WASHINGTON, D.C.·BALTIMORE: Hosts of first site visit promise a capital show TAMPA/ST. PETERSBURG·ORLANDO: Site committee's late visit lets bid group tailor pitch DALLAS: Final meetings set stagefor mid-month site visit 2012 GAMES: THE FINAL BIDS LOS ANGELES: Bid riding on efficiency,confidence of organizers SAN FRANCISCO BAY AREA: Organizers keep tight rein on specifics of Bay bid CINCINNATI: Light-rail line, civil unrest pose new wrinkles to bid HOUSTON: First-time financial details promise profit of $257M SITE VISITS NEW YORK: Venue plans get a tweak,financial pledge on hold
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HOUSTON: First-time financial details promise profit of $257M
Published June 4, 2001
Houston will bring in at least $2.2 billion in revenue and turn a $257 million profit if it is selected to host the 2012 Summer Games, according to projections by the Houston 2012 Foundation.
The projections mark the first time the local bid organizing group has publicly discussed the financial details of its effort to host the event. Susan Bandy, the foundation's executive director, said the revenue projection is lower than that of other markets bidding for the Games, such as New York and Tampa Bay-Orlando, each of which has projected revenue of $3 billion. Bandy said the Houston group purposely chose to be conservative on its predictions in hopes of gaining U.S. Olympic Committee favor for hosting the Games.
"We believe that we make a very good partner because we are conservative," Bandy said, "and because we can show that we can stage spectacular Games without having to raise more money than any city's raised in the history of the Olympics."
Of the $2.2 billion in expected revenue, $1.5 billion in corporate sponsorships would be given to the city by the USOC from its work in hosting the Games in the United States, Bandy said. The balance would be generated locally from ticket sales, sponsorships and merchandise sales.
Projected expenses for hosting the Games include contingency costs of $70 million and legacy costs of $60 million. The legacy expenses account for items that are intended to serve the community after the Games are complete, such as statues created for the planned Olympic Park or development of sports programs for local youth.
The $257 million projected profit is in addition to the expected prolonged economic impact of the event and the capital improvements that would remain after the Games. Houston would have to split its windfall with the USOC and the International Olympic Committee, but the size of shares has yet to be determined. Bandy said Houston's take would probably be earmarked for youth sports programs.
George DeMontrond, chairman of the Houston 2012 Foundation, said the group has developed a video presentation as part of its bid effort to show off the city's strengths. He said the local group is trying to emphasize the number of existing facilities available for use compared to facilities that would have to be built.
"We have so much building that's coming out of the ground right now," DeMontrond said. "A picture is worth a thousand words. It gives us a compelling format to present some of our attributes."
The local group did make some venue changes from the original bid it submitted to the USOC in December in hopes of boosting its proposal. Boxing was moved from the George R. Brown Convention Center to Reliant Center at Reliant Park, which the foundation calls Olympic Park. Weightlifting was shifted to Texas Southern University. Beach volleyball will be served up at Olympic Park property as well.
Jennifer Darwin writes for the Houston Business Journal.