NY Times business section cheers urban stadium trend, doesn’t seem to know why

The New York Times has a weird affinity for big sweeping articles about the stadium industry that don’t quite justify their declarative headlines, and the latest one ran in Friday’s business section under the headline “Welcome to the Neighborhood: America’s Sports Stadiums Are Moving Downtown“:

Across the country, in more than a dozen cities, downtowns are being remade as developers abandon the suburbs to combine new sports arenas with mixed-used residential, retail and office space back in the city. The new projects are altering the financial formula for building stadiums and arenas by surrounding them not with mostly idle parking lots in suburban expanses, but with revenue-producing stores, offices and residences capable of servicing the public debt used to help build these venues.

There is a germ of truth in this: Yes, more stadiums and arenas are being built near city downtowns instead of out in the suburbs, the Atlanta Braves‘ new ballpark notwithstanding. That’s true of everything, though, not just sports — we’re in the middle of what’s been dubbed the Great Inversion, a decades-long process where people are increasing moving back to cities instead of out of them. (For “people,” here, read “people with money and options” — plenty of people continued to live in and especially immigrate to big cities even in the 1960s and ’70s.) So yes, there are lots of mixed-use urban developments being built around sports venues, but there are plenty built even with no stadium, or even when a stadium was planned and not built. “America’s Sports Stadium Builders Jumping on Urban Land Rush Bandwagon” might have been a fairer headline.

On top of that, the Times article tries to counterpose the traditional business model where “owners threatened to move their teams if governments did not build them new stadiums along with the roads and public utilities needed to operate them” against the new downtown development trend. But plenty of urban ballpark districts have gotten public funding after team owners threatened to move — hell, the Sacramento Kings arena that is the article’s centerpiece is getting $226 million in public subsidies that were approved only after the team owners threatened to move the team to Seattle.

There are plenty of good things about building sports venues near urban centers: They’re easier to get to by public transit, they support more economic development in cities (such that they support much of any at all), and in general they promote the idea that cities are good places to live and work and go see high-priced entertainment. They also take up valuable land that could better be used on buildings that aren’t dark a couple hundred days a year, displace residents and businesses, and by promoting the idea that cities are good places to live and work and go see high-priced entertainment, spark gentrification and force out the city residents who are supposed to benefit from all this alleged economic development in the first place. The urban-stadiums trend is not a simple good, in other words — and it certainly has nothing to do with any shift away from public stadium subsidies, even if some urban stadium developers are using ancillary land grabs to help pay for their construction costs.

If you want one paragraph that neatly sums up the Times’s perspective, this quote from Kansas City city manager Troy Schulte on that city’s publicly funded downtown Sprint Center should do the trick:

M. Schulte acknowledges that although tax revenue from the district is steadily increasing, it is not clear that enough will be generated to cover the debt service. “But from the perspective of economic development and economic resurgence,” he said, “it’s the best $300 million we’ve ever spent.”

Urban sports venues: They don’t pay off for cities, but they’re still great! Your paper of record, people.

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13 comments on “NY Times business section cheers urban stadium trend, doesn’t seem to know why

  1. There is a Forbes article that references the NYT article touting the “benefits” of the arena for Sacamento (https://www.forbes.com/sites/prishe/2018/01/21/real-estate-investments-near-golden-1-center-revitalizing-downtown-sacramento/#3aa40f505840). One highlight:

    •Golden 1 Center created more than 2,000 food and beverage jobs, accounting for over $31 million in wages, and nearly $79 million in new gross regional product.

    That sounds SO good … until you do the math. In other words, 2,000 people were hired with an average annual salary of $15,500 or $1,290 per month. If you assume a full-time employee, the average employee is earing $7.45 per hour. Minimum wage in California is $11.00 per hour. Rents in the downtown area average $1,600 per month.

  2. Perhaps the new Amazon and Apple 2nd-headquarters will be built in conjunction with one of these new downtown stadia, concurrent with the culmination of President Obama’s remarkably successful U.S. economic revitalization through the rigorous regulation which characterized his administration.

  3. What strikes me as odd is that in the Golden Age of American Sport, very few urban stadiums were anywhere near what might be called “downtown.” While I can think of a few basketball arenas that were close to downtown, very few football and baseball stadiums were (Tiger Stadium being a notable exception). European classic soccer stadiums are almost all outside the downtown districts, usually in large public parks or residential neighborhoods.

    While team owners wanted transit and decent land, the Times proceeds as if there was absolutely no good reason for stadiums to not be on expensive downtown land.

    1. Yeah, most early stadiums and arenas were built on cheap parcels on the outskirts of town, which later got subsumed into the city. (Yankee Stadium is one classic example there.) I’m pretty sure there was at least one early baseball stadium — St. Louis Browns, maybe? — where the stadium was built out in the then-sticks so that the owner could charge fans a fee to ride on the streetcar line he owned.

      1. Another common option was to put the ballpark down by the river. This had the disadvantage that you might lose the first few weeks of the season due to flooding, but this possibility also kept the ground rent down. The Pittsburgh ballpark in the late 19th century was in almost exactly the same place as the modern park, but without the benefit of all those civil engineers and concrete.

        1. I love that old photo of Crosley Field, I think it was, with the guy in a rowboat at about second base.

    2. Part of the problem is that these articles talk as if “downtown” and “suburbs” are the only two possibilities. The thought seems to be that a city consists of downtown, surrounded by a vast expanse of single-family houses with lawns. This is very weird, considering that these articles are nearly always written by people who live in or near actual cities.

  4. I’m just shocked that the New York Times mentioned jobs. Roger Noll and the rest of the Econ profs might want to take note.

    1. Some casual reading might suggest to you that cities have jobs whether there is a ballpark or not.

      1. And some reading of Noll and other “econ profs” would show that a lot of them do look at job impact (or at least income impact — I don’t know if there’s an easy way to show if the same money is being spread around to more people) and find essentially zero impact on a citywide basis. What are you talking about, Ben?

  5. To pick nits, I’m not sure you can claim stadiums cause no economic development but spark gentrification. The two are kind of a description of the same thing, just with different connotations.

    In general, stadiums follow economic development/gentrification, not create it. This makes sense–sports teams want to sell tickets to rich people. To do so they want to put their stadium in places that are easy for rich people to get to. If your stadium 10 minutes from someone’s office they are certainly more likely to attend a game, but also more likely to buy a condo there.

    There are a few stadiums that didn’t follow development/gentrification. For example, the original of the current era, Camden Yards. It certainly hasn’t created much either.

    1. “To pick nits, I’m not sure you can claim stadiums cause no economic development but spark gentrification.”

      They can *shift* economic development. That’s often sufficient to cause gentrification, at least in a specific area. But otherwise we’re in agreement here on the rest.

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