A Sixers move to Camden lurked until the new South Philly arena deal was struck, as more details emerge

Several days removed from the bombshell announcement that the 76ers had abandoned their quest to build a new $1.3 billion arena complex at Market East in Philadelphia and instead will partner with Comcast Spectacor, which owns the Flyers, on a new arena complex at the site of the current sports facilities in South Philadelphia, the reasons why remained murky.

But things are clearing up.

The sides feuded for two years over the Sixers’ planned move from the Wells Fargo Center, where they are a tenant of Comcast through 2031. The main reason the Sixers wanted a new arena is because they don’t make much money from the WFC, and a new arena that they owned outright eventually would allow them to print their own money.

» READ MORE: The 76ers have struck a deal with Comcast Spectacor to stay in South Philly and abandon plans for a Center City arena

So, why the compromise? Because the sides already are business partners; because the Sixers would make more money with less investment quicker; because Comcast feared competition; and because the city was paranoid that the Sixers would move to Camden.

First, the NBA and WNBA have entered into an 11-year TV deal with NBCUniversal beginning with the 2025-26 season. Such a deal benefits every NBA team, including the Sixers. Comcast owns NBCUniversal and therefore is, essentially, a business partner of the 76ers, if indirectly. After the TV deal was struck in July, it seemed odd that business partners, even indirect partners, would be at each other’s throats.

Enter NBA commissioner Adam Silver. After the TV deal was done, Silver contacted Josh Harris, the managing partner of Harris Blitzer Sports & Entertainment, which owns the Sixers. Silver might look unimposing, but he speaks for NBA ownership; he isn’t above a strong-arm tactic; and he is no fan of the Sixers, who have caused him institutional problems for more than a decade. Don’t forget, in 2015, Silver was behind the demotion of Sixers general manager Sam Hinkie, the architect of the catastrophic rebuilding effort called “The Process,” and engineered things for NBA Brahmin Jerry Colangelo to take over the team.

Silver also contacted Comcast chairman and CEO Brian Roberts, who is behind the TV money, and Mayor Cherelle L. Parker, who, like Silver, was desperate for the Sixers to stay in town. Silver urged all of them to reconcile the differences between the two sides — even if that meant negotiating past the City Council’s approval vote on Dec. 19. Which, of course, they did.

Why was the city desperate to appease the Sixers’ pivot? After all, Parker, the previous administration, and several Councilmembers spent years on political maneuvers and battles with constituents to get the downtown site approved.

The city was desperate because even after the downtown arena deal passed Council, the Sixers, according to a source familiar with the arena deal, kept negotiating with Camden, where they have a practice facility.

This was surprising because, during the process of getting approval, the team and city implied that downtown arena approval would render a move to Camden moot. That implication was a diversion, according to the source; Camden “always” remained on the table. New Jersey was prepared to offer around $800 million in tax credits to lure the Sixers to the waterfront area near the existing practice facility.

Philadelphia city and Sixers team sources say a move to Camden now will not happen.

This explains why, at the press conference Monday that announced the teams’ new partnership, Mayor Parker stressed several times that keeping the Sixers from moving to Camden was paramount. She needed the team and its tax revenues to remain inside Philadelphia city limits.

Why did Comcast cave?

Because now Comcast won’t have to pay for a new South Philly arena by itself and because Comcast feared that a downtown arena would lure away lucrative nonsporting events, such as concerts and ice shows, from South Philly. The Sixers planned to compete for nonsporting events downtown.

Once the deal was approved, Comcast knew it had to move off its initial proposal — a proposal that was, in the words of one Sixers source with whom we spoke months ago, “laughable.” The source said the original proposal essentially would have kept the Sixers under Comcast’s thumb and garnered the Sixers little more than a better place to play.

Also, the initial Comcast proposal stated that the new arena would not have been completed in 2031, the Sixers’ target date, since their lease expires then. In fact, it might not have been completed for as many as five years after that, according to a Comcast source who spoke about the plans last spring. After all, Comcast just completed $400 million in renovations at the Wells Fargo Center. The Sixers might have been looking at an additional half-decade of tenancy.

“Comcast was willing, generously — even though they had put in a lot of their money into the existing arena to make it great — to move up their time frame,” Harris said.

Comcast acquiesced to the 2031 opening date in the new proposal. It was a painful concession for Comcast, since it also plans to partner with the Phillies to expand the Xfinity Live! entertainment complex across the street from Citizens Bank Park and replicate The Battery, a large, raucous collection of retail stores, restaurants, bars, and hotels that surrounds the Atlanta Braves’ ballpark in Cobb County, Ga.

The new proposal also made HBSE and Comcast 50-50 partners in the building and its revenues, according to two sources familiar with the deal. This was a game-changer since the Sixers currently receive only their own ticket sales and a small percentage of their game-night revenues, such as food and beverage sales and parking. Now, according to one source familiar with the deal, the Sixers and Flyers will keep the proceeds from their own events and split the proceeds from other events.

The new proposal also gives the 76ers more say in the design and construction of the sports complex and the surrounding hotel and retail properties. In a word, the Sixers will make more money on their own terms and with less risk and less investment.

Hence, the Sixers’ incentive to form the partnership.

“We didn’t really change our mind,” Harris said, straight-faced, on Monday.

Of course they did.

First, according to a former HBSE employee, while the new arena deal likely will mean that the Sixers will profit far less in the long term, they will assume far less risk and far less outlay.

Instead of a $1.3 billion project with tens of millions of dollars allotted to community improvements and retail investments, they are equal partners in a $2.5 billion project with fewer moving parts. They are particularly relieved that Comcast has agreed to be a part of the boondoggle of developing Market East, especially since there now will be no arena to act as an anchor.

The Sixers, Comcast, and the City of Philadelphia have promised that the pledged community improvements and retail investments along Market East will proceed, but none of those entities will supply specifics such as a timeline, proposed businesses, or possible residences.

The clincher from the Comcast end?

Comcast now — again — has an ownership stake in the Sixers. Comcast sold the Sixers to a group of investors led by Harris and Blitzer for $280 million in 2011 (the group morphed into HBSE in 2017). The Sixers now are valued at $4.6 billion, according to Forbes.com.

There’s no telling what the Sixers might be worth with a new arena in the fall of 2031.