Las Vegas Strip May Miss Out on Two Huge Sports Deals

It once seemed inevitable that Las Vegas would land every possible sports deal, but Sin City might actually find itself left at the altar.

Las Vegas has a long history of being a place where relationships come together quickly or burn out after a too-bright start. You might meet the love of your life on the Las Vegas Strip or end up needing a quickie divorce after a few drinks (and maybe some harder stuff) convinced you that having an Elvis impersonator marry you to someone you met that day was an excellent idea.

In a city full of excess, anything seems possible and that has made the Las Vegas Strip the ideal threat for any sports team looking for leverage. Since the Supreme Court ruled that states could legalize sports betting. Las Vegas stopped being taboo. That led to the National Hockey League bringing the expansion Golden Knights to T-Mobile Arena nestled in the heart of Caesars Entertainment (CZR) - Get Free Report and MGM Resorts International's (MGM) - Get Free Report Strip properties.    

The instant success of that move made Las Vegas a leverage point for every franchise looking to get a better deal from its home market. That allowed the former Oakland Raiders, a team with a cash-strapped owner looking to make every dime possible, to negotiate a deal for a move just off the Strip.

That deal made sense for Raiders owner Mark Davis, whose wealth comes from the team, but while every franchise looking for a new arena or stadium will flirt with Las Vegas, 2022 taught us that Las Vegas may have trouble getting teams to the altar.

The Oakland A's May not Pick Las Vegas

The Oakland Athletics have negotiated with a number of sites on the Las Vegas Strip for a domed stadium that would seat around 30,000 people. That's low for a Major League Baseball stadium, but it would likely drive higher ticket prices should it ever happen.

The problem for Las Vegas is that the team continues to negotiate with Oakland where despite the city giving the A's every reason to walk away, the team hasn't.

Richard N. Velotta of the Las Vegas Review-Journal predicted at the beginning of 2022 that the A's would jilt Las Vegas and he's sticking to that prediction for 2023.

"The Oakland Athletics will abandon plans for a Strip baseball stadium to stay in Oakland. Technically wrong because two Strip locations continue to be in the running for a potential stadium. But I continue to believe the A’s won’t ever make it to Las Vegas," Velotta wrote about his 2022 prediction and his thoughts going forward.

One site, the Las Vegas Fairgrounds adjacent to Circus Circus would make a lot of sense as the north Strip needs another major draw more than the South or Central Strip. The second site, at the Tropicana, which Bally's Corporation (BALY) - Get Free Report bought in 2022 makes less sense as it's way more valuable as a resort casino than as a stadium.

Political factors are also weighing against the A's as the state of Nevada and the city of Las Vegas were willing to bend over backward with tax concessions to get Allegiant Stadium built for the Raiders. They seem much less likely to do that for a Major League Baseball team.

The NBA Has no Team for Las Vegas

Multiple NBA-ready arena projects are in some phase of development on the Strip, but none seems likely to be completed over the next few years. An NBA team could, of course, share T-Mobile Arena with the Golden Knights, but that's a less attractive deal for a team looking to make a move.

The reality is that there's no NBA team in the same situation as the A's where Las Vegas would be a logical suitor. And, while Vegas was really the clear best market for the NHL and the NFL, Seattle looms as a competitor for any NBA team that might decide it wants a new home.

Las Vegas' best chance for an NBA team would be if the league decides to expand, and while an expansion franchise might cost $4 billion, it would dilute the share each team gets of the league's broadcast revenue. 

Expanding the league, which would likely involve adding two teams -- one in Seattle and one in Las Vegas -- would likely happen after the next NBA TV deal is made for the 2025 season and onwards. Owners could keep the new teams from being part of the revenue pool for a certain amount of years, but that would thin the list of people willing to pay $4 billion (what the Phoenix Suns are selling for) to own a team.

The reality is that the NBA's owners benefit more from having Las Vegas (and Seattle) as leverage over their current cities than they do by getting a 1/30th share of $4 billion (or even $8 billion for two teams).