When the Giants Come to Town, It's Bye-Bye Baby

02.13.2008
Hearts, Butterflies and Stadium Debt

Following yesterday’s post on the Giants, urban development, and economics, here’s another question to throw into the mix: What’s the status of the Giants stadium debt, and how has it been affected by the five-mile pile-up in the debt markets? The Wall Street Journal has an in-depth story today (subscription req’d) about how the subprime mortgage crisis is spilling over in complicated ways, even affecting student loans and civic institutions — including S.F.’s De Young Museum. Any debt geeks out there with insight into the Giants’ situation?

Now, on to the juicy stuff:  

* For those with no TV access, SI writers are live-blogging the Clemens hearing. Fun! Judging by their statements and questions, the Republicans seem to be pro-Clemens and anti-Brian McNamee, the guy who claims he gave Clemens the ‘roids and HGH; while the Democrats are the opposite. At least one GOP’er from Indiana has made it into an “American hero” issue. What, like an insult to Roger is an insult to every decent American childhood dream? Is he that naive, or is there something else going on here?

* Roger’s wife Debbie, to whom McNamee said he also gave HGH shots, has her own Web site. (Warning: Excessive images of hearts and butterflies can cause stomach upset.) MacNamee says he shot Debbie up in preparation for an SI photo shoot of her and Roger. What does Debbie say about all this?  

“Roger came to me one day and told me that we had been asked to do a photo shoot for Sports Illustrated. I had major anxiety! I was a 39-year-old mother of 4! Once I realized that this WAS going to be a reality, I decided I had to give it everything I had. My mind was set. I am not a risk taker, but have since learned that with great risk, sometimes comes great reward. The responses from that experience have been wonderful and I feel it was a turning point in my life. It’s nice to have a goal for yourself and to see it through. The goal kept me motivated and focused. Using common sense and my ability to balance my life, I achieved that goal.”

Debbie wants you to know that she’s an 2002 Ebel Award winner and 2005 Person of Vision Award winner.

* Check out my contribution to Spring Training 2008, the latest site in the Blogs by Fans network. 
Also on the Network:



[February 13, 2008 11:29 PM]  |  link  |  reply
ELM said

OK. Obviously stadium debt is second to, say, necrophilia when it comes to conversation starters. I'll take it under advisement.

[February 13, 2008 11:50 PM]  |  link  |  reply
obsessivegiantscompulsive said

Oh ye of little patience! :^) Yeah, whut were ya thunking?

This should have no effect on the stadium debt. The Giants, if they had good advisors, should have gotten a loan that is not tied to a floating rate but rather is a set interest rate so that there's no surprise down the line should rates go up. Most businesses want to know what their expenses are and go for fixed loans.

And, according to, I believe, allfrank/frank, the debt was financed by the Giants owners so thus they owe the money to themselves and presumably would not do anything to themselves regarding the debt.

Now, if that is not true, and the loan was financed by one of the troubled banking institutions, it could be possible that if the bank goes under, the loan could possibly technically go in default with the rest of the principle due immediately, but if they were able to get the loan with one of the top banks, then there is little danger of the firm going under like that. But I'm not a bank/loan expert, so I might be missing something somewhere, but that is what I recall from past business news I read. Still, I would think it was a large institution they got the loan from, if they did get a loan, and there's little danger of this happening, if I got my info right.

Here's a surprisingly debt factoid I read recently somewhere, the debt is paid up in 2015, not in 2019 as I had seen elsewhere.

[February 14, 2008 12:13 PM]  |  link  |  reply
Anthony said

quite a workout schedule for Mrs. Clemens. (or is that skedule?)

[February 14, 2008 1:40 PM]  |  link  |  reply
Anthony said

> McNamee talks about injecting Clemens' backside with growth hormone in a Jacuzzi. (Wait a second—that might be the lasting image.)

http://www.slate.com/id/2184374/

[February 15, 2008 11:57 PM]  |  link  |  reply
ProspectHound said

[Removes prospect hat, revealing accountant/attorney under]
The Giants stadium debt was a private equity instrument executed by the team with Chase Manhattan Bank, which has since been sold several times, much as CMB has been. The health and solvency of the institution holding the debt is irrelevant to the terms of the note as long as the note is current, though the Giants would be thrilled if it were called, seeing as they have accelerated payment as much as allowed under the debt instrument (the payment term is locked in to create certainty of a flow of payments at a certain interest rate- it's more stringent than a prepayment penalty on a home mortgage, but the condition is roughly equatable. The interest rate on the note is higher than current cost of funds by over 300 points, so nobody is going to excelerate this puppy. ). While the note will not be actually repaid in full until 2015, the team established a 'sinking fund' almost a decade ago to collect funds in anticipation of a player's strike that has not materialized, and added to it subsequently, and so has already 'saved' a significant proportion of the remaining note balance- in other words, if a lender would be so foolhardy as to forgo higher than market interest and call the note, payment of the remainder wouldn't be much of a hardship. [feeling slightly soiled and wishing that he had never gone to law school, but relatively happy with how the accounting degree has worked out, PH showers and resumes the mask of the mild mannered prospect geek]

[February 18, 2008 10:10 AM]  |  link  |  reply
Lyle replied to ProspectHound

PH, I'm truly impressed. I even understood some of that. So the main points are (1) the team DID take out a loan, (2) it will be paid off by 2015, and (3) the team has an emergency fund in case of a players' strike. Interesting. And thanks.