Pegula sells land for $1.75 Billion, Will Bid on Bills!

[HopefulFuture]

Who's ready for a Frack the Patriots t-shirt?!

 

He hasn't said anything himself... but at the NFL owner's meeting it sounds like others did. This is from 4/1

howard ‏@hsimon62 Apr 1

Terry Pegula's name brought up as potential #Bills owner at NFL meetings. http://cbsprt.co/1f0aLuC via @cbssports

 

Actually, Terry Pegula has mentioned the Bills 2 times since his purchase of the Sabres. The first time was in 2011 when he stated to Ed Kilgour that he never even considered buying the Bills but that he does not want them leaving Buffalo. The second time was in 2013 where he restated he does not want the Bills leaving WNY.

 

edit: And it should be noted, Pegula has no passion to football like he does hockey, hence enter Galsano, who initially wanted the Bills, not the Sabres. Then look to other WNY power brokers, Paladino, Millstien, Jacobs and the Rich family. I'm not saying all will be involved, but something is up as each of these power brokers have poised themselves financially to pump a great deal of investment into the Buffalo-Niagara region. Money is starting to move, like I said, there is movement behind the curtain.

Edited June 12, 2014 by HopefulFuture

[Miyagi-Do Karate]

I agree!! I remember a couple of months back there was discussion about the worst thing that could happen this year. People were voting for things like "EJ gets hurt and only plays 10 games." The team being bought by the evil troll and subsequently moving out of WNY is 1,000,000,000,000 x worse than anything that can happen on the field. This period is right there with the Super Bowl era as the most important time in franchise history.

 

Agree.

 

Keeping the team in buffalo is everything. I would take it over never winning a Super Bowl.

[May Day 10]

yup. This is the most important thing x1,000,000.

 

Im excited about the season, but it all really takes a back seat to all this ownership and facility issues. Its been a dark cloud for about 15-20 years and to imagine it could be lifted, and the Bills and Sabres likely safe for my lifetime would be too much to handle.

[BringBackFergy]

There was some discussion above re. capital gains taxes of $500 million and how his $1.75 billion sale might be cut significantly thanks to Uncle Sam. There is a tax planning technique called a 1031 exchange (a/k/a Like Kind Exchange) where you can sell investment property, have an escrow company hold the proceeds, and then identify another property (similar investment property) which you intend to purchase within 90 days thereafter. Since the owner never takes control of the funds, the IRS doesn't tax the owner on the gain since he is re-investing the gain in a new property within a certain time period. If El Pegual has the $1.75 billion held by another escrow company (as opposed to his free checking account in his own name...lol), he could purchase a good chunk of land in Buffalo (waterfront, Beth Steel, etc) and close on it within 90 days. The tax on the sale of the oil land is deferred until he sells the new land he just acquired.

[MyHorseAteTheKid]

I thought the NFL wouldn't allow someone to be an owner, if they already own another professional sports franchise?

[26CornerBlitz]

I thought the NFL wouldn't allow someone to be an owner, if they already own another professional sports franchise?

 

Asked and answered....Not an issue when both teams are in the same market.

[Kirby Jackson]

There was some discussion above re. capital gains taxes of $500 million and how his $1.75 billion sale might be cut significantly thanks to Uncle Sam. There is a tax planning technique called a 1031 exchange (a/k/a Like Kind Exchange) where you can sell investment property, have an escrow company hold the proceeds, and then identify another property (similar investment property) which you intend to purchase within 90 days thereafter. Since the owner never takes control of the funds, the IRS doesn't tax the owner on the gain since he is re-investing the gain in a new property within a certain time period. If El Pegual has the $1.75 billion held by another escrow company (as opposed to his free checking account in his own name...lol), he could purchase a good chunk of land in Buffalo (waterfront, Beth Steel, etc) and close on it within 90 days. The tax on the sale of the oil land is deferred until he sells the new land he just acquired.

Thanks!! My dad was explaining the same thing to me yesterday. He is in investment banking and knows a good deal on the subject. He thought that the timing and amount were certainly curious. If you think about the cost of the team and an owner's portion of a new stadium that $1.75B ($1.25 team, $500M stadium) would certainly sound about right.

 

One thing that I didn't ask: does that only apply to real estate or does it apply to buying existing businesses as well?

Edited June 12, 2014 by Kirby Jackson

[Wayne Cubed]

So, here's the most important question: Will the NFL allow someone to own the Bills and the Sabres?

 

(hint: Comic Sans)

[May Day 10]

can this be related to the NYS putting a move on getting the engineers in identifying a stadium site?

[Beerball]

Actually, Terry Pegula has mentioned the Bills 2 times since his purchase of the Sabres. The first time was in 2011 when he stated to Ed Kilgour that he never even considered buying the Bills but that he does not want them leaving Buffalo. The second time was in 2013 where he restated he does not want the Bills leaving WNY.

 

edit: And it should be noted, Pegula has no passion to football like he does hockey, hence enter Galsano, who initially wanted the Bills, not the Sabres. Then look to other WNY power brokers, Paladino, Millstien, Jacobs and the Rich family. I'm not saying all will be involved, but something is up as each of these power brokers have poised themselves financially to pump a great deal of investment into the Buffalo-Niagara region. Money is starting to move, like I said, there is movement behind the curtain.

I believe, and Yolo will correct me if I'm wrong...what he meant was that Pegula has not mentioned the Bills publicly since Ralph's passing.

[KevinRome]

.... There is a tax planning technique called a 1031 exchange ....

 

Very interesting, thanks for that input. If true, then Pegula as owner could be a done deal. Otherwise he's forking over capital gains taxes for the sale. Unless, of course, some other obscure tax rule comes into play.

[Beerball]

Agree.

 

Keeping the team in buffalo is everything. I would take it over never winning a Super Bowl.

You know, my immediate reaction to the OP was "no friggin way" but...for the Buffalo Bills to win a SB they must exist as the Buffalo Bills. Y'all are correct.

[YoloinOhio]

I believe, and Yolo will correct me if I'm wrong...what he meant was that Pegula has not mentioned the Bills publicly since Ralph's passing.

That was what I meant... to my knowledge, no peep from Pegula since the team officially became available when Ralph passed away. To my knowledge.

[26CornerBlitz]

That was what I meant... to my knowledge, no peep from Pegula since the team officially became available when Ralph passed away. To my knowledge.

IMO, that's how real players operate. Let your actions do the talking. Just get things done w/o seeking publicity. I've had a feeling all along that TPegs would be a serious player as a potential Bills' owner. I sincerely hope it happens.

[JohnC]

There was some discussion above re. capital gains taxes of $500 million and how his $1.75 billion sale might be cut significantly thanks to Uncle Sam. There is a tax planning technique called a 1031 exchange (a/k/a Like Kind Exchange) where you can sell investment property, have an escrow company hold the proceeds, and then identify another property (similar investment property) which you intend to purchase within 90 days thereafter. Since the owner never takes control of the funds, the IRS doesn't tax the owner on the gain since he is re-investing the gain in a new property within a certain time period. If El Pegual has the $1.75 billion held by another escrow company (as opposed to his free checking account in his own name...lol), he could purchase a good chunk of land in Buffalo (waterfront, Beth Steel, etc) and close on it within 90 days. The tax on the sale of the oil land is deferred until he sells the new land he just acquired.

 

I doubt there is a sizeable parcel of land he can buy within 90 days. Whether you are referring to the outer harbor or Lackawana or land located in the city proper you are taling about complicated deals that will take quite some time to get a deal consumated.

 

An outer harbor land acquisition would make a lot of sense that would enhance his current holdings and development projects near the arena and in the vicinity of Canalside. I'm not adding much to what you already know (impressed with your financing and tax knowledge) but transferring the proceeds from his land sales to another land purchase is a very long and complicated process that is going to take time.

 

My suspicion is that he made the land sales to become more liquid to be in a good position to buy the Bills. Then later down the line he will plan on the next step to use the franchise acquisition to enhance his already in place projects. The main point I am makingis there is a longer road to how this franchise and stadium issues materialize.

[Miyagi-Do Karate]

You know, my immediate reaction to the OP was "no friggin way" but...for the Buffalo Bills to win a SB they must exist as the Buffalo Bills. Y'all are correct.

 

It's a bizarre Hobbesian choice.

 

Choice A) Team stays in Buffalo, and never wins a Super Bowl; or

 

Choice B) Team moves to a different location, and wins the Super Bowl (or multiple Super Bowls)

 

I think almost everyone here would take Choice A, because Choice B would mean the team is dead to us anyway.

[26CornerBlitz]

It's a bizarre Hobbesian choice.

 

Choice A) Team stays in Buffalo, and never wins a Super Bowl; or

 

Choice B) Team moves to a different location, and wins the Super Bowl (or multiple Super Bowls)

 

I think almost everyone here would take Choice A, because Choice B would mean the team is dead to us anyway.

 

If the LA Clippers ever win an NBA Championship, my $$ says there will be no parade in WNY.

[Buftex]

Well said? I'm very confused by what he said.

 

 

No offense to either of you but how the hell is any of that well said?

 

Well said!

[KD in CA]

Welcome to Football Heaven.

 

We are going to have one heluva locker room next year.

 

[GoPre]

There are only 24 hours in a day. W/ everything Pegula is involved with, I just don't see how he'd have the time to own the Bills. Remember, owner's do have their responsibilities. Staff can only do so much.