Stadium Naming Rights going out to bid

[danefan]

http://www.bizjournals.com/albany/blog/2013/06/ualbany-tees-up-bid-naming-rights-for.html

[haggyland]

http://www.bizjourna...rights-for.html

 

A 10 year contract with a 10 year option? Me no like.

If the program was stagnant? Maybe, but although there is no timetable, they have already planned phases up to 20+ thousand capacity. Propose a small contract term now; rebid in a couple of years.

[danefan]

I don't mind it if the price is right!

 

$1m per year sounds good to me.

[haggyland]

I don't mind it if the price is right!

 

$1m per year sounds good to me.

 

I guess I could argue that the potential bidder's list would be fairly static, so it doesn't matter much.

 

Still, in that ninth year of the contract, when we are hosting Appy State in front of 20K fans, the bidding rights will look like a bargain!

[danefan]

I suspect the high bidder is already probably known. I don't think you put something like this out to bid if you don't know who is going to win.

 

I also suspect that 4th luxury suite is for that company.

[uofalbany]

If the winner of naming rights gets an option for another 10 years, let's hope we reserve the 'option' to increase the cost of naming rights to whatever we feel is necessary at that time.

[Dane96]

I suspect the high bidder is already probably known. I don't think you put something like this out to bid if you don't know who is going to win.

 

I also suspect that 4th luxury suite is for that company.

 

Yup...all of this!

[Dane96]

If the winner of naming rights gets an option for another 10 years, let's hope we reserve the 'option' to increase the cost of naming rights to whatever we feel is necessary at that time.

 

I am sure any increase is tied to TWO simple factors (or should be): Capacity numbers and number of events. Increases in both should lead to a pre-determined increase. However, my guess is that the increase is no more than 20% on the second 10 years.

[danefan]

BTW - just to reiterate what this means......we have a company that has agreed to purchase the naming rights.

 

Just the like the stadium, a RFP doesn't go out on something like this until you know what you'll get in return.

 

This is great news, IMO.

[Clickclack]

SEFCU paid handsomely for naming rights to the arena...this will probably fetch significantly more...

[Dane96]

BTW - just to reiterate what this means......we have a company that has agreed to purchase the naming rights.

 

Just the like the stadium, a RFP doesn't go out on something like this until you know what you'll get in return.

 

This is great news, IMO.

 

Indeed. I am actually SHOCKED that all four boxes are GONE (as you note...the last box will go with the naming rights barring some insane business deal stating otherwise). I worked for the River Rats and Firebirds when in school...and selling anything at the Pepsi (TUC) was very difficult). To have a guarantee of $120,000 in revenue (5 years x 4 boxes at $150k total per box= 600K), plus what is likely to be at least 400k per year in naming rights is frankly amazing in Albany...unheard of actually for a college campus.

 

It means we will have a minimum of 520k dollars for operational costs, which is a great number. My guess is the naming rights brings in a bit more (600k per year minimum) so we are likely playing with 720k in house money for operations.

 

Add on that other operational costs will be tax write offs: donation of facilities for events like high schools, etc.

 

What it all means is that most of the ticket and concession sales will go to profit or offsetting other athletic costs for the next 10 years...minimum. THIS IS HUGE!!!

[haggyland]

BTW - just to reiterate what this means......we have a company that has agreed to purchase the naming rights.

 

Just the like the stadium, a RFP doesn't go out on something like this until you know what you'll get in return.

 

This is great news, IMO.

 

Seems like informal agreements would be in violation of the NYS Procurement Lobbying Law, but I am not a/the lawyer, and I have forgotten if the SUNYs are even subject to the PLL.

[Clickclack]

We probably should build a few more boxes...just saying...

[haggyland]

 

To have a guarantee of $120,000 in revenue (5 years x 4 boxes at $150k total per box= 600K)

 

 

Math seems off? Would be 600K per year; 3M for the term, right?

[Dane96]

We probably should build a few more boxes...just saying...

 

I'd think that this helps our cause in building the VIP suites on the second tier. In fact, I would gather that the next round should be VIP suites and completion of the lower bowl. The VIP suites plus the "lounge" would like consist of at least 6-8 boxes plus the lounge (take the 4 boxes now, the presidents box plus one coaches box for 6...maybe seven suites...then the operations box and another coahces box for the lounge). That would likely bring in slightly more $$$ than the current boxes because of lounge access. The current 4 suite renters would get "grandfather" rights to the lounge as they are the "founding lessees" of the stadium.

 

Figure 175k per box x 7= 1.225 million, which half can go into an operational budget...and half goes into the downpayment on the construction loan float. You now have boxes...plus 12,000 permanent seats.