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Economic Effect: The Relocation of Professional Sports Teams Abby Bertsch Daniel Brodnik Russell Burgett Tiffany Arnold.

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Presentation on theme: "Economic Effect: The Relocation of Professional Sports Teams Abby Bertsch Daniel Brodnik Russell Burgett Tiffany Arnold."— Presentation transcript:

1 Economic Effect: The Relocation of Professional Sports Teams Abby Bertsch Daniel Brodnik Russell Burgett Tiffany Arnold

2 Our Teams…

3 Opening Day 2005

4 The Decision to move… Major League Baseball in charge of new Location: – Various Virginia suburbs – Portland, Oregan – Arlington, Texas Largest advantage –> boost expected for the local economy

5 Concerns: Peter Angelos, Baltimore Orioles Owner Lack of baseball interest from African American’s may be a factor of the past Washington Senators – (1901-1960) Moved in 1960 & 1972 - What makes Nationals different?? worst percentage of any team in Major League Baseball history that played for more than two seasons - including the Expos Fear of increased taxes

6 Where will they play? D.C. Mayor, Anthony Williams, helped convince MLB to relocate to Washington D.C. in exchange for the city’s building a new ballpark – 2/3 of D.C. residents - opposed to the new Stadium – Financed through the city – no state or county support Much of the fan-base comes from the Maryland & Virginia suburbs – First 2-3 seasons would be played in RFK stadium $14 million in renovations

7 Nationals Park: Opening Day March 29, 2008 Attendance: Sold out

8 Economic Effects: Expected Totals: Over the next 30 years, the stadium is expected to generate $2.5 billion in tax revenue that would not have otherwise been created

9 Nationals Park vs. RFK Not only would the development bring in more economic growth, but it would help increase the development rate in the surrounding community. Because of the location, it would turn a neglected area, into a thriving one. Surprisingly, each ballpark’s “hard costs” are the same.

10 Montreal… “It almost seems the Expos never left” – Journalist Stephen Ellsesser. weak baseball fan base in Canada. Suprisingly, not a large impact on local economy as one might expect

11 Attendance totals exceeded the Expos’ 2004 attendance final attendance for the 2005 season (2,731,993), exceeded the previous three seasons in Montreal combined, and was 11 th in all of MLB. Positives:


13 The Charlotte Hornets: 1988 – 2002 Strong Early Interest Basketball Hotbed Cornered Market Faltering Record Wavering Attendance Failure

14 New Orleans A City waiting $84 Million stadium $40 Million contract

15 Tragedy Hurricane Barrage Expensive Move Shrinking City 500,000 to 158,000

16 Cleveland Browns

17 Cleveland Browns Move to Baltimore 1995: Art Modell’s announcement City of Cleveland vs. Art Modell & the NFL Unique compromise – Move the team to Baltimore – But unable to take the Browns history Baltimore considered new team Cleveland received a new franchise

18 Cleveland Browns Move to Baltimore Cleveland’s uproar from the Browns departure – Fans & Businesses Advertisements & promotions were cancelled – Papa John’s Pizza pulled radio advertisements and promotions that would have provided $50,000 to the Browns Estimated that the Browns generate $47 million in economic activity

19 Cleveland Browns Move to Baltimore Nonlocal fans spend on average $43.95 in restaurants Browns games brought in 4,700 visiting fans and 65,000 local fans in 1994 Overall, quite a large economic impact on the city of Cleveland

20 Cleveland Browns Move to Baltimore Impact on Baltimore: – Browns would generate $54 million in direct economic impact – Off-site direct spending, including retail and restaurant sales, would reach $21 million

21 Cleveland Browns Return Cleveland Browns Stadium – Groundbreaking on May 15, 1997 – Cost of Construction: $283 million Cost to the public: $212 million 1999 Browns return to Cleveland


23 The Creation of a Franchise The city of Phoenix grew from 99 th to 9 th largest Since 1946, Arizona has housed many spring training teams

24 Early Attempts First attempt by Elyse Doherty and Martin Stone 1980 approached St. Louis Cardinals owner about sharing a stadium Deal failed, and Stone’s bid was effectively ended

25 Arizona Baseball, Inc. Started in 1993 by Jerry Colangelo Received support from Chicago Bulls, Chicago White Sox, Milwaukee Brewers March 9, 1995 awarded a franchise to begin play at a fee of $130 million

26 Arizona Diamondbacks 20 th most valuable team Value has increased 12% over the last year Revenues exceeding $164 million Total value of $379

27 4 Valuation Categories Sport valuation Market valuation Stadium valuation Brand management

28 Conclusion… Studies have shown that when franchises are brought into a town, there is a direct economic impact on the surrounding area. This includes the creation of jobs, increased tax revenues; an overall increase in the state of the economy can be increased with visitor team spending and with fan spending outside the park.

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