(Publisher’s Note: LVSportsBiz.com will be talking sports-business with KSNV News 3 Sports Anchor Randy Howe Sunday night after the 11 p.m. news, so tune in.)
By ALAN SNEL
LVSportsBiz.com
I walked the concourse at Cashman Field during several recent Las Vegas 51s ball games and I’ll be the first to say (check that, second to say behind 51s President Don Logan) that the Triple A baseball team deserves a new ball yard to replace antiquated Cashman. Most of the seats are actually in metal benches and the training and player development facilities are not up to Triple A standard at this downtown Las Vegas venue.
It’s completely understandable that Howard Hughes Corporation, the 51s’ owner, would want to build a new $150 million ballpark that just happens to be in its business district called Downtown Summerlin that just happens to be in its master planned community known as Summerlin.
It makes perfect business sense — the new Triple A ballpark will be a tremendous amenity for Howard Hughes Corp. to promote its valuable assets of Summerlin and Downtown Summerlin.
But here’s the thing. How does the Las Vegas Convention and Visitors Authority (LVCVA), the local tourism agency, justify giving Howard Hughes Corp. an $80 million payout in the form of a so-called ballpark naming rights deal when the agency’s job is to attract tourists to this market? Really, how many tourists come specifically to visit Las Vegas for the sole purpose of watching their favorite hometown Triple A team play the 51s in Las Vegas?
In effect, the tourism public agency charged with luring visitors to Las Vegas gave $80 million of Southern Nevada’s public money to a national Texas-based land developer that generated a stunning $1.1 billion in total revenues in 2017, including a healthy chunk of income from its various master planned communities in Summerlin, Texas and Maryland. And a look at the operating incomes of Howard Hughes’ master planned communities shows Summerlin is the most lucrative one by far in 2016 and 2017. You can check out Howard Hughes Corp.’s financials here.
Here’s the total revenues info:
The LVCVA will be spending the next 20 years paying this land developer $4 million annually — a ballpark naming rights payment far beyond the going rate for a minor league baseball park. (The LVCVA said it was losing millions of dollars annually operating the Cashman complex, so it argued those losses would end with the new Summerlin ballpark and somehow that explanation justified giving Howard Hughes the land developer/Triple A ballclub owner an $80 million naming rights payment.)
And I guarantee that Howard Hughes Corp. will use its new publicly-subsidized Las Vegas Ballpark (some name for a new ballpark in Las Vegas, eh?) to promote its master planned community, Summerlin, and to make Summerlin even more valuable.
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To limit the news attention on this $80 million payment to Howard Hughes Corp., the LVCVA decided to have its board vote on the deal Oct. 10, 2017. Does that date ring a bell? It just happened to be the morning of the Vegas Golden Knights’ first-ever regular season home game at T-Mobile Arena, the emotional home-opener nine days after the Oct. 1 mass shooting massacre on the Strip. In other words, the naming rights deal approval was overshadowed by a much bigger news event that same day. Nice job, LVCVA, by using the Knights’ home-opener to divert attention to the ultra-sweetheart deal you served up to Howard Hughes Corporation.
The LVCVA made Howard Hughes Corp.’s Summerlin development more valuable thanks to its $80 million “naming rights” deal, while we all try to figure out how paying a land developer to help build a Triple A ballpark in the Las Vegas suburbs amounts to furthering tourism in this market.
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Speaking of tourism and sports stadiums, it will be interesting to see what the breakdown is for the percentage of Nevada residents who pay for personal seat licenses for reserved seats at the Raiders’ $1.8 billion domed football stadium compared to the percentage share of non-state residents. There’s about 50,000 reserved seats in the venue being built on 62 acres on the west side of I-15 across from Mandalay Bay.
For the 7,000 or so club seats at the Raiders stadium, the breakdown was 73 percent Nevada residents buying club seat personal seat licenses, while 27 percent of the club seat PSLs were purchased by fans outside the state.
I suspect the breakdown of fans buying reserved seat PSLs will be closer to a 50/50 split between local Las Vegas area residents and non-Nevada residents. Keep in mind, the 65,000-seat Raiders stadium was the creation of a tourism-focused committee, which is why hotel room revenues are paying for the public’s $750 million contribution to the venue’s construction. And Southern Nevada leaders expect the stadium’s events — especially new sports and music events — to also draw tourists to create extra economic spending above levels this market is seeing now.
Check out the latest on the Raiders stadium construction.
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No sports market pulls off “sportstainment” events like Las Vegas, which is why the Mayweather-McGregor spectacle was staged here last year.
And this year’s version of Mayweather vs. McGregor is Tiger vs. Phil in a golf showdown in Las Vegas.
Tiger Woods is performing well this weekend with a 5-under-par 66 Saturday at the British Open, and creating more buzz for his one-on-one event with Phil Mickelson in Las Vegas.
Personally, I’d like to see pro golf promote the sport’s young guns like Jordan Spieth more than trotting out a Tiger vs. Phil event.
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If you’re in the sports/entertainment/PR business, you might have heard rumors and scuttlebutt that the Madison Square Garden arena project called the MSG Sphere behind the Venetian and Palazzo is looking to add an NBA team to its music-based venue.
But LVSportsBiz.com hears from Madison Square Garden that the Sphere is not being designed with sports locker rooms, scoreboards or a court with seating on four sides. In fact, the interior design shows a stage with seats facing it and no plans for an NBA court, Madison Square Garden says. There could be e-sports competitions because of the high-tech, futuristic design of the Sphere, but the NBA is not being courted.
That’s sweet news for MGM Resorts International CEO Jim Murren, who was hanging out with NBA Commissioner Adam Silver during NBA Summer League in Las Vegas last week. Murren wants an NBA team for T-Mobile Arena as a third major tenant and brought the WNBA to Mandalay Bay Events Center to show the NBA that Las Vegas is worthy of professional basketball.
Las Vegas Sands Corp. is also kicking in $75 million to the Sphere project, while Oak View Group executives Tim Leiweke and Irving Azoff are also consulting on the arena that is supposed to open in 2020. As the former Anschutz Entertainment Group (AEG) CEO, Leiweke ran the downtown Los Angeles Staples Center.
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LVSportsBiz.com will be at Sunday’s Las Vegas Aces 3 p.m. game at Mandalay Bay Events Center. The Aces, led by the tandem of star rookie A’Ja Wilson and veteran sharpshooter Kayla McBride, started the season, 1-7. But the Aces have turned things around and are now 11-13, only one game out of the last playoff position.
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