The Los Angeles Rams have been rather aggressive this offseason. By signing Ndamukong Suh and making several trades—the latest being Tuesday’s big deal with the Patriots for wideout Brandin Cooks—the Rams have made significant upgrades to a roster that won 11 games and an NFC West title last season. They’re all in.
It’s obvious what the Rams are doing. They’re making good use of the considerable salary-cap surplus they’ve got from having a talented quarterback on a low-cost rookie contract. The 2013 Seahawks and 2017 Eagles won the Super Bowl by constructing their rosters using strikingly similar blueprints. Jared Goff has cap hits of just $7.6 million and $8.9 million the next two seasons, with a fifth-year option in 2020 that allows them to buy more time before doing a pricey extension. The Rams will have some big decisions to make in 2019, but they’ve also set themselves up to have plenty of cap flexibility with which to do it. It’s the surest way to build a deep, complete team, and from a football standpoint, the window for the Rams is within the next two or three seasons.
But a hidden, off-field motivation could be at work here, too: Last month, the Rams began selling pricey personal seat licenses for their new Inglewood, Calif., stadium that’s slated to open in 2020. It’d be impossible to overestimate just how crucial this sales period is.
“I think people don’t quite understand that, to some extent, the pre-stadium PSL sales cycle is for all intents and purposes 20 years of sales wrapped into 18 months,” says one stadium financing expert who used to work for an NFL team. “You get these guys on PSLs, get their down payments, and they’re locked in for a decade-plus.”
The price tag for the new facility, which the Rams will share with the Chargers, was initially said to be $2.6 billion. ESPN’s Seth Wickersham reported last week that the surrounding development is expected to push the total cost of the project to around $5 billion. California taxpayers are not picking up the tab, other than $180 million in future sales-tax kickbacks that Field of Schemes co-author Neil deMause has described as “pretty cheap as stadiums go.” Rams owner Stan Kroenke thus needs to sell a lot of PSLs to offset his share of the financing. (Per the Orange County Register, Chargers owner Dean Spanos has a stake in the company that will own the stadium.)
PSLs, which caught on around the NFL with the advent of the stadium construction boom around the turn of this century, are one-time costs fans must pay for the right to purchase their tickets. The incentive for fans is that licenses belong to them and can be sold for whatever someone else might be willing to pay. The catch is that when the team sucks, the value of those licenses drops. The Jets are currently being sued for removing PSL stipulations from sections that initially required them when the new Meadowlands opened in 2010.
(Revenue from locally generated sources like PSLs does not have to be shared with other owners, though it does count toward the salary-cap formula, which means it’s money that must be shared with the players.)
The Rams are making fans pay a mint for PSLs for the best seats in the house. Last month, per the Register, some 13,000 premium club seats located mostly in the lower bowl went on sale to current season-ticket holders with a maximum PSL price tag of $100,000 for the Rams, and $75,000 for the Chargers. (Only the Cowboys, with their $150,000 tab for the highest-end PSLs at Jerry World, charge more.) The lowest PSL price for the club seats is $15,000 for the Rams, $10,000 for the Chargers. The remaining 75 percent of the seats in the stadium will carry PSLs for under $15,000, with some going for $500 or $1,000.
And what better way to entice fans to part with extraordinary gobs of cash than by giving them a Super Bowl contender?
“Of course the Rams are going to make moves like the not-all-that-smart long-term Cooks trade because this is as much about selling seats between now and next June as anything,” the stadium expert tells me. “And once those seats are sold, well, buyer beware. There’s no guarantee the Rams are going to keep spending like this beyond 2019.”
There are historical parallels to be drawn. In the last 10 years, the Jets/Giants and the 49ers also built stadiums without much public money, which created an incentive to boost PSL sales. The Jets made an advance splash in 2009 by hiring Rex Ryan as head coach, signing linebacker Bart Scott in free agency, and trading up to draft quarterback Mark Sanchez. A year later, just before the new Meadowlands opened, the Jets also traded for wideout Santonio Holmes. They reached the AFC title game in 2009 and ‘10 but haven’t been to the playoffs since. The Niners brought in Jim Harbaugh as head coach and reached the Super Bowl in the 2012 season, a few months after the PSLs for their new stadium went on sale. San Francisco hasn’t made the playoffs since 2013, but the Niners finally appear to be headed in the right direction again now that they’ve acquired quarterback Jimmy Garoppolo.
Both the Jets and Niners made what at the time appeared to be sound football moves. But it’s hard not to notice the timing, too.
“You just have to put your best foot forward,” the stadium financing expert says. “It’s unequivocally the single most important and lucrative sales cycle in franchise history [for the Rams]—and will be until at least 2050.”