The New York Post is reporting that the Wilpon family’s financial situation is so precarious that they cannot add payroll through trades. The report states that adding a front line starting pitcher is the least of their problems. Their debt load is so heavy and attendance is down so much this season that if the trend continues for a season or two, they may be forced to sell the team.
It was almost one year ago that I wrote about the Madoff mess causing talk of the Mets being forced to sell the team. Now those rumors are back. You never really know exactly what the financial situation of the team is. But it’s not a good sign when the rumors of trouble are consistent and persistent.
The key points of the NY Post article are:
- The team has nearly $700 million in debt
- The Mets are losing about $10 million/year including depreciation and interest payments on the debt
- Attendance is down 19% from 2009 and down 35% from 2008
- SNY is profitable but is leveraged to roughly six times it’s earnings before interest
- The Wilpon family refinanced about $375 million in loans and kept $75 million for themselves
The article has a little bit of information about the family’s investments in commercial real estate which has been in a down market for three years now. It doesn’t help that the Mets’ fortunes have been down for three years now either. And it won’t be easy to recover. The article states that one of the debt covenants prevents the team from increasing payroll. Taking on Roy Oswalt or Cliff Lee would be great this month. But the Mets can’t expect the Astros or Mariners to take back equal or more salary.
We may be stuck with the pitching staff as it stands now. Maybe John Maine or Oliver Perez will come back and start doing what seems unlikely to most of us. If not, we could be speculating on who will be buying the Mets in a couple of years. Hopefully, it won’t get to the point that the Rangers have this season.
Thanks to MLBTradeRumors for the link.