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Saturday, April 06, 2024

Good quote on arenas and stadiums as "performing arts centers" attractions for cities

 Right now there's a lot going on in stadium and arena deals:

  • Chicago: the White Sox MLB and Bears NFL teams want new stadiums
  • Boston: the Revolution soccer team aims for a stadium in Everett, just outside Boston
  • Dallas: the Mavericks NBA team along with the Stars hockey team wants a new arena, preferably with a casino, which isn't yet legal in Texas
  • Kansas City: the Chiefs football team and the Royals baseball team just lost a sales tax extension which many attributed to a poorly defined program for use of the money
  • Las Vegas/Oakland: the Athletics MLB team is moving to Las Vegas with an interim stop in Sacramento 
The Las Vegas Athletics aren't interested in a throwback stadium design
There's an article in the Fort Worth Star-Telegram, "America's future sports stadiums finally at a cross roads," suggesting that the KC vote indicates voters are tired of paying subsidies to billionaires for sports teams.  
Any proposal for a new home of the Stars and Mavericks should serve as a litmus test where America sits with its tolerance to subsidize venues for teams that take a disproportionate share of the revenue. As the valuation of sports franchises continues to shatter logic, perhaps citizens will have a hard time justifying giving them more money.  
I'm not sure I agree.  I think the KC vote was more about not getting enough information to make a good decision, with a foundation of a bit of lack of trust ("Why Royals and Chiefs need to say we heard you, not act out ," Kansas City Star).  

And as I blogged, the Virginia Governor sprung the arena proposal on the public and the Legislature, giving them only 14 weeks to decide ("Wizards and Capitals teams staying in DC after all and the failure of the mansion tax referendum in Chicago have one thing in common: failure to take the time to build consensus").

In Oakland, the city was willing to provide a fair amount of money, but the MLB team owner wanted even more.

The S-T article quotes Ron Kirk, mayor of Dallas when the American Airlines Center was built, opening in 2001, and he has some interesting points.

1.  30 year maximum life for the facility

Ron Kirk knew going in what the lifespan would be for a replacement for Reunion Arena. “Thirty years,” he said. 

Kirk was the foremost political figure to lead the American Airlines Center project from its conception to construction. The AAC cost $420 million to build, and it opened in October of 2001. 

No one in any rational state who builds a house, or even an office space, thinks before they sign the necessary 43 million documents required for construction, says, 

Area around the Dallas arena, 2001.

“Thirty years and she’s done.” “That’s the reality of modern sports,” said Kirk, the former Dallas mayor, in a recent interview. “You build a building and when it’s life span is over, you build a new one. That’s what these owners want.”

2.  Sports stadiums and arenas as performing arts/cultural facilities

You either play, and operate, the glorified museum-stadium, which is a tourist attraction, or you “need” the new one complete with an assortment of new-age amenities. “The argument is always you never need to build it; we battled that when we did it here,” Kirk said. 

“We put in $125 million, and there’s been over $3 billion in private investments around (the AAC). It worked spectacularly.” 

Before the construction of the AAC, the area was an industrial hazard site. Literally. Since the building went up, it’s morphed into a mixed-use site for offices, residential space in the form of condos, and retail space with bars and restaurants. 

Area around the Dallas arena today 

“What drove a lot of energy then, in the ‘90s and not just in Dallas, all o.f the urban areas had been hallowed out by families fleeing and businesses going to the suburbs,” Kirk said. 

“The one thing that brought people back into the urban areas were arts, culture, sports, museums, and concerts. “It’s a performing arts building; that’s what you need to think of it as.”

Response.  

  1. How did Dallas get so much spillover development around the arena?  Those before and after photos are startling.  Did they have a plan, an implementation organization or did it just happen?  Few arenas or stadiums generate this level of change.  It could be location (I've never been to Dallas) because a lot of arena and stadium placements have flawed locations.
  2. Chicago.  The baseball team owner chose a bad location for the current stadium, and had no interest in embedding it in a neighborhood commercial district, despite the example of Wrigley Field a few miles a way.  While the new "stadium city" initiatives like Ballpark Village in St. Louis, District Detroit, or the area around the Braves stadium aren't city embedded per se, creating a mini city of development around them is what they do.
  3. Chicago.  The Bears are vacillating between a suburban location and the Chicago waterfront.  They propose a domed stadium, and placing such facilities in parks is very controversial in Chicago.  The Chicago Tribune editorialized, "The Bears have yet to say why they need the lakefront. Why even think of saying yes without that?," stating the Bears haven't provided a good rationale for a waterfront location, that a dome would hide the water, and that it would change the park with a museum and cultural center (there are 10 such facilities) to a sports and entertainment district. (Similar to the issue in KC about lack of definition.)
  4. Dallas.  The interesting thing is that Mark Cuban's sale of a majority of the basketball team to Las Vegas Sands with the aim of a casino means that sports betting/casino ("Mark Cuban has Vegas-like vision for Dallas, new Mavs arena if Texas OKs casino gambling," "Mark Cuban: ‘I’d like to see resort casino gambling,’ plans for making Texas a destination," and "Mark Cuban, the Mavericks and the great plan to bring a casino to Dallas," Dallas Morning News) or "ballpark village" (ULI case study, "Stadium anchored mixed-use development," Realogic, "It takes a ballpark village: stadiums, coalitions, and growth in two cities," MIT thesis) are the two future paradigms for boosting revenues.    

  5. Kansas City.  Probably better to have the baseball team downtown, but it's not a city with well developed transit.  For example, the 76ers argue by changing locations, instead of the 30% getting to the arena by transit now, it will be 60% on Market Street.  That won't happen in KC.  Plus you still need to do tons of marketing etc. to make the stadium work for other actors.  If games are scheduled early, people won't eat off site.  And increasingly, baseball patrons aren't interested in anything but eat and drink, so they won't help adjacent retail.
  6. Nashville.  Business doesn't care much about non business metrics.  Some of the residents are skeptical that the "wealth creation for the black community" objectives are reachable ("Some North Nashville Residents Wary of MLB Pitch," Nashville Scene).
  7. Philadelphia.  Probably Market Street is a better location and needs the jump in interest.  Plus more people will take transit to get to the games, comparable to the numbers for Madison Square Garden and Barclays Center in Brooklyn, which are the highest for transit using nationally.  The trick is to integrate the arena better and improve the street, while arenas tend to have deadening effects.
  8. Salt Lake.  Many years ago there was a study by American Business Journals about the capacity of metropolitan areas to add professional teams ("American City Business Journals calculates the capacity of North American metropolitan areas to support new/additional professional sports teams" 2015, archive.ph original article), also taking into account college sports (college football especially is big in Salt Lake).  Salt Lake didn't have a lot of financial capacity to add beyond NBA, soccer and Utes football.  It's smaller in population than most of the smallest teams in the professional sports landscape. But billionaires are billionaires and they don't think economics applies to them.

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