Rogers buys SkyDome for $25 million

Canadian Press

11/29/2004 10:11:29 AM

TORONTO (CP) - Once seen as a world leader, SkyDome has fallen to the point where it is now worth only slightly more than the Blue Jays paid their star first baseman last season.

Rogers Communications, owners of the Toronto Blue Jays, are spending just $25 million to buy SkyDome from Sportsco International, a Chicago-based group of investors.

"A very fair price," said Blue Jays CEO Paul Godfrey.

It's a fraction of the $580 million the stadium cost to build. But the aging 50,000-seat stadium has been steadily going down in price since opening in 1989. It sold for $151 million in 1994 and Sportsco paid $80 million when it bought SkyDome out of bankruptcy court in April 1999.

Monday's sale does not include the SkyDome hotel, which Sportsco previously sold in 1999 to Renaissance for about $31 million.

Quizzed about the bargain-basement price for the domed stadium, Godfrey said the price reflected "the cash flow it can generate. It's not on what (it) cost to build it."

Sportsco wasn't interested in addressing the low sale price.

"We have a tremendous amount of passion for this facility but recognize it is in the best long-term interest for all parties to have common ownership for both the facility and the baseball team," Sportsco representative Harvey Walken said in a statement.

Still Godfrey could not ignore the irony that 20 years earlier he was part of the government bureaucracy that paid out of its ears to build the stadium.

"When I was chairman of Metropolitan Toronto some 20 years ago, in February of 1984, I know Metro Toronto put in the first $30 million and if someone had told me back then the price for the total building would be cheaper today than the price of the first down payment, one may have been a little amazed," he said at a news conference at SkyDome.

The Jays finally join the other 29 Major League clubs who either own or operate their facilities, which they believe will be a major bonus down the road.

Control of SkyDome gives the Jays better access to stadium revenues from parking and concessions, among other sources.

"If I was to roll back the clock of time, I would have advised Mr. (Ted) Rogers not to buy the team unless he owned the facility," Godfrey said.

He said the team had been trying to buy the stadium for four years but that serious talks began four to five months ago.

Rogers inherits the original land lease deal SkyDome had negotiated with government officials back in the 1980s, an agreement that sees another 84 years on the lease.

Godfrey said the Jays don't expect to benefit financially from owning the stadium in 2005, but hope to see an increase in revenue in years following next season.

Concessions, for example, had been split between the concessionaire, the team and the SkyDome.

"Now all of those revenues that were split before between Sportsco and the Blue Jays will all come to the Blue Jays," Godfrey said.

The Jays are buying the stadium for essentially what they spent on one player alone last season in Carlos Delgado ($19.7 million US - $23 million Cdn).

While Rogers got the SkyDome for a bargain-basement price, it remains to be seen whether the Jays will be able to avoid the losses that Sportsco reportedly endured.

Re-naming SkyDome will fetch a few dollars.

"The naming rights belong to the organization and no decision has been made on a name for a building at this time," Godfrey said. "We're going to try to take a fresh approach on that."

When SkyDome opened in 1989, it was the envy of the baseball world - a state-of-the-art facility that continually packed in more than 50,000 fans a game. The Jays broke baseball records with more than four million fans per season in '91, '92 and '93.

Last season the Jays drew 23,455 per game, its highest average in five years.

As it turns out, SkyDome was among the last of its kind. Baseball moved back to more traditional-looking stadiums - such as Camden Yards in Baltimore, Jacobs Field in Cleveland and The Ballpark in Arlington, Texas - and multipurpose facilities gave way to specialty stadiums.

Now the Jays want to make SkyDome more baseball-friendly, promising to upgrade the playing surface and replace the Jumbotron with a newer model.

"At some point in the future we would feel a lot better if we could diminish the concrete look of the building," Godfrey said.

"Over the longer term we expect to improve the way the fans experience the game itself."

The timing of the sale had no link to last month's announcement by the Toronto Argonauts that the CFL club was leaving SkyDome and moving to its own new $70-million outdoor stadium in 2006.

"No, not really," Godfrey said. "I wish the Argos would stay here. If they have a change of heart they're welcome back."

The SkyDome sale is expected to close in December.

The ball club, meanwhile, inched closer to profitability last season. The Jays will likely post an operating loss of somewhere between $7 million and $8 million for 2004 - boosted by league revenue sharing, a higher Canadian dollar and a slimmer payroll.

That's less than half the near-$18 million the club lost in 2003.

The Jays' financial improvement came as the team's on-field performance skidded. The team finished with a disappointing 67-94 record, placing it last in the AL East, after an 86-win season in 2003.

Off the field, the loonie is proving lucky for the Jays. The Canadian dollar closed at 84.32 cents US Monday, which is significant for the Jays since player salaries are paid in American dollars. The company can now buy U.S. greenbacks to reduce a foreign-exchange loss on salaries paid next season.