Seven years ago, the Warriors budgeted $800 million to build an arena. Today they’ve got their new home, at a cost of around $1.6 billion.
Since Rick Welts, team president and COO, was the point man on the project, does the $800 million overrun come out of his paycheck?
“It’s a payroll-deduction plan,” said Welts, who is 66, “so I’ll be working here for a really, really long time.”
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That would be great for the Warriors, who hired Welts in 2011, nine months before announcing plans to build their new arena in San Francisco. He was assigned the duty of top dog on the business/political end of the project, answering only to team co-owners Joe Lacob and Peter Guber.
Welts sat down with The Chronicle to talk about his personal journey on the project, from dream to eye-popping reality. He said he did not charge in with absolute confidence.
“I had no idea if I could handle it,” Welts said, “but I knew that I wanted to try. ... None of us knew if we could get this done. Joe and Peter didn’t know, either. ... It was a once-in-a-career type opportunity to head up something like this, and you know why it’s a once-in-a-lifetime opportunity? Because no one would be crazy enough to do it twice.”
Even if they wanted to try, there’s no money left. Welts presided over a wild spending spree by Lacob and Guber, which Welts touched on during the interview, a look back at the long and winding road that led to Chase Center.
Welts made it clear: The budget-busting wasn’t his fault.
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“Joe and Peter are the biggest reason we were over budget, because every time we got to ‘This was supposed to cost this much, now it costs that much, but we can do something to get us back to budget,’ it was like, ‘We’re going to build the building we set out to build.’
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“Small things. In the plans, the base of the building was concrete, but now it’s this amazingly beautiful material called Neolith. That was a $2 (million) or $3 million decision. The plaza was going to be cement pavers, we upgraded and that’s probably $5 million. ... Lighting was literally double the original estimate, we’re talking $300 million more. As much as Joe might blame the architects or the staff, I blame him for the cost overruns.”
Shepherding the Chase project is the latest triumph in an NBA career that started with Welts serving as a ball boy for the Seattle SuperSonics in 1969. He was inducted to the Naismith Basketball Hall of Fame last year, and has made his mark on the league as a clear and creative thinker. The All-Star Weekend festivities were his brainchild.
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But he’s not creative enough to help us sell newspapers by inventing entertaining stories about wild clashes with Lacob and Guber. Welts did note that whenever he had bad news for Lacob, he delivered it after a Warriors win.
Lacob said, “I can honestly say that I have never had a disagreement with Rick, or Peter. Not once. These people are professionals. Reasonable. Smart. And we are like-minded.”
To be clear, Welts did not build Chase Center by himself. However, as Raymond Ridder, senior vice president of communications, said, “This arena does not get built without Rick. He has been absolutely incredible throughout this entire process — building relationships, navigating meetings, always trying to do the right thing. The calm hand through all the craziness.”
Building an arena is like building a baby — the project can’t even get started without interpersonal relationships, and that’s a Welts specialty.
“Rick took the lead with politicians and neighbors and the city types,” Lacob said via email. “He is great at this, as he is fair and even-keeled and likable. Perhaps I am not as likable (cheesy smile emoji).”
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The project had major hurdles from the start. Strong political forces opposed the plan to build the arena at Piers 30 and 32, near the Bay Bridge, and it was a regulatory nightmare. Even Welts couldn’t smooth his way through those waters. The Warriors were looking at years of battles and litigation.
“The divine intervention,” Welts said, “was Marc Benioff calling Joe Lacob and saying, ‘Hey, you’ve got some problems, eh? Look, I’ve got these four city blocks, this 11-acre site in Mission Bay. ... I’m ready to put a shovel in the ground, but I’ve made a decision it’s too small for Salesforce headquarters. If you want to buy it, I won’t take it to market.’
“Now, Mark’s not by accident gotten where he is, he’s a big businessman. So we paid a significant nine-figure price to acquire just the dirt. But ultimately that was a game-changer. It got us off public property onto private property, and, unique to San Francisco, this is not a waterfront site since it’s more than 200 feet away from the bay, so all those other regulatory things that come with developing on the waterfront no longer applied to our project. That all disappeared.”
What appeared in its place was another huge roadblock, the Mission Bay Alliance, a mostly anonymous group formed solely to oppose the arena. The alliance almost killed the project.
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Welts said the alliance “was very well-funded, big contributors to UCSF, and put UCSF in a very difficult position, because they didn’t want UCSF to cooperate, they wanted to challenge this site. They went after our EIR (environmental impact report), they had a ton of lawyers, and seemingly unlimited funding.
“They’d lost two prior motions ... and (an) appeal. They’d taken their petition to stop construction and overturn entitlements to the California Superior Court. There was going to be a ruling. If it had gone the other way, it would have put a complete halt to any construction. It could have taken years to play out.”
On Jan. 17, 2017, on the morning of the planned groundbreaking ceremony, featuring dancing backhoes and a construction worker circus act, “I’m literally driving onto the site, which was just a parking lot, early in the morning, 8 or 9. My cell says Kelly (David Kelly, Warriors’ general counsel). David said, ‘We won. The court dismissed their case entirely.’ It could have been a very different day.”
Even Welts’ foes end up liking him. Sam Singer was spokesperson for the Mission Bay Alliance, since disbanded, and Singer said, “Rick Welts is one of the great sports executives in history. He was an honorable and tough and honest opponent. We didn’t want the arena there, but we’re Warriors fans, we want to see the team win, and we wish ’em the best.”
Along with roadblocks, there were side trips and detours. Welts recalled one of the many neighborhood meetings.
“We set up a meeting at the Dogpatch Saloon ... with media people and neighbors,” Welts said. “I was showing our designs, and somebody raised his hand and said, ‘Don’t you think that looks like a toilet bowl?’
“I looked at it. He was absolutely right. ... The Toilet Bowl Meeting got a lot of traction in the media. It took us a couple months to recover from ToiletBowlGate, but we got a much better design.”
The construction stayed on schedule, but with constant challenges.
“I can fall asleep any night in about 30 seconds,” Welts said, “but the curse of this is the countless nights I was awake at 3 or 4 in the morning because I just had an idea, or something I needed to write down, or I was just stressing out. Yeah, it’s part of the deal. You’ll see a lot of tired eyes around here. We’ve only been open for 10 days and we’ve got a lot of tired people.”
In times of trouble, Welts leaned on his partner, Todd Gage, or simply strolled the arena.
“If I ever had a not-great day,” Welts said, “all I had to do was walk the site, because of the pride that the 1,600 men and women who built this thing had. They were going home and telling their families, ‘We’re building the Warriors’ arena.’ ... The way they expressed their thanks and pride, how important it was to them, was really touching. It was unexpected to me.”
During a walk-around I had with Welts a month ago, he stopped at a section of new sidewalk that had just been jackhammered into chunks.
“This was a brand-new sidewalk yesterday,” Welts said, puzzled. “This stuff happens all the time.”
And is still happening. The morning I sat down with Welts, The Chronicle ran a story about the Central Subway falling another year behind schedule. The Warriors are counting on the subway to ease traffic woes.
Also, the arena is a bust unless the Warriors thrive in it.
“It’s not a win until the players love it,” Welts said. “The most important thing is how it feels when we’re playing a game. Ultimately, it’s got to be a great place to play basketball.”
I asked Welts, if he is at a party and someone starts telling tales about a nightmare kitchen remodel, does he spit out a mouthful of martini?
“I listen patiently,” he said, “because I’ve been through those, too, and those are frustrating. But yeah, this is a different animal.”
Scott Ostler is a San Francisco Chronicle columnist. Email: sostler@sfchronicle.com Twitter: @scottostler