Sports Facility Reports, Volume 1, Number 1 (Spring 2000)

Sports Facility Reports, Volume 1, Number 1 (Spring 2000)

Volume 1, Number 1
(Spring 2000)

THE SPORTS FACILITY BOOM

by: Paul M. Anderson, Editor

Fifty-seven teams in the United States four major professional sports leagues (i.e. Major League Baseball (MLB), the National Basketball Association (NBA), the National Football League (NFL), and the National Hockey League (NHL)), are playing in new facilities built between 1990 and 2000. In addition, ten teams built new facilities in the 1980s, fifteen teams renovated their current facility in the 1990s, thirteen teams will begin play in new facilities in the early part of the new century, and fifteen teams are actively seeking to renovate their current facility or to build a new facility. In fact, by 2005, approximately 84% of these major professional sports league teams will be playing in a renovated or new facility completed after 1980.

This proliferation of sports facility construction is often termed the "sports facility boom." Estimates of its total cost to the public will approximate $9-10 billion by the year 2010. Many justifications have been offered to explain this boom:

 

  • (1) The "obsolescence" theory proposes that, because the facilities being replaced were built in the 1970s or earlier, it is more cost efficient to replace the facility than renovate it to meet current standards. These older facilities are obsolete because they do not contain the luxury suites, concession areas, and other fan amenities necessary to generate the revenues to survive in professional sports today.
  • (2) The "edifice" theory offers that a new facility can be more than merely the home for the team. It can become the focal point for community development by encouraging commercial and residential interests to relocate to the downtown area.

  • (3) The "expanding attendance" theory argues that a new facility will automatically increase attendance for a team based on the novelty and increased amenities for fans associated with the new facility.

  • (4) The "competitive balance" theory reasons that new facilities are needed to provide teams with the revenue necessary to allow them to compete successfully in leagues experiencing significantly rising player and other costs.

  • (5) The "increasing cost" theory demonstrates that as franchise fees and values rise, owners must have new facilities to realize revenue streams that will allow them to receive an attractive profit on their investment

Regardless of the specific reason, most experts argue that this sports facility boom will continue in the future. In fact, teams with facilities that are not even 15 years old (e.g. the Milwaukee Bucks and Charlotte Hornets) have already begun to seek ways to renovate their homes or to build new facilities to enhance their revenue generating potential.

The purpose of these Sports Facility Reports ("SFR") is not to take sides in the debate concerning the construction of such facilities. Through this bi-annual publication, the National Sports Law Institute ("NSLI") of Marquette University Law School will provide information concerning the sports facility industry. A basic part of each issue will be the "Facility Update Charts" that will provide information about teams in the four major league team sports. In addition, SFR will provide (1) Stadium History Charts (this issue provides the second half of the MLB Stadium History chart that started in For The Record: the Official Newsletter of the National Sports Law Institute, Vol. 11, No. 1, pgs. 5-7); (2) information about the sports facility boom at the minor league level; (3) studies of the public/private contributions made to finance sports facilities; and (4) studies of escalating franchise fees and team values. SFR will also provide insight into current issues affecting the sports facility industry.

Issues of Sports Facility Reports are available online at the National Sports Law Institute's website at . To receive SFR send an email request to munsli@marquette.edu, fax a request to (414) 288-5818, or call (414) 288-5815.

FACILITY UPDATE CHARTS

Major League Baseball
National Basketball Association
National Football League
National Hockey League

Sports Facility Reports is a newsletter published twice a year (spring & fall) by the National Sports Law Institute of Marquette University Law School, PO Box 1881, Milwaukee, Wisconsin, 53201-1881. For further information contact the NSLI by phone at (414) 288-5815, by fax at (414) 288-5818, or by email at munsli@marquette.edu. Upon request, this publication is distributed via email to individuals in the sports field.

Editorial Staff: Matthew J. Mitten, Professor of Law & NSLI Director
Paul M. Anderson, Editor & Designer, NSLI Associate Director
Contributors to Volume 1, Number 1: Kirsten Hauser, Eugene Laflamme, Daniel Miller, Ben Menzel, Keith Miller, Basil Loeb, Craig Pintens, Kevin Stangel