SBD/July 16, 2013/Facilities

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  • Raiders Could Fund Less Than Half Of $800M Cost Of New Oakland Stadium

    The Raiders want to stay in Oakland, but their current lease expires after this season

    Oakland and Alameda County officials learned yesterday the Raiders "want to build the NFL's smallest stadium at their current home, but the team might not be able to cover even half the costs," according to Matthew Artz of the OAKLAND TRIBUNE. AECOM Associate VP David Stone said that a study "found enough demand in Oakland for a 50,000-seat football stadium that would cost roughly" $800M. Stone said that the Raiders have "proposed contributing" about $300M toward the project. Stone said that if the NFL "agreed to provide" $200M "from its stadium loan program, that would leave an estimated $300 million shortfall." City leaders had been "adamant about not subsidizing a new football stadium after losing tens of millions of dollars to bring the Raiders back from Los Angeles, but their tone softened" yesterday. City council member Larry Reid "acknowledged that public money would be needed to help cover stadium construction costs and wouldn't rule out supporting it." Reid said, "My primary concern is this is a city that always had three major league teams and that now there is the possibility that we will have none." The Warriors are "planning to leave" Oakland for S.F., and the A's "still want to move to San Jose." With the Raiders' O.co Coliseum lease "expiring after the upcoming season," Owner Mark Davis has said that he "wants to stay in Oakland but doesn't want to sign another short-term lease at the Coliseum without an agreement in place for a new stadium." Artz notes the Raiders are "the only Oakland team interested in the city's ambitious vision for transforming 750 acres around the Coliseum into a sports and entertainment center with an adjacent biotech campus" (OAKLAND TRIBUNE, 7/16).

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  • Mets, Yankees Both Seeing Declines In Ballpark-Related Revenue

    Ticket revenues for the Mets and Yankees have declined in recent years

    The Mets' ballpark-related revenue "dropped last season for the third straight year," to $121.5M, about half the $234.3M "the team had expected," according to a front-page piece by Baumbach & Marshall of NEWSDAY. Analysts expect that figure to "decline even more because 2013 ticket sales are 10,000 fewer per game than the team projected." A portion of the team's ballpark-related finances are "far from what the Mets anticipated before" the '09 opening of Citi Field. The Mets told prospective bondholders in '09 that they "expected to sell the majority of their game tickets for five years." Had that "come true, the Mets projected that annual revenue from a part of their ballpark revenue for such items as premium seat tickets, suites, concessions and parking would eclipse" $200M each year and reach more than $240M this year. Despite the Mets' "inability to meet projections -- and the downward trend of their finances -- the team's bonds are still attractive to investors." The most significant financial difference "between the Mets' forecast and actual revenue took place within Citi Field's most expensive seats." Revenue from these 15,000 seats is "included in the team's revenue stream to pay back its bonds." The Mets expected $123.5M in '09 from "retained seats revenue," which represents "10,635 premium seats, about a quarter of the stadium's capacity." But the "'retained seats revenue' never met 2009 projections and continues to drop." The team reported $99.3M in ticket revenue in '09, while in '12 it "received only" $43.9M, 67% shy of its '12 projection. With "smaller crowds than projected lately, companies have been less willing to advertise at Citi Field." Records show that "revenue from stadium advertising and signage has averaged" $46M per year since '09, about 25% "short of the team's annual average projection of" $62M. Concessions' revenue also has "dropped each year," from $15.2M in '09 to $11.4M last year, "well short of the Mets' annual projection of about" $21M (NEWSDAY, 7/16).

    POSTSEASON HANGOVER? On Long Island, Jim Baumbach cites quarterly revenue statements as showing that the Yankees' "overall ticket and luxury suite revenue has declined" 11% since the new Yankee Stadium opened, dropping from $397M in '09 to $353M last year. Standard & Poor's analyst Jodi Hecht said that the decrease is "mostly because the Yankees have hosted fewer postseason games in recent seasons compared with" when they won the '09 World Series. The Yankees declined to comment. The information focuses "only on ticket and luxury suite sales." Hecht said that of the $397M in ticket and suite revenue in '09, $72M was "generated from the team's eight home playoff games." She added that in the three seasons since, the Yankees have "averaged an estimated" $57M in playoff ticket revenue from four home playoff games a year. In its "first fiscal quarter filing, the Yankees reported" $207M in ticket and suite revenue, down from $214M in Q1 last year. The Yankees "drew more than 4 million fans in each of their final four seasons at the old Yankee Stadium, but averaged only" $198.4M in annual ticket and suite revenue." Financial statements for the Yankees bonds show that in the first four seasons at the new stadium, the team "averaged $378 million in ticket and suite revenue, bolstered by postseason runs" (NEWSDAY, 7/16).

    BUILD ME UP: In a special to the GLOBE & MAIL, Joe Lapointe writes Citi Field and Yankee Stadium are "part of a sports-facilities gold rush in the New York area that has sharpened competition for events and given customers more and fancier choices for a sports experience." By '15, "all 10 local pro teams will play in modern, amenity-filled venues that were either built new or refurbished in the last decade." Yankees President Randy Levine said, "We’re not here to please television commentators and what they think the stadium looks like. We’re here to please our customers and fans. And all of them are very happy with those seats and they are basically sold" (GLOBE & MAIL, 7/16).

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  • Bloomberg Backtracks On Possibility Of New MLS Club Playing At Yankee Stadium

    There has been no significant progress in finding a permanent home for NYC FC

    After N.Y. Mayor Michael Bloomberg on Sunday "appeared to indicate in his weekly radio address" that MLS New York City FC would play home games at Yankee Stadium, the mayor's office issued a correction yesterday indicating that Bloomberg "was mistaken," according to Sam Borden of the N.Y. TIMES. Deputy Press Secretary Julie Wood said, "The script for the mayor’s radio address on Sunday overstated the possibility that the New York Football Club could play some games at Yankee Stadium while they search for a permanent home. No decision has been made on where they will play." Yankees and MLS officials confirmed that "no significant progress had been made on determining a permanent home" for the team. Yankees Managing General Partner & co-Chair Hal Steinbrenner has said that the team "would be open to having New York City FC play some games at Yankee Stadium on a temporary basis while a permanent stadium is being built." Plans to build a soccer stadium in Flushing Meadows "now look unlikely," and a site near Yankee Stadium in the Bronx "has been seen as another potential option" (N.Y. TIMES, 7/16).

    CANARIES IN A COAL MINE? In Sacramento, Marcos Breton notes a Thursday night exhibition match at Raley Field featuring EPL club Norwich City "will be a first" and "could be a milestone in the ultimate goal of bringing" an MLS team to the city. It is "an idea whose time has come." MLS in many ways is "the perfect sports league for Sacramento." The city has "perfect weather for soccer, large immigrant communities and thriving youth leagues in the city and suburbs." Entrepreneur and USL Pro team Owner Warren Smith "hopes a big crowd at Raley Field will begin to make the case that Sacramento has passion for soccer" (SACRAMENTO BEE, 7/16).

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  • Hawks Selling New Loge Boxes At Philips Arena, Just 20 Rows Off Floor

    Seven new loge boxes or “micro-suites” at Philips Arena, "merely 20 rows from the arena floor, will replace some 140 club seats in Section 107, opposite the visiting team’s bench on the west side of the arena," according to Gary McKillips of the ATLANTA BUSINESS CHRONICLE. On the market for "a little less than two months, six of the seven new suites have been sold with a seventh contract pending." Each of the seven micro-suites has "four seats, two bar stools, flat-screen televisions and two iPads as well as access to a private bar and dining area." The loge package "gives owners access to all Hawks games, as well as concerts and shows at Philips Arena and preferred parking for each event." Atlanta-based New South Construction "oversaw building of the new loges, while the design was done in concert with" Atlanta-based architectural firm The Johnson Studio. Hawks and Philips Arena Senior VP & Chief Revenue Officer Andrew Steinberg said, “The loge boxes are being sold on terms of three to five years with a cost for the all-inclusive package in the low six figures.” He added that the new lower bowl loge boxes "provide fans the closest access to the action of any loge-type seating in the Atlanta market" (ATLANTA BUSINESS CHRONICLE, 7/12 issue).

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  • Univ. Of Minnesota Renting Out TCF Bank Stadium For Events To Generate Extra Revenue

    UM has collected over $470,000 in TCF Bank Stadium rentals this fiscal year

    The Univ. of Minnesota, in an "attempt to find revenue in unusual places," has been renting out TCF Bank Stadium "for everything from weddings and bar mitzvahs to Tennant Company meetings and Comcast awards banquets," according to Mike Kaszuba of the Minneapolis STAR TRIBUNE. The president's suite "rents for $600 for six hours." Though proceeds so far are "modest -- roughly a half-million dollars annually -- school officials are trying to emulate other universities." The school has "collected at least $471,619 in stadium rentals this fiscal year, outdistancing the $317,895 collected by Ohio State," which has a similar program. The Twins' Target Field "has seven weddings scheduled at the ballpark this year," but "having a public university rent its new stadium for corporate events can be ticklish." UM associate professor Bill Gleason, a faculty member since '92, has "been an outspoken critic of the school’s corporate relationships." He said, "It just doesn’t smell right." Gleason believes that the "rental money, which goes to the school’s athletic budget, should go to the university’s general fund or to reduce student fees." UM Associate AD Scott Ellison "defended the policy." He said that the school "rents other campus sports arenas and was only doing what others have done" (Minneapolis STAR TRIBUNE, 7/14).

    TEAGUE'S TEEMING AMBITION: In Minneapolis, Jim Souhan wrote UM AD Norwood Teague's first year on the job has "hinted at an aggressiveness and savvy that has been missing in the Gophers athletic department since [former UM football coach] Murray Warmath had the brains and guts to recruit black football players." Souhan: "Ambition? Check. Teague isn’t trying to coax a few extra victories out of women’s cross-country. He is trying to elevate football and basketball, the sports whose revenues raise all ships. Business-savvy? Check. When was the last time any sports entity in the Twin Cities revealed construction plans or hopes without begging for tax dollars? ... Confidence? Check. Only someone with bravado and a successful track record could, in his first year on the job, fire a Hall of Fame basketball coach and propose to solve all of the university’s sports facilities problems in one privately financed swoop" (Minneapolis STAR TRIBUNE, 7/13). Also in Minneapolis, Sid Hartman wrote Teague "has not raised a lot of money since being named" AD. Teague was asked "how fundraising here compares with his former job at Virginia Commonwealth." He answered, "You just have to get after it and dream big and tell your donors that you’re dreaming big and hope that they’ll hop on the dream with you. I guess for lack of a better way of explaining it, people are the same, they want to give to things that they’re passionate about and we have to sell that to the Nth degree over the next five, six, seven years." Teague also said that he "did not have any second thoughts about releasing such a big figure for his proposal" in regard to the school's recently unveiled $190M facility renovation plan. He said, "I really wanted to get it out and show what we were doing" (Minneapolis STAR TRIBUNE, 7/15).

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  • Facility Notes

    In Sacramento, Ryan Lillis reports a group "trying to force a public vote" on the city's plan to subsidize a new downtown NBA Kings arena has "fallen short in its push for a special election this year and will instead aim for the June 2014 ballot." The group was "unable to gather enough signatures before Monday's deadline to force a special election." Instead, it now "has until Dec. 16 to file 22,000 valid signatures from registered city voters." The group, also known as STOP, "wants the public to vote on the City Council's approval" of $258M in public subsidies to the $448M arena planned for Downtown Plaza (SACRAMENTO BEE, 7/16).

    ART FOR ART'S SAKE: In Ft. Worth, Susan Schrock reported the city of Arlington has "set aside $200,000 for the first of several planned sculptures to be installed between Cowboys Stadium and the Rangers Ballpark." Up to 15 permanent sculptures "are envisioned." City officials said that the public art "would not only be an added amenity for park users but also would serve as an additional arts and culture destination for the millions of visitors who come to Arlington." The themed sculptures "could represent events such as" Super Bowl XLV, which was held at Cowboys Stadium in '11, or the Rangers’ back-to-back AL pennants in '10 and '11 (FT. WORTH STAR-TELEGRAM, 7/14).

    MUSEUM HOPPING: In San Jose, Lauren Hepler reports the 49ers are "currently working on a 17,000-square-foot museum" at Levi's Stadium "slated to be open seven days a week." 49ers COO Paraag Marathe said that the team is hoping to attract "school field trip groups" to the museum. He said, "We'll have a learning lab downstairs where students can learn about the physiology of sports" (SILICON VALLEY BUSINESS JOURNAL, 7/12 issue).

    ON THE 86 LIST: In L.A., Roger Vincent reported the ESPN Zone restaurant at L.A. Live "closed over the weekend to make way for three new restaurants." Most outlets of the sports-themed ESPN Zone chain have "been closed by parent company Walt Disney Co., but one store remains open near Disneyland in Anaheim" (L.A. TIMES, 7/15).

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