Rose Garden arena bankruptcy

[7] Claiming the local economy was responsible for reduced revenues which made it unable to make payments on the loans used to finance Rose Garden Construction, the Oregon Arena Corporation filed for bankruptcy on February 27, 2004.

In addition, the local economy affected ticket sales, and a lawyer for the creditors noted that OAC was ineffective in luring non-basketball events to the arena.

[10] As a result of the bankruptcy proceedings, the Oregon Arena Corporation was dissolved and their assets (primarily the Rose Garden and the underlying land) became the property of the lenders on January 1, 2005.

[8] For a while, the Trail Blazers (still owned by Allen) and the Portland Arena Management had a highly hostile relationship,[11] with the two entities competing for ticket sales.

[12] Almost immediately after PAM took over the arena, the Trail Blazers demanded that new owners perform US$40 million in renovations to maintain the Rose Garden as a "first class facility.

"[9] One year after the Rose Garden was transferred to creditors, Larry Conn, an executive at Vulcan Inc. gave an interview in which he claimed that "all options were on the table" concerning the Trail Blazers as the "economic model" was broken, and noted that without a "public-private partnership", "no businessperson can sustain losses of that kind".

[21] In an interview, Allen indicated that the Blazers' strong 2006 draft, including 2006 NBA Rookie of the Year Brandon Roy, caused him to change his mind about selling the team.

[3] Lewis & Clark College law professor and noted local blogger Jack Bogdanski was even more unkind, attacking the morality and "character" of a billionaire "weaseling" his way out of a debt that he could easily repay personally, especially at a time when the team was putting an emphasis on the off-court behavior of his players.

After Blazer management complained about having the "worst lease in pro sports",[13] Dwight Jaynes of the Portland Tribune noted that the situation was largely the team's own fault.

[23] Helen Jung noted that teams regularly complain about losing money, and suspected that such claims were often a ruse to obtain public financing.

At that point, a new Allen-owned corporation, Vulcan Sports and Entertainment, was chartered to operate Allen's sports-related properties, including the arena, the Trail Blazers, and the Seattle Seahawks.