Automaker Mercedes-Benz has become the new sponsor of the Louisiana Superdome. Pretty much every other deal like this has been especially lucrative and this will be no exception. In addition to being great for the Saints and the city of New Orleans, this deal could greatly benefit the Hornets.
According to Nakia Hogan of the Times-Picayune:
Although financial terms weren’t available, the deal between the luxury automaker and the NFL franchise is expected to guarantee that the state will not pay the team any more direct subsidies.
So now all that money the state has earmarked for the Saints is suddenly freed up. I don’t expect the state to pay the Hornets the same amount as the Saints, any additional revenue would be huge for the team.
Additionally, this opens up the possibility of selling the naming rights to the New Orleans Arena. Look at this from Hogan’s article:
According to the current lease agreement, the Saints get the first $1 million of net revenue from the naming rights deal, with a 50-50 split between the team and the state of the remaining revenue, although the state’s share is in credits toward the subsidy payments, not cash.
How huge would a deal like that be for the Hornets? According to the financials we’ve see from a few years ago, the team lost about $4 million. Add in to the two huge commitments from sponsors along with state money and a naming rights deal and all of a sudden the Hornets have a positive revenue stream. The NBA is ready to negotiate with local buyers and deal like that would only increase the value of the team.
With the lockout set to continue, David Stern needs to get on the phone with Governor Jindal and start working on a new lease for the Hornets asap. Even if it is only to drive up the price of one of his assets.