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Report: Nets lost $144 million this past season. Even Prokhorov seems to care.

Jun 30, 2014, 6:45 PM EST

Mikhail Prokhorov Mikhail Prokhorov

Here’s what’s often left out when discussing the spending of Mikhail Prokhorov and the finances of the Brooklyn Nets: This is a much bigger play for him than just the team. This is a real estate deal.

In addition to the majority of the Nets Prokhorov owns 45 percent of the Barclay’s center and has the right to buy up to 20 percent of the surrounding Atlantic Yards development (worth an estimated $4 billion and increasing). This is why reading into the money lost by teams in a year-over year basis gets convoluted, owners have their hands in a lot of pockets.

But the Nets basketball operations are bathed in $144 million of red ink and are screwing with the NBA’s profit/loss curve, reports Zach Lowe at Grantland.

The basketball side of the Nets’ business is projected to have lost $144 million over the 2013-14 season, according to a confidential memo the league sent to all 30 teams in early June. (Grantland has reviewed and verified the memo with a half-dozen sources.) If that strikes you as out of whack, that’s because it is.

The NBA expects nine teams will end up having lost money once luxury-tax distribution and revenue-sharing payments are finalized. The Nets, with that monster $144 million figure, are the biggest losers. Next in line? The Wizards, with projected losses of about $13 million. That’s right: The Nets lost $131 million more than any other NBA team last season. This is what happens when you pay $90 million in luxury tax for an aging roster and play in a market so large you are ineligible to receive any revenue-sharing help.

Again, that is basketball operations, it does not include any money Prokhorov makes with his other hand on the Barclay’s Center. Still, that is a whopping amount of red ink.

Prokhorov reportedly has ordered a round of belt tightening, which is understandable (and tied to making minority owner Bruce Rattner’s minority share that is for sale look more attractive, Lowe reports). But all this red ink starts with the Russian oligarch himself — he ordered Billy King to put together a big roster that could “open” the Barclays Center and win games. Doing that means thrashing future assets and spending. Billy King has his flaws as a GM but here he was the good employee following company orders.

However the NBA is not the Barclays Premier League — a Russian billionaire cannot just come in and buy players and get his team a title. Not the way it works in a salary cap world.

The Nets may have upgraded their coach if they bring in Lionel Hollins as expected. But If they are really serious about winning it’s going to take some better roster management, not squandering of resources.

And that will help the bottom line, too.

  1. 2016olympics - Jun 30, 2014 at 6:55 PM

    “The Nets lost $131 million more than any other NBA team last season.” #Whoa

  2. Hard On For Harden - Jun 30, 2014 at 7:05 PM

    “Billy King has his flaws as a GM but here he was the good employee following company orders.”

    This is may be partially true, but that doesn’t excuse Gerald Wallace for Damian Lillard. You can argue about hindsight with what happened with the pick and it might not being Lillard, but you don’t send a lottery pick for Gerald Wallace, no matter how weak the draft. Plus these picks sent to Boston for KG/Pierce have a high probability of being in the lottery. Pretty high strokes gambling for minimal returns.

    • Hard On For Harden - Jun 30, 2014 at 7:09 PM

      Stakes* my apologies fricking autocorrect. I only have an IPhone 5s and not a fancy one like the rest of you.

  3. csbanter - Jun 30, 2014 at 7:36 PM

    The fact they lost 144 million will not get any sympathy from the other teams. The money spent got them more national exposure than ever, but that’s it. Poor Prokorov and his Nets try selling this tale of woe to places like Minnesota, Utah, Milwaukee, New Orleans and Cleveland.

    Small markets are laughing at this.

  4. mcjon22 - Jun 30, 2014 at 7:59 PM

    Amnesty….somebody. Joe Johnson perhaps?

    • blueintown - Jun 30, 2014 at 8:12 PM

      Joe Johnson can’t be amnestied.

    • sdelmonte - Jun 30, 2014 at 8:37 PM

      He was pretty good last season. Or at least better than D-Won’t.

  5. jimeejohnson - Jun 30, 2014 at 8:21 PM

    That’s chump change to this Russian capitalist. Nazdarovya: no theet, Sherlock!

  6. deadeyedesign23 - Jun 30, 2014 at 9:37 PM

    A good employee doesn’t take the plane into a nosedive because the tower told him to. He should have stood up to the owner if he disagreed with the plan. If he can’t do that then he’s not a good GM.

    • sportsfan18 - Jun 30, 2014 at 10:31 PM

      Some owners want and expect you to do that to them…

      Other do NOT and if you do, you’re looking for work…

      So ya gotta pick your battles…

      I’m NOT saying your wrong as I would want all info out there and discussed…

      But reality is that many administrations, like our current one, do not…

  7. edavidberg - Jun 30, 2014 at 10:15 PM

    What is strange is that it took so long for him to notice.

  8. sportsfan18 - Jun 30, 2014 at 10:28 PM

    Confidential memo?

    Do they even KNOW what confidential means?

    Grantland reviewed with SIX OTHER sources…

  9. esracerx46 - Jun 30, 2014 at 10:35 PM

    If they lost 144 million and paid 90 million in luxury taxes…simple math says they still lost 54 million somehow. Something isn’t adding up.

    • bkbell3 - Jul 1, 2014 at 1:14 AM

      racer i believe they spent 180mil on contracts and lux tax. That’s the missing number.So their contracts came to around 90mil i guess without looking it up.

    • bkbell3 - Jul 1, 2014 at 1:24 AM

      correction their contracts came to just over 102mil plus 90mil in tax for a total of 192mil. in contracts.Then you have to add in operating expenses for the front office, hotels,planes etc. Then subtract ticket sales and tv deals etc. and yea, wow.

  10. jzone954 - Jun 30, 2014 at 10:36 PM

    Now we know why jay pulled out.

    • jkirby317 - Jul 1, 2014 at 12:18 AM

      Because when he asked for more money and control they told him to kick rocks. That is what they should have told him when he asked to interview with them in the first place.

    • Hard On For Harden - Jul 1, 2014 at 2:24 AM

      Yes because Jay Z was some huge heavyweight who owned a significant chunk of the team (insert sarcasm). You wouldn’t believe how many people I run into that falsely believe this was case.

  11. saint1997 - Jul 1, 2014 at 1:01 AM

    Why are the Wiz so far in the red ?

  12. jetsfaninindy - Jul 1, 2014 at 10:22 AM

    Cant buy championships!?!? Why not? The Heat did. Literally, you can’t
    have 3 max players. Money in sports are shady. The Heat (amongst others)
    were over the cap with 3 players. The cap is a joke. These super teams are a joke.
    I guarantee players are taking money under the table.

  13. Mr. Wright 212 - Jul 1, 2014 at 11:00 AM

    People thought I was a Knicks fan busting Nets fans balls, but when I said they are screwed until Joe Johnson and Deron Williams are both off the books, I was telling the truth.

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