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April 28, 2010

Devils arena creates development, except for the actual development part

Ken Belson, the New York Times' favorite rose-colored sports business reporter, has an article today headlined "Devils' Move Paying Off for Team, and Newark." For the team, no duh — after all, the Devils got $358 million in public money to help build the place. As for the city, Belson's evidence comes down to this single paragraph:

The additional foot traffic has helped generate nearly $15 million in economic activity and helped created 708 jobs in Newark, on top of the 1,400 people who work in the arena when there are events. Marriott plans to break ground on a new hotel in September. Several housing developments and a park across from the arena are planned. A few sports bars will open on a street adjacent to the arena.

Belson doesn't give a source on the job-creation stats, but presumably they come from an economic impact report by the city, and we all know how unreliable those numbers can be. As for the rest, I last walked the area around the Newark arena the summer before last, and I described what I saw at the time (for a magazine that subsequently folded before my article ran) as:

The building is surrounded on three sides by parking lots, on the fourth by vacant storefronts. A large "Going Out of Business" sign looms across the street, advertising a furniture store that's been forced out after 85 years when the city took its building under the threat of eminent domain. Jack Stoecker, co-owner of the Green Street Cafe adjacent to one of the parking lots, says, "Hockey nights I'm sold out"; a block away from the arena on Market Street, meanwhile, merchants say they seldom see spillover business from fans, who prefer to go straight from their cars to the game.

That was pre-economic collapse, though it's certainly possible that, as Belson concludes, "the real gauge of the arena's success will coming in the next few years, as the economy recovers." Still, "too soon to tell" is a far cry from that cheery headline.


figures don't lie, but liars can figure.
another municipality enriches franchise owners at the expense of taxpayers...

Posted by paul w. on April 28, 2010 12:46 PM

Are you kidding me?

"Jack Stoecker, co-owner of the Green Street Cafe adjacent to one of the parking lots, says, "Hockey nights I'm sold out"

It does make sense that when the Arena hosts an event the local business' thrive. Sports does create revenue and gives the fans identity for their city/state.

Ask the fans of Seattle and the business' how they're doing since the Sonics left to become the Thunder. They get no business.

I also bet you that the City of Los Angeles is pissed they didn't front a lot of the money/bonds for Staples Center. AEG makes a killing and want to privatize there own football stadium.

I can get your arguments for football stadiums since they're way more expensive and use barely any dates in the entire year. But for Basketball/Hockey arenas, they work. I would also say the same for Baseball Stadiums because they play so many dates which generate revenue.

The only people you can blame the City Councils that agree to shitty leases. (ex. INDIANAPOLIS)

Posted by Wow Neil on April 30, 2010 05:13 PM

Arenas are undeniably better than stadiums for ancillary development — if they're in use 200+ nights a year. That doesn't describe the Prudential Center, though it'll come closer the years the Nets play there. And even then, it's hard to run a business just based on foot traffic for a couple of hours a night, half the nights of the year.

As for Seattle, I'm sure businesses near KeyArena are sad that the Sonics left. For those in Capitol Hill or Queen Anne or downtown, however, I'd bet they either haven't been hurt or are doing better — since locals are no longer dropping money on NBA tickets, they have it to spend on other things instead.

I'm reminded yet again of the comedy club owner in Toronto during the 1994 baseball strike, who said, "We're doing great! We hope hockey goes on strike too!"

Posted by Neil on April 30, 2010 05:40 PM

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