How to Square $6.1B Purchase Price, $192M Payroll and Revenue Sharing?
After several months of suspense and all sorts of wild speculation, we now know who the next owner of the Boston Celtics will be.
It won’t be Jeff Bezos, billionaire Red Sox and Globe owner John Henry or Jeffrey Lurie, owner of this year’s Super Bowl champs, the Philadelphia Eagles.
All were names that popped up as potential bidders for the Celtics at a one point or another, though it’s not clear if any of them even put in a bid.
Not so for current Celtics co-owner Steve Pagliuca, who did bid and whose offer to buy the franchise fell short.
Rather, the team’s next owner will be someone most of us have never heard of: William Chisholm, managing director and co-founder of Symphony Technology Group, a private equity firm based in Menlo Park, California.
Chisolm has agreed to pay a record-shattering $6.1 billion for the Green Team.
The spin masters are already at work, with a “person close to Chisholm” telling the Globe that Chisholm is a “lifelong Celtics fan with an ‘encyclopedic knowledge’ of the team” who grew up locally in Georgetown.
If the NBA approves the deal, Chisholm, who currently owns a home on Nantucket, will add to his real estate collection and buy a home in Boston as well, the Boston Globe has reported.
Now the big question is whether Chisholm will also start hunting for sites in and around Boston on which to build a new home and arena for the Green Team.
Unpleasant Financial Realities
While the Celtics may be the defending world champions, they are merely tenants in the drab, cookie cutter North Station arena they play in – albeit very important tenants.
The Garden is owned by none other than Jeremy Jacobs, the billionaire who owns both the Bruins and a national concessions empire, Delaware North.
Even as they shovel money out the door to pay for the team’s $192 million payroll, the current ownership group, led by Wyc Grousbeck, is forced to share concessions and other revenue with Jacobs, who also owns the Boston Bruins.
It’s an unpleasant financial reality that Chisholm will soon be grappling with himself.
Unless this is history’s most expensive vanity deal, Chisholm must find a way to make the numbers work.
And it’s hard to see how the financials make sense right now given that the Celtics currently don’t own the arena they play in.
To have his purchase pencil, I’d argue Chisholm will have to find a way to build a new arena for the Celtics in Boston, something far easier said than done in a city that has been a graveyard over the decades for grand plans for new sports venues.
A “new arena can cost $2 [billion] (look at Philly arena plans) and current lease goes to early mid 2030s,” noted one sports business source in an email. And Garden owner “Jacobs will likely hold tight on lease terms.”
The Unknown: What Does Chisholm Think?
Still, while finding a site in Boston would be extremely challenging – let alone getting a arena project permitted and finances – it’s not impossible
Think: Gillette’s acreage near South Station, the sprawling parking lots and ex-tank farms around the Encore Boston Harbor casino in Everett or old Flower Exchange site off Interstate 93 in the South End near Boston Medical Center, where a big biotech development was planned before the sector’s rapid growth was suddenly stunted.
Or do the Celtics team up with Garden owner Jacobs and Delaware North and do a major rebuild on-site?
Wyc Grousbeck, the team’s outgoing owner, attempted to throw cold water on the arena speculation in an interview with the Globe this month, noting the team’s Garden lease extends into the mid-2030s
Grousbeck said another renovation is likely the next step, with the Celtics and Jacobs’ Delaware North both chipping in.
“We’ve each chipped into that. It’s really a partnership in that regard,” Grousbeck told the Globe. “That’s going to continue into the 2030s, and then we’ll probably both look and see what we should do.”
But while Grousbeck will stick around through 2028 as the team’s governor, he’s on his way out.
The incoming Celtics owner told the Globe he had a few ideas, but stayed tuned, for it will be Chisholm, not Grousbeck, who will have the last word on this issue.
