Sports teams are investing $10 billion in stadiums by 2030 — here’s how they’ll be different – CNBC
Fans for the Tennessee Titans and the Los Angeles Rams before an NFL football game at SoFi Stadium, Sunday, Nov. 7, 2021, in Inglewood, Calif.
Marcio Jose Sanchez | AP
The Buffalo Bills are seeking a new $1.3 billion National Football League stadium. The Chicago Bears are spending $197 million to acquire land that could eventually be their new home.
FedEx Field is falling apart, and Washington Football Team is lobbying for a new stadium in Virginia. A few Major League Baseball teams, including the Kansas City Royals, Oakland Athletics, and Tampa Bay Rays, want new parks.
In the National Basketball Association, the Los Angeles Clippers have already started to build their $1.2 billion arena. The Philadelphia 76ers are angling, the Dallas Mavericks could be lurking. And then there’s the National Hockey League with the Phoenix Coyotes.
Teams are are seeking venue upgrades and could invest more than $10 billion for development by 2030. The bigger U.S. sports leagues have already secured national media revenue, so now teams want to increase revenue in other areas. New and revamped arenas are one way they can.
Sports clubs can attract lucrative naming rights and sponsorship deals with new buildings. There’s also a potential real estate play, with franchises including the Atlanta Braves and Milwaukee Bucks using their new buildings as anchors for massive real estate projects. That development helps generate even more money for teams.
Still, there remains a debate about who should fund sports projects, and what will be different in a post-pandemic environment.
CNBC spoke to executives about the sports stadium and arena landscape and what’s to come.
An aerial view shows the USD 1.66 billion MSG Sphere at The Venetian, where construction work is stopped due to the coronavirus (COVID-19) pandemic on May 21, 2020 in Las Vegas, Nevada.
Ethan Miller | Getty Images
Smaller venues, more experiences
In the last 20 years, teams maximized arena revenue by adding larger corporate suites, club, and general admission seating. However, the ongoing Covid pandemic is changing that thinking.
Bill Mulvihill, the head of U.S. Bank sports and entertainment group, assisted in financing the Los Angeles Rams SoFi Stadium, which cost $5 billion. He echoed others who predict smaller venues on the horizon for the next generation of stadiums and arenas.
Mulvihill said more clubs are creating plans for in-arena spectators and TV viewers. “The idea is to have some unique fan experiences, not just drive up the total number of people in your building,” he said.
“I think the talk and the trend are smaller capacities overall when talking about arenas,” added Rob Tillis of investment firm Inner Circle Sports. “The bigger NFL stadiums will maintain large capacity.”
To enhance the value proposition of attending games, you may notice your favorite team is leveraging seating experiences like the NFL’s field-level suites. The Texas Rangers incorporated new seating options for Globe Life Field – their $1.2 billion ballpark. It includes suites on the field and two field-level lounges along the first and third baseline.
CNBC took a tour of the Rangers’ new park last August.
The field suites were pretty enjoyable, and sitting in the lounges felt like watching a baseball game while at a local sports bar with the field actual field nearby.
“These new buildings are focused more on providing a variety of premium seating projects to meet the demands of the market,” said Dan Barrett, president at CAA …….