The World’s Most Famous Arena is moving.
The New York City Council has given Madison Square Garden 10 years to relocate amid efforts to renovate Penn Station, which sits below the arena. The building is home to the New York Knicks and Rangers, and is owned by The Madison Square Garden Company (MSG) , a mid-cap stock with a $4.6 billion market cap.
News of Madison Square Garden’s impending relocation has not been good for MSG stock.
Shares have tumbled nearly 3% since Wednesday afternoon, dipping below $60 for the first time since July 2. The move appears to be little more than a momentary blip for a fast-rising stock.
MSG stock is up 31.5% year-to-date, rising to its highest level since the company went public in January 2010. Relocating Madison Square Garden was bad publicity for the company that owns the building, but the impact should be very short-lived.
For starters, MSG still has 10 years to find a new home. Besides, this isn’t the first time the arena has had to move. The original Garden opened in 1879, but has since moved to several locations throughout New York City. It opened at its current location above Penn Station in 1968.
Wherever the famous arena moves, it will still be home in the largest city in the world, it will still be home to the Knicks and Rangers, and it will still host major concerts and other sporting events such as the Big East basketball tournament.
The relocation is a nuisance and will likely cost MSG some money in the short term. In the long term, however, MSG remains a strong company with an improving bottom line.
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