SBJ/October 10-16, 2011/Facilities

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  • Illini offer naming rights to finance arena renovations

    University of Illinois officials are marketing a $60 million to $70 million naming-rights deal for Assembly Hall that would top the list of college sports facilities named for corporate entities.

    Warren Hood, the athletic department’s top fundraiser, said the school is asking for $2 million to $3 million over 20 to 30 years to pay for a major renovation of the 48-year-old Big Ten basketball arena. Pending final design, those upgrades are projected to cost about $140 million.

    Four Illinois companies have shown initial interest in the arena’s naming rights, all with a national footprint, said Hood, Illinois’ associate director of athletics for external operations. Hood would not identify the companies or their business categories.

    It is an aggressive pitch for the arena called Assembly Hall for almost a half-century, naming-rights consultants said.

    A formal proposal should be ready in the spring. The goal is to get a deal done 18 months before construction starts, so the sponsor can be involved with activation inside the arena.

    Fresno State’s Save Mart Center, an arena that opened in 2003, has a 20-year naming-rights deal valued at $2 million a year. It carries the highest annual value of any college sports facility in the U.S., according to SportsBusiness Journal research.

    A more comparable deal, for an older college facility with retroactive naming rights, is Alaska Airlines Arena at Hec Edmundson Pavilion, on the campus of the University of Washington in Seattle. In January, the airline signed a five-year deal, valued at $700,000 annually, for naming rights previously held for 10 years by Bank of America. The bank’s deal had a total value of $5 million.

    In Champaign, Hood, who ran the fundraising campaign for the $123 million renovation of Illinois’ Memorial Stadium, believes he is asking a fair price to name the 16,700-seat arena. The building also books several concerts and Broadway productions every year.

    The Illinois campus is a 2 1/2-hour drive from Chicago, the country’s third-largest market. The national television exposure the Illinois men’s hoops program receives on CBS, ESPN and the Big Ten Network is another key part of the deal’s value, Hood said.

    The renovation itself, a project spread over the next three to four years, will add roughly 20 suites, two clubs, courtside seats, 1,000 club seats and some loge boxes. Aecom is the architect and Turner Construction is the general contractor.

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  • Packers food contract goes on the table

    The Green Bay Packers have issued a proposal for the food service contract at Lambeau Field, tied to the club’s effort to upgrade menus, improve customer service and get up to speed on new concessions technology.

    Officials with 10 firms, including Levy Restaurants, the Packers’ current food provider, met with the team during the first weekend in October, toured the stadium and attended the Broncos-Packers game. Levy has held the contract since the 2002 season, one year before Lambeau’s $295 million renovation project was completed. Its 10-year deal expires June 30, said Chris Bigelow, the consultant managing the process for the club.

    The Packers are satisfied with Levy’s operation, but with significant turnover in the team’s front office over the past decade, new executives want to evaluate other options as Chicago-based Levy’s deal nears expiration, said Tim Connolly, vice president of sales and marketing. Connolly has been with the Packers since May after working for the Chiefs, Vikings and, most recently, the Jaguars.

    With more NFL teams using stored-value tickets and gift cards to pay for concessions, it
    GREEN BAY PACKERS (2)
    The Lambeau Field food business includes catered events at the Atrium (top) and the sports bar Curly’s Pub.
    is also a good time for the Packers to consider how to use new technology as part of a $143 million expansion of the stadium’s south end zone. The Packers plan to introduce an all-inclusive ticket covering the cost of food and drink for 180 new seats connected to the project, Connolly said.

    In addition, the Packers want to upgrade some food stands in the seating bowl that still do not accept credit card transactions, he said.

    Major league concessionaires view Lambeau Field as a marquee account because of its history and tradition and the revenue it generates every year from 10 sold-out games, plus the playoffs, which the Packers have made five times in Levy’s nine seasons. For fiscal 2010, the Packers, the NFL’s only publicly held team, reported about $6 million in net revenue from concessions and parking revenue. The Packers do not separate food income in their annual report, team spokesman Aaron Popkey said.

    A big piece of the stadium’s food business comes from catering special events in the Lambeau Field Atrium, a building with banquet space that opened in 2003 as part of the stadium renovation. The Packers reported about $58 million in sales and marketing revenue in 2010, a figure that covers 600 to 800 atrium functions annually, Connolly said.

    The atrium also contains Curly’s Pub, a sports bar and restaurant operated by Levy.

    “It is a year-round operation, no question about it,” Bigelow said.

    Based on Lambeau’s business model, Bigelow said he would not be surprised if all 10 firms submitted proposals. With such a large group, normally a few firms drop out before investing thousands of dollars to develop those documents.

    Proposals are due in mid-November, and the Packers expect to make a decision late in the season, Connolly said.

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