The Brooklyn Nets are riding their newfound fame to a slew of lucrative sponsorship deals that could culminate in the renaming of the Barclays Center, The Post has learned.
The NBA team owned by internet billionaire Joe Tsai is aggressively scouting new corporate sponsors at a time when the team’s successes have positioned Tsai to drive a hard bargain and add millions of dollars to the team’s bottom line, sources said.
The Nets have been actively wooing new sponsors for the patches placed on players’ jerseys — a branding opportunity now paid for by cell phone maker Motorola. It’s also shopping for a new corporate sponsor for the arena’s main entrance, which is currently named after insurance giant Geico, according to a source close to the situation.
Sources say they expect the team to snag as much as $13 million a year for the uniform rights alone — or more than British bank Barclays currently pays each year for the naming rights to the team’s 17,732-seat arena known as the Barclays Center.
And it’s just one reason industry sources expect the Nets will soon be on the lookout for a new corporate sponsor to replace Barclays.
It’s not just idle speculation. When Tsai bought a controlling stake in the Nets and Barclays Center in 2019 for a combined $3.5 billion, he was sold partly on the notion that he could increase the value of the stadium’s naming rights by 2022, thanks to a contract clause allowing the parties to part ways after 10 years, sources said.
Barclays currently has the right to pay $10 million a year for the stadium naming rights through 2032. And while that might seem like a steal for the multipurpose stadium, which recently played host to the private memorial service for deceased rap icon DMX, Barclays’ original reason for sponsoring the stadium was swept away with the financial crisis in 2008.
Barclays agreed to put its name on the arena in 2007 when then-CEO John Varley had been planning a major expansion of the bank’s US retail operations.
The financial crisis forced the embattled British bank to retreat from its US ambitions. Barclays still has a US credit card business, but zero brick-and-mortar banks.
The Nets also have reason to bow out. By the time the arena was finally erected in 2012, the Nets had reluctantly agreed to halve Barclay’s annual sponsorship dues to $10 million from the originally agreed-upon $20 million.
Now, branding experts say, the NBA team could easily snag $15 million to $20 million for naming right to stadium, especially if the team continues on its current trajectory.
When Tsai bought the Nets from Russian billionaire Mikhail Prokhorov in 2019, it had just emerged the season prior with the worst record in the NBA. Now its trio of star players — Kevin Durant, Kyrie Irving and James Harden — have made the Nets one of the most-watched teams in the league.
The team’s star power was made abundantly clear last week when illustrated versions of its top three star players graced the cover of the New Yorker magazine.
“Brooklyn and the Barclays Center is at the epicenter of sports, entertainment, media, and culture,” said Octagon Executive Vice President Woody Thompson, who advises major brands and clients on sponsorship opportunities including venue naming rights.
“There is an opportunity here to be in a part of the city, and in a landmark facility, that is gaining a lot of steam and exposure.”
The Nets and Barclays both declined to comment. Neither Geico nor Motorola returned requests for comment.
Sources said the Nets are talking to Motorola about renewing its uniform patch rights as it shops them around. The cell phone company last year bought the team’s patch rights for the current NBA season for an undisclosed amount.
Of course, even with millions more in sponsorship fees, Tsai’s investment may continue to bleed money for some time.
Barclays Center had more than $500 million in debt, including annual $36 million payments paid in monthly installments. Debt rating agency Moody’s in 2019 slapped the Barclays Center with junk bond status.
Tsai is personally responsible for covering all the stadium’s losses. For the year ending June 30, 2020, the Chinese internet billionaire shelled out $13.5 million to cover Barclays Center arena expenses, according to Moody’s. This despite annual operating income of $44 million for the team during calendar year 2021, according to Forbes.
Moody’s doesn’t see the team’s financial situation improving this year, but notes that Tsai is furiously trying to turn things around.
“Even with the arena reopening with fans during 2021, we do not expect operations to go back to normal immediately,” Moody’s said in a November 2020 report. “As such, this may require further capital contributions from Mr. Tsai.”
It added: “We understand that Mr. Tsai and the Arena’s new CEO, John Abbamondi, will likely want to make strategic changes to the arena’s revenue mix to improve financial performance.”
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