Sources say that despite the investment of $16 million a year in the team by Kendrick and the others, the Diamondbacks have continued to have trouble covering operating costs and meeting the team's payroll.
Colangelo's financial struggles with the Diamondbacks -- in conjunction with his promises that the public's $243 million investment in Bank One Ballpark would trigger a downtown renaissance that has yet to materialize -- raise doubts among many about whether he's the man to mastermind any downtown master plan.
"When you look at the hard numbers of what sort of vibrancy he's created downtown, I think he has missed the mark," observes Kimber Lanning, owner of Modified Arts, a downtown art gallery, and Stinkweeds, a music store in Tempe.
"It happened in such recent history that you would think our city leaders would remember clearly that we just spent all this money on stadiums and we were promised a vibrant downtown and we don't have it," she says.
Colangelo's altruistic statements aside, some sources think the Diamondbacks' precarious financial condition has something to do with Colangelo's notions about what would be good for downtown. That is, are his financial needs prompting him to push for a quick-fix Jerde development that is devoid of soul but would be a certain moneymaker?
Colangelo's Diamondbacks are clearly a financial albatross.
Forbes magazine estimates that the Diamondbacks are currently worth about $269 million. While that value is greater than the current amount of money invested in the team, $227 million, it is less than the $355 million that will be invested once the infusion by Kendrick's group is completed.
The team is also deeply in debt -- with more than $145 million owed for cost overruns related to stadium construction and other expenses. The organization owes players another $175 million in deferred salaries.
Despite winning the 2001 World Series, the team announced that it lost $136 million between 1999 and 2002.
Big debt and steady losses don't add up to a bright future.
Kendrick, for one, doesn't expect to see a profit on his investment in the Diamondbacks in his lifetime.
"I have twins, 7-year-olds," he says. "And I hope they will see some of that money. I expect I never will."
Colangelo's buy-now, pay-later philosophy has forced the team to start slashing its payroll -- from $94 million this past season to a projected $55 million in the 2005 season (which is the main reason Schilling is on the block).
A big question looming for the Diamondbacks is whether fans will continue to support a team of young, relatively low-paid players who may produce average teams for years to come.
The team drew 2.78 million fans last year, down from 3.2 million in 2002. Kendrick says attendance is projected to slip to about 2.6 million in the 2004 season.
At the beginning, Kendrick says Colangelo's philosophy was: win quickly and build up a fan loyalty that will remain during lean years.
"If we have a winning tradition and transition out of an older team into a younger team, people will be more likely to hang with us," Kendrick says. "We hope that will happen."
There are also storm clouds over Colangelo's America West Arena empire. Not only is the facility losing the National Hockey League's Phoenix Coyotes later this winter, its remaining major attraction is facing difficult times.
The Suns are struggling with lagging attendance and the prospect of flooring average teams fighting to make the playoffs for years to come. The team lost $5 million last year and is expected to lose $20 million this year.
In addition, it appears the Colangelo-controlled group that operates the city-owned arena is facing financial difficulties.
The Phoenix Arena Development Limited Partnership reneged on a deal with City Hall two years ago to remodel the interior of the arena. The city put $10 million into the project, and Colangelo's group was supposed to cover the balance of the $13.5 million in renovations to concourses, seating areas and rest rooms.
After the improvements were completed, the arena partnership failed to come up with its share of the money, forcing the city to reluctantly advance Colangelo's group a $3.5 million loan.
The city's investment in the arena revamps was based, in part, on a more ambitious promise for upgrades that Colangelo's partnership never kept.
The arena group had vowed to build a 75,000-square-foot sports, entertainment and dining venue on the plaza east of the arena in addition to the upgrades inside the venue. The plaza project, which was to be anchored by a Jillians sports and entertainment venue, was supposed to generate more than $350,000 a year for the city.
With the Diamondbacks and the Suns facing financial problems, it's not surprising that Colangelo and his partners are looking for ways to bring more bucks into downtown. Last June, the Downtown Phoenix Partnership, co-founded by Colangelo, announced it wanted a "destination retail-and-entertainment center" brought into the area.