Clippers owner Steve Ballmer could remake the South Bay city of Inglewood by throwing money not just at Madison Square Garden Co. but also at local affordable housing advocates.
The billionaire businessman is in advanced talks to buy the MSG-owned Forum, which would almost certainly put an end to MSG’s lawsuits seeking to block the Clippers from building a privately financed Inglewood arena less than one mile away from the Forum.
A purchase by Ballmer, the former Microsoft chief executive — who Forbes puts at a net worth of $61 billion — could be the beginning of the end for The Forum, an institution long synonymous with Inglewood cultural life.
It would also realize the vision of Inglewood’s mayor since 2010, James Butts, who is vying to transform a predominantly working-class Latino and black city of 109,000 people into a major North American sports hub, complete with an NBA and two NFL franchises.
Ballmer has bankrolled the basketball side of that vision, including mollifying local activists with the promise of money for affordable housing.
“Steve Ballmer will do the right thing for his organization and his community,” Butts, the mayor since 2010, told The Real Deal. “Of that, there is no doubt.”
A case of surplus land
MSG declined comment for this story, and a Clippers spokeswoman responded to questions with a statement that read in part: “We are examining every possible way to resolve our differences with Madison Square Garden Co. regarding our new arena.”
Those differences erupted in 2017 when the Clippers bought 26 acres of city-owned land at West Century and South Prairie Avenue, one mile away from The Forum.
MSG, which owns the New York Knicks, filed a lawsuit that claimed the city of Inglewood deceived MSG what the land would be used for. MSG also financed litigation by an ad hoc “community” group called Inglewood Residents Against Takings and Evictions (acronym IRATE) that claimed Butts broke open meeting laws.
But while the feud between Ballmer and MSG Chairman James Dolan grabbed the headlines, a lawsuit was filed by an actual Inglewood neighborhood group, Uplift Inglewood, an entity not affiliated or financed by MSG.
Represented by prominent L.A. legal nonprofit Public Counsel, Uplift Inglewood claimed Butts and the city violated the California Surplus Land Act, a law that stipulates cities who sell their land must prioritize it for affordable housing. The lawsuit came amid community fears that a Clippers arena taken together with a Rams and Chargers football stadium could exacerbate the city’s rising rents in a community where 65 percent of residents are renters.
But in November Los Angeles County Superior Court Judge Daniel Murphy ruled in favor of the Clippers and Inglewood.
The judge noted that in the 1980s the city determined the land could receive Federal Aviation Administration grants since it sat close to Los Angeles International Airport flight paths. Inglewood never got those grants, but Judge Murphy wrote the municipality had a longstanding plan to convert the parcel into “noise-compatible, revenue-generating development.”
Ryan Leaderman, a land use attorney at Holland & Knight not involved in the case, said Uplift Inglewood had a plausible legal argument but it was relying on “bad facts, since the city has been looking to dispose of this property for commercial development since the ‘80s.”
Such judgments tend to be appealed, but Uplift Inglewood chose not to challenge Judge Murphy’s decision — in large part because Ballmer announced in the fall $100 million in Inglewood community incentives.
“We believe that pledge can kick off affordable housing development locally,” said D’Artagnan Scorza, coalition member of Uplift Inglewood. With $75 million of the $100 million put toward a “revolving loan fund” to build affordable housing, Scorza envisions multifamily buildings near the Crenshaw light rail line opening this year.
The activist acknowledged he’s not sure how the money would be doled out, but he said a partnership with Ballmer could be better than trying to beat him. “It is difficult to stop one of the richest people in the world from accomplishing what they want to accomplish,” Scorza said.
Showtime’s over
The Clippers owner would begin to build the Inglewood Basketball and Entertainment Center after an environmental review and start playing games there in 2024 when the team’s lease at the downtown Staples Center expires.
Inglewood, of course, had an NBA team long before blueprints for an Inglewood Basketball and Entertainment Center. The Lakers played at The Forum from 1968 to 1999 including the memorable Magic Johnson “Showtime” teams that helped make the NBA the profitable international business it is today.
But after the Lakers and NHL’s Kings moved to the downtown Staples Center, Inglewood was left without a major sports and entertainment hub — dimming the Forum’s star.
MSG tried to change that by buying the Forum in 2012 for $23.5 million from the Faithful Central Baptist Church, and announcing $100 million in renovations to vie for top concerts. The New York City company succeeded in furling the Forum into part of a company that reported $141 million in net income last fiscal year.
But the Rihanna plus Eagles reunion shows populating the Forum’s line-up seemed an afterthought to the city’s vision of first building an NFL stadium set to open this season, and then luring the Clippers.
MSG’s lawsuits have the underlying premise that a Clippers arena would cannibalize the company’s Forum business. The future of the half-century old institution, though, is of secondary concern to the city of Inglewood. “The reality is that the Forum brings in less than ¼ the revenue that the Hollywood Park Casino brings to the city on an annual basis,” Butts noted.
Ballmer, Butts added, “has to do what makes economic sense.”