Obsessive Wrigley Renovation Watch: Is the Ricketts Family Just Trying to Put the Rooftops Out of Business?

respect wrigleyLingering in the background of every Wrigley Field renovation discussion we have is the possibility that the Ricketts Family, who did not own the Chicago Cubs when the team officially sanctioned a partnership with the rooftops that outline the outfield at Wrigley, does not want to come to an agreement with those rooftops. Publicly, the family says they’re working with the rooftops on an agreement involving advertising signage, the proceeds of which will help fund the renovation. The rooftops, with the aid of Alderman Tom Tunney, are working to preserve their views into Wrigley Field, and are clinging to an agreement signed with the Cubs that provides for revenue sharing through 2024, and which may or may not absolutely protect their views.

But, however unsavory it might seem, we have to at least discuss the possibility that the Cubs are considering a plan that would (1) erect signs that block the rooftop views, (2) involve a lengthy legal dispute, (3) drive the rooftops out of business in the meantime, (4) allow the Ricketts Family to purchase the rooftop buildings at a reduced rate, and (5) allow the Ricketts Family to repurpose those buildings to drive additional personal revenue or additional Cubs revenue.

At least one rooftop owner – George Loukas, who owns three of the buildings – has already openly suggested that this would be the Ricketts Family’s plan, if they had their way. He reiterated that belief on Friday, in a statement to the Tribune: “Based on everything I’ve seen from the Ricketts family during this recent process, they are not interested in a true partnership. In fact, it appears they would like to put the rooftops out of business …. It’s disheartening this is the direction it’s going.” Is that just posturing and a public appeal for sympathy/political support? Maybe. Ricketts Family spokesman Dennis Culloton called Loukas’s claim a mere conspiracy theory.

But the same Tribune report reveals that, in 2011, the Ricketts Family attempted to purchase a 50% ownership interest in five buildings in the outfield at Wrigley – four rooftops, and one non-rooftop building on which they would have placed a JumboTron. How different the renovation fight might look if that purchase attempt had succeeded.

There are no public indications that any talks between the Ricketts Family/the Cubs and rooftops about a buyout are still ongoing, but that does remain a possibility in this renovation dispute. If it becomes clear that the Cubs will be able to block some of the views from the rooftops, it’s possible that a building or two will decide it’s better to sell and get a marginal premium than to hold out hope for a friendly solution down the line or an unfriendly solution in court. If that doesn’t happen, it’s possible that the Cubs will simply come to an interim advertising agreement that honors the current contract with the rooftops, and then, when that contract expires in 2024, the Cubs will block the rooftops out of existence.

That’s certainly what Culloton’s statement on the current state of the advertising talks suggests.

“There’s considerable discussion about the best way signs can be incorporated in a way that meets the needs of the alderman and the rooftops for the duration of the contract,” Culloton told the Tribune.

You might as well underline that “for the duration of the contract.” The Cubs don’t have much leverage, and 2024 is a long ways off, but the implicit threat there is: “if you don’t satisfy us in these discussions, we will make sure to put you out of business in 2024.” (And, if the Cubs really do have that power, I’d think that threat would also have an impact on the rooftops’ ongoing financing arrangements, but I don’t want to go too far down that rabbit hole, since I’m not a business/finance/whatever expert.)

[Disclosure: Some of the rooftops advertise on Bleacher Nation, but that has not affected the way I've covered this ongoing story.]

Brett Taylor is the editor and lead writer at Bleacher Nation, and can also be found as Bleacher Nation on Twitter and on Facebook.

64 responses to “Obsessive Wrigley Renovation Watch: Is the Ricketts Family Just Trying to Put the Rooftops Out of Business?”

  1. Kevin

    Playing hardball in big-money business? Naaahhhh………

  2. Jono

    Is this better than the Ackamn / Icahn battle over Herbalife?

    1. Jono

      *Ackman

    2. Luke

      Nothing is better than the Herbalife drama. That thing is just all kinds of awesome.

  3. JR

    Word on the street is that Garza, Baker, and Stewart are looking to buy their roof top buildings from their salaries this year for doing nothing… And then flip the rooftops to Cardinal ownership. The ultimate flip reversal… Ha…

  4. Dan

    This article about the rooftops made me smile, because i really hope the cubs either a) are able to renovate Wrigley how they see fit. However, if they can’t because the rooftops wont allow the cubs to do so, I really hope the cubs put them out of buiness in 2024. Im a chicago cubs fan and want them to win the world series. I can really care less about the greedy rooftop owners

    1. Jono

      wait, you CAN care less about the rooftop owners? Or you CAN’T care less? If you “can care less”, then you do care. ;)

  5. DONNIE621

    Is there a possibility that the Cubs could buy out the contract of the roof top owners so that this won’t actually go to 2024?

    1. Chuck

      Yes. But the Roofies would have to agree to the buyout price.

      1. Brandon

        It is extremely unlikely that there isn’t a buyout clause in the contract. In other words, the rooftop owners have almost assuredly already agreed to a buyout price and process. The only question is whether Ricketts wants to pay whatever amount is fixed in the buyout contract.

        1. Brandon

          *buyout clause.

    2. CubFan Paul

      The Cubs could renovate, block their views, then the current contract becomes void. But the Mayor won’t green light the renovation without a rooftop agreement. But no buyout needed.

  6. Chuck

    “I’d think that threat would also have an impact on the rooftops’ ongoing financing arrangements, but I don’t want to go too far down that rabbit hole, since I’m not a business/finance/whatever expert.”

    While it is true that those types of issues have an impact on commercial loan structures, two things:

    1) Most commercial loans have maturities not exceeding 5 years (maturities, not amortization schedules). That means most building owners would renew their loans at least 2 more times before the contract ends. That’s forever in terms of commercial loans.

    2) Even if the Ricketts shut them out / down in 2024, the buildings don’t have $0 value. They just revert to standard apartment/condo prices (net of cost for removal of bleachers, conversion of bar space to standard apartment). A bank isn’t going to insist on a $-0- balance on the loans in 2024. Just at a level commensurate with comparable real estate prices.

    1. hansman1982

      However, the cost of capital has, undoubtedly, increased for the rooftops since the banks are going to see their income stream as higher risk than before.

      “…the buildings don’t have $0 value.”

      If the ricketts shuts them out of business they will have very little value. The cost to tear down the bleachers and the support mechanisms would be dramatic. Additionally, they have, probably, forgone much of the maintenance of unused rooms or torn up rooms to make storage space, supports, etc…

      I bet you’d be surpised how many of the properties (read all of them) end up foreclosed on or in bankruptcy 6 months after the contract expires.

      1. Chuck

        11 years is a long time. Given the banks have 11 years to get the owners to get the loans down to reasonable levels, I’d be very surprised if many end up in foreclosure.

  7. Chuck

    It’d be interesting to see who int he Ricketts clan is driving the real estate stuff here. Is it Tom and the kids or is it Joe? The hardball wheeling and dealing smells like the dad. That’s how he built Ameritrade: via acquisition.

    1. CubFan Paul

      Joe has nothing to do with the Cubs (again).

      1. Chuck

        “The Cubs” and “The Real Estate Stuff” could easily be two separate things. When I read “Joe isn’t involved in the Cubs,” I think front office hires, player personnel, etc.

        I highly doubt Tom Ricketts can get $500 million for Wrigley rehab and a hotel without his dad’s checkbook. Or approval.

        1. CubFan Paul

          Mr. Uninformed its called InCapital. Over $275 Billion in bonds underwritten. No Joe, just facts and money.

          1. hansman1982

            But, but, but…Tom is just a rich kid. No way he’d be able to build a successful international bond company without Dad’s checkbook.

            1. CubFan Paul

              That would be TD Ameritrade.

              1. hansman1982

                InCaptial is a bond company (unless everything I read about the company when Ricketts bought it was wrong and/or I forgot about everything)

                Unless you are talking about Daddie’s wallet. Then that would be TD Ameritrade.

                1. CubFan Paul

                  Once again, you’re off topic Hans. Stop before you start putting words in people’s mouths ;)

                  1. hansman1982

                    Oh, sorry…

                    JOE RICKETTS IS EVIL!!!!

                    (is this better?)

            2. Jono

              that’s a joke, right?

              1. hansman1982

                nooo….

                1. Jono

                  good. It’s hard to determine sarcasm on the internet, and the class warfare people are so ridiculous that they sound sarcastic most of the time.

                  1. hansman1982

                    just know that when I start a post with:

                    “But, but, but…”

                    I’m being sarcastic.

  8. Indy57

    Brett, if this isn’t solved by the time you come to Chicago in early May, perhaps we have a three-day “Cinn-in.” All BN’ers and friends could make a pilgrimage to Ann Sather on Belmont Friday, Saturday and Sunday. We take over the place at 7:30 and leave just before game time. Everyone carries in “sticky buns” from Cinnabon. We only order coffee. You can organize a flash mob that dances to “The Lincoln Park Pirates”, someone can bring in a Sammy-sized boom box that plays nothing but “1984” and maybe David Lee Roth can make a guest appearance.

    If you are squeamish about BN being the “host” (after all, some roof top bleachers advertise here) we could all wear Cubs Den t-shirts and wear nametags that say “Arguello, Loxas or Felzz.” The coffee tab would just about cover 17% of the average bill on a regular day. Don’t forget to tip your wait staff.

    Let’s hope the Cubs continue to use their biggest stick; Economics. There is a broader issue here. It is about huge tax revenues for a city that is in bad financial shape. Pensions, schools and crime are significant issues for the city and each issue has a relationship to money or lack thereof. Losing the Cubs’ revenue would be a serious hit to city and to Wrigleyville and all for a handful of poachers and their Alderman. I do not feel sorry for the “Roofies.” Get what you want Tom and don’t stop until you do.

  9. Kramden

    Just wondering if the Ricketts family did buy those buildings, if their strategy would be different…, preserve the rooftop seating and place the ads on the rooftops as the current owners propose? Would the rooftop revenues with the rooftop ads end up being greater than the revenues generated by ads inside Wrigley alone?

    1. aCubsFan

      In an ideal world the Ricketts would love to own as much of the property around Wrigley so all the income is coming directly to them. Having $24 million from seat revenue in the rooftop clubs plus the $10-$20 million from the signage outside the park is a heck of a lot better than the deal as it stands right now.

  10. Glen

    Is there any other business out there that profits off of someone else’s product, with pretty much no overhead?? I can’t think of one…..rooftop owners need to do WHATEVER it takes to stay in the good graces of the Cubs Organization, otherwise, they are cutting their noses off to spite their face. I get that you have a contract for the next 10, or so, years….but that time is going to fly by……then what??? Get your heads out of your rears rooftop owners and lets make this happen……I, for one, am tired of hearing about it. Lord knows that we have enough to worry about as it is………

    1. B Clifton

      Television networks?

      1. Glen

        Really, that’s the one you went with…….TV is a necessary evil in sports. The team needs to have TV to promote their product. How, I ask you, do the Cubs NEED the rooftops???

  11. Josh

    Wrigley needs renovated in the worst way, the Cubs have to do whatever is necessary to make that happen. If that includes putting these rooftop people out of business, so be it. The Cubs should have never allowed this practice in the first place and I am for Ricketts taking whatever measures are needed to rectify the problem.

  12. Jon

    I have no problem with the Cubs blocking the roof tops views if an agreement can not be met. The roof tops do not provide a product, but rather a service that is completely dependent upon another entity, in this case the Cubs. The Cubs need to worry about the their own P & L and product, not the roof tops.

    1. Glen

      AMEN…..you only have a valid argument when you bring something to the table….what the heck do they bring???

  13. Larry Bittner

    I’m waiting for this quote from Ian Stewart, “Aside from my wrist and quad I feel the best I’ve felt in years. I’m ready to go.” Schmuck

    1. Glen

      HA, maybe we can get him to hold up an advertisement sign (like those kids standing in the intersections holding up “we buy gold” signs) and bring in revenue that way!!! He could stand next to the on-deck circle, he needs to earn is 2 mil somehow !!!!!!

    2. Smacks

      What does Ian Stewart have to do with any of this?

  14. Curt

    hey leeches you deserve nothing for stealing anyways, neither you or yr buddy the alderman just don’t get it the cubs don’t owe you a view sorry for yr luck I hope you get what you deserve ( nothing) but I’m site you’ll hold this up till you get yf undeserved cut.

  15. Spencer

    Serious question: How much do people think the rooftop seats add to the “allure” or “cool factor” that Wrigley Field and the surrounding area has?

    1. Tim

      I watched a game from a rooftop last year for the first time and its not great.

      As a Cubs fan, I really wanted to watch the game. But youre so far away and can’t see much of whats going on. The TVs they have are a full 10 seconds behind the real game time, so you hear the crowd cheering and want to wathc whats happening and you’re just frustrated.
      yeah, the open bar and catered food is fantastic, especially for under 100 bucks. But Id rather be in Wrigley, at home or at a bar watching the game.

      The rooftops have always been cool until you go to one

    2. Josh

      Zero. If anything they make Wrigley seem tacky.

  16. FastBall

    If I was a rooftop owner I would sell the top of my building to Ricketts. Get rid of my bleachers and tell him he can do what ever he wants. I would get out of the bar business which always ends up in failure eventually. If I was Ricketts I would just say this. Until I get a reasonable agreement on all the bullet points I spend $0 on Wrigley and the surrounding area. If the building falls down so be it. If I was Ricketts I would just say fine by me. I will keep my $500MM and F U Jo Boo.

  17. cubzforlife

    Crane Kenney is the genius behind all the real estate deals. And the rooftop stuff he over sees. Tom Ricketts is more than just a “little rich kid”. Look at his accomplishments before he went to work for dad. Any parent would be proud of this guy with or without Dads loot.

    1. Cub Style

      Crane Kenney and genius do not belong in the same sentence.

      1. pete

        Crane Kenney and Wile E Coyote – super geniuses.

  18. Kevin

    Why Crane Kenney is still employed is unbelievable.

  19. Kev

    Gosh… first George Loukas ruins Star Wars, then he ruins Indiana Jones, and NOW he wants to ruin Cubs baseball!??!

  20. Kevin

    Simply boycott the rooftops!

    1. Cub Style

      I had no desire of going to one in the first place. So it’s not really a boycott.

    2. ThatDude

      that would actually solve this whole problem. if we could somehow take away their customers, we could basically put them out of business for Tom

  21. ThatDude

    id rather watch the game on TV than on a rooftop. rooftop seating provides a terrible view of the game and I can go to a bar or stay at home and save a lot of money while getting a better view

  22. Tommy

    I’m starting to feel the same way about the rooftop story as TWC does.

    1. TWC

      Then drink. Heavily.

  23. DarthHater

    ”Based on everything I’ve seen from the Ricketts family during this recent process, they are not interested in a true partnership.”

    Why the hell should the Cubs be interested in a “true partnership” with someone who owns 0% of the Cubs and therefore is entitled to no say whatsoever in how the Cubs’ business is operated?

    1. JB88

      Not to mention whose entire business is built on stealing from the Cubs, selling it back at 17%, and trying to stop the Cubs from operating their business as they see fit.

      If ever irony needed definition, that quote provides it.

  24. Danny Shamrock

    Move to Rosemont already

  25. cubfanincardinalland

    How insane is it, that a major league sports franchise is being delayed on a major renovation and long term building plan, because of buildings across the street that watch the game from the roofs? If you made it up, nobody would believe you.

  26. DONNIE621

    Cub Fan Paul… You wrote

    CubFan Paul
    March 25, 2013 at 11:25 am | Permalink | Reply
    The Cubs could renovate, block their views, then the current contract becomes void. But the Mayor won’t green light the renovation without a rooftop agreement. But no buyout needed.

    I am not sure I understand. So the agreement with the rooftop owners is un-enforceable? @024 is an artificial date? Can you explain… thanks

    1. CubFan Paul

      Apparently the current deal with the rooftops allows the Cubs to renovate/build. Meaning the rooftops can’t stop a blocking of their view, which is why the City wants an agreement up front from the Cubs to not block know them out, before green lighting construction.

      This is how I understand what’s going on.

      1. brickhouse

        The term of the agreement was not to block the rooftop views for a 20 year period

        1. DarthHater

          Instead of just making statements like that, which are very incomplete, at best, you might try actually reading the much more detailed information that Brett had previously provided in the two links in his post above.