Here’s why Liberty is holding onto the Braves

Why is the media conglomerate from Colorado — the one that as of today is worth $15.29 billion on the open market — holding onto our baseball team, or that tax write-off/asset that somehow greased the conglomerate’s big deal with Time Warner a few years ago?

I’m thinking it has something to do with the figure 47 percent. That is how much the value of the Braves franchise has increased just since Liberty bought it in 2007. You and I probably don’t own anything that’s appreciated that much since the recession started. As of October 2013, our Bravos were worth $760 million, according to Bloomberg, which crunches numbers for a damned good living. So even after accounting for inflation, the value of the Braves has soared by nearly half since Liberty took them off Time Warner’s hands.

Not a bad return for the work Liberty’s put in. Why, the conglomerate has ….um, reduced payroll since 2007 by nearly 10 percent in inflation-adjusted terms while slightly raising the cost of attending a game and convincing a county government whose busiest highway is named after a dead president of the John Birch Society to hand over $300 million to help fund a suburban ballpark/office park/shopping center.

Whatever money Liberty has pumped into the Braves has been spent on real estate, video screens and arcade games, not on starting pitching and outfielders. But it’s their asset. They can do as they please. We’re just ticket buyers/bloggers/TV viewers. But this is our blog, and we can type what we please.

Speaking of real estate, I assume the Braves will partner with experts to build their mixed use development. Of course, that’ll mean splitting whatever money they might make from the development. Lord knows, another shopping center and office park in Cobb County is a sure-fire success, isn’t it? That’s what worries me. The Braves have not come out and said it — JS and Co. are about as publicly candid as the North Korean government — but it seems obvious this real estate gambit is at least partly a result of the horrific local TV deal the Braves ended up with after all those genius media execs finished their transacting.

So because supposedly shrewd businesspeople saddled our team with a financially crippling TV arrangement that lasts a quarter century, our team, along with Cobb County taxpayers, are embarking on a massive real estate venture that may or may not ever pay off. I’m no real estate pro, but you don’t have to look far to find similar boondoggles. Check out the ajc’s story about the Cincinnati project, for example. Toby Keith owns a restaurant in the complex next to the Reds’ ballpark. Cool!

This might be an oversimplification. But there is at very least a big kernel of truth here: While third-tier organizations like the Astros and Padres rake in newfound TV riches, the team with the biggest regional radio network in pro sports and so a large following to watch games on TV — yes, our Atlanta Braves — is left to gamble its future on a real estate project. What could possibly go wrong? Maybe it’s sadly appropriate that in a place long ruled by real estate developers, the Braves have to pin their hopes on a shopping center. Hey, maybe the Braves can give Heyward, Freeman and Andrelton a cut of the take from the bars and restaurants out there at 285 and I-75. I joke, but it would be intriguing to see if MLB and the players union would OK an arrangement like that. Maybe Braves Acres could work after all!

Or maybe if Braves Acres becomes a pipe farm — PVC poking out of the ground everywhere with no buildings to hook to — Liberty will rush to sell and we’ll get a decent owner. Then that owner would have to spend a few years getting out from under the real estate disaster.

On the bright side, pitchers and catchers report in less than a month. And Lucas Sims and Jason Hursh appear to be progressing nicely.

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5 Comments on Here’s why Liberty is holding onto the Braves

  1. this is an excellent point and one i’ve tried to make on various sites. the braves are looking to compensate for a failed broadcast deal (and whoever signed that thing for the team, do we know?) with a real estate development deal and naming rights. you saw the braves just back from a trip to st louis to look at the cardinals real estate venture, ballpark village, which has been stalled for several years and is being rolled out very slowly because of market conditions. if st louis, with its rabid fan base, a stadium (and ballpark village) right at two light rail stops, in a safe (and you better believe the st louis police department make the cards job one) downtown business district, is having problems doing this, the braves (with no expertise in their organization that i can see from their backgrounds) are running way uphill. as a braves fan, i can only wish them good luck!

  2. rankin' rob // January 26, 2014 at 9:12 am //

    While I acknowledge most of what you write here to be true, I’ll be glad when pitchers and catchers report and this site can go back to being a baseball blog, instead of a snarky version of the Atlanta Business Chronicle.

  3. Jack Straw // January 26, 2014 at 8:37 pm //

    Liberty has made a hostile bid to take over Time Warner through a subsidiary. The Braves’ position on Liberty’s balance sheet has to be maintained. Bad baseball business in the short term, but what if Liberty succeeds? Will they want THEIR team on all of those cable packages? Could it be good for the Braves over the next 2 to 6 years?

  4. i would doubt that liberty needs the braves on its balance sheet for any reason related to the acquisition; at its most generous valuation it is a tiny piece of the total. in fact, i would think the company would prefer to sell the team and use the money for the time warner acquisition and integration. and the braves are restricted by major league baseball from being on cable (or broadcast) in competitors’ markets by the new media contracts. only mlbtv and its rightsholders can bring you out of market games that are not blacked out.

  5. The failed development of a mixed-use retail district around The Ballpark in Arlington is a major reason that former Rangers owner Tom Hicks’ holding company went into bankruptcy. Who the hell wants to shop at a mall next to a sports venue that’s used a lot more often than a pro football stadium? No wonder Hicks never signed up any prospective tenants other than J.C. Penney (which is based in the area).

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