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$1 billion and counting for the Cubs

From Danielle Sessa at Bloomberg:

The Cubs' sale price is likely to exceed Dan Snyder's 1999 purchase of the Washington Redskins of the National Football League for $800 million, the most paid for an American sports team. John Henry's $700 million purchase in 2002 of the Boston Red Sox, Fenway Park and the majority of a regional-sports network is the most spent for a baseball team.

England's Manchester United soccer club was sold to Malcolm Glazer in 2005 for $1.45 billion and is the most ever paid for a sports team.

Cuban Among Bidders

Billionaire Mark Cuban, owner of the Dallas Mavericks who made his fortune by selling his to Yahoo! Inc., will continue in the bidding process, though the identities of the four other groups weren't known, the Sun-Times reported. John Canning, chairman of Madison Dearborn Partners LLC, considered a favorite because of his friendship with baseball Commissioner Bud Selig, was not among the groups advancing to the next round because his offer fell short of the $1 billion mark, according to the newspaper.

...The Cubs may not be worth as much money if the team doesn't come with the ballpark, said Andrew Zimbalist, an economics professor at Smith College in Northampton, Massachusetts. The club owner may not be able to make improvements to Wrigley that will boost revenue, or the owner might have to share that money with the landlord.

I agree with Zimbalist. Bi-lateral monopoly (the Cubs away from Wrigley are just another team, Wrigley without the Cubs is hard to fathom) creates contractual problems which reduce the wealth of both parties. Hence, absent political considerations, the stadium and the team should be jointly owned and managed. (I'll wager Zimbalist said something like this, but it is too dry for the regular media).

This position creates a puzzle though. If the Cubs are worth more with the stadium, why are they not jointly owned & sold? Must be the subsidy angle. But that suggests a welfare reducing distortion - issues related to the improvements mentioned above - which is not much discussed, if at all, in the literature on stadium subsidies.