A recent article in the Sports Business Journal revealed some potentially bad news for the Cowboys and their owner Jerry Jones. The team is in the process of building a brand new stadium which was originally supposed to cost in the area of $650 million, but has seen costs almost double to over a billion dollars. Now, they're trying to get themselves out from under some bad debt quickly.
The Dallas Cowboys are seeking to borrow $350 million by Dec. 1, according to numerous finance sources, in one of the worst credit environments in the nation’s history.
The club’s proposed deal would refinance $126 million the team borrowed last year through the now-imploded auction-rate securities market, as well as add new debt to cover cost overruns at the team’s $1.2 billion stadium that is set to open next year, the sources said.
In addition, it appears the New York Yankees are having trouble selling luxury suites for their new stadium
Seven luxury boxes down the foul lines priced at $600,000 remain available for the 2009 season, the first at the new Yankee Stadium. The team still had seven available in August, too.
“There’s no getting away from the fact that the world is different than it was, so traffic slows,” chief operating officer Lonn Trost said Tuesday. “So you don’t have 10 people banging on the door. You may only have two people.”
I suppose it's only been a matter of time before the credit crunch and slumping economy in this country started to hit the world of sports. Dallas is trying to borrow it's way out of spiraling stadium costs and bad loan deals... Will other teams start to see their budgets tightened as far as payroll and free agency go?
What effect is any will the current financial system have on the ongoing discussions about a new collective bargaining agreement?