PORTLAND, Ore. (AP) – Billionaire Paul Allen’s spokesman said Thursday the future of the Portland Trail Blazers is in doubt after Allen’s investment managers estimated the NBA franchise stands to lose more than $100 million over the next three years.
Lance Conn, who heads Vulcan Capital, Allen’s privately held investment firm, told The Associated Press in an interview that "all options are on the table" because "the economic model is broken."
Allen, a Microsoft co-founder, has lost more than $12 billion on various investments in the past decade, and his NBA team has been hemorrhaging money for much of that time.
He had to sell off his interest in the Rose Garden Arena, the home of the Blazers, after the company that ran it, Oregon Arena Corp., declared bankruptcy.
Conn told AP that Allen has decided it is time to cut his losses with the Trail Blazers – or find a new way to finance the team.
"No business person could justify these kinds of losses continuing," Conn said.
Portland Mayor Tom Potter had no immediate comment but he has scheduled a meeting with Trail Blazers officials for Friday morning, a spokesman said.
A spokesman for Gov. Ted Kulongoski said the governor met with Vulcan and Blazers representatives two weeks ago, but there was no discussion about a bailout.
"I don’t know what would leave the (Blazers) ownership the impression there is an opportunity for broad-scale public financing," said Pat Egan, Kulongoski’s chief of staff. "I don’t know how they could draw that conclusion at this point."
Conn said Vulcan has invested $600 million in the team and the arena since 1988 but has yet to see a profit.
He also provided an economic impact study done for the team that suggested the Trail Blazers pumped $2 billion in direct spending into the regional economy and $3.8 billion in indirect spending. The study by Horrow Sports Ventures also noted the team generated more than $127 million in taxes and other public revenue since the franchise was formed in 1971.