+1 More likely scenario... Red McCombs jumped into the project in a protected position (probably, like you said, retaining personal ownership of the land, perhaps leased back to the track). Part of Tavo's job was to secure additional funding to follow on with Red's initial investment. That hasn't happened, and Austin Commercial has stopped work until the next phase is paid for. That won't be paid for until it's funded. Tavo hasn't brought in the money to fund it, and now it's on Red's (and other investors') shoulders. This would create massive strife amongst those involved in the project. Red is faced with being "so close, yet so far" and doesn't want to lose the $$ he's invested so far, but nobody wants Tavo holding 5% for adding no value beyond being the guy who knew Bernie. A few options exist to resolve the strife... -Perhaps Tavo is just throwing his hands up and bailing out -Perhaps Red has told Tavo that he (Tavo) has failed and they want him out. Tavo is investigating selling out his 5% to the 95% owners. -Perhaps the whole thing is imploding and Tavo doesn't want any liability if/when that happens. ...or any other number of alternatives. I would guesstimate that Tavo is feeling huge heat from Red and the other investors. I wager they want him out because he hasn't produced what he needed to in order to make the project a go. Meanwhile, the USF1 project is in dire trouble.
This was Bernie's gripe with Indy. NO marketing. None here either and it is not CHEAP to market an event of this size, AGAINST all the other events in the US the same weekend. They are woefully behind on this. Maybe it will come together soon. As I stated before a purpose built facility is good for F1 in the US. The US and F1 have never shown consistent support or profit. This needs help soon. I hope SOMEONE has a plan, funding, and the smarts to put it out. The continuing lack of information is ridiculous. How long before the State decides to not back this.
The question I have is,... with the GP date change (IIRC) COTA needs to re-apply for the METF funds when they are within 1 year. But what does re-application mean? Does the entire city council have to re-approve, of is it just a request submitted to Susan Combs office. Assuming the reports of Tavo's departure to be accurate,... I would suspect that some on the council would advocate for some additional due diligence. Back on the conspiracy theories... tin foil hat firmly in place... if COTA is out of money and "needs" the $25M from the state in hand to proceed (or to secure private loans)... this "management shake-up" could be a ploy to provide cover for lack of work over the next 7 weeks (about 7 weeks until the 1 year mark).
The City has done their part in approving the 'local organizing committe' They'd only need to go through the comptroller now
Hang on, weren't you saying a while back that the $25MM was irrelevant to the progress of the project? If success or failure hangs on that amount they really are in trouble; Wasn't the total budget to get 'er done ~$500MM? BigTex; The teams can't chopper in their guys - There's too many of 'em! [~50 engineering staff per team and more than double that with the support staff] - If access is as bad as some are suggesting they'll have to camp out in their motor homes! Cheers, Ian
Its difficult at best to make money on hosting an F1 event in the private sector as Indy has proven.. TV and much of the hospitality revenue goes to F1.. Ticket sales, sponsorship and limited hospitality area about the only revenue streams.. This is more of a loss leader for the venue, hope they can make some money on other events.. The overhead for a facility that they are constructing is unreal... Make it up off other events... As we all know TV ratings for open wheel on Speed or ABC are terrible at best for a sponsor.. With much of the big ad budgets out of F1 it will be interesting to see who they can land as title sponsor.. Tech or Austin based company.. AMD past CEO was a race car driver and I could see him sponsoring.. Dont know how motorsport friendly the new CEO or Pres is... Anyway, Circuit of Americas Pres if from Churchill Downs and the VP Marketing is from the Dallas North Stars.. Not any open wheel staff that I am aware of.. Tim Mayer of CART and ALMS is a consultant.. They best bet is to leverage the Mexican market for ticket sales...Telemex would actually be the best title partner to have to sell tickets to event.. Have a few support series that have a Mexican driver presence, worked very well for CART at Mexico City and Monterrey..I agree too with the fact that you have to start marketing and selling tickets and not to be there yet is a flag.... Again hoping for the best, my resume is in...
I haven't followed this thread for a while thinking things are moving along. I guess they aren't. Hmm, I was kinda counting on this GP for next year. Guess I have to re-evaluate my travel plans. Good thing I still have my hotel reservation for Monaco.
sounds like legal mumbo jumbo. rich folks covering their A$$es. but the motorhome is in the storage lot ready to roll when and if.
Certainly possible. I find Tavo's call to Combs curious. If he was being forced out completely against his will, he wouldn't want to help those doing the pushing to get the state funds. It would be in his interest to at least be in a position of power on paper. Whatever is going on, it seems to me, Tavo is at least a somewhat willing participant... If someone is buying Tavo out,... that implies there is something of value to buy. On the flip side,... it seems fairly certain that this leaked before it played out. If this was purely a restructuring to protect assets, we would have learned of this through a press release. Finally, there has been the underwhelming construction progress of the last 2-3 months... Interestingly COTA's website ( http://circuitoftheamericas.com/progress.html ) was offering monthly progress videos in the spring / early summer... April, May, and June 2011... but none since June... No July,... No August,... No September,... And there have been no photo updates since 7/22/11. Somethings up,... just what??? The fact that this broke thursday and Tavo hasn't responded is curious. Think about it,... if you were an investor on the bring of releasing funds,... Is there a scenario where Tavo's silence is a good thing. The only ones I can come up with are: (1) That Red McCombs is buying out the entire project. This doesn't seem likely too me, because I just don't see ROI. (2) They are shopping the entire project, hoping to find an outright buyer. To me this seems the most likely scenario. It would explain the lack of progress, Tavo's call to Susan Combs, and the current COTA teams silence.
The quote from the A Statesman below interesting light on things. Hellmund is a founding partner of Circuit of the Americas, yet a little more than two weeks ago told the American-Statesman he had begun doing consulting work for groups hoping to attract a Formula One race to Mexico, Argentina and South Africa. At that time he mentioned that he was basically a race promoter and that his work in Austin was almost done. He then quickly added: "The U.S. Grand Prix is the most important thing. The next thing is to promote the U.S. Grand Prix."
I have not visited this thread in a while. As one of the "twenty-percenters" in the poll, I'm starting to feel just a little bit smug, though I would rather have been wrong.
On a more positive note, COTA's CFO has real estate development experience. When the track fails, we'll find out what Red really wanted to do with this land.
The whole tenor of this is lacking overt support and a good show of MONEY and progress on a consistent basis. If Simon thinks the whole project is being shopped then who is a likely buyer of a race that will lose money. Sorry but this is not Google's initial stock offering. Until someone comes forward and publicly announces budget and timelines this is not about to happen. I have zero faith and the clock is ticking. If anyone has tickets or reservations for Monaco or another race do not let them lapse. Sad and frustrating. I would not be attending the first year in Austin but later on(year 2) after they work out the problems and add hotel space.
Keep in mine,... my belief from the beginning has been that this project did not make financial sense for the majority of investors in the facility. I have always believed the Red McCombs was involved in such a way that his monetary risk was minimal (land, which he retains... and seed money) The way I read the tea leaves,... the only scenario I can come up with that fits with all individual data points is the project is being shopped for sale. That is far different than believing they have or will find buyer! Are there other scenarios,... I am sure... but this is my SWAG. Do I have any degree of certainty,... not really. Curious what others think is going on.
Hopefully, this isn't a rehash of something already posted here but last night on Wind Tunnell, Dave Despain read from a release which stated that FOM's deal with the USGP was made with Tavo and not the Circuit of the America's (SIC). So, if Tavo opts out, the contracts are going to have to be redrawn and things become all the more muddled as the playing field shifts. If the project is at the point of no return and other contracts with Australian V8 Supercars and MotoGP are in the same circumstances, this could become a mess of epic proportions. BHW
Even if other contracts with other series' are in the name of the track, that the F1 rights are with Tavo is HUGE in light of the reports of him looking to bail out of the project. The rights are useless to him in the absence of a track (I would imagine), *unless* they are vague enough to allow him to shop the race to other tracks like Indy or the private track in NY (Monticello?). That would make me think that either he is being squeezed out and looking to sell the rights to COTA/McCombs, or the whole project is being shopped for sale as Simon says, and they are getting their ducks in a row. Either way, bad joo-joo.
Interesting you mention Montecello as a friend in Europe with close ties to the Renault team has insisted all along that this is the track they're really targeting. Starting to sound as though things in Austin have really gone off the tracks. But, we have to figure that the teams and their sponsors are making provisions and setting budgets to race in the U.S. BHW
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from the statesman's website: http://www.statesman.com/sports/formula1/construction-on-f1-track-resumes-1895935.html
Any progress is a hopeful sign. Just curious how the project went from $250M-400M, to "over $100M to cover remaining construction". And "21 machines in all" will be coming...
I am clueless about construction but 21 machines doesn't sound like a lot on a project this size. It sounds like some infusion of cash happened, doesn't it? I had fear about the vitality of this project...hopefully this won't make their deadlines impossible.
Certainly not the end of this story but good news for sure. Why didnt they put something out when work stopped. It does wonders to quell rumors.
