August 24, 2011
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.
August 19, 2011
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.
September 20, 2010
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!
September 14, 2010
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’m 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’t 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.
September 13, 2010
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.
September 08, 2010
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.
August 26, 2010
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...
August 19, 2010
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.
August 17, 2010
New Meadowlands is grey, expensive, video-filled
The new kajillion-dollar Jets and Giants stadium in the New Jersey Meadowlands opened on Monday night, and the reviews are decidedly mixed:
- The Jersey Journal calls it "metallic and neutral," praises the numerous hi-res video boards, and notes that the seats are "much further from the field than in the old building."
- The New York Daily News says fans like the sightlines and video screens, but not the high concession prices.
- The Newark Star-Ledger reports that one fan says "it's beautiful" and the food lines moved fast, but tickets were too expensive and the cell phone service was "spotty."
The grey decor is intentional, so as not to give either team an advantage in terms of team colors, though it's already drawn complaints before this. Ditto the high prices. As for the cell phone service, maybe the Jets and Giants could subcontract with the New York City subway system to improve on that.
June 11, 2010
Adultery site bids for Giants/Jets stadium name; fieldofschemes.com ups the ante
The sports blog world was much agog yesterday over the prospect of the new New York Jets and Giants stadium possibly being named after a website that has variously been described as a "website that promotes extramarital affairs" and "the dating site for adulterers." (Its slogan: "Life is short. Have an affair.") According to the website's CEO, he's willing to offer $5 million a year for a five-year deal to slap his site's name on the teams' new stadium.
Now, the odds on the Jets and Giants accepting are pretty much zero, but the CEO in question probably doesn't care about that, since he's just gotten his URL printed in dozens of newspapers by doing little more than issuing a press release. (Which is why you'll note I haven't actually mentioned the site's name — fieldofschemes.com's ad rates may be cheap, but I draw the line at free.)
Looked at that way, it's a brilliant move, and I don't see why I, for one, should let the opportunity pass to cash in as well. So, without further ado: Fieldofschemes.com hereby offers the Giants and Jets $20 trillion a year if they will name their new stadium "The Meadowlands Field of Schemes at Fieldofschemes.com Field." This is a serious offer, as evidenced by the fact that I used "trillion" and not "kajillion" or "kersquillion" in the announcement.
USA Today, you know where to find me.
May 27, 2010
New York gets Super Bowl, promised rain of money, snowballs
In case you missed it, the NFL awarded the 2014 Super Bowl to the new New York Jets and Giants stadium on Tuesday night, setting off a media frenzy in the capital of what's left of the news media. For sheer hype, you'll of course want to turn to the New York Post, which asserted, among other things:
The Super Bowl could pump $500 million into the metro-New York economy, according to some estimates.
The vote was a clear nod of appreciation to the Giants and Jets for building a state-of-the-art, 82,500-seat stadium without having tapped public funds.
Errrr, it was certainly a reward for building a new stadium, which is what the NFL does to get these things built. But "without having tapped public funds" isn't exactly true, given that the stadium got free state land and property tax breaks — and in any case, since when does the NFL want to reward its teams for putting up more of their own money and extorting less from taxpayers?
On the subject of that $500 million for the "local economy," meanwhile, ESPN's Peter Keating talks to some economists who say it's a load of crap:
In 1999, for example, Phil Porter of the University of South Florida, looked at six Super Bowls at three different venues and concluded there was "no measurable impact on spending." In 2006, Robert Baade of Lake Forest College and Victor Matheson of the College of the Holy Cross found that on average, Super Bowls generate about one-fourth of the impact projected by the NFL, and that two cities -- Atlanta in 2000 and Tampa in 2001 -- actually lost money on the game.
I've talked to Porter frequently, so I know there's one caveat to these figures: He looked at warm-weather sites, and needless to say, hotel rooms in New York in February are slightly less packed to the gills than they are in Miami. Still, there's likely to be some crowding out of other visitors for the Super Bowl — New York is pretty hopping with tourists at all times of year — and Matheson's point holds true that "the magnitude of the economic impact would depend a lot on how willing fans were to get away from the game and spend money on things like Broadway shows."
Meanwhile, other outlets focused on different angles, with Bloomberg News noting that the announcement means the teams could get more money for naming rights to the stadium (which New Jersey gave up its stake in, you'll recall, as part of the final stadium deal), while the New York Times notes that it snows in New York in February, and fans might throw snowballs. Which is probably the weakest attempt of the day to find a Super Bowl-related excuse to rehash an old news story rattling around the archives, but at least it beats printing economic misinformation.
April 26, 2010
Meadowlands stadium slammed for pillars, grey decor
More reviews are coming in on the New York Giants' and Jets' $1.6 billion new stadium, and glowing they ain't:
- The New York Post reports that the end zone sections have numerous seats obstructed by pillars, with one Jets season-ticket holder calling this "a joke" and a stadium architect noting that pillars were very unusual in modern stadiums. (Though obstructed views are less so.) The stadium's designer insisted that the columns were necessary to bring the upper deck closer to the field, which is certainly a legitimate goal, and that the obstructed seats were never intended to be sold. Why the teams bothered to put in seats there in the first place, though, is unclear.
- A Giants season ticket holder who got to walk through the place this weekend calls it "UNIMPRESSIVE" (caps in original), griping: "Everything is grey. The outside is grey, the floors are grey, the escalators are grey, the paint everywhere is grey, the signs are grey, the bathrooms are grey, the barriers are grey and every seat is grey." His other complaints, in declining order of seriousness (my judgment): The upper deck is farther from the field, the escalators are poorly placed, and it was windy.
If you want to check the place out for yourself without waiting for football season, you'd better like Bon Jovi or the Eagles. Or maybe next Friday's Mexico-Ecuador soccer game is a better bet, if you don't mind the Bon Jovi-sized prices.
March 18, 2010
Jets and Giants race clock to sell out PSLs
Another day, another New York Times story on the state of the sports industry, this one on whether the New York Giants and Jets will be able to sell out their personal seat licenses in time for their new stadium's opening this fall.
Times writer Richard Sandomir reports that the Giants "are about 1,500 licenses short of selling out but have been at that level for at least two months," but that a team spokesman says "sales had not hit a wall and were expected to pick up soon." The Jets, meanwhile, won't say how many licenses remain, but that sales are "going well."
Whistling through the graveyard aside, you wouldn't think that falling a few thousand seats short in an 82,500-seat stadium would make that much difference — that's what game-day sales are for, right? Except that PSLs add a new wrinkle: Since fans have been told that buying PSLs is the only way to get tickets (or the only way to get good tickets, in the Jets' case, since they're offering some PSL-free seats), they're likely to be awful steamed if they find themselves sitting next to fans who bought seats with no extra fees. That's what happened in Oakland when the Raiders couldn't sell out their PSLs and resorted to selling them as regular seats, and that's a debacle that nobody wants to risk repeating.
If I had to put my money on something, it'd be some quiet discounting of specific PSLs to try to get them to move. (The Jets already cut some prices last month, after earlier price cuts in October.) New York football fans, watch your emails for discount coupon codes...
December 28, 2009
One of the best ways to get the nostalgic fervor going for an old stadium is to have a "last game" there. The New York Giants played their last game in their old New Jersey Meadowlands home, and the NYC press corps did not disappoint with nostalgic references.
Neil Best of Newsday (link here for Newsday subscribers or those willing to pay to register) described yesterday's shellacking of the Giants by the Carolina Panthers as "the most embarrassing of their 283 games there," perhaps overlooking the 1978 Giants/Eagles game where Herm Edwards helped Big Blue snatch deafeat from the jaws of victory in a play Giants fans know as simply "the fumble." The New York Times was a bit more circumspect, with Joe Lapoint suggesting the 41-9 blowout had "the feeling of a funeral" with more than 78,000 moruners attending the ceremony.
It's not actually the last game at Giants Stadium, though as that may be played out on Sunday evening, when the Jets take on the Cincinnati Bengals in a game that is sure to fire up the forces of wistful nostalgia once again. The Bengals, many might recall from previous postings on this site, are draining the coffers of Hamilton County, Ohio, as the cost of financing the team's new "jungle" in the Queen City has caused taxpayers to dip into their pockets more than they were initially led to believe. We'll see how things work out in the Meadowlands when the new sports palace opens up for the Giants and Jets in 2010. Both teams have set seat license fees to stratospheric levels, so New York metro season ticketholders are likely to be a bit poorer in 2010.
While taxpayers tend to fund professional sports complexes in the U.S. as part of our ongoing support of private enterprise, which for some reason does not pass as "socialism," our friends to the north are debating how to get ice rinks built for, shockingly, average people to use for their own events and activities instead of for pro team use. An article today's Globe and Mail says that if a new public rink goes ahead as proposed "it will be one of the few publicly funded arenas to open in Toronto in the last 28 years." Not sure why 28 years is significant, but the construction of a publicly funded facility for something more than spectatorship sounds like an interesting idea.
November 23, 2009
Fan sues Jets, Giants over PSLs
It's way early in the legal process, but a judge has allowed a lawsuit to go forward against against the New York Giants and Jets for requiring personal seat licenses to purchase tickets at their new stadium opening next year. Harold Oshinsky, who somehow has enough money to have been a season ticket holder for both teams for the past 24 years, charges that he has an implicit right to renew his tickets in perpetuity, and can't be denied that just because he won't buy a PSL. U.S. District Judge Peter Sheridan didn't necessarily endorse Oshinsky's claim, but said he will be allowed to continue with pre-trial depositions and discovery.
Needless to say, if Oshinsky were to win, this would have huge impacts for stadium financing plans, especially in the NFL, where PSLs are most common. That said, Sheridan didn't sound exactly encouraging in his language, though he did take time to note that “it is common knowledge that professional sports franchisees have a sordid history of arrogant disdain for the consumers of this product.”
August 31, 2009
Sports bubble watch: Giants, Jets seats still selling slowly
More on the previously reported difficulties the New York Giants and Jets are having selling tickets at their pricey new stadium opening next year, this time courtesy of the New York Times:
The Giants, who still have seats to sell for some games this season, have not found buyers for about 3,000 club season tickets for 2010, some in the best locations at the highest prices.
And the Jets lag behind the Giants. They said they still had "a few thousand" season tickets remaining for 2009 and were advertising half-season packages...
Jim Lites, a senior consultant contracted by the Giants to sell seats in the new stadium, acknowledged that the recession and the higher ticket costs for 2010 were having a chilling effect.
"There is a point at some price that people won't purchase a product," Lites said. "It's still a bit of sticker shock. There has been some pushback on the price."...
Albert Cruz of Hastings-on-Hudson, N.Y., had a similar reaction when he was asked to renew his Jets season tickets for next year. He has sat in the fourth row for 25 years, he said. His tickets cost $90.
For next year, he said, he was offered midlevel seats with P.S.L.'s from $8,000 to $9,000 and per-game prices of $400 to $500.
"They're just too darn expensive," Cruz said. "As a loyal fan, I feel shafted."
Both teams say they'll sell their remaining tickets by next fall, but given that the Giants have already run through what had been a 20-year-plus waiting list, you have to figure they'll need to resort to price cuts or two-for-one deals to get there. And as we've seen before, that tends not to sit well with those who paid full price.
June 18, 2009
Giants sell naming rights to left shoulder
The ever-evolving naming-rights market took a new turn yesterday with the announcement that the New York Giants have struck a $35 million, 15-year deal to rename their new practice facility the Timex Performance Center — as part of which the team will wear a Timex patch on the left shoulder of their practice jerseys. The NFL recently okayed corporate logos on practice uniforms only, though you have to wonder if it's a slippery slope that's inevitably headed toward this.
June 02, 2009
Sports bubble watch: Giants waiting list has evaporated
In a Newsday column mostly about the lagging naming-rights market — both the Dallas Cowboys stadium opening this year and the New York Giants and Jets stadium opening in 2010 still haven't found buyers for their stadium names — sports business writer Neil Best reveals this tidbit as well:
The Giants are further along in their sales process but still have personal-seat licenses available at club levels for $20,000, $12,500 and $7,500 &mdash ones that come with game tickets at $700, $500 and $400.
Johnson and Mara expressed confidence that they will be sold out before the 2010 openers. But Mara confirmed that the Giants have moved through their notoriously long waiting list and that tickets now are available to the public.
What this means is that at least 60,000 Giants fans have been offered the chance to buy season tickets at the new place, and replied, "Not at those prices." See why I'm concerned for Santa Clara?