The economy hits the venue industry as three new luxury venues open their doors. Dallas Cowboys, New York Yankees, and New York Mets spent the last two years building luxury stadiums totaling $3.5 billion. Teams made plans for luxury when times were good but they are now faced with some roadblocks. Who can afford $2,500 a seat tickets? What companies (especially those with TARP money) can put down thousands for that luxury box? Or what about the millions it takes to get naming rights on one of these venues?
Bank of America has backed out of talks with the Yankees regarding naming rights. Citi has assured everyone that not TARP money will be used in the $400 million deal over naming rights for the Mets stadium. Jerry Jones, Cowboy Owner, entertained the idea of a $ 1 billion naming rights deal but will be forced to settle for less. This story is not different than thousands of stories around the country right now... times were good and these teams spent money and planned as if times would always be good. Can we blame them? No, because for most of us going to a live sporting event is a luxury. They looked ahead assuming that American fans would want more and more out of that luxury. They were right about fans wanting more luxury, but they were wrong about our ability to afford that luxury.
It all sounds rough but don't worry, the stadiums are built...the teams will play in them... and the fans will follow their team. They might follow their team to the $85 outfield seat rather than the $2500 luxury seat until the economy turns around - but they will follow their team and these venues will be enjoyed for years.
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