SBJ/May 7-13, 2012/Facilities

American Airlines Center ties lower price, one-year term to select suites

American Airlines Center has started marketing one-year suite deals for sports fans, the product of a yearlong effort to find out what Dallas residents want to see in premium seating.

Twenty of the arena’s 142 suites are part of the new SeasonPass Suites program.
AMERICAN AIRLINES CENTER
Arena officials last week introduced the SeasonPass Suites, a new product tied to 20 of the 142 skyboxes at the facility. The suites are on the north end of the Admiral Level, the highest of the three suite levels.

The price of the 20 suites has been cut to $125,000 for one-year deals next season, a 44 percent decrease from the previous price of $225,000 and a change from the minimum three-year commitment. And those aren’t the only significant differences.

SeasonPass Suites include 12 tickets to all Mavericks and Stars games; previously the suites carried tickets for all events. Also, the new product includes a rotating food menu and beer, wine, soda and bottled water, along with three parking passes. In the past catering was a separate fee.

The SeasonPass program provides an option for a segment of the market that no longer could afford to buy suites at a higher price for all events, said Brad Mayne, Center Operating Co.’s president and CEO.

In many cases, premium-seat patrons have downsized from suites to club seats, Mayne said. As a result, there are open suites, but the building has not taken a big hit financially because demand remains strong for single-game rentals for NBA and NHL games.

Mayne said American Airlines Center is ranked fifth in NBA suite revenue, according to the latest internal league documents.

“This is not a fire sale,” he said.

The price adjustments reflect the dynamics of a premium-seat market in Dallas-Fort Worth that has changed considerably over the past decade, including the opening of Cowboys Stadium in 2009, said Bill Rhoda, a principal with CSL International, a sports facility research firm.

American Airlines Center opened in 2001 with 142 suites, twice the number of skyboxes at newer arenas. For example, Amway Center opened in Orlando in 2010 with 68 loge boxes and 14 MVP tables, a spin on the loge box concept, in addition to 60 suites and 1,400 club seats.

CSL consulted on the original premium-seat mix for both arenas. Over the past year in Dallas, CSL helped form the SeasonPass program by surveying existing and past suite holders and the corporate community to get a better sense of the high-end seat market locally.

Arena officials also have had focus groups at the facility to discuss new concepts such as theater box seats — groups of four to eight seats with dining space behind the seats — as Center Operating Co. considers whether it makes sense to ultimately reduce the number of suites to match the market’s needs.

About a half-dozen major league arenas have converted traditional suites into theater boxes, including United Center, Verizon Center, US Airways Center and TD Garden.
Over the past few seasons, theater boxes have sold for $60,000 to $125,000 a year depending on the arena and the market.

American Airlines Center’s Admiral Level is in the same location upstairs as areas where two-tenant arenas in Boston and Chicago completed theater box retrofits, Rhoda said. “Both have done well,” he said.

TD Garden also has the Heineken Board Room, a club seat product tied to an annual fee of about $18,000 in which members pay only for tickets they use to attend Bruins and Celtics games. That concept is also under consideration for Dallas, Mayne said.
American Airlines Center’s one-year deals provide the arena with the flexibility to eliminate suites after next season, Mayne said. HKS, the arena’s original architect, has compiled some ideas for new premium-seat options, but no decisions have been made.

“If this new product is successful, it wouldn’t make sense for us to spend the capital on something else,” he said.

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