Below The Cap & In The Black: Spurs A Case Study In SuccessPublished June 9, 2003
A long playoff run, a low payroll and the new SBC Center "will result in the Spurs making a profit of about $10[M] this season," according to BLOOMBERG NEWS' Scott Soshnick. Spurs Chair Peter Holt: "Oh yeah, we'll make money this year. It's the first time in a while we've made anything." Holt said that the Spurs, 17th of 29 in payroll, "broke even last season" in their final year of play at the Alamodome. During the previous two seasons the team lost $10M a year. NBA Commissioner David Stern, who said that "about half of the league's teams are profitable," added, "The Spurs are as good a model as there is. If a team is well managed, gets the right building and drafts the right players, it can win no matter where it's located." Holt, who said his team would have made money this year without making the playoffs, also credited the league's luxury tax. Holt: "The tax is working. Without it, I couldn't be in business right now. I would have had to move out of San Antonio, and I could never have kept Tim Duncan. The labor contract we put together in '99 saved small markets" (BLOOMBERG NEWS, 6/7). Holt is featured in a Q&A cover story in this week's SPORTSBUSINESS JOURNAL by John Lombardo. Holt, on the playoff run's financial effect: "I had to borrow a certain amount of money to build the arena, so this year we will knock the borrowing way down. When we do our pro forma financials, we figure on one round of the playoffs, never any more, so these later rounds have put a lot of money in our pockets. It's been a beautiful run from a financial point of view. We are a winning team, but we are also financially efficient" (SBJ, 6/9 issue).
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