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The Honolulu Advertiser
Posted at 12:10 a.m., Sunday, October 12, 2008

NBA to operate arenas in China

By Broderick Turner
Los Angeles Times

The NBA will announce today plans for a multibillion-dollar real estate venture to design and operate a dozen multipurpose arenas in major Chinese cities for a future affiliated basketball league.

The NBA is teaming with AEG, owned by billionaire Philip Anschutz, to operate arenas that will hold 17,000 spectators, with the primary funding coming from the Chinese government and Chinese banks.

"We think that it's a terrific partnership," NBA Commissioner David Stern told the Los Angeles Times. "And we think that not only will it be good for basketball that will be played in those places, but it will be very good for general entertainment in China."

Tim Leiweke, president and chief executive of AEG, said one of the new arenas might be in Shanghai. "The decision that we're going to have to make is which of the 12 do we choose, because there are so many cities that want to do this," he said.

The arenas will showcase basketball, other sporting events, concerts, cultural events and trade shows.

However, Leiweke downplayed the idea that the arenas are being built based on a guarantee of having an NBA-style league in China.

But eventually — and Stern didn't offer a timetable — the arenas will house some type of affiliated basketball league, he said. "The start of a league is not essential to the success of these buildings," Stern said.

The NBA and AEG see vast potential in China, and that's why they formed the partnership. "We think we've gotten ourselves the best and most knowledgeable partner available," Stern said.

AEG, a sports and entertainment conglomerate, owns the L.A. Kings, the L.A. Galaxy, the Staples Center, and the Home Depot Center in Carson, Calif. It also and operates arenas across the country and in London and Germany.

David Carter, executive director of the USC Sports Business Institute, said it's natural for the NBA and AEG to form a partnership to pursue the growing China market.

"I think for all of them, China represents the new frontier. ... If you look at where AEG has gone the last several years, they've really begun to focus on facility ownership and operation and they've continued to focus on building their international presence," Carter said.

"And the NBA, looking to make sure they further penetrate China, certainly wants a partner like AEG to help them navigate new markets."

Basketball has become popular in much of Asia, including China.

During the Beijing Olympic Games, Kobe Bryant was mobbed and drew chants of "MVP" when the U.S. men's basketball team played. More than 1 billion people watched the U.S. play China, the biggest TV audience for a basketball game.

The NBA is so popular in China that American players have nine of the top 10 best-selling basketball jerseys, led by Bryant, LeBron James and Allen Iverson. Yao Ming's jersey is 10th.

The league also played a major role in helping China build the Beijing Olympic Basketball Arena, which housed the Olympic basketball tournament. In a separate deal, AEG now operates the Beijing facility.

There already is a pro league called Chinese Basketball Association, and current NBA players Yao and Yi Jianlian established themselves as young stars there before coming to play in the U.S.

With the prospect of arenas being built, Stern said, "of course the promise that each building sponsor wants is that if there is a league, the potential building will have the team in the NBA ⁄or‹ CBA partnership league that may be starting."