Nets' Big Losses Continue ... Even Beyond Prokhorov's Cushion
by Net Income on Jun 9, 2011 1:53 PM EDT
in Brooklyn
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PrintAs part of his agreement to buy the Nets, Mikhail Prokhorov agreed to fund team losses in New Jersey for up to two years and up to $60 million. Forest City Enterprises, Bruce Ratner's parent company, said Monday losses continue and exceed Prokhorov's guarantee. So, FCE will have to fund them as it did in the past.
FCE's new CEO David LaRue said "entities controlled by Mikhail Prokhorov committed to fund up to $60 million of the team's losses from acquisition to the completion of the arena. We now anticipate that $60 million cap will be reached sometime in the second [current] quarter of the year, at which point Nets Sports and Entertainment, the ownership group of which we are the managing member, will need to fund the overage."
Nets Sports and Entertainment is the Ratner-led group that owned the Nets prior to the team's sale in May 2010. It continues to own 20% of the team.
Quoting LaRue, Atlantic Yards critic and chronicler Norman Oder writes that allocated team losses for 2011 and about the first half of 2012 "will be in in line with losses" experienced prior to Prokhorov's acquisition. "We previously thought we were done with these levels of losses but it now it appears that the cap will be reached sooner than originally anticipated." How this will affect Nets' operations was not addressed.
- Forest City Enterprises reports earnings rise for first quarter 2011, claims Brooklyn office vacancies being addressed, must absorb Nets losses Norman Oder - Atlantic Yards Report
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Second
Thank the lord (marv albert) we have proky…We came to far now for a few million to hold us back
Third
Dallas goes up 3-2 tonight! Go Nets!!
NETS Jersey Strong Brooklyn Ready
When you have to shoot, shoot don't talk.
this, plus Kimmie's fall from grace
what’s a fan to do???
Nets spent a lot of money, as we have noted, on everything from cash considerations in the D-Will trade to the hiring of a team chef, with the apparent knowledge that losses were mounting.
And Prokhorov has invested a lot of money in the arena as well, buying $76 million in junk bonds to finance the arena infrastructure. Told as well that that can be swapped for equity in the arena in another two years. That could be accelerated of course and some money added.
Asked for comment. See if we get it.
Thanks for the Heads Up.
Brooklyn, Where Nets Basketball Happen.
http://twitter.com/#!/jamesisahero07
I didn't want to scare the kids at the time...
But that Deron Williams changing agents scares the bejeezus out of me !
For me it didn't if Deron refuses to sign then trade him/
We can at least get someone decent for him. Not the way that we planned to but there’s still a light at the end of the tunnel.
Brooklyn, Where Nets Basketball Happen.
http://twitter.com/#!/jamesisahero07
Because...
"Next year, with a full training camp, I think he can go after that Scott Skiles' record of 30." - Billy King
Deron switched agent because the dude was small time
And deron gonna be primtime and looking at big contracts and deals. On top of that he coudln’t be happy with how the Utah deal went done, if I found out on sportscenter and I’m an nba super star I’d have words with my agent.
"Next year, with a full training camp, I think he can go after that Scott Skiles' record of 30." - Billy King
what's the likelihood
that these mounting losses equate to nothing more than pocket change for the boss?
Rich people don't like to lose money...
They want to make money, lots of money !
I wonder if our assistant coaches leaving has anything to do with this financial issue ?
come on guys 'you're better than dat'
dwights on the trading block, Deron is organizing the BK takeover, and Hump got played…2 out of 3 aint bad
Kimmie fall from grace?
Who is Kimmie?
"Next year, with a full training camp, I think he can go after that Scott Skiles' record of 30." - Billy King
Lol, When all is bleak...
You can count on Outlaw to lift your spirits!!!
"The mind is its own place, and in itself can make a heaven of hell, a hell of heaven"
Ahh, this is why they need full year commitments from the L&P section
Makes sense.
Section 18, Row 7 at The Rock!
"Your 2010-2011 New Jersey Nets - It Is What It Is"
They end up selling much less L&P packages, and manage to damper our enthusiasm
Yormark, the best in the business
Avery Johnson can go Outlaw himself.
NETS BASKETBALL…. JUST DEAL WITH IT!
12 wins
"We're not there yet, but we're going somewhere," Johnson said. "And we're going to Brooklyn. We're not going to contract. We're going to Brooklyn."
The economy has been pretty bad...
the last few years. People not spending as much money on expense entertainment.
Only Hershey, PA is allowed to say that!.
Hershey, The Sweetest Place on Earth:
http://www.youtube.com/watch?v=AUN—6azo3E
why do ppl say the hump got played?
Did he get dumped? Honestly I’m lost. I don’t pay attention to these things
by netsfanallday on Jun 9, 2011 2:43 PM EDT via mobile reply actions
He was dumped by Kim??
I thought they were getting married??
Brooklyn, Where Nets Basketball Happen.
http://twitter.com/#!/jamesisahero07
Nah she didn't dumped him according to this article.
http://www.vancouversun.com/entertainment/Kardashian+protects+assets/4920244/story.html
She was just protecting her assets(which one?).
Brooklyn, Where Nets Basketball Happen.
http://twitter.com/#!/jamesisahero07
Nor this article:
http://thestir.cafemom.com/entertainment/121456/7_signs_kim_kardashian_didnt
Even the accuser says it was early in the year. Back in January she wasn’t committed to Hump anyway so it would have been no big deal even if true.
Hump is probably being consoled in Kim’s lap right now.
I love it when you talk dirty Jerry !
Thanks for the update…
by M I K E on Jun 9, 2011 3:40 PM EDT up reply actions 3 recs
i was lost too but i google the yopic and it says kim k. might be smashing kanye lol
by netsfanallday on Jun 9, 2011 2:49 PM EDT via mobile up reply actions
we all know kim k. has been with a lot of guys not surprised at all about kanye of its true.
And if its true how will hump play next year?
by netsfanallday on Jun 9, 2011 2:51 PM EDT via mobile up reply actions
Random thought.
I think proky was aware that the team will lose money in the coming years. He’s a businessman right? You analyse the market before you do your move. Of course he was ready for this.
Brooklyn, Where Nets Basketball Happen.
http://twitter.com/#!/jamesisahero07
Yeah I'm sure Proky and his team went into this looking at what realistically could/would happen
The whole Rosy glasses approach doesn’t seem to be Prokys style, so I’m sure things were foreseen.
"We're not there yet, but we're going somewhere," Johnson said. "And we're going to Brooklyn. We're not going to contract. We're going to Brooklyn."
NI This seems like a crazy deal for the rat
Not that he doesn’t deserve it, but the way I read this is that the Nets now have a blank check for losses over 60 million? That means that the team can spend money like water and the only one who suffers is the Rat. Seems like the Rat made a bad deal and Prokhorov is taking full advantage. Is that correct, is there any limitation on what the team can spend money on?
Maybe Prokhorov is eliminating Ratnert...
Deliberately losing money so Ratner bails out and sells the whole package to Prokhorov ?
That is kind of what i am thinking
A little Russian gamesmanship. Ratner deserves it and more. He may have been the worst owner in sports history.
I thought it was the Clippers owner who's worst??
Brooklyn, Where Nets Basketball Happen.
http://twitter.com/#!/jamesisahero07
Yes but the clippers were never good
The Rat took the Nets from Almost Champions to Almost the worst team in the history of the game in 2 seasons.
No
I have no details, but from what I think I know, Prokhorov controls the Nets board of directors and as principal owner, sets the budget….I’m sure in consultation with the Ratner people.
But with losses mounting, the issue is whether the franchise will tighten its purse strings a bit in order to keep Ratner’s losses low. Or some new agreement could be reached. It’s not going to affect the retention of D-Will but it could (and again I dont know) keep them from doing other things. That $60 million includes things like debt service and money to facilitate trades/ That I do know.
As both the Prokhorov people and the Ratner people for comment. I have not received any response.
There must be an agreement in place about total loses
otherwise as majority owner Prohkorov can set a budget with losses totaling $200 million and he would only be liable for $60 million. Personal chefs for everyone!
We also don’t know how there income flows. 3rd quarter (summer) could be a slow month with minimal expenses and 4th quarter could be the most profitable due to ticket sales collections. So there may not be a lot of additional loses.
this sucks
so we could be frickin screwed now
oh god just when we had hope
by MrDollarBills on Jun 9, 2011 5:32 PM EDT up reply actions
I wouldn't bee TOO worried
Prokhorov looks at the Nets as a long term investment. They have approached this situation aggressively including the trade for DWill which made the Nets a now team. The goal is still to build a winner for Brooklyn. A big part of that is related to image. The Nets will carry themselves like a first class organization because they need to be perceived as one in order to become one. Otherwise Prokhorov stands to lose tons of money. The Nets are an investment and he needs to put in money in order to make money.
by gsloots on Jun 9, 2011 6:38 PM EDT up reply actions 3 recs
It kind of reminds me of that Soprano's episode
You know the one were Tony takes over the sporting goods store when his high school buddy looses all that dough playing cards? As a shrewd businessman, its in Proky’s DNA to look for weakness in a business strategy and when Ratner was desperate to fund his arena, Proky pounced and has been spending mad money to improve the organization while loosing millions knowing that he isn’t the one whose gonna be paying the bill. Brilliant!!!!!!!!!!
"We all have to decide for ourself how much sin we can live with"
Does anybody remember that little article last week...
stating that Prokhorov is entering Russian politics and might not be so involved with daily hands on activity with the Nets ?
Does anybody remember Prokhorov stating several months ago that he was surprised how difficult and competitive the NBA was, in trying to put a winner on the court ?
Am I being too paranoid ? And if so, can I take any medication for it ?
Being too paranoid
He understood the risk, even if the reality is a little more brutal. He is a businessman who thinks he is god and can overcome all, and I think he has too much pride to pull the plug after all the trash he’s been talking about “making a global team” and “turning Knicks fans into Nets fans”
by Anthony Perez on Jun 9, 2011 3:35 PM EDT up reply actions
How this will affect operations
It won’t Proky runs the team, FCE will have to eat the loses as agreed partially and occurred partially because they helped manage the team into the ground. The other part being the NJ market.
"Next year, with a full training camp, I think he can go after that Scott Skiles' record of 30." - Billy King
You just had to...
throw the NJ market thing in there huh…
Is it affecting the giants, jets, red bulls, and devils as bad as it is the Nets? hmm…
why are you
so offended? its true, basketball is not for NJ and is clearly not as big a market as brooklyn/NY
CLEARLY
what every other sport?
the giants and jets are clearly NY’s team, and the devils arent doing that well, and anyone who argues that NJ is as big a market as brooklyn has no idea what they are talking about
Not even going to bother...
Waste of time and energy. Topic has been discussed hundreds of times. Why go back to it. You win. NY wins…everyone is happy.
And NJ loses which makes you extra happy…
i do win
because you cant come up with one fact as to why the nets would be just as successful in NJ as in Brooklyn, and how NJ is just as big of a market as NY, so yes i do win
He was being sarcastic
Why do you think that the market in NJ can never work for major sports franchises? I think that there is more to this than just the market. Just like NetsNewark, I will not state why because I will just be repeating what I have already said. Then again, you will still believe the myths no matter how many times they have been disproven. If there was never the idea of moving to Brooklyn, then the fan base would increase for the Nets. On a side note, saying that those who oppose the are less of a fan compared to you is very insulting considering that I have probably been a fan longer than you have of the Nets. If you asked me, the reverse of that is more true.
I would bet...
that this guy became a Nets fan solely because they are moving to Brooklyn. That’s why he is so passionate about this subject. I doubt he would have even cared about the Nets if they were still an NJ team.
These are some of the new fans folks, just have to accept them. Though I’m not a big fan of those who continue to bash the old NJ fans and bash the state/city they played in. God forbid you say anything negative about their beloved borough…
Accept and move on…
You can't compare the Nets to those teams though
All those other teams (outside of the Devils) don’t have any teams playing in NYC to compete with so they have the advantage of getting all those NYC sports fans. With the Devils I think the prolonged success of 15 straight playoff appearances and 3 Stanley Cups accounts for their more profitable situation.
"I just copped me an all-things, a professional ball team
Tell me I ain't the illest hustler ya'll seen"
Nets would have been...
a little more profitable, had the RAT not destroyed the momentum. It’s the RAT’s fault…not NJ.
Some people here seem to take a shot at NJ anytime they can. Don’t worry guys, Nets are going to NY. That will solve this problem right?
they would have been more profitable?
when they were making it to the finals when the rat didnt own the team in 2002, they were still 26th in the league in attendance, please.
that argument is too old at this point
Ratner overreached in a number of areas early on and then had to pay and pay and pay while the litigation dragged on and while the economy fumbled.
The Nets lost money in New Jersey before Ratner took over. there were never any profits. Lew Katz told people in 2003 that the Nets would never be able to pay three players the max. Then, he sold the team.
YankeeNets...
did own them before the RAT took over. They wanted to move to Newark, they must have seen some potential in it. But once they couldn’t get funding from the state for a new arena in Newark…they sold to the highest bidder.
Something like that…
No one knows...
what would have happened had they got the funding for the new arena in Newark. Unless you know something i don’t know? You got the inside scoop? Is this ratner?
It could have worked
If the Nets had moved to Newark when it was first proposed, they could have gotten more fans as they would be near mass transit, and the fact that Newark-Penn Station is a major transit hub for NJ. However, I feel that they should have paid for it themselves rather than having public funding. At least the Prudential Center was built with private money when Jeff Vanderbeek, the owner of the Devils, had it built. As for knowing the inside scoop, it does remind me of Gordon Gecko from the movie Wall Street who had every insider knowledge to trading on stocks, which lead to his arrest at the end. Perhaps Newark would have helped the Nets had they not moved there after the mentioning of them moving to Brooklyn.
Yes because Gorden Gecko is the only example of insider trading
All though that is one of my favorite movies. Greed is good, to bad the sequel wasn’t….
"Next year, with a full training camp, I think he can go after that Scott Skiles' record of 30." - Billy King
Yeah, while that izod...
IZOD…greatest arena in the world, with access to mass transportation. How they loss money during that time is beyond me…lol
Different situation..
as this is now a lame duck team….If you don’t get that, i can’t help you. Seek professional help….
seek professional help?
you should sir, you are sitting here saying how they would be just as successful in Newark, they have deron williams now, not to mention, Newark was a dump back then, so you should seek professional help
I'm out of here, it's too damn hot to argue guys...
I’m gonna go to the nearest bar…have a drink or six, and seek out the smallest Knicks fan there and kick her butt. Hopefully she don’t fight dirty.
Or they just wanted out of the friggin Izod center
The worse arena for a long time in major American Professional sports.
"Next year, with a full training camp, I think he can go after that Scott Skiles' record of 30." - Billy King
Yes I did
Or somone else would have pointed it out making me look foolish. Thats the reason I said it. Even when the team was in contention and in the finals game weren’t selling out. Now I’m totally unbiased on NY vs NJ debate not even from the area so I have no interest. If you like you can say its NJ or more the fact the knicks have been around so long it has a stranglehold on the fanbase. Playing in a crappy arena no doubt didn’t help or the years of faultily but no team is going to usurp the knicks in playing in NJ not even in NJ. Its nothing against NJ but when you litsten to espn 1050 and have so and so from NJ calling in as a knicks fan it makes it obvious, NJ as shown it can’t and won’t support a team anytime soon. Brooklyn is a much bigger market and easier to get to the market should help the nets financial woes and support the team.
"Next year, with a full training camp, I think he can go after that Scott Skiles' record of 30." - Billy King
Funding the losses
As I read the excerpts, the pre-Prokhorov ownership group has to fund the losses, not FCE itself. FCE is the largest member of that group, I believe, but not the only one. Perhaps it has the right to fund all the losses and dilute the others, I don’t know, but I doubt it is legally obligated to fund the losses on its own.
in the past it funded up to 58% of the losses
few of the ownership group came through when cash calls were sought. Everyone was tapped out by the time of the sale and a lot of the big shareholders from that group are gone.
Ratner did do some bad things
but everybody is giving him more junk than he deserves. If it werent for him, we wouldnt be moving to brooklyn and getting a chance to be relevant again. Kidd would of retired or been traded, and the Nets would of spent the rest of history in NJ with a terrible fan base, at the bottom of the league in the standings, and last in attendance every year, so we should be thanking ratner right now.
his big problem
was over reaching…thinking his plan would sall through with minimal opposition. He also didn’t get full funding back in 2003. He had to ask the old owners to stay on.
he expected the Nets to be playing in Brooklyn in 2006-07.
The main reason
The move to Brooklyn was never about the fans, it was just about him trying to get more property than he already has. The reason there was so much opposition to this was because he was using a public process to get his way when it was clearly private. Also, he used a state agency to help him bypass many city zonning laws that would actually prohibit such a thing. Many city council members hardly got a say on this thanks to his friends in high places. Also, why should he be allowed to use taxpayer dollars to fund for it when the money should come out of his wallet? The ESDC also helped him win his bid despite being lower than what Gary Barnett of EXTELL offered, which was tripple that. The truth is that Ratner underestimated his opponents. Of course, there will always be those trying to believe that the end will justify the means as long they get what they want in the end, nothing else matters. Taxpayer dollars should be used to help with the public sector, and not help a rich man get richer. Right now, Bloomberg, who is the mayor of NYC, plans on closing a number of schools and firehouses in the claim that there is no money to keep them open, but doesn’t mind giving so much to his great friend Ratner.
by Tal Barzilai on Jun 9, 2011 7:15 PM EDT up reply actions 1 recs
I swear "the Rat" is always screaming from the hills how he is losing $$$
He should just sell all his shares/stake in the Nets to Proky so that our Nets can get away from the virus that he is.
Niners,Nets,Reds & USC!!!
"We'll be the first really global team in the NBA. For me, being the first foreign owner, I want to do my best to invite all the fans for the team all over the world. I think the NBA is worldwide. But other teams [possess a] more local mentality. We are going to create and to build a global franchise to sell all around the world. I think I have a competitive advantage compared to other owners." - Mikhail Prokhorov
I know Cleveland does
but they dont use it. They built a Taj Mahal out in the suburbs for LeBron.
http://www.ellerbebecket.com/expertise/project/2_270/Cleveland_Clinic_Courts.html
Dont know of any other court in an arena. Probably are but not many.
officially, SHoP is the "facade architect"
ande Ellerbe Becket, which has designed more a dozen NBA arenas, is the “architect”.
They should have gone with Sven
"Next year, with a full training camp, I think he can go after that Scott Skiles' record of 30." - Billy King
by shea23 on Jun 9, 2011 8:08 PM EDT up reply actions 1 recs
his ankle was bothering him
and may be he is moving so fast in the mocks that he doesnt think its wise.
Faried wont work out for the Nets. WOnt work out for any team lower than #24.
Doesn't expect to last long
Pause
Section 18, Row 7 at The Rock!
"Your 2010-2011 New Jersey Nets - It Is What It Is"
in this draft
who knows.
Most of the big names haven’t been seen.
How many games did Irving play? Kanter? Biyombo is in Spanish version of the D League. Tyler played in Japan. ON and on it goes.
What if we wanted to see if it was worth moving up for him?
i dont want him anymore
Brook Lopez is the MAN!
----
I don't really hate Outlaw, its just fun to make fun of him
he's only going at 24??
my b, shouldve checked before posting
Brook Lopez is the MAN!
----
I don't really hate Outlaw, its just fun to make fun of him
Yeah, i was talking about Faried lol
Brook Lopez is the MAN!
----
I don't really hate Outlaw, its just fun to make fun of him
I just dont see
How these losses are in any way going to affect the team’s operations. With an owner in Prokhorov who wants stars so badly and wants to win so badly, I dont see him letting Ratner’s losses affect the Nets’ operations.
aren't a good portion of the losses..
..associated with the building of Barclays? shrug
by Whoop Dee Damn Doo on Jun 9, 2011 5:06 PM EDT reply actions
Irina works for Onexim Sports and Entertainment
which reps his interest in Nets.
Onexim Sports and Entertainment owns 80 percent. Nets Sports and Entertainment, Ratner’s group, owns 20 per cent.
Not sure how much Sergei Kushchenko gets for a part time job as director of Nets Basketball.
FYI, Yormark leaves for Moscow this weekend to talk with ownership, among othr things.
Brook Lopez is the MAN!
----
I don't really hate Outlaw, its just fun to make fun of him
by netsareboss on Jun 9, 2011 6:21 PM EDT up reply actions 1 recs
Saw it for the first time on the Nets FB page. All of the posts are on June 7, I think, so yeah.
http://otrbasketball.com/forums
Yankees-Nets-Broncos
looks like we'll be the Nets in Brooklyn
Larry King (on Jimmy Fallon) was talking about how much he loves Brooklyn,and talked about how he just did a promo for the Nets.
this
makes up for the glum financial news
hopefully the team will be okay
The Nets live on!!!
by MrDollarBills on Jun 9, 2011 5:48 PM EDT up reply actions
Larry King...will he make it to 2012
Nets have said they will have famous Brooklynites do promos for the Barclays Center
That'd be awesome
We could have like Jay-z, Larry David, and Chris Rock, maybe Woody Allen also
by JerseysFinest. on Jun 9, 2011 6:33 PM EDT up reply actions
Must suck living so close to to Miami (heat)
"Next year, with a full training camp, I think he can go after that Scott Skiles' record of 30." - Billy King
It kind of reminds me of that Soprano's episode
You know the one were Tony takes over the sporting goods store when his high school buddy looses all that dough playing cards? As a shrewd businessman, its in Proky’s DNA to look for weakness in a business strategy and when Ratner was desperate to fund his arena, Proky pounced and has been spending mad money to improve the organization while loosing millions knowing that he isn’t the one whose gonna be paying the bill. Brilliant!!!!!!!!!!
"We all have to decide for ourself how much sin we can live with"
Sorry for the double post
"We all have to decide for ourself how much sin we can live with"
Ai available?
Not that i want him on this team, but do you think he is a possible choice instead of keeping sasha?
I'm an MJ FAN (Bulls)... turned into JKIDD FAN (Phoenix-Nets)...
NOW, I'm definitely a NETFAN - Go Deron Williams!
Didn't he play pooryl in Turkey
Iverson is done in the nba
"Next year, with a full training camp, I think he can go after that Scott Skiles' record of 30." - Billy King
Looks like reversible jerseys are back in business.
Get your outlaw/Kobe jersey! The two best fade aways in the game!
by Gr8tness on Jun 9, 2011 6:57 PM EDT via mobile reply actions
Sweet Deal
All the more incentive for Prokhy to dump Outlaw over Petro if there is an amnesty clause.
Hmmmm
i can see mikhail thinking this is a long term investment. Like rule of thumb for opening a business is losses first 2 years then start making money on the 3rd year.
I dont see this as a problem.
Proky knew we were bleeding money but invested anyway.
In Prokhorov & Billy King WE TRUST.
8 > 3
DH12 OR BUST!
Official Member of the "Travis OutLOL Society". 5 years, 35 Million Dollars worth of lulz.
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