The biggest fish - Page 3

The America's Cup would transform San Francisco's waterfront -- but is it a good deal for the city?

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The next world-famous sailing match could be held in San Francisco in 2013
PHOTO BY JEAN-BAPTISTE DANIEL

A seven-member board, chaired by sports management executive Richard Worth, will direct the ACEA, according to Newsom's economic advisors, but the other six seats have yet to be filled. ACEA's newly minted CEO is Craig Thompson, a native Californian who previously worked with a governing body for the Olympics and has helped coordinate major sporting events internationally. In an interview with sports blog Valencia Sailing, Thompson provided some insight on why major corporations might be inspired to donate to the cause. Basically, the Cup is the holy grail of networking events.

"It's a very difficult economic situation we are going through, and it's not the best time to be looking for sponsors for a major event," Thompson acknowledged. "On the other hand, the America's Cup is one of the very few activities ... that offer access to really top-level individuals in terms of education or economic situation. The America's Cup is a unique platform for a lot of companies that want access to those individuals that are very difficult to reach under normal circumstances. I can tell you for example that Oracle is very pleased with the marketing opportunity the America's Cup has presented to them. They invite their best customers and are very successful in turning the America's Cup into a platform for generating business. The same thing can be true for a lot of different companies that need access to wealthy individuals."

But should San Francisco taxpayers really be subsidizing a networking event for the some of the business world's richest and most powerful players?

 

TRANSFORMING THE WATERFRONT

Over the past four months, Newsom's Office of Economic and Workforce Development (OEWD) has been negotiating with race organizers to hash out a Host City Agreement outlining the terms of bringing the America's Cup to San Francisco.

The proposal will go before the Board of Supervisor's Budget & Finance Committee on Dec. 8, and to the full board Dec. 14. A final decision on whether San Francisco will host the race is expected by Dec. 31. ACEA and ACOC will each sign onto the agreement with the City and County of San Francisco.

From the beginning, the event was envisioned as "the twin transformation," according to OEWD — the America's Cup would be transformed by attracting greater crowds and heightened commercial interest while San Francisco's crumbling piers would be revitalized through ACEA's $150 million investment in port infrastructure.

The plan paints downtown San Francisco as the "America's Cup Village" during the sailing events, and a study produced by Beacon Economics estimates that the financial boost would come primarily from hordes of visitors flocking to the event — more than 500,000 are expected to attend. The city expects a minimum of 45 race days, including one pre regatta in 2011 and one in 2012 (or two in 2012 if the one in 2011 doesn't happen), a challenger series in 2013, and a final match in 2013.

The transformation of the city's waterfront would be dramatic. In addition to the rent-free leases for Piers 30-32, 50, and Seawall Lot 330, ACEA would be granted exclusive use of much of the central waterfront, water, and piers around Mission Bay, and water and land near Islais Creek during the course of the event. Under the Host City Agreement, race organizers would have use of water space spanning Piers 14 to 22 ½; Piers 28, 38, 40, 48, and 54, a portion of Seawall Lot 337, and Pier 80, where a temporary heliport would be sited.

Seawall Lot 330, a 2.5-acre parcel valued by the Port at $33 million, lies at the base of Bryant Street along the Embarcadero and has a nice unimpeded view of the bay. Piers 30-32 span 12.5 acres, and Pier 50 is 20 acres.

Comments

Great piece,

The two numbers that jump out are the 35 acres of Bay front that Ellison would actually control. Newsom's people had everyone thinking it was 3 acres.

The other one is that you have a very astute post on another of your threads about this issue (or is it on the Bay Citizen?) who has a serious big time real estate background and says that any competent Realtor could get 50 times the value at which the Mayor is valuing the property they're proposing to give away (in a poker game where there aren't even any other players!) ... Means, Ellison is getting over 5 billion in property and we're losing, what, 80 pier businesses and how many jobs?

Time for Mirkarimi to show for the first time in his career that he can admit to a mistake. This is an incredible debacle and Ross is the lynch pin. If he doesn't flip on the issue, SF loses billions in value and all he get's is a chance to have a martini with Larry Ellison. Choose one, Ross. The people. Or, the photo op.

Go Niners!

h.

Posted by Guest h. brown on Nov. 30, 2010 @ 8:03 pm

A couple comments.

Firstly, is the city honestly going to consider losing the hosting of the America's Cup and its massive attendant benefits over a mere $10 million, out of a budget close to $6 Billion?? You ~have~ to be kdding me!

On the long term leases, the partner who already has half of SWL: 330, and built a condo there, renegged on a deal to resuscitate Pier 32. The numbers did not add up for him. Fortunately by some miracle this opportunity has arrived to salvage the idea, one that rescue the piers and also absolve the Port of a truly massive deficit problem with that, and maybe a couple other dilapidated, piers. How do you propose to raise city money to save those piers from crumbling into the ocean?

On the competition. Who knows who Alinghi put Daly in touch with, but Alinghi and their owner, spiteful and hurt billionaire Ernesto Bertarelli, just took a very serious beating at the hands of Ellison. Who do you think they tried to find for Daly? Someone who might support the Ellison cause? Of course not. Who they found is a nobody. Nobody has ever heard of this guy, I have looked into it too. To top that, the very next day after Daly posted the so-called non-proposal story from out of Valencia, the mayor of Valencia, Rita Barbera, said on live camera that her city had indeed offered 250 million Euros in (already) purpose-built facilities, but that the Americans had deemed the Italian offer to be stronger. Why would the ACEA have turned down the Valencia offer she spoke of, if the Italian offer was not in fact stronger? The fact that insiders in Rome are holding their cards close to the vest should be no surprise. They WANT this prize, believe me.

This is a very big deal. It is not going to solve other city budget allocation issues, decide who gets what from the $6 Billion. But it will, if wiser heads than Daly's prevail, generate an enormous boost to the city overall, as well as massive improvements to the waterfront that have no other good prospects for them at all.

Lastly: This is a about a fantastic, clean, beautiful, proud image for San Francisco. The America's Cup puts places positively on the world map like almost nothing else does. Yes, SF could use that about now! Quite frankly, articles like this do the opposite.

Posted by Guest on Nov. 30, 2010 @ 8:48 pm

You have one number wrong.

Ellison spent a decade pursuing the Cup at a total cost of $1 billion, not $100 million !!!

Posted by Stingray on Nov. 30, 2010 @ 9:29 pm

On one hand you mention hard economic times as an impact to raising sponsorship and a reason for not supporting a billionaires yacht race and yet on the other you fail to see that hard economic times are exactly the reason why the piers in question will continue to rot. So the lost rent figures are slightly skewed given that context.

Surely it's better to continue to improve the water front and host a world class event that will generate revenue you would never have seen anyway than hold out for another property developer that will be looking for a killer deal as well but will bring no new tourism to the city.

Posted by Guest on Nov. 30, 2010 @ 11:24 pm

Once upon a time, hosting the America's Cup was a prestigious thing. In fact, one of the reasons for competing for the America's Cup was to win the right to host the event the next time around.

It's a shame that the Golden Gate Yacht Club and Larry Ellison put the event out to tender. Instead, winning the Cup should have been the same as winning the right to host the Olympics. The citizens of San Francisco should have started planning to host the event the day after BMW ORACLE beat Alinghi.

Major events always cause these fights. People in Albert Park in Melbourne don't like the F1 Grand Prix there and it probably loses the city some cash, but it puts the city on the international stage for a couple of days a year and generates some tourism dollars. The UK people are ambivalent about the cost of the Olympics, but hopefully there will be some legacy infrastructure that comes out of it.

Some people are going to make money, some people are going to lose money. The Golden Gate Yacht Club should just announce with pride that they are glad to have won the right to hold the America's Cup in San Francisco, then everyone should get on with making it an incredible event.

Posted by Dave Fuller on Dec. 01, 2010 @ 2:23 am

These billionaires will not be satisfied until we begin to present them with a stream publicly funded of gold bricks.

-marc

Posted by marcos on Dec. 01, 2010 @ 9:58 am

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