An In-Depth Look at Soccer Specific Stadiums

red-bull-arena

This season marked the grand opening of Major League Soccer’s latest venue, Avaya Stadium, built specifically for soccer in San Jose, California.  According to NBC Bay Area, the global tech firm Avaya agreed to pay $20 million over 10 years for the naming rights to the stadium and the construction of the stadium cost close to $100 million. In addition to the excitement around a having a new field to call home, Avaya Stadium is home to the largest outdoor bar in North America that will require 30 bartenders, and plans to test the limits of fan engagement by being the first ever cloud enabled stadium. These technological enhancements will make the stadium a testing ground for the future of sports.

This stadium is the latest in a line of “soccer specific stadiums” that have been built by MLS franchises to increase revenue.  Currently 15 of the 20 teams have one of these stadiums, with 2 more stadium plans approved and planned to open by 2017.  The teams make their money through increased profits in ticket sales, merchandise, food and beverage sales, and parking that they might not have achieved as tenants in another entity’s venue.  The success of these new stadiums has been apparent enough for MLS to require potential new franchisees to have a plan in place for their own soccer specific stadium in order to be considered as a serious candidate for expansion.

According to Business Of Soccer,  attendance for Sporting Kansas City and for the New York Red Bulls spiked significantly after moving into their new stadiums.  In Kansas City, attendance rose from an average of approximately 11,000 to an average near 19,000 between 2011-2013.  In the case of New York, when Red Bull Arena was built in Harrison, New Jersey, attendance rose from an average near 12,500 in 2009 to anywhere from 18,000-20,000 between 2010-2013.  The San Jose Earthquakes hope to find similar success in their new stadium that has a capacity of 18,000 seats.  Below is a video from CBS San Francisco showing the features of Avaya Stadium.

These stadiums are not always a recipe for success.  According to Forbes, the Red Bulls owe the local government $3.6 million in back taxes due to a dispute over ownership of the property.  In the case of Chicago, it cost $98 million to build the team’s stadium Toyota Park, and the bill was funded by taxpayer dollars.  The stadium has yet to repay this initial cost, and in 2013, Forbes estimated that the Chicago Fire see $5 million in revenue a year as a combination of only 17 guaranteed home games, hosting the FCS National Championship, as well as hosting other events such as concerts.  While some experts and politicians might argue that the problem lies in the stadiums suburban location 12 miles outside of Chicago, other stadiums are experiencing similar challenges.  As stadiums not just in MLS but across all sports are evolving to generate more revenue from amenities and enhancing the atmosphere for fans, older stadiums suffer as they become obsolete.

The league plans to see future soccer specific stadiums in D.C. and Orlando by 2017.  The goals behind these stadiums seems to be too improve the game day experience for fans, increasing the amount of fans that come to their stadiums and hopefully creating a chain reaction of buzz around the team that will boost the team’s presence both in the community and on television.  These soccer specific stadiums can be a burden when it comes to financing and construction costs, but they can also be a genius marketing mechanism that builds the team’s brand with a more concrete identity.

REFERENCES

http://www.businessofsoccer.com/2014/08/27/soccer-specific-stadiums-prove-important-investment-for-mls-success-contd/

MLS 3.0: Evolution of the Soccer-Specific Stadium

http://www.forbes.com/sites/chrissmith/2013/11/20/major-league-soccers-stadium-revolution/

http://www.mlssoccer.com/news/article/2014/12/17/newly-approved-dc-united-stadium-set-be-17th-soccer-specific-stadium-mls

http://www.nbcbayarea.com/news/sports/Avaya-Stadium-San-Jose-Earthquakes-Announce-Naming-Deal-As-Cost-Of-New-Stadium-Skyrockets-283278811.html

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