SBJ/December 11 - 17, 2006/This Weeks News
Louisville marketing to two-suite buyers
Published December 11, 2006
The University of Louisville is tackling the challenge of selling new suites in its planned basketball arena and soon-to-be-expanded Papa John’s Cardinal Stadium by putting season-ticket holders first in line for the best locations if they buy skyboxes in both buildings.
The $65 million football stadium addition includes 45 suites and is expected to be ready for the 2009 season. The $252 million arena, where the men’s basketball team will be the primary tenant, will contain 72 suites and will open in 2010.
That’s 117 new suites, but the school will only have about 90 to sell, based on the assumption that the 24 skybox owners at Freedom Hall will renew their contracts when the new arena is completed.
|Louisville basketball’s new home will have 72
suites. The school also is adding football suites.
“We have contracts for existing [basketball] suites that end in the next few years and some others that run out about the time we move downtown,” said Kevin Miller, senior associate athletic director. “The same thing with football.”
Louisville has not established suite prices for the new arena and the stadium expansion. Suite buyers would pay a minimum of $105,000 annually for multiyear contracts based on the $75,000 boxes at Papa John’s and $30,000 units at Freedom Hall, home of Cardinals basketball since the 1950s.
Louisville officials initiated the marketing approach because of the demand for premium seating evidenced by waiting lists for the existing suites.
About 80 season-ticket holders completing priority seating reservation forms indicated they would dig deeper in their pockets to buy suites in both venues, said Charlie Johnson, a consultant hired to develop a business plan to raise $30 million in private donations for the stadium project.
“I can’t think of one school simultaneously selling luxury suites for football and basketball and also the serendipity of great programs in both sports,” Johnson said.
Gary Friedman, Louisville’s associate athletic director for development, could not confirm the number Johnson provided because Friedman had not seen the survey results. Friedman did say that more than 1,000 season-ticket holders have expressed interest in buying a football or basketball suite, and he anticipated that the list could grow substantially in the coming weeks with Louisville’s football team having clinched its first BCS bowl berth.
One sports facility consultant said Louisville’s strategy could have a downside.“The concern I would have is that all of a sudden you are asking for [significantly more] money,” said Dick Sherwood, president of Front Row Marketing, a firm competing for the contract to sell naming rights for the 22,000-seat arena.
Louisville keeps 100 percent of football suite income at its on-campus stadium and will share 12 percent of arena premium-seat revenue with the Louisville Arena Authority, the facility’s landlord, under a memorandum of understanding the two parties agreed to earlier this year.
At the University of Central Florida, which will open a new arena and a new football stadium this fall in Orlando, school officials sold 21 football skyboxes before turning their attention to the 16 basketball suites, said Tim Leonard, assistant vice president for athletics, development and annual giving.
“I wish we could have done it all at once, and it makes sense to offer a joint price and buy both at a discount, but we had two different projects and two different pro formas,” Leonard said.
Ohio State University sold about 90 percent of the 42 suites available when Value City Arena opened in 1998 in Columbus by promising buyers first opportunity to buy skyboxes planned for Ohio Stadium. A renovation of the stadium that included building 82 suites was in the early stages of development and not completed until 2001.