Group Created with Sketch.
Volume 20 No. 42

Events and Attractions

The Guinness International Champions Cup soccer tournament debuting next month and later culminating in Miami will find its future championship weekends bid out to other cities.

Such was the message last week from Stephen Ross, owner of the Miami Dolphins and Sun Life Stadium, where this year’s event will conclude. Ross is also the co-founder with Matt Higgins of RSE Ventures, the sports, entertainment and technology business that is the parent company of Relevent Sports, which created the Guinness International Champions Cup.

Since the event’s announcement in April, it has been widely assumed the tournament, which Ross plans to make an annual event, would always end in Ross’ stadium in Miami. But that’s not necessarily the case, said Ross in an interview at RSE Ventures’ headquarters in Manhattan last week.

“I don’t know if it will be in Miami all the time,” Ross said. “We will bid it out.”

Ross’ declaration could be the result of frustration after his bid for public funds for a portion of a $350 million renovation of Sun Life Stadium was thwarted by the Florida Legislature in early May. It also could be a message that Ross wants to send to state politicians and residents: If Sun Life Stadium is not upgraded soon, Miami will continue to lose out on hosting prime events.

Guinness International Champions Cup

Dates: July 27-Aug. 7
Participating clubs: European clubs A.C. Milan, Chelsea, Everton, Inter Milan, Juventus, Real Madrid and Valencia; MLS Los Angeles Galaxy.
Match sites: Valencia, Spain; Indianapolis; Glendale, Ariz.; San Francisco; Los Angeles; East Rutherford, N.J.; Miami.
Format: Bracket-style, culminating at Sun Life Stadium with 5th and 7th-place games on Aug. 6, and championship and 3rd-place games on Aug. 7.
TV: Fox Soccer

Neither Ross nor Higgins would comment directly on the local political dealings.

“Other cities will see the support that we’re getting this summer for the tournament,” Ross said. “I have no doubt that there will be plenty of interest.”

Miami representatives last month failed in their effort to bring the Super Bowl to South Florida in 2016 or 2017. The NFL’s site-selection decision for those games came in the wake of Miami’s unsuccessful effort to secure funding to improve Sun Life Stadium, which opened in 1987.

“We’re bullish on soccer in Miami, which has become an international hub for soccer fans in the U.S.,” said Higgins, CEO of RSE Ventures and a former executive vice president of business operations with the New York Jets. “But we’ve begun to hear from other cities interested in the Guinness Cup. First, we want to make sure the property works great. We’ll wait and review how the [event] plays out in Miami. No matter what, our end goal remains to renovate Sun Life Stadium.”

Ross is confident of the interest in the Champions Cup tournament.
The 2013 Guinness International Champions Cup will feature seven European clubs along with MLS’s Los Angeles Galaxy, competing across seven host cities. Fox Soccer will televise 11 of the tournament’s 12 matches live. The tournament will be broadcast in 151 countries.

“The idea to have all eight teams play in Miami on the same [days] was Steve Ross’,” said Relevent Sports CEO Charlie Stillitano.

Stillitano estimated that all Guinness International Champions Cup matches will draw at least 50,000 fans.

“There’s not much going on in sports in late July and early August other than baseball,” Ross said. “We thought having a championship game, instead of just a round-robin of friendlies like you used to see a lot in the summer, was key. People in America want to see you play for something. Out of nowhere, and in just nine months, we’ve created this great tournament that people will want to come to every year. Eight soccer clubs of this caliber all playing in the same city [is] unparalleled.”

After Miami this summer, other cities may get their chance to play host.

The Merion Golf Club has all the characteristics of a classic U.S. Open venue, from its tight fairways and thick rough to its tradition-steeped course.

What it doesn’t have is a lot of space. Last year’s U.S. Open at Olympic Club was played on a nearly 300-acre footprint, compared with the 110 acres at Merion, which will host the Open this week.

Only a few hospitality units will be on the course itself at the Merion Golf Club.
Photo by: USGA
That poses some unique challenges for the U.S. Golf Association team in charge of finding a home for all of its hospitality clients. Sarah Hirshland, the USGA’s senior managing director for business affairs and a Duke graduate, compared the Open at Merion to staging a Final Four at cozy and intimate Cameron Indoor Stadium.

“You just can’t do everything you want to do on the golf course property,” Hirshland said. “This Open requires tremendous creativity and a lot of cooperation from the community.”

Hirshland cited the cooperation of the Haverford Township, Pa., community because many of the Open’s hospitality clients will be partying in the front yards of homeowners across the street from the course.

The USGA struck rental agreements with about 10 homeowners on Golf House Road to build hospitality structures in their front yards. Those big white tents will line the street that leads to Merion’s entrance.

A 40-by-30 foot tent with 100 tickets per day and 40 parking passes in one of those front yards costs $275,000 for the week. Food and beverage and decorating typically can double the cost for clients.

Buying space from homeowners was one solution the USGA came up with to accommodate the space required to put up 32 hospitality tents. Only the USGA’s five corporate partners — American Express, Chevron, IBM, Lexus and Rolex — plus the broadcast partners, NBC and ESPN, will enjoy hospitality on the golf course itself. Those units will be on the sixth and 13th holes, leaving the finishing holes clean except for the grandstands.

To create even more space for hospitality, the USGA reached an agreement with Haverford College, whose campus will be the site for the 1895 Club, Trophy Club and Champions Pavilion. The golf club and college are separated by a commuter rail line, so the USGA had an overpass built for spectators going back and forth from the tournament. It’s roughly 400 yards from the hospitality options at Haverford to the 18th hole.

The USGA was able to offer about the same amount of hospitality space it normally does, but it required a different approach than the typical rows of white tents that line the fairway at tournaments.

“It’s groundbreaking in a way,” said Bill Colvin, a former IMG executive who arranges hospitality for clients at major golf events. “You’re just not used to seeing a major championship in such a setting. Any golf course architect these days looks for 200 acres or more to build a course.”

The hospitality tents, marketed and set up by MSG Promotions, the USGA’s longtime hospitality agency, were sold out months ago. Only a handful of daily passes to the 1895 Club and the Trophy Club were available in the weeks leading up to the Open for $75 to $250.

“You simply take what the golf course gives you,” Hirshland said. “For our highest-level partners, the corporate partners, you work to figure out how to take care of their needs first. The broadcast partners, you take care of. Then we look at what other space options we have and that’s where we had to come up with some new ideas and extend beyond the gates.”

Hospitality at its peak generated close to $20 million in annual revenue for the USGA at the 2008 Open. Most venues can’t generate that much revenue because the 2008 site at Torrey Pines had a hotel and conference center on-site, in addition to a spacious footprint on the golf course. Its high-end offerings also sold for much more, with the top prices at $575,000 for a lodge at the 18th hole.

Despite Merion’s limited options, this Open will do well financially in the hospitality category. In typical years, hospitality revenue has ranged from $10 million to $15 million, and the USGA has not lowered expectations for Merion.

Overall, however, this Open will produce less revenue than years past because only about 25,000 paid fans will be on the course per day. Olympic held 37,000, and next year’s site, Pinehurst, will hold close to 45,000 per day.

“When you go line by line on revenue, a number of the lines will be comparable to other Opens,” Hirshland said. “Other lines, like the gate, will not.”

The compact course design and proximity of homes add up to a tough task for tournament operations at Merion Golf Club.
Hospitality for the USGA’s major events is built into the contracts of corporate partners. Those deals, all in, go for $3.5 million to $5 million annually, and hospitality can account for $250,000 to $500,000 of that each year, industry insiders said.

Those partners will be on the golf course. For non-partners, tents at Haverford or Golf House Road range from $115,000 to $275,000.

Weekly passes to the all-inclusive 1895 Club on the Haverford campus run $1,875 and cover food and beverages in an air-conditioned unit. A Trophy Club weekly pass goes for $685 and does not include food and beverage.

A piece of hospitality revenue is normally shared with the host club.

Despite the challenges associated with Merion, which first held a USGA championship in 1904, there will always be a place for historic golf courses in the Open rotation, even if it means the gate proceeds might take a dip.

“As a healthy nonprofit organization, and a disciplined organization, we don’t get off track from what’s most important and that’s the integrity of the competition,” Hirshland said. “The first thing we take into account is whether the course will provide the test of golf we’re looking for. Second, we have to make sure we have the space and logistical capacity for traffic and parking. The rest of it is figuring out the cost and revenue. As long as we can check off the first two boxes, we’ll figure out the rest.”