Wednesday, January 18, 2012

Orlando's Path to MLS

It's not news that Orlando City S.C. is working to gain a franchise in Major League Soccer (MLS); owner Phil Rawlins has stated that since he relocated the team from Austin. It's not news that Orlando City has been in discussions with MLS about a franchise; Don Garber and City's front office have confirmed talks and non-disclosure agreements. It's not news that the entire southeast of the country is absent of a MLS team; odd for an otherwise "national" league that stretches from east to west and into Canada. And, of course, it's not news that MLS wants the 20th expansion team to be in New York City. What is news is the path for Orlando to join MLS is becoming increasingly more clear. The dynamics of having a league that contracted to just 10 teams in 2001 and has since expanded to 19 teams for the 2012 season has caused a shift from the traditionally strong sports town to less traditional locations. Don't be confused with our other articles, this is an opinion piece, but it is based on facts gathered as part of our research and reporting for other stories. Here is our view of how Orlando can find its way into Major League Soccer in the near future.

Like with any other professional league, there are two ways to gain membership; expansion and relocation. MLS currently stands at 19 teams with the addition of Montreal this season and with expansion in each of the last 7 seasons, the streak will end unless the 20th team is announced in the next 6 months for play starting in 2013. MLS' position for the last several years has been to add the 20th franchise in New York City, specifically in Queens, Brooklyn, or the Bronx to have a rivalry with the New York (Harrison) Red Bulls. MLS has been working with several potential owners (i.e. NY Mets, NY Cosmos, others) over those same several years to secure a stadium plan which is virtually a precursor to an expansion franchise. Historically, each of the teams gaining membership since 2003 have had funding and a plan in place for either renovations or construction of their soccer specific stadium (SSS); the exception being Seattle but that's a different animal. Try as they might, MLS hasn't been able to get a firm commitment and timeline established by any of the NYC interested parties, this has forced them to look elsewhere for the 20th team. Now the expansion talk includes Orlando, Las Vegas, Minnesota, as well as others mainly because they have "clearer" paths towards SSS whether through public or private funding. Why is there so much focus on the 20th team? The magic number for most professional leagues around the world is 20 teams, allowing for each team to meet twice, home and away, for a total of 38 matches. It's not a rule, some leagues have 24 teams or more, but it seems to lend best to the international break calendar and the idea of having a balanced schedule over a 40 week long season. MLS has stated that they are pushing to get 20 teams and then plan to "sit and wait" for the next 10 years to see how the sport develops. Now you can understand why so much focus is being placed on the next expansion team. But with all this focus, perhaps the real path for Orlando into MLS has been revealed... relocation.

To understand relocation in MLS you have to first look back at it's history, simple really since only one team has relocated. The San Jose Earthquakes relocated to Houston in 2006 due primarily to a failure by San Jose officials to offer financial support to a SSS in the bay area. Houston was considered an expansion franchise and the Earthquakes retained their history (and MLS Cups) for a future ownership group to purchase which occured in 2008, though technically it was a relocated franchise. As of this season there are 3 teams playing in non-soccer specific stadiums or facilities that haven't been renovated to meet MLS standards; San Jose, New England, and DC United. San Jose is close to finalizing plans for a SSS near the airport and having been an expansion franchise 5 seasons ago, there is little to no chance of them re-locating for now. New England was one of the original MLS franchises, owned by Robert Kraft who also owns the New England Patriots, Gillette Stadium, Patriot Place Retail District, and basically the entire town of Foxborough, Massachusetts. Although they have been near the bottom of the league in average attendance, the cost of keeping the team at Gillette is tiny compared to building an SSS in downtown Boston. Mr. Kraft is a savvy businessman, and as long as the team isn't bleeding money, he will keep them in Foxborough so he can control all aspects of the revenue stream. DC United, winners of 4 MLS championships, play at the 50 year old RFK Stadium, a place known more for its rat population in recent years. DCU has been working for years to get district funding and approval for a SSS inside the beltway, but to no avail. With the Washington Nationals getting a district supported stadium 3 years ago, the well for sports stadium public funding has run dry in DC. Unlike the New England situation, the stadium is owned by the district and the team is owned by a private holdings company. In the last 6 months talk of DCU relocating to nearby Baltimore, to a publicly funded SSS downtown, have hit a fever pitch. In my honest opinion I think DCU are already on their way to Baltimore and that this will be their last season in DC with 2013 finding them at M&T Bank Stadium (home of the Ravens) until their new SSS is complete. So with all of those non-SSS teams already spoken for, how can Orlando get a relocation franchise? There are two other candidates.

Chivas USA shares the Home Depot Center with the Los Angeles Galaxy. The whole idea of Chivas and its branding was to pull in the Hispanic population of Southern California and to offer a second revenue stream for the facility. When the team joined the league in 2005, the idea of sharing a stadium seemed reasonable, just like the Lakers and Clippers sharing the Staple Center in the NBA across town. Now it is seen as a bit of an eye sore for the league, almost like Chivas is the younger step-brother to the richer Galaxy. Chivas is going to relocate, it's just a question of when and where. But don't hold your breath waiting for the team to come to Orlando, it's not likely to happen. Instead Chivas will find its way to San Diego, Las Vegas, or even Phoenix in the next 5 years once an ownership group and stadium deal are put in place. Las Vegas is probably the front runner only because of the stadium deal(s) being proposed and the marketing potential for the first professional sports team to break into the "Sin City" market.

Perhaps the most likely candidate for relocation to Orlando is one of the original MLS teams and owners of the first SSS in the league; the Columbus Crew. The Crew are owned by the Hunt Sports Group (HSG) a company founded by the late Lamar Hunt; perhaps the greatest supporter of soccer in America and namesake of the US Open Cup's Lamar Hunt Trophy. HSG fully funded the construction of Crew Stadium in 1999 at a cost of $28M; pretty small number by today's standards. Although it was the facility that launched the SSS boom in MLS, Crew Stadium lacks a number of the creature comforts and allure of the newer SSS in Houston, Kansas City, and Harrison. Although it is only 13 years old, the stadium is showing signs of age and the team has been looking to the city and state for support in renovating or constructing a new stadium. Columbus was always the odd franchise in the original ten, the only city without any other professional sports team (at the time). HSG has already begun "lightly" pounding on the stadium-or-relocation drum with recent reports of a new stadium a little closure to downtown and the entertainment district. Still, HSG might have other plans for the team. The group owned three MLS teams (Kansas City, Columbus, and Dallas) until unloading Kansas City in 2006 and in a league where multi-team owners are becoming the minority; it could be time to cut Columbus from the books. HSG has always had a strong presence in soccer and recently they have been searching for a English professional team to purchase. Unsuccessful bids for West Ham and Crystal Palace in the last several years mean that HSG could sweeten their offer for an English club by gaining revenue from the sale of the Crew. Although MLS continues to grow, the potential for profit of a name-brand English club still greatly exceeds that of a professional soccer team in the states. Orlando isn't much of a different market than Columbus. Both have only one other professional sports team in town (NHL's Blue Jackets vs NBA's Magic), both are competing against college sports teams (Ohio State vs UCF/Florida), and both are in the middle of large population centers without MLS teams (Cleveland-Columbus-Cincinnati vs Tampa-Orlando-Miami). As stated in our previous articles on MLS in Orlando, the city and county have already allotted upwards of $150M for renovations to the Citrus Bowl, plans which now include modifications to support Orlando City's needs along with college football and concerts.

If 2002-2012 was the decade of expansion in MLS, 2012-2022 may be the decade of relocation, a chance for MLS to adjust its position into more profitable stadiums and revenue generating deals. Teams like DC United, Columbus, and Chivas could find their way to new cities or at least into new SSS in their current locations. The demand for MLS franchises is strong, defying the recession and growing while other professional leagues are looking at contraction (MLB early 2000's) or further relocation (NBA, NHL, and NFL).

What are your thoughts on MLS' 20th team and Orlando's potential of gaining a franchise? Post a comment below and let us know or hit us up on Twitter (@ScoringThird) or Facebook (Search: "The Scoring Third").

6 comments :

  1. Great article and assessment of the MLS situation. It's been surprising that MLS is pushing so hard for a second team in NY when there are so many parts of the country that are unreached. Thanks for all of the thought that went into this post.

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  2. I am no businessman, but I would think that there are plenty of arguments to aid Orlando City's MLS bid. There is a large transplant population here (from other countries and other parts of this country), no MLS presence in the southeast, the ability to buy into the league, and even just the current roster's impressive abilities should bring the possibility of the move up in the leagues.

    I would love to see MY TEAM go further up the professional soccer ladder. What can fans do ? Write letters ? Send emails ?

    See you at the pitch -

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  3. Brian - To answer your question about what fans can do to bring MLS to Orlando... SHOW YOUR SUPPORT. If you're not a member of one of the supporters groups yet, check out the Ruckus, Iron Lion, etc and join. The more direct impact will be coming out in big numbers to the Disney Pro Classic next month when MLS Comish Don Garber is there. When we find out his schedule we will spread the word.

    This is really just an opinion piece on the differences between expansion and relocation paths to MLS. The first and primary goal is to get Orlando the 20th MLS expansion team, the relocation is much less of a consideration at this point.

    Thanks for following our blog!

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  4. Once again, no one seems to be addressing the David Beckham expansion team. Beckham has a legal contract with the MLS for an expansion franchise when he retires. No one else but Beckham has a deal in place. Everything else is pie-in-the-sky speculation. Beckham has just signed on for another two years with the Galaxy, which probably means he will retire after the 2014 season. Therefore he could field a team in 2015. It makes no sense for the MLS to consider any other group at this time. Beckham IS the 20th team!

    So where would Beckham want his team to play? His family loves LA. But as Practice Cone points out, even if Chivas goes, LA isn't equipped to handle another expansion franchise. Vegas makes the most sense for Beckham. It is the adopted party playground for LA. It has all the glitz and attracts the glitterati that Posh adores and is just a short chopper hop or Ferrari spin from LA. The Vegas club would become the instant arch rival to the Galaxy. Beckham would absolutely LOVE that. Only if Beckham relishes absentee ownership is any other market in the mix. I can't imagine the Beckhams moving to Orlando, can anyone? Only if Chivas moves to Vegas before 2015 does Orlando have an actual shot at the MLS.

    Therefore, Phil Rawlins needs to redirect his attention from Don Garber to David Beckham. If the rumored franchise fee for an expansion MLS team is in fact $100 million, then Rawlins doesn't have a big enough investor group to handle it, nor does it appear he has any other potential investors from his Stoke/Burnley connections to step in. Besides, with David Beckham's deal in place Orlando has NO shot at all without Beckham. If Rawlins can swallow his pride, then he needs to sit down with Beckham immediately and cut a deal making Beckham the majority owner, NOW. If he can make that happen, then all this speculation goes away, because with Beckham as majority owner of Orlando City, and with his guaranteed expansion deal with MLS, Orlando City would become the 20th team. Done deal. Case closed.

    ReplyDelete
  5. Anonymous Beckham Fan - You may want to check out our "Friday Footnote" article from today. The Beckham buy option has some clauses and has been restructured from his original 2008 deal. Bottom line is that MLS 20 can proceed without Becks being the owner.

    Thanks for following our blog!

    ReplyDelete

 
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