Sacramento Executive: Sports Arenas: Is The Business Model Broken?

I have come to believe that the business model for sports arenas just doesn't work. I am not sure it ever has. It reminds me of the Walmart model. The owners promise revitalization, jobs, and other economic development pluses and extract huge tax incentives from local jurisdictions and then when the arena is declared not to be 'state of the art' and a replacement is needed, (and the tax incentives have run out), they threaten to pick up and decamp to the next 'desperate' locale.

Here is an extract from an article in the Arizona Republic, which makes this same point.

It wasn't supposed to turn out this way.
When team owners started agitating for new, taxpayer-financed facilities in the 1990s, they often couched it with projects meant to turn around struggling center cities.

There was a stick, too: the threat that the team would leave if its demands weren't met, a trend partly foreshadowed years before by the football Cardinals' angry departure from St. Louis.

It seemed to work in places such as Denver, where Coors Field became the centerpiece of the reclamation of what had been the city's skid row. Now, downtown Denver is booming, and all four of its big-league teams play downtown.

Phoenix's experience was quite different.

Although a new ballpark and basketball arena bring thousands downtown, the center city is still badly lagging behind its peers. The development enjoyed around Coors Field hasn't happened here. Many nights, the streets are devoid of people.

In Los Angeles, neighborhoods around Staples Center have only recently begun to hint at a major turnaround. And it is driven more by big development dollars in condo and office projects, combined with more demand for downtown living, than the arena itself.

The lesson seems to be that stadiums and arenas are wonderful assets, but they have a wider benefit only when other positive forces are at work. Alone, they can't solve deeply entrenched pathologies.

And the venues risk losing any appeal if the owners will go shopping for a new taxpayer deal at the first opportunity.

The old stadium game isn't entirely dead. Minneapolis is building a ballpark for baseball's Twins after years of resistance, and the NFL's Vikings may eventually get a new home, too.

But now there's a new game: As cities have wised up, the owners are seducing gullible suburbs.

Glendale may become a national template, as Bay area suburbs are wooing the San Francisco 49ers and the Oakland A's. A suburban county was courted and dumped, at least for now, by the Vikings. In all these cases, big suburban development projects are being promised along with the arenas.

Unfortunately, these stadiums only worsen sprawl and congestion. They're usually removed from mass transit. Quiet neighborhoods are quiet no longer.

The promise of stadiums didn't work out. That's what happens when feral greed wins.