Wednesday, October 13, 2004

New Stadiums -- Pro or Con?

The Dallas Cowboys are thinking of building a new stadium, but where should it go? In sport we've learned that newer staidums increase profit for teams because newer stadiums include more luxury boxes. The luxury box tickets can be priced low at the price of a regular ticket, and that profit will be shared with the other teams due to revenue sharing agreements. But, the real value of a luxury box seat is much higher than what the team states. Thus, this extra price hike turns into pure profits for the team, and the revenus from these tickets does not have to be shared with other teams, hence why teams want newer stadiums. Being a West Virginian, I attend many WVU games. Even this year, the field was, and still is under construction in Morgantown WV. What are they doing? Adding a section of luxury boxes to an end of the stadium. Even take a look at Pittsburgh, two brand new stadiums, PNC Park for the Pirated and Hinze Field for the Steelers.

It's the cities in question that have to allow new taxation rates in order to the new stadiums to be constructed, so with the hundreds of millions that go into new stadium construction, you know that the benefit that the stadiums create for the city and local merchants must far exceed the cost.

The question though is, do you locate directly in the heart of the city, such as the Steelers, Browns, Cowboys and most other teams, or do you go for a location in the suburbs such as the Washington Redskins did. Arguably the Redskins are the most valuable team in the NFL. They are not located in downtown D.C., but outside of the city in Prince George's County, MD. Some question whether the fans will be willing to drive an extra distance, from say Dallas to now Arlington TX to see the Cowboys play. Washington has proved that the fans will 'go the distance'. Hey, is the famous line not "If you build it, they will come" ? By building a stadium outside of the city, more business will probably flock to the same location. Local merchants, ie. restaurants, malls, gas stations, they all benefit from the thousands that pour into the stadiums for games.

So what is it to be for the Cowboys.... Dallas or Arlington? The Arlington Cowboys.... not sure how that's going to sound! Or will Dallas for out millions extra to keep the 'Boys' there?

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