Hey, kids! MGoBlog is out in force at the Big Day Prep Showdown and Devin Gardner is about to take Inkster up against Ricardo Miller and Pioneer. Let's talk it up.
For the last few years, Michigan has been building a name for themselves in volleyball. It wasn't too long ago that Michigan was always a bottom wrung team. Under the tutelage of Coach Mark Rosen, Michigan has scraped its way to respectful. Friday, it took the next step.
In front of a packed house of 5,772 in Omaha, NE, just an hour away from the University of Nebraska campus in Lincoln, the Wolverines took on the #3 Cornhuskers in the Runza/AVCA Challenge, the top tournament in the college volleyball regular season. This game was going to be tough; Nebraska has dominated Michigan in 3 games, sweeping Michigan in 3 games each time. The Cornhuskers have only lost once ever in the Qwest Center. Nebraska was coming off yet another Final Four appearance, knocking Michigan out in the same stadium during the Sweet 16 round.
But Michigan came out looking to match the effort of the 2007 season opener against Hawaii in Hawaii. They wanted to take out the crowd early. They wanted to get into the heads of the younger Husker lineup. They did just that. Michigan came out strong early. Juliana Paz and Alex Hunt were putting tremendous pressure on the Huskers front line. Megan Bower and Courtney Fletcher, who wasn't even slated to start until the last minute, were strong on the front, affording Michigan plenty of opportunities for easy passes. Everything clicked. [Full recap after the jump]
For round 2 of The Great Ohio Creeper Van Trip, Paul and I traveled to Dayton to consume part of the Skyline Chili™ Crosstown Showdown, wherein the Talbott brothers' Huber Heights Wayne team took on the Princeton Vikings of Cincinnati.
Terrence Talbott missed the game with an injury to his left leg or foot (he was on the sidelines in an aircast and crutches), but Terry was a full-go, and the defensive tackle performed well for the Warriors. Also playing for Wayne was 2011 QB prospect Braxton Miller, who impressed as well (don't hold your breath M fans, he's highly likely to end up a Buckeye).
The Warriors shot themselves in the foot many times, including on their first drive. A big kickoff return gave them possession well into Viking territory, but QB Braxton Miller fumbled a snap on the goal line, which Princeton recovered. The Vikings drove the ball past midfield on the ensuing possession, but a long pass was intercepted by Wayne at the 1-yard line. This didn't turn out so well for the Warriors, however, as the very next play resulted in a loss of yardage and a safety. Wayne was able to strike back before half, as a big Miller run on a speed option gave the team good field position, and he finished it off with a 20(ish)-yard touchdown pass.
After the half, Wayne struck again, as the Vikings fumbled the ball on the first play from scrimmage, which the Warriors recovered inside the 10-yard line. Miller ran the ball in on an option from about a yard out, giving the team a 14-2 advantage. As the game turned to the fourth quarter, the rain picked up, and the play became a little sloppy. As Wayne was trying to run out the clock, a shotgun snap over Miller's head went out the back of the endzone cutting the lead to 14-4. As Princeton started driving the field to bring the game within a single score, a fumble led to a scoop-and-score for the Warriors, providing the final 21-4 margin.
Talbott was the Warriors' defensive MVP, e-fact. He was constantly in the opposing backfield, whether he was lined up at tackle or end. He was a quick-penetrating type, and even when the Vikings started trying to counter against that (eventually), he was harassing QBs, forcing running backs into his teammates, and generally being a disruptive force. He doesn't have the biggest frame in the world, but there is certainly potential to add some mass and be a quick-penetrating "SEC-style" (ugh, shoot me) defensive tackle when he arrives in Ann Arbor. Trust me, he may be a little underrated because he's a tweener, but I think this kid is an absolute steal.
Miller had some struggles, be it from a wet field, first game jitters, or even just a bit of inexperience. That said, the dude can freakin' play. Though his dad says he doesn't want to play in a college offense where he'll have to run the ball much (note: Terrelle Pryor ran 139 times last year, and passed for 165 attempts), he is rather fast, and has super quickness and agility. Though he's likely to end up playing in Columbus, he's someone that Michigan should really try to sway for next year's class. Wayne was running a spread-zone offense, with a QB read much of the time, so it's not something he'd be unfamiliar with. He's a very good fit for Michigan's offense, and would allow for Cornelius Jones to switch positions if need be.
Photo Gallery (Video in next week's Friday Night Lights post)
On Thursday I posted my impressions of the luxury boxes going up in 2010 and offhandedly mentioned that Michigan is constructing a money factory, or "mint." A reader challenged those assumptions with numbers:
I am quite surprised that you describe the stadium expansion as a "money factory" or anything like it. Remember, the cost of this project (even if it comes in at budget) was set at $235M. [Editor's note: He later corrected this email: the overall cost for the renovations was $226 million.]
Looking at the Athletic Department numbers, and assuming they sell every seat and find folks to pay for everything they put a price on for naming rights, I don't see this as anything more than a break-even proposition. They list $56.3M in naming rights ($33.45M of which is apparently spoken for), which gets the amount they need to finance (I am assuming they are financing it, but even if they are not, there is at least an opportunity cost for the money they are using) down to $178.7M (235 minus 56.3). Taking your $5.7M number for the Suites revenue per year, you can add $1M for Indoor Club Seats (250 @ $4000 per), $6.2M for Outdoor Club Seats (2750 @ an assumed average of $2250), and $1.3M for Chairback Seats (650 @ $2000). The annual total is approximately $14.2M. At that annual payment, it would take 30 years to pay off $178.7M at a 6.88% interest rate. At a 5% interest rate, it would take 20 years.
In 20 years, these "luxury" places will need considerable renovation, I would guess. If they do not sell all of the naming rights or all of the seats, they will have to pay for a longer time to get this paid off. Even Mr. Martin never said this was to be a money maker. He claimed it was the only way to pay for needed upgrades to the existing stadium. However, now, the aisle widening (which I do not really understand, because the bottlenecks are the entrances to the sections, and I don't think they can do anything about those) is not happening as part of this original project (which is to be done in 2010), and the seat widening may not happen at all. I agree that they seem to be doing a first class job of what they are doing, but, other than to provide a few rich guys with fancy digs, I do not see this project as a financial winner. Please help convince me I am missing something.
I thought the assumptions above were pessimistic. Not all of the money in the renovations is going to the boxes and holding revenue constant over a period of ten or twenty years is excessively conservative. Also, the assembled media was told specifically that the seat widening was on and given a timeline for that process. But I am not a business guy and I don't have the numbers at my fingertips to dismiss his point out of hand.
So I asked a guy who goes by the handle "rekker" who's close to the project and has been providing solid information on the construction since it was announced. He responded like so:
This guy is reasonably coherent, but his analysis contains a couple of big, incorrect assumptions and logical flaws. I’ll start with the analytical problems. I’ll then present what I think of as the proper way to consider this project.
1. Your emailer assigns the entire cost of the project to the luxury boxes and club seats. That’s wrong. The project consists of three distinct elements. Because they are intertwined, it is difficult to assign a precise share of the cost to each piece, but these are approximations.
- Long-neglected maintenance – including replacing all foundational concrete, replacing all benches, replacing all mechanical systems, replacing the press box, which is structurally unsound, etc.
The approximate cost of this (absolutely necessary) work is $60-75 million. Even if it there were no stadium renovation or premium seating, this work would have to be done over the next few years.
- Improvements that make the game day experience better for everyone. This includes new (double-decker) concourses, wider aisles, wider seats, new and more bathrooms, new concession areas, etc.
The cost of these “improve everyone’s experience” is about $75-90 million. So for items (a) and (b), we are now up around $150 million.
- The cost of the towers, which contain the club seats, luxury boxes, and the new lounges. [Editor's note: also the new press box.] The incremental cost of these is around $75 million.
2. The cost and financing details are much friendlier than proposed.
- The project cost is $226 million, not $235 million.
- The athletic department is covering $36 million of this cost out of existing reserves. They also plan to raise $40-50 million in naming opportunities ($33mm is in hand). So the net debt needed for the project is actually about $140 million (not $178 as he suggests).
- Because of the financial crisis, the AD was able to get a great rate on the bonds it issued for the project. They came in at just over 4%. Because the interest rate was so low, the AD decided to finance a total of $190 million, but this allowed it to retain about $50 million is cash reserves as a cushion. Net borrowing (since the cash reserve can be used at any time to pay off the debt) is $140 million.
- The carrying cost of $140 million at 4% (assuming a 20 year payoff of the principle) is $10.3 million.
3.The likely donations from the boxes and club seats are likely to be higher than the minimum required.
- The 82 boxes will provide a minimum of $70,000 per box ($5.7 million), but the AD estimate is that top-up donations given to secure better locations will bring this up to between $7 and $8 million.
- His estimates for the club seats are reasonable, but again too low. He presents the absolute minimums.
Club seat (and chairback revenues) will total at least $8.5 million. In reality, competition for the better seats it driving donations up. Zone 1 club donations are averaging about $5,000, vs. the minimum requirement of $3,000. This likely won’t play out over all seats, but the AD is confident that the club and chairback seats will produce more than $10 million in incremental revenue.
- So the total incremental revenue will come in at between $14.2 million and $18 million.
How to think about the project
UM has a large need. Maintenance had been neglected for decades, the bathrooms are medieval, and the flow in and around the stadium is horrible.
The AD could undertake a $150 million stadium improvement project with no luxury seating (items 1a and 1b above), and no clear way to pay for it. This would mean about $100 million in borrowing and a roughly $7.3 million annual financing cost. Or the AD could add luxury seating for an additional $75 million cost ($225 total), and ask those 4000 rich people people to cover the cost of the whole project.
Option 1 would require something like a $10 per game surcharge on all 100,000 tickets sold for every game for the next 20 years (7 million per year, 7 games, 100,000 tickets per game).
Option 2 has no surcharge for regular ticket holders. The overall project costs about $10.3 million per year to pay off, but the luxury seating crowd generates somewhere between $14.2 and $18 million per year in incremental revenue.
The AD has been generating annual surpluses of $5 million to $9 million for the past few years. Adding $4 – 8 million to this while covering the entire cost of the stadium expansion seems like a pretty great investment. And remember, this is all being done with no cost to the 100,000 plus people who will sit in the bowl each week.
Before someone objects that not all the seats are sold, I’ll admit they are right. But 70% of both the boxes and club seats are sold. And this is with a year to go. Even if not one more seat is sold, the current reservations would generate $9.9 million, just a few hundred thousand short of the carrying cost for the entire project. I’d bet on the over on this one.
While the project is perhaps not literally a “money factory”, it is about the closest thing we’ve seen in Michigan for many years.
[/insider, back to me]
We all love the Big House but we've probably all got horror stories about missing half a quarter because of congestion or excessive lines or (especially for women) bathroom overcrowding. And then there's always that one guy—you know that guy—who will battle you for every millimeter of space in your seat. And don't get me started on Incredibly Pointy Knee Guy.
When I took the tour, the SID repeatedly pointed out the new walkways, concourses, and points of sale across the stadium. The seat and aisle widening will be complete by 2013. And the entire stadium will be brought into ADA compliance. And the net cost to the bowl is zero, with the AD netting somewhere between $4 and 8 million per year above and beyond paying off the loan. Whatever issues you have will Bill Martin—and I have a few—financial acumen cannot be one of them.
Last night, Paul and I took in a game at Canton South High School, the home of 2010 wide receiver commit Jerald Robinson. The Wildcats took on the Dover Tornadoes, one of their big rivals in Ohio's Division 3. Since this was a pretty big game, the local TV stations were in attendance, and the game was televised live in the area.
The game got off to an unceremonious start for Canton South, as their first play from scrimmage was a snap over the quarterback's head, recovered by Dover near the 3 yard line. The Tornadoes easily punched it into the endzone, and Robinson returned the ensuing kickoff near the 30 yard line. Two plays later, lightning struck again, as their running back fumbled the ball, and Dover recovered yet again, easily converting another touchdown.
From that point forward, Canton South had to throw the ball to stay in the game, something that was tough to do with an overwhelmed quarterback in his first game. When I predicted whether Robinson would be able to move up in the rankings, I said the QB play would be a factor - so don't expect him to have much of an opportunity to move up.
Robinson was targeted a couple times early on slants, and ran one reverse for 7 yards, but later in the game, he was hardly getting the ball thrown his way at all, and oftentimes wasn't even running routes as the QB rolled away from his side of the field. I would guess that he got slightly injured early in the game (and he did have his ankle rolled at one point but got immediately back up), and couldn't cut as well as he'd like. Later in the game, when they started throwing his way again, it was almost exclusively on fade routes, which were mostly well-defensed or poorly-thrown. Defensively, he didn't always appear to put in the utmost effort, and though part of that may be a matter of scheme (don't let anybody get behind you, no matter what happens), he also seemed hesitant to tackle at times, and his better upside seems to be at wideout. He finished with 2 receptions for 6 yards, 1 solo and 6 assisted tackles, and one 7-yard rush.
The Wildcats mounted a valiant comeback effort on the back of two catch-and-run touchdown receptions by James Lucas, the team's #2 receiver, but the deficit was too much for them to overcome, and they ended up on the wrong side of a 27-14 result. The teams were fairly evenly matched (especially with South not being able to use their whole playbook playing from behind), and if they played again, the result could just as easily go the other way.
Video Highlights (Photo Gallery included in next week's Friday Night Lights feature).
First we talked coaches, and now onto the players themselves.
- Shaw is hoping that he will be able to stay fully healthy this year. He has his burst back, and he just needs to get his confidence going full blast again.
- "I'm kinda favoring it [the injury]. My confidence is returning, and I just can't let up in rehab."
- The indication that there was something truly wrong was the Minnesota game. He was caught from behind for the first time in his career - "and I've been playing football since I was 7 years old" - and his dad called and said there must be something more serious wrong with him.
- The team had lots to prove in the offseason, and they took their workouts to a whole new level to prove it.
- Grady will play both fullback and tailback "whatever position helps the team win." Being able to play multiple positions gives the team more personnel versatility.
- "I haven't played with my brother since I was a sophomore [in high school], so it should be pretty cool."
- As defending the spread goes, it's the more experienced defensive teams that are best at trying to shut them down.
- Mathews isn't sure whether the spread offense will best help prepare him for the NFL. "I still have my old playbook, so I can always look at that." If anything, he says playing in multiple offenses over his career might help make him a better all-around receiver.
- Different offenses (such as the spread) work well in college, which is what makes the college game more fun to watch. However, in the NFL, there are so many good athletes on defense that it's difficult for these offenses to succeed.
- He has only been in Ann Arbor a little over two weeks, though he participated in voluntary workouts over the summer. It was frustrating to wait at home and miss the first week of practice, especially because he needed to get going on the adjustment to college ball.
- Turner grew up a Michigan fan (and took grief from Ohio State fans once he committed to the Wolverines), and he has some family in the area, so if he feels homesick, they're only 20 minutes away.
- Charles Woodson was the reason that Turner liked Michigan as a child, and he was happy to get the #2 jersey to honor his idol. Though he hasn't met Woodson, his eyes lit up when told that he would probably have the opportunity. "Today?" Sorry, it will have to wait until the season.
- Koger will be used as a true TE, flexed out wide, and this year, they're adding in some packages as an H-Back.
- In terms of catching passes, his use won't be too different from last year - though hopefully he'll see more passes thrown his way: "If I'm open, I'll get the ball."
- He's looking forward to spending a year healthy. The wrist injury plagued him all last year - even after he made his breakthrough later in the season.
- It was a relief to break out against Penn State, but not too big because he was expecting to do it eventually. That doesn't mean he was too frustrated with his performance leading up to the game, though. He's forgotten about all of the struggles last year (both individual and team) and looking forward to this year.
- He doesn't care if splitting carries reduces his time in the spotlight, saying "I'll take them as they come. Whatever helps us win."
Don't forget about Paul's media day photo gallery, either. It features Michigan QBs holding hands, and should not be missed.