Why new stadiums aren’t better places to watch sports, in two photos and a french fry story

I took in the Argentina-Ecuador soccer match in New Jersey on Tuesday night, which was my first chance to see the now five-year-old stadium that the New York Giants and Jets built to give themselves a more luxurious setting than the old Giants Stadium across the parking lot. And I’ve gotta say, my initial reaction was much like my first visit to the new Yankee Stadium: They spent more than a billion dollars for this? I mean, here’s the view from our seats:

met-lifeIt has a ribbon board, and those big video screens in the corners, and obviously a bunch of luxury suites and clubs that I didn’t have access to. (Also, yes, that’s snow that you see falling. No more outdoor sporting events in March for me.) But overall, for average fans there’s nothing particularly better about actually watching a game here over the old place — in fact, from the end zone seats it didn’t feel all that different from being at one of the old “concrete donut” multipurpose stadiums like Veterans Stadium, only with more cupholders.

And as for being out of the seats, which is where modern stadiums with their massive footprints are supposed to shine, things were if anything even worse. Here, for example, is the view of the concessions concourse during halftime:

met-life-halftimeYes, soccer halftime is always a madhouse since no one wants to leave their seats during the action and risk missing the only goal, but this was beyond awful. After fighting my way through a crush of people to find the end of one concessions line — but allow me to just quote the customer survey that the stadium people kindly requested that I fill out after I attended the game, no doubt not knowing what they would be in for:

The staff were all fine. The logistics, however, were a nightmare: It took us forever to find our way to our seats (on the 200 level opposite the train station, requiring that we climb to the 300 level then come back down again) and find our way back to the train, the crush to leave after the game was appalling (despite only 48,000 fans in attendance), the concessions lines were the worst I’ve ever seen at any stadium, and the concessions stands were incredibly backed up at having enough food. (Some of this may have been because it was soccer when there’s a big halftime rush to the concessions, I understand, but maybe plan ahead for this a little?) And fortunately we were under an overhang, or it would have been miserable sitting in the rain and snow, especially with your no-umbrellas policy. Also, the ad signage was so irritatingly ubiquitous (video ads even during play, really?) that even my 12-year-old son, who *likes* commercials, was complaining about it.

I’m not sure what to suggest, as a lot of these problems seem inherent to the stadium design, but hiring more staff to direct people and way better signage would be a start. I’d go to MetLife Stadium again if some event I absolutely had to see was happening there, but I wouldn’t be happy about it. And next time I wouldn’t bother to try to get french fries.

This has been the most surprising discovery of my years of research into the new-stadium game, and one I have to keep explaining to people: New sports venues, on the whole, kind of suck. They’re far more geared toward serving luxury customers — who are the ones willing to pay the big bucks that justify these buildings, when they can be justified at all beyond the desire for public subsidies — than toward things like making sure that people can line up for the restrooms without creating a traffic jam. It’s not so much that stadium and arena designers are doing a bad job — though in many cases they arguably could be doing far better — as that making for a better fan experience is fundamentally not the goal of these places. Separating fans from their money, especially fans with lots of it, is, and despite anything you may have heard about the free market supposedly reflecting the demands of customers, there isn’t always a direct alignment.There are many reasons why we’ve seen a rash of new stadiums and arenas in the past 30 years, but one factor that shouldn’t be overlooked is that it’s a land rush to serve a new market: There weren’t that many people with tons of disposable income to blow on upscale ballpark food in the 1970s, whereas now, well, we all know what’s happened. I once wrote an article for the late, lamented Village Voice sports section that talked about A-Rod’s then-record salary and suggested blaming it all on Ronald Reagan’s tax cuts for the wealthy; that was an oversimplification then, and even more so now that we know that much of the rise in inequality was actually the result of Reagan’s SEC rules, but if you want to shake your fist at someone for having to pay higher ticket prices for a lousier experience, you could certainly pick a worse target.

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Cubs sued by apartment owner, NY Giants sued by zombie Lehman Brothers

The owner of an apartment building across from Wrigley Field is suing to block the Chicago Cubs‘ planned hotel construction on the grounds that the city council didn’t follow proper zoning rules, and that its approval of the project was “arbitrary and capricious.” Read the complaint here if you like; I don’t know enough about Chicago zoning law to say whether it has any merit, but given that the landlord is seeking just $6 million in damages on a $500 million project, this seems at worst something that can be settled out of court.

And anyway, that wasn’t even the craziest stadium-related lawsuit filed yesterday. That honor would go to Lehman Brothers suing the New York Giants over canceled interest-rate swap contracts that were used to hedge the team’s stadium bonds. Yes, that Lehman Brothers. Yes, I sort of understand what interest-rate swap contracts are. No, I don’t understand exactly what the lawsuit is over, though apparently it has to do with who had to pay whom how much when the interest rate swaps were cancelled because Lehman was suffering total existence failure; what’s left of Lehman thinks it’s owed $94 million plus interest, while the Giants think … well, the Reuters article in question doesn’t actually say what the Giants think. And given that it also says that Met Life Stadium is both wholly owned by the Giants, and also jointly owned by the Giants and Jets, neither of which is actually true (it’s owned by the state of New Jersey — hello, no property taxes! — and jointly operated by the two teams), maybe we’ll just have to wait for someone else to explain this. If we really care beyond “Giants being sued by zombie financial company.”


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MetLife inks Jersey naming rights deal for … some number of millions

The MetLife naming-rights deal for the New York Jets and Giants stadium is now official, with a 25-year agreement worth a reported $17 to 20 million a year. It’s unclear whether this means the payments vary, or news reports are just guessing about the amount — or, for that matter, whether the dollar figures are based on anything other than previously reported guesses.

This is actually an upgrade for MetLife, which previously was paying $7 million a year for advertising rights to a corner of the stadium. Instead, it will now get not only the name of the stadium (which will host the 2014 Super Bowl), but “120,000 square feet of branded space at the stadium’s main entrance,” according to the Newark Star-Ledger.

The uncertainty over the price and the inclusion of ad space at the entrance makes it tough to compare the dollar figures here to other naming-rights deals, but it’s fair to say that this is a sign that the naming-rights market is returning to life, after most corporations sat it out the last few years during the recession. (With some notable exceptions.) As MetLife chief marketing officer Beth Hirschhorn explained her company’s big buy: “MetLife has near ubiquitous brand awareness. This helps raise our top of mindedness.” Not to mention their neologismshare.

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Met Life to pay $20m/year for Meadowlands naming rights?

The New York Post is reporting that the New York Jets‘ and Giants‘ year-old home will become MetLife Stadium under the terms of a naming-rights deal to be announced in the next week. According to the paper, MetLife’s payments “could range as high as $20 million year for 20 years” — though of course, we’ve heard that before.

The main interest here is that, if true, it means that the market for naming rights has rebounded a bit after the economic collapse, which would seem to bode well for other teams (or cities) trying to raise funds by selling their stadium name. At least, if your city is the largest media market in the U.S., and your stadium has two NFL teams playing in it.

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Giants, Jets host city: We’d like our property taxes now

Hey, remember how the town of East Rutherford was threatening to charge the New York Jets and Giants property tax on their new stadium, way back when the building was first approved in 2006? Well, East Rutherford Mayor James Cassella has stopped issuing threats and started issuing invoices:

The New Jersey town of East Rutherford has sent the Giants a $745,000 bill for taxes on a practice complex built on the same site as the stadium. The community plans to levy taxes on the stadium next year if it’s successful collecting them on the training facilities, Mayor James Cassella said.

“We believe the new stadium built for the Jets and Giants and the training facility should be taxable,” Cassella told the state’s Local Finance Board at a meeting in Trenton today. “For some reason, they believe they shouldn’t have to pay taxes on a private development.”

The teams insist that the state’s payments in lieu of property taxes take care of any tax bill that East Rutherford is due; Cassella disagrees, saying the stadium can be taxed like any other privately owned building. Meanwhile, I haven’t been immediately able to track down what happened to the clause in the team’s originally proposed lease that would have forced the New Jersey Sports and Exposition Authority to pay any added tax bill for the teams. If it’s still in place, that would be bad news for New Jersey taxpayers — especially considering that the Authority is already flat broke. Gee, thanks, new stadium lease!

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Sports bubble watch: Fans priced out by PSLs say they won’t be back

The New York Jets, it turns out, had the same problem in their home opener last night as the Giants did the previous day: several thousand empty seats, all in the pricey sections that require fans to shell out for personal seat licenses to buy tickets.

Harvey Araton in today’s New York Times, though, looks not at the empty seats, but at the people who aren’t sitting in them:

In [Judy] Staubo’s case, after making a quick decision not to pay $20,000 for each of the family’s six seats in 2008, she did initially agree to buy four seats in the upper deck that carried a $1,000 P.S.L.

“They sent me my assignment — the last four seats in the last section,” she said. “I said, ‘Wow, what a slap in the face.’ All those years, all that loyalty, and what they were telling me was, ‘You don’t matter.’ And I said, ‘O.K., I‚Äôm out.'”

Now, in free-market fundamentalist terms, this is all well and good: Previously a spot on the Giants’ season-ticket list was something that longtime fans hoarded and newbies had to endure a decades-long waitlist to get; now, anyone with sufficient cash can buy their way to the lower level, and the team gets to reap the proceeds. It all works perfectly — so long as you believe that the most sensible way to decide who gets to see a football game (or see it from the same atmospheric layer is based on who has the most capital to invest up-front in ticket rights.

One who disagreed with this notion, Giants fan Lou Palma, told Araton he not only gave up his seats but refused a ticket to the home opener on general principle:

“I will not go,” Palma said. His only contact with the Giants will continue to be e-mails to officials that contain insights and opinions they won‚Äôt want to hear.

“I sent a column in The Times that talked about libraries closing in Camden while the taxpayers are stuck with the debt on the old stadium,” Palma said. “I got back an e-mail from the vice president of marketing. He said, ‘Take me off your e-mail list.'”

It’s not quite talking about a revolution, but there does seem to be a growing anger at sports teams for inaccessible ticket prices. The question is whether consumer outrage will grow to the point where those empty blocks of seats force teams to adjust their pricing structure. Probably not — but it has already hit the non-football Eagles.

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Giants open new stadium before 5,000 empty seats

The New York Giants home opener at New Meadowlands Stadium yesterday wasn’t blacked out, but it wasn’t sold out, either:

One mezzanine section right at the 50-yard line – $12,500 PSL, $500 game ticket – and one section at around the 5-yard line – $7,500 PSL, $400 game ticket – had just a handful of fans in them. There was an entire row in a section in the corner of the end zone on the mezzanine level that was empty.

Directly behind the Giants bench, one section of the Coaches Club – $20,000 PSL, $700 game ticket – looked like it was pretty well sold out, but the sections next to it had some good seats still available. And it’s not like the seats were empty because the fans escaped the rain and remained in the cozy club lounges.

The Giants announced the paid attendance at 77,245. That means about 5,200 tickets were unsold: club seat PSLs, suite tickets and seats that were once designated to comply with the Americans With Disabilities Act that are now available as regular seats.

Club seats and suites don’t apply to the NFL’s blackout rules, but the fact that so many remained empty indicates that we’re heading toward another New Yankee Stadium situation, where cheap seats sell out but the pricier ones go wanting. I’ll leave it to economists smarter than me to explain why this would be a rational pricing strategy, but it sure seems like it’s the new trend, in New York sports edifices, anyway.

We’ll see how things go tonight for the Jets when they stage their own home opener at the Meadowlands — reportedly they’ve sold out their non-premium seats, but that’s not the same as having all the seats filled.

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Times fumbles ball on Giants Stadium debt

I’ve beaten up on New York Times sportswriter Ken Belson plenty before in this space, in large part because of his failure to fully investigate the rosy economic claims of stadium boosters. So you’d think it’d be good news that today Belson tackles the troublesome fiscal legacy of New York-area sports stadiums:

It’s the gift that keeps on taking. The old Giants Stadium, demolished to make way for New Meadowlands Stadium, still carries about $110 million in debt, or nearly $13 for every New Jersey resident, even though it is now a parking lot.

The financial hole was dug over decades by politicians who passed along the cost of building and fixing the stadium, and it is getting deeper. With the razing of the old stadium and the Giantsand the Jets moving into their splashy new home next door, a big source of revenue to pay down the debt has shriveled.

New Jerseyans are hardly alone in paying for stadiums that no longer exist. Residents of Seattle’s King County owe more than $80 million for the Kingdome, which was razed in 2000. The story has been similar in Indianapolis and Philadelphia. In Houston, Kansas City, Mo., Memphis and Pittsburgh, residents are paying for stadiums and arenas that were abandoned by the teams they were built for.

And so on. Only one problem: Whether the debt on an old stadium is paid off before it’s demolished doesn’t matter one whit. While “Whattaya mean, we’re still paying for that pile of rubble?!?” is a natural reaction, it doesn’t make much economic sense. Stadium debt is, when you come down to it, a bookkeeping measure — the construction expense is sunk the moment you sign the contract to build the thing. The rest is just a matter of (in a manner of speaking) what kind of mortgage your municipality wants to take out.

If the state of New Jersey had chosen to pay off Giants Stadium by selling 20-year bonds, in other words, it still would have represented the same expense to the public — but since the bonds would have been retired faster, suddenly it wouldn’t make Belson’s hall of shame. That’s nonsensical. If cities shifted to paying for their stadiums with suitcases full of twenties, would that make them better deals?

The problem with tearing down stadiums early isn’t the debt, it’s the revenues that you’re giving up by allowing teams to move into new buildings with sweetheart leases. As Belson notes late in his piece, the old Giants Stadium generated about $20 million a year for the state; at the new one, the Jets and Giants supply only $6.3 million a year in lease payments. That’s a real cost, and one that could have been avoided if the state hadn’t agreed to rent public land to the teams so they could build a new stadium and get out from their Giants Stadium lease.

The real scandal here isn’t how debt service is financed, but rather that cities and states are tearing down perfectly functional stadiums just so that teams can stop paying rent, costing taxpayers millions. Now there’s a headline I’d like to see in the Times.

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Forbes: Jets and Giants will make a mint, barring lockout

The freshly validated Forbes team value estimates for the NFL are out, and there are two main stories: One, average team values have fallen for the first time on record, thanks to the sucky economy. And two, the New York Jets and Giants are worth more thanks to their new stadium, but the debt they took on for it puts them at risk if there’s a lockout in 2011:

Every team would suffer, but “a lockout would affect the Giants and Jets probably more so than any other NFL franchise,” [Forbes senior editor Kurt] Badenhausen said.

“The Giants’ and Jets’ built-in costs of servicing debt are so much higher. If we have a lockout, they still have to pay the interest on their debt, even if nobody’s buying a ticket.”

Of course, the other way to look at this is that here’s another benefit of teams putting up their own money for stadiums: They have an incentive to actually play football, instead of shutting down the sport every time they want to win a bargaining victory over the players’ union. Not that the Giants and Jets owners are likely to have that much sway over NFL labor tactics, but we can dream of world where franchises pay their own stadium debts, and take on their own risks…

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Giants reverse course, offer PSL-free seats for sale

Hey, remember how the New York Giants swore that they’d be able to sell out their high-priced PSLs by opening day? Well…

After insisting for months they had no more non-premium PSLs available and fewer than 1,200 premium PSLs left, the Giants yesterday quietly announced plans to sell single-game tickets without PSLs through Ticketmaster.

The sure-to-be-controversial plan starts today, when existing PSL holders get first dibs on what the team described in a news release as “a limited number of individual game tickets for the Giants’ eight 2010 regular season games.”

What is certain to cause hard feelings will come Monday, when fans who did not buy PSLs — which started at $1,000 for the Giants — will have the chance to buy single-game tickets without the PSL requirement.

The controversy, of course, is that Giants fans have been buying PSLs after being told by the team that this would be the only way to get tickets. This won’t be as bad as 15 years ago, when the Oakland Raiders only managed to sell half their PSLs and ended up selling the rest of their seats as individual tickets, but it’s still likely to anger many PSL buyers, and potentially open the door to lawsuits.

Giants owner John Mara tried to downplay the controversy, insisting that these were just a handful of extra seats held back to comply with ADA rules and ensure that all season ticket holders had seats, and adding, “We never said that we wouldn’t sell single-game tickets. But we didn’t advertise it.” Which would be a better defense if the Giants hadn’t posted this on their own website in 2008:

The so-called PSLs, one-time payments that guarantee the purchaser associated rights to purchase Giants season tickets, will be part of the purchase price for every stadium seat in the new building.

If nothing else, it’d be interesting to see what the FTC has to say about this.

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