras. The faces of Memphis baseball will be back, on their way to becoming faces of the St. Louis Cardinals, the second-most powerful brand in all of Major League Baseball if you combine regional popularity with longevity and championships.

Baseball will be back, indeed, unless you muck it up.

Built at a cost of more than $70 million, AutoZone Park was drenched in red ink from Opening Day of its inaugural season almost 14 years ago. No business model before or since could erase this kind of debt by selling tickets to Triple-A baseball games. The debt is not going away (at least not conventionally, with an infusion of cash). It didn’t for the Memphis Redbirds Baseball Foundation, and it will not for the current bondholder, Fundamental Advisors. Until the current arrangement is washed clean — much of that debt swallowed by one party or another — AutoZone Park will never be a profitable venture. To evaluate mayor AC Wharton’s proposal for the City of Memphis to purchase the ballpark under such criteria — How can the city make money? — is a swing and a miss at a pitch two feet outside the strike zone.

When you reconvene Tuesday, and when you finally vote on the matter on January 7th (per the mayor’s wishes), instead of trembling over the numerous worst-case scenarios — an obligation of city councils, to be sure — consider the best-case scenarios already on the table. Hands are extended, ready to shake.

• The St. Louis Cardinals want their top minor-league affiliate to play at Third and Union. They want to pay the City of Memphis for a team to play at AutoZone Park. Take this for granted at your peril. You think ticket sales and sponsorships have dragged since the Grizzlies’ arrival in 2001 and the economic collapse of 2008? Gaze into your crystal balls and imagine sales and sponsorship for the Triple-A (Double-A?) affiliate of the San Diego Padres or Minnesota Twins playing in downtown Memphis.

• The Cardinals want to be part of Memphis baseball for a long time. And yes, a 17-year commitment is a long time in the world of professional baseball. Why are the Cardinals so attached to AutoZone Park? Spacious clubhouses may have something to do with it, but the Cardinals are attached to the ballpark because Memphis is Cardinal Country. It’s a marriage formed over the airwaves of KMOX radio throughout the 20th century, boys and girls in Central Gardens listening to Stan Musial hit five home runs in a double-header at some distant ballpark. Even the best of marriages require work and attention to detail. These cross-generational details are in your hands.

• Baseball must be played at AutoZone Park. This is no conference center or multipurpose arena. It’s a baseball stadium. The choices — however the costs are broken down and revenues shared — are but two scenarios: the business of baseball proceeds in Memphis, or it shuts down. And without baseball, that tract of land at Third and Union some of you deem unworthy of $20 million will be worth a tiny fraction of that figure. I’m guessing the cost of demolishing the stadium — to try something else on the property — would cost somewhere between $5 million and $10 million. And what could rise from the destruction of such a civic asset?

Those are the words I’ll leave you with: civic asset. AutoZone Park — with the St. Louis Cardinals nesting there — is a civic asset that makes Memphis a better city than we would be without it.

Make sure baseball comes back to Memphis. And happy holidays.

Comments (20)

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This project was doomed from the very start, would it have been smart to make im provements to the old Chick ball park ? it was paid for . Memphis need progressive thinkers when it comes to such large projects , Best move would be like the article said would be to tear it down it will never make millons, i see a nice hotel in that location

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Posted by Wake up Memphis on 12/17/2013 at 7:57 AM

AutoZone Park is part of what makes downtown Memphis...downtown Memphis. In my opinion, it is as much a part of the city as the hotel across the street from it and the bridge connecting its home to Arkansas. Was it an overbuild by the Redbirds at its inception - yes. The park could have been just as much of a success at 2/3 the cost, but ask yourself how nice it has been to see something in Memphis done RIGHT, not just done. Could the Forum have been built for less? Sure. Is it an amazing arena befitting a basketball town? Of course! Cities and a large amount of their residents identify with their sports teams and the venues where they play - it's just a fact. Let the Redbirds and AutoZone Park slip away because you don't think the city should be in the business of owning sports parks, and not only are you naive to the way sports venues operate, but you VASTLY underestimate the positive impacts they have on the communities in which they sit.

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Posted by MTBlake on 12/17/2013 at 8:56 AM

First off, ... it wasn't done RIGHT. The economics were terribly flawed.

IF the city is going to acquire the asset, it should be at a rock bottom price. The current bag holder is a speculator who thought it would make a real killing by purchasing the bonds at fire sale prices.

They want to pass the bag to Memphis and get out as cheaply as possible. Nothing noble about these critters. What's nice from the city side, is there is not a lot, if any, other prospective purchasers.

There is no other use for the asset, other than as a sports field. Memphis should have someone independent do the homework on analyzing the project to see what number will allow the city to make a reasonable profit if they acquire the park. They should not pay one penny more than that number.

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Posted by JuliusJones on 12/17/2013 at 10:27 AM

I really don't care that much for the park. That is what is important in this purchase. The value is in the land that the park sits on. Maybe not now, but, sometime in the future, that land will be gold.

Investors and speculators don't invest necessarily in structures, it is the land that they look at.

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Posted by oldtimeplayer on 12/17/2013 at 10:43 AM

If it were me, I'd be inclined to same something like, "It would be a shame if the city had to condemn these facilities, but I'm sure we can avoid any unfriendly outcomes by agreeing to a more reasonable purchase price."

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Posted by Jeff on 12/17/2013 at 3:15 PM

Get a grip.....I can't help you if you think that everything is measured in dollars and cents. Autozone Park is about quality of life. Sure, not everyone likes baseball. So there are other things in downtown Memphis for them. But I love going to the ballpark after a tense day at work and feeling the stress leave slowly and steadily while a really diverse group of Memphians and visitors spend a few hours together sharing the joy of watching young about-to-be-stars and tested veterans play a great game. Why so many Memphis residents seem to enjoy being miserable instead of contributing to make this a good place to be is beyond me. Go be miserable somewhere else. Just Don't take my baseball park away.

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Posted by kpd on 12/27/2013 at 9:32 PM

I honestly don't see where the *potential* problems lie? The city has a chance to obtain a $70 million ballpark for $20 million. The Cardinals lease payments plus the sales tax rebates cover the bonds which will be paid off in 17 years, the length of the initial Cardinals lease. The naysayers are pulling out the same tired, worn and proven wrong arguments they used to say the FedExForum would never work. Thank God they weren't listened to then, and they should be ignored now. Vision, some have it, some don't.

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Posted by Midtown Mark on 12/27/2013 at 10:15 PM

We visit every year from UK and Autozone is ALWAYS an attraction and we visit all the time - love it; all I can say is that Memphis will not be the same without it. I wished we had that sort of park in our local cities in UK. Again, I agree, please don't put a price on everything!! How about your locals .......... and us visitors?

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Posted by cplovesmemphis on 12/28/2013 at 8:44 AM

Like the previous post from the UK, I am a regular visitor from Australia. I visit Memphis twice a year as I have investments in the City. I just love going to a game at Autozone. Unfortunately baseball in Australia in not a "major" spectator sport so it's fantastic to be able to see a game I love, played at such a professional level. If the $20M quoted is the buying price, that is a steal from a venue of such quality. I live in a city (Gosford) 40 miles north of Sydney and the Local Council owns the sports stadium. It contracts out the management of this facility to the private sector. It struggles to obtain a reasonable return on it's investment but the financial benefit to the region can not be denied. In my view Memphis City should adopt the same entrepreneurial approach and consider the long regional impact of having a world class venue in Memphis.

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Posted by Len Bain on 12/28/2013 at 5:07 PM

I'm not a Memphian but visit your city 5-6 times a year. AZP, during the season, is a must stop for me and my family. I prefer driving 3 hours south to Memphis to see the Redbirds than drive 1 hour north to see the Cardinals. During our visits, which include hotels, meals, fuel, souvenirs, etc, we help "stimulate" the cities economy by paying sales tax. This just makes sense to me for the city to offer a facility to bring in visitors and residents alike for quality entertainment. The Cardinals organization, the best in the Bigs, would be an ideal business partner.

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Posted by JLKTCB on 12/28/2013 at 7:14 PM

The city council is not forward thinking...All they do is fight amongst themselves and like to play the race card at times. If they tear it down and build a hotel, what is there to come to see...the ducks at the Peabody??? Memphis does not get conventions because of FedExForum and their costs, the run down convention center, and as COGIC seems to think, the outrageous hotel prices...but thats another rant altogether...Wrestlemania 30 is in New Orleans the first weekend in April and what hotel rooms are left are either a $50 cab ride to the city of over $400 an night...it's called supply and demand...basic economics that I doubt anyone on the council has studied!

What the city council does not realize as they can only see past their own pet projects and mismanagement of the city is that most of the people who occupy seats in the stadium actually come from outside the city of Memphis. I for one live in Olive Branch, and now thanks to Willie Herenton and the great migration south made a lot of money off my property and no longer have to spend my money north of the border, with the exception of the zoo, pink palace, The Orpheum, and Auto Zone Park...I pay for tickets, buy concessions, souvenirs, and pay to park. A majority of it is spent on baseball...it is something I was raised watching and would miss. Notice I left out Grizzlies...this is not family friendly with the high ticket prices...So pull your head out of the sand and think long term...$20 million is nothing in the scheme of things for a facility that is one of the finest in baseball...look at all the other failures...Mid-South Fair, Pyramid...If anyone really thinks there will be a Bass Pro in the Pyramid is really dreaming...the city council will screw that one up too.

As far as a hotel in downtown, what about the old Greyhound Terminal...oh wait...doesn't Willie own that? That would be perfect for a hotel...close to FedExForum and the ball park...a win win for all parties...sales tax, hotel tax, and property tax revenue for the city and county. Maybe Nashville has it right with a metro government instead of dealing with two groups who want to take their toys and go play by themselves...only one group to deal with and no duplication of services. Now that's forward thinking...what about Indianapolis...they built an NFL standard stadium...Hoosier(RCA) Dome without an NFL team and got one...also were able to parlay that into a state of the art facility in Lucas Oil Field...all while the premier sporting event in the community (Indy 500) was suffering from declining attendance...more examples of forward thinking...If the city doesn't purchase the stadium, the Redbirds will leave (probably for Springfield, MO) and the AA team will go somewhere else that is forward thinking and doesn't think about current dollars but future opportunities. If the pensions are underfunded, it's not baseballs fault...it's the ineptitude of the city council and mayoral administrations current and in the past...If the streets need repair...it's more mismanagement...the school merger and now resegregation...more mismanagement at all levels.

Baseball is a source of pride to a community and the fact the Cardinals what to leave their top minor league team in a city in such disarray should say something to the council...maybe they need to look at the management style of the Cardinals and model it...seems pretty successful, with 4 World Series appearances in 9 years! That should be enough to see that it is a win win for all parties.

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Posted by obcomputertech on 12/30/2013 at 5:43 PM

Michael Wacha?

Rehabbing, my transistor radio, is new enough, Where's Bob Gibson? and can you say duck before ya can't?

8o)

I love my memories of the Cards, baseball and Ms. Bartlett, (the evil witch). But, I was 12, that isn't the demographic that pays the bills. Baseball is no longer a thing children of that age listen to. The're more worried about "DNA" and whether it proves parentage or a lifetime behind bars.

Such is life.

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Posted by thecatsmeow on 12/30/2013 at 6:06 PM

From a pure business and investment idea, it is a very good deal. The land is the most valuable asset. Get the land, argue about what to do with it later. Upkeep, we already have the personnel on the payroll; adding one more piece of property can be absorbed by the same workers. The other most important consideration is that the city has control of what will eventually become of the land.

I am not talking race, but purely economics. Who knows, if the city doesn't buy it, with its high privacy walls, some smut peddler might buy is and make it the largest private sex club in the land? Is that what we want?

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Posted by oldtimeplayer on 12/30/2013 at 7:11 PM

Land?

HaHaHa!!!

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Posted by thecatsmeow on 12/30/2013 at 7:21 PM

How far is the former Greyhound Bus Station? HaHaHa!!!

I never said he couldn't make a profit HaHaHa!!!!

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Posted by thecatsmeow on 12/30/2013 at 7:23 PM

Land?

Yeah, I know a little .

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Posted by thecatsmeow on 12/30/2013 at 7:25 PM

As a longstanding fan of the FIRST-most "powerful brand in all of Major League Baseball" (yeah, you know which one), I have to say Frank's reasoning is powerful and persuasive. And his team is definitely the one with a farm system to watch.

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Posted by Jackson Baker on 12/30/2013 at 9:10 PM

Obviously the cats meow has not noticed what is downtown...The old Greyhound Terminal is right across the street from the stadium...tear it down and build a new hotel...If Bass Pro ever opens that should help the Pinch District...AutoZone Park brings people downtown 70+ times per year and they spend $$$$$. The city seems to think it needs to make a profit...just break even and be happy with all the tax revenue that will flow in over and above the cost to retire the bonds. I would say that AutoZone provides a higher boost to the businesses near the park than the Grizzlies do. Warmer weather and more families to spend money! Out of town money!

As far as using city employees for maintenance of the park...look at the condition of the city parks...they are not skilled enough to keep a professional baseball field in shape. The city council should be happy to break even and go on...are they making a killing off the Pyramid??? If not for Bass Pro, it would be empty still. Mud Island is not open enough to turn any kind of a profit, let alone cover costs. It should be open over the holidays and especially during the Liberty Bowl when there are several thousand visitors here from the participating schools...The only thing that fills that stadium is the Southern Heritage Classic...No one is talking about closing it and tearing it down, are they...if the U of M were smart, they would do like Louisville and build their own stadium on campus and abandon the Liberty Bowl where the wardrobe of choice is an empty seat, just like the FedExForum unless certain teams are playing.

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Posted by obcomputertech on 12/31/2013 at 5:39 PM

@ obcomputertech

Obviously you have no idea how that property has been "traded" and who was a tradin', Now ifin I can guarentees Ya'spektaculaur returns can I get a GO MAYOR! ?

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Posted by thecatsmeow on 12/31/2013 at 6:42 PM

This is a win-win: how can folks not see that? The city gets a fantastic civic asset - and for those of you counting dollars, yes, it happens to be on valuable land; the bonds are rescued from the clutches of the New York bondholders who - let's face it don't care about baseball and don't care about Memphis; the team will belong to the World Champion St. Louis Cardinals who have been successfully doing baseball since about 1904, thank you very much; and the Cardinals put in money to make the park even better than it already is. And that's saying something!

By the way, it was never said that the city would run the ball park; that's one of those misconceptions that people like to perpetuate and get all worked up about. The Cardinals know a thing or two about running ballparks and facility management, I think we can trust them.

There is no point whining about how wrong things were done in the past. The people who brought this team here did so with good intentions, even making a non-profit entity to run things because it was about civic involvement not making money. Here is a chance to re-set and keep baseball here and keep the RBI program going for 17 years guaranteed - minimum.

Would all of you naysayers feel better with a dark corner at 3rd & Union and putting all of those people in the ballpark and connected to the team and ballpark out of jobs? See a decline in economic activity downtown? So then you can continue to whine about things being wrong in Memphis? Did you not see the comments from visitors - could you please shut up and giving such a bad impression of our city?! Sheesh!

Go Cardinals and Go Redbirds!

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Posted by Vivi on 01/02/2014 at 1:14 PM
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