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New Orleans is a fabulous city. Great food. Great music. Great arts and culture.
But is it a great NBA market, and can the New Orleans Pelicans survive there long-term?
Those kinds of questions always will surround teams in smaller NBA cities with smaller TV markets.
And regarding New Orleans, it’s particularly timely because of Anthony Davis’ wish to be traded from the Pelicans.
What will happen to the Pelicans without a franchise-type player such as Davis? Can they remain viable in New Orleans? Is relocation a possibility?
This isn’t the first time relocation for New Orleans has been discussed. Back in 2010 when then-New Orleans owner George Shinn wanted to sell the team, there were suitors who had interest in buying and possibly relocating. The NBA ended up buying and taking control of the team for a short time.
But the NBA views relocation as a last resort in most cases. (Yes, I understand where Seattle SuperSonics fans are coming from).
And the NBA found a buyer for New Orleans in 2012 – when Tom Benson, owner of the Saints, came to the rescue.
But Benson died in March, and his wife, Gayle, is in control of the Saints and Pelicans. How much longer does she want to own the teams? She could make a significant profit by selling. Benson paid about $340 million for the Pelicans, and in the latest “Forbes” team valuations, the Pelicans are worth about $1 billion, which ranks last among the 30 teams.
New Orleans is a tough market for sure – a small city (compared to other NBA cities), a small TV market (compared to other NBA cities) and a shortage of local corporate sponsors. Also remember: The Pelicans are on the receiving end of the league’s revenue-sharing program.
But two people familiar with the sale of NBA franchises told USA TODAY Sports they have a hard time seeing the Pelicans relocate for a few reasons beyond the league’s desire to keep the team where it is. The people requested anonymity because they were not authorized to speak publicly about the situation.
The Pelicans’ arena lease doesn’t run out until 2024, and yes, there are ways to get out of it, but it comes with financial penalties. And as of right now, with Davis, Pelicans attendance isn’t horrible. The arena is filled to 91 percent capacity according to ESPN attendance figures.
And where would they go? Seattle? Louisville? Montreal? St. Louis?
The latter three might not even be better NBA markets, according to one of the people with whom USA TODAY Sports spoke.
Then, there is Seattle, always looming over the NBA as a potential expansion or relocation city. Rightfully so, too. There should be an NBA team in Seattle.
But relocation fees are way less than expansion fees, both of which are shared among the rest of the teams in the league.
When the Sacramento Kings were up for sale, one group planned to pay a $115 million relocation fee. Divided by 29 other teams, that’s about a $4 million payout for each team. Hardly a game-changer.
But an expansion fee? That could be close to $1.5 billion or higher, given the average value of a team is $1.65 billion, according to “Forbes”. Divided by 30 teams, that’s $50 million per team, the kind of money that interests other owners.
So, while the topic of relocation often will surround a team such as the Pelicans, it will take something drastic for the franchise to move.
For now, the Pelicans need to focus on their future, building without Davis on the roster and putting a product on the floor that is entertaining for fans and sponsors.
Follow USA TODAY Sports’ columnist Jeff Zillgitt on Twitter.