The University of Washington, pending approval by the state board of regents, plans to issue a developer-led proposal in the next few weeks for what could be the most expensive college football stadium renovation to date, a $300 million makeover of Husky Stadium in Seattle.
The idea is to hire a private developer to assume the responsibility for selecting the architect, general contractor and other subcontractors, and accelerate the process for improving the 87-year-old stadium.
“The developer-led model is viewed as an efficient way to cut time and economize the process that we would have to go through to get public approvals,” said Chip Lydum, Washington’s associate athletic director for facilities and events.
School officials have been trying for the past three years to renovate the 72,500-seat lakefront stadium, a project that has met resistance at the state level.
In late January, high-ranking state lawmakers said they would not support extending a hotel-motel tax to provide $150 million in public money for the project, a levy created initially to fund Safeco Field and Qwest Field construction.
The remaining $150 million would be privately raised through ticket sales, premium seat revenue and sponsorships, according to Lydum.
“We expect to continue with the RFP process,” Lydum said. “The funding effort will be a long-term effort, but we need to continue getting our partners in place in the meantime.”
The University of Washington is moving ahead
with its $300M plan, though it’s meeting
resistance at the state level.
Privately run projects are not uncommon in the college ranks. In 2006, Stanford completed a remarkable nine-month, $90 million renovation of its football stadium in Palo Alto, Calif., after an influential alum controlled the design and construction and led the fundraising campaign to pay for it.
Billionaire developer John Arrillaga, whose name was already on several Stanford buildings, hired the same firms he uses to design and build nonsports facilities. In the course of one offseason, they accomplished the task of gutting the seating bowl and reconfiguring its seats, reducing capacity from 85,000 to 50,000.
The University of Central Florida hired developer KUD International to assume the financial risk for building UCF Arena in Orlando, a $51 million facility that opened last fall. The project was tied to new student dorms and campus retail to create revenue streams to help pay for the arena.
In Boca Raton, Florida Atlantic University’s goal was to use the Central Florida business model and hire KUD International to build a new football stadium as part of its mixed-use Athletic Innovation Village.
But the school and developer could not agree on contract terms and the delay threatened to “push back” the stadium piece, which the school wants to have open in 2010, said Athletic Director Craig Angelos. As of three months ago, KUD is no longer involved in the project, Angelos said.
FAU instead will act on its own to hire a designer and builder in the next several weeks, and use corporate naming rights, philanthropic gifts, premium seat revenue and advertising income to pay for a proposed $62 million stadium that seats 30,000.
The school will worry later about hiring a developer to build student housing, retail and a parking garage, Angelos said.
HOK Sport, the architect that was part of KUD’s development team at Central Florida and Florida Atlantic, will have to resubmit a bid for the job in Boca Raton.
In Seattle, HOK completed a master plan for renovating Husky Stadium. It will now have to team with a developer.
The Husky Stadium project is not tied to mixed-use elements, but the $300 million price tag does include a $50 million football support structure and a $20 million premium club space spanning the south sideline, Lydum said.
No suites are planned as part of the renovation, he said.
AEG SIDES WITH TICKETMASTER: It’s a safe bet to assume that as AEG continues its rapid ascent in arena management and signs more booking deals with NBA and NHL facilities, it will resist signing ticketing contracts with Live Nation, its chief competitor in the concert promotion world.
Live Nation is getting into the ticket business in 2009 after signing a licensing agreement with CTS Eventim, a German firm and Europe’s largest ticketer, and plans to compete aggressively against Ticketmaster, the industry’s dominant player.
AEG has no plans to get into ticketing simply because Ticketmaster is the absolute best at it, according to Tim Leiweke, AEG’s president and CEO. “I’ve always believed you don’t re-create or try to compete with phenomenal systems,” Leiweke said.
“Ironically, when I hear people [at Live Nation] talk about spending $20 million to start up a ticketing company, Ticketmaster spends more than that every year on its software,” he said. “We know with Ticketmaster we will never have a crash, we will be able to service our customers with the best technology and we will have more ability to move mass amounts of tickets than any system created to date.”
AEG is familiar with CTS Eventim from its sports business in Europe. The ticketer has the contract at Color Line Arena in Germany, where the AEG-owned Hamburg Freezers pro hockey team plays.
The O2 World, the 16,000-seat hockey arena AEG will open this fall in Berlin, will “probably be a Ticketmaster building,” Leiweke said.
When Live Nation recently announced its foray into ticketing, officials trumpeted the fact that CTS Eventim sold 3 million tickets in the first hour of operation for the 2006 World Cup in Germany without suffering any glitches.
“It’s a good system,” Leiweke said, “but with all due respect, with people going around saying because the ticketing system worked in Germany, it’s going to work everywhere, I’d be careful with that.”
Don Muret can be reached at dmuret@sportsbusinessjournal.com.
