Brewers Maryvale Spring Training Lease

[dlk9s]

As a side note, I actually invested a lot of effort researching this topic (public finances used towards professional sports venues) for a college class many years ago. In most cases using economic projections to justify using public funding for sports or entertainment venues is going to be significantly flawed and/or a losing battle. One example, the "jobs created" are typically overstated and many of them are of the "seasonal employment" variety. I honestly think a better approach than trying to justify that the stadium is going to pay big dividends to the local economy would be to be stick with the pitch surrounding intrinsic benefits gained by the public in having a team located in their community as well as coming up with creative ways the public could utilize the facility throughout the year to maximize it's appeal as a local landmark.

 

I did a similar project when I was working toward my MBA - tried to determine the economic impact of the Carolina Panthers. Nice perk was getting to visit the stadium, meet with Jerry Richardson, go on the field, etc. Eventually presented to people from the Panthers and various government and business leaders from the city.

 

As you discovered, it was crazy hard to come up with some sort of accurate financial figure. It was basically a bunch of guessing and extrapolating. Like it seems you did, we really talked up the "intangible" impact, like how having professional sports teams makes a city a "big league" city and can help draw businesses and what-not.

 

It was half B.S., but probably wasn't much different in that regard to what the pros do.

[nate82]

As a side note, I actually invested a lot of effort researching this topic (public finances used towards professional sports venues) for a college class many years ago. In most cases using economic projections to justify using public funding for sports or entertainment venues is going to be significantly flawed and/or a losing battle. One example, the "jobs created" are typically overstated and many of them are of the "seasonal employment" variety. I honestly think a better approach than trying to justify that the stadium is going to pay big dividends to the local economy would be to be stick with the pitch surrounding intrinsic benefits gained by the public in having a team located in their community as well as coming up with creative ways the public could utilize the facility throughout the year to maximize it's appeal as a local landmark.

 

I did a similar project when I was working toward my MBA - tried to determine the economic impact of the Carolina Panthers. Nice perk was getting to visit the stadium, meet with Jerry Richardson, go on the field, etc. Eventually presented to people from the Panthers and various government and business leaders from the city.

 

As you discovered, it was crazy hard to come up with some sort of accurate financial figure. It was basically a bunch of guessing and extrapolating. Like it seems you did, we really talked up the "intangible" impact, like how having professional sports teams makes a city a "big league" city and can help draw businesses and what-not.

 

It was half B.S., but probably wasn't much different in that regard to what the pros do.

 

All stadiums are losing propositions for the city paying for them. There is very little economic positives that funding a stadium brings to the host city and the negatives are far higher than the positives. There are some ways you can improve the economic situation but a spring training facility where you are only going to be using it 1/12 of the time per year is rather foolish.

 

If the Brewers wanted to get really creative they could buy a AAA team and then place that team at their spring training facilities. This would then bring in more revenue for the city but that is still a losing situation for the city but at least you could justify it a little bit more. It is extremely hard to justify spending $70 million on a spring training facility. I am also wondering how long Phoenix is going to be a viable spring training spot. Las Vegas has been creeping up on taking some teams from Phoenix, I don't like the idea of this as one of the major selling points for spring training in Phoenix is the relative closeness all of the facilities are from each other. The drive from Phoenix to Vegas is about 5 hours.

[rickh150]

http://deadspin.com/study-finds-buying-brewers-a-new-spring-training-park-w-1797630664

Wow, that is a really interesting article. For those that haven't checked out that link you should do so. To give an idea the name of the article is: Study Finds Buying Brewers New Spring Training Park Will Lose Money, So Town Buries Study And Commissions Friendlier One

 

As a side note, I actually invested a lot of effort researching this topic (public finances used towards professional sports venues) for a college class many years ago. In most cases using economic projections to justify using public funding for sports or entertainment venues is going to be significantly flawed and/or a losing battle. One example, the "jobs created" are typically overstated and many of them are of the "seasonal employment" variety. I honestly think a better approach than trying to justify that the stadium is going to pay big dividends to the local economy would be to be stick with the pitch surrounding intrinsic benefits gained by the public in having a team located in their community as well as coming up with creative ways the public could utilize the facility throughout the year to maximize it's appeal as a local landmark.

 

Great article... I always thought the season was too short, games were in the middle of day, Brewers were really not a big draw to a large percentage of sports fan... to get huge money thru taxpayers to build and upkeep a stadium. If Brewers wanted to foot the bill to build it, have town upkeep it, then it is a more beneficial agreement.

[DHonks]

If the Brewers wanted to get really creative they could buy a AAA team and then place that team at their spring training facilities. This would then bring in more revenue for the city but that is still a losing situation for the city but at least you could justify it a little bit more. It is extremely hard to justify spending $70 million on a spring training facility. I am also wondering how long Phoenix is going to be a viable spring training spot. Las Vegas has been creeping up on taking some teams from Phoenix, I don't like the idea of this as one of the major selling points for spring training in Phoenix is the relative closeness all of the facilities are from each other. The drive from Phoenix to Vegas is about 5 hours.

 

Sort of. The Brewers cannot have a AAA team in the Phoenix area. They could in Tucson, which is only 1.5-2 hours from the Phoenix complexes. But as others said, that hasn't been discussed (still a much shorter commute than the Grapefruit League).

 

Would Vegas make a push for Spring Training? I've heard nothing about it, but Vegas is cooler and windier, with a MUCH smaller population. Part of the benefit to Phoenix is that the greater area has over 5million people (not sure if that includes "snowbirds" or not). While stadiums don't turn profits for those that build them, they are often like museums. Having them is often good for the community, morale, etc, but they don't turn profits.

[MadThinker88]

Kinda of surprised that the year round development aspect (extended Spring Training, the short season AZL and Fall ball) is not played up more.

 

One more thing, Cleveland & Cincinnati jointly combined for the complex in Goodyear AZ. Surprised that the Brewers don't try to craft something with another club (drawing in the Twins or even the White Sox)...

[trwi7]

The White Sox are with the Dodgers at Camelback Ranch. There's no reason for them to leave.

[Eye Black]

Below is the latest article on this situation. I guess I would be surprised if the Brewers do indeed end up paying for the entire cost of a stadium, but it appears that would have to be the case if they want to move forward with Gilbert as their Spring Training destination.

 

Gilbert won't fund Brewers ballpark, but idea isn't dead

[MrTPlush]

Not dead, but has breathing tubes in a lifelong coma. Not only do we have to pay for it, but guess what that also means we have to pay for future improvements. The Cubs have it written in their deal that the city must keep it up to date.

 

Sounds pretty terrible for the Brewers. They could probably do better elsewhere. Gilbert doesn't want to make any investment outside of the direct revenue money they get from it, lame.

 

Not my money, but I doubt Attanasio will pay for it.

[Invader3K]

Part of it is that the Brewers are simply late to the dance on this. More and more, cities and states have figured out that spending millions in taxpayer dollars to built a stadium is no longer a good deal (if it ever was).

 

re: Maryvale, it seems like I have to re-post my thoughts on it every years. My wife and I visited Spring Training about six years ago. When we got to our hotel, which was in the northern part of Phoenix, we asked the clerk at our hotel desk where to visit, sights to see, etc. One of the first things she said was, "Avoid Maryvale." Then we told her we were there to see the Brewers, and she said, "Well, if you go during the day and just go to the stadium, you should be OK."

 

So yes, it seems to have a bad reputation, not just with tourists, but with the locals. No, it's not a festering ghetto, but it's an area surrounded with lower income houses, pawn shops, etc. You drive out of the stadium after a game, and there are people begging for money on the median (at least there were at the time we visited). The stadium itself is OK, perfectly fine to just watch a game, but the newer ones blow it out of the water in terms of layout and amenities.

[MadThinker88]

The White Sox are with the Dodgers at Camelback Ranch. There's no reason for them to leave.

 

Understood. I honestly don't know off the top of my head which clubs have paired up like Cleveland/ Cincinnati.

I do realize the Twins are currently in Florida but know nothing about their situation there.

 

What I do know is this: there is at least 1 other team in baseball that is operating by itself at a facility (either in Arizona or Florida).

It is on the Brewers to find someone to match up with...

[jerichoholicninja]

The White Sox are with the Dodgers at Camelback Ranch. There's no reason for them to leave.

 

Understood. I honestly don't know off the top of my head which clubs have paired up like Cleveland/ Cincinnati.

I do realize the Twins are currently in Florida but know nothing about their situation there.

 

What I do know is this: there is at least 1 other team in baseball that is operating by itself at a facility (either in Arizona or Florida).

It is on the Brewers to find someone to match up with...

 

The Twins ST site is the home of their A ball team. I don't think that's a huge roadblock but I would guess that makes them less likely to leave.

 

Looking at the geographics, Houston makes sense to go to Arizona but they just built a new complex. St. Louis does too but they currently have 4 of their minor league teams playing in their stadium.

 

In Arizona, Oakland and the Angels play in pretty old parks but each recently went through major renovations. Seattle and San Diego share facilities that are aging and haven't been upgraded in awhile to the best of my research. Perhaps pairing with one of those two is the best option for a shared site.

[BrewCrew02]

For those that know more than I do. Why not build the spring training complex and have the Brewers' AAA team play there? That way there is revenue for a majority of the year. Guessing it is much more complicated than that.

[jerichoholicninja]

For those that know more than I do. Why not build the spring training complex and have the Brewers' AAA team play there? That way there is revenue for a majority of the year. Guessing it is much more complicated than that.

 

Yes it is. The Brewers would almost certainly have to buy a AAA team first. And someone pointed out that they couldn't play in Phoenix, I would assume because of the DBacks and TV rights or something.

[And That]

Besides buying a AAA team and moving it, one of the biggest hangups in having a AAA team use the facility during the season is that day games are basically untenable there, which would create scheduling issues with the rest of the league. There's also the matter of the extended spring training/AZL league guys needing to use the facilities in season.

 

And frankly, how many people could the Brewers hope to attract to a AAA baseball team's games whose parent club is a marginally popular team a couple thousand miles away?

 

I don't know about any exclusivity or TV rights the Dbacks might have, though. There are plenty of minor league teams in the markets of major league teams. Plus as I mentioned, I don't think a Brewers AAA team would pose any real attendance or viewership threat to the Diamondbacks.

[jerichoholicninja]

Besides buying a AAA team and moving it, one of the biggest hangups in having a AAA team use the facility during the season is that day games are basically untenable there, which would create scheduling issues with the rest of the league. There's also the matter of the extended spring training/AZL league guys needing to use the facilities in season.

 

And frankly, how many people could the Brewers hope to attract to a AAA baseball team's games whose parent club is a marginally popular team a couple thousand miles away?

 

I don't know about any exclusivity or TV rights the Dbacks might have, though. There are plenty of minor league teams in the markets of major league teams. Plus as I mentioned, I don't think a Brewers AAA team would pose any real attendance or viewership threat to the Diamondbacks.

 

I don't think extended ST/etc would be an issue. As I found during my research the Cardinals ST stadium is used by 4 minor league teams, including two in the same league.

[Point Beer Is Best]

Below is the latest article on this situation. I guess I would be surprised if the Brewers do indeed end up paying for the entire cost of a stadium, but it appears that would have to be the case if they want to move forward with Gilbert as their Spring Training destination.

 

Gilbert won't fund Brewers ballpark, but idea isn't dead

 

 

So not only would the Brewers have to pay for the stadium, Gilbert wants it proven out that any money they are on the hook for annually will be offset with the incremental tax revenue (which they say hasn't been provided yet).

 

I'm glad that the tide is turning in regards to these phony economic studies showing that taxpayer funded stadiums provide a net gain in economic impact to those taxpayers when in reality they don't. I just wish it were happening to somebody else's team! Why can't we have nice things?

[And That]

I'm glad that the tide is turning in regards to these phony economic studies showing that taxpayer funded stadiums provide a net gain in economic impact to those taxpayers when in reality they don't. I just wish it were happening to somebody else's team! Why can't we have nice things?

Can always hope Florida hasn't figured this out yet.

[MrTPlush]

The D Backs are not approving a AAA team that close to them. Why? They have absolutely zero reason to do so.

[owbc]

Having never been to spring training, this discussion has made realize why the Brewers are still in Maryvale. The facility is mostly fine, slightly lacking in space and slightly outdated but otherwise fine. It even has some advantages compared to other facilities. The neighborhood is unappealing to the eyes and there is nothing to do nearby...but otherwise there is no evidence that it is detrimentally affecting anyone.

 

Spring training isn't that profitable. The Brewers are definitely NOT going to get their investment back on a new facility, so there's no rush to move. Of course they will move if taxpayers are going to throw $70 million at the Brewers. If that doesn't happen, the Brewers will eventually spend their $20 million upgrading Maryvale and life will go on.

 

Side note: Maryvale itself is a great example of the 'intangible' economic impact--suggesting that in some cases it may literally be zero. In the land of sprawl and highways, nobody has to spend money in any particular town and a spring training facility isn't enough of a jolt to spark activity.

[dlk9s]

I can see why a city or county might want to pay some of the cost for a big-league stadium, but I don't know why any town would want to pay a single penny for a spring training facility. I'd tell the MLB club to pay it all or go somewhere else.

[FVBrewerFan]

I can see why a city or county might want to pay some of the cost for a big-league stadium, but I don't know why any town would want to pay a single penny for a spring training facility. I'd tell the MLB club to pay it all or go somewhere else.

 

That's how I see it. I can't imagine economic impact would be a net positive for Spring Training or probably even most minor league facilities. I do think major league stadiums have a positive economic impact for the area around the stadium specifically, and the community in general. As others have said though, very hard to quantify.

[nate82]

Vegas is more of a speculation/rumor. There have been a few games played in Vegas recently and the teams have profited quite well doing this. Vegas is a concern but so far nothing has come of this concern. It may just be a ploy by the teams to get more money from the city or county to build a facility.

 

I still think a AAA team would make sense here scheduling would be a nightmare but there is a AAA team in Las Vegas so the scheduling wouldn't be all that bad. Plus the AZL team can play on the practice fields if a game needs to be played at the same time as the AAA team is playing.

[DHonks]

As I said previously, one major problem is that the tax funding solution established by voters in Arizona created a mechanism to have an authority build a pool of money to help subsidize these communities in building stadiums. So for the other communities in AZ, they had major assistance in building the stadiums as a result of Valley-wide support. Unfortunately, the successful, very elaborate complexes have raided that fund sufficiently that there is nothing available.

 

These stadiums do tend to get somewhat regular use outside of spring training. Many high school state tournament games are played in Tempe, Phoenix, and Maryvale. Adult leagues may rent them for leagues. Throw in the Arizona Fall League usage for several ballparks, or Arizona Summer League teams as well. They don't make money, but they can be a key part of a development or community that helps it grow and develop.

[MrTPlush]

Going off your point DHonks in the lengthy economic report done on the Gilbert proposal it mentioned Gilbert needed more field in the future anyway. This complex could provide those fields saving them approx. $8mil(can't remember specifics).

 

This helps the city past obvious revenue streams.

[jvrocksaz]

I saw this on a local Gilbert page today...

 

The People of Gilbert Arizona:

 

9 NEW FACTS you want to know about the Brewers Stadium proposal:

 

1. Milwaukee Brewers will pay for 100% of the stadium, which is $70 million.

 

2. LGE, the developer who created the amazing downtown Gilbert strip, is willing to invest $90 million to build the surrounding village of restaurants, entertainment, and hotels.

 

3. $267 million economic benefit for Gilbert comes from just the construction of the stadium.

 

4. Construction of the stadium, surrounding fields and village will create around 1900 jobs.

 

5. $278 million in ANNUAL economic benefit for Gilbert after stadium is operational.

 

6. Operation of the facility and village will create around 2500 jobs.

 

7. When not being used by the Brewers, the practice fields will be available for youth sports and the town of Gilbert to use all year long.

 

8. The cost of all this to Gilbert is $3.5 million per year FIXED, which does not escalate with inflation.

 

9. What will go up with inflation and benefits Gilbert is the $1.5 million extra in tax revenue.

 

Above all else, Gilbert will not have to pay approximately $750,000 for maintaining the parks that the community is going to be able to use. This, plus the $1.5 million in tax revenue is $2.25 million to the town. Tax revenue goes up over time so the gap between that and the $3.5 is not that much (less than $1 million).

 

So I pose this question to the people of Gilbert... Where can you get a return of $278 million annual economic benefit???

 

I'll go one step further, even if only 1/4 of the economic impact happened, where else can you get a return of $70 million per year on a less than $1 million investment?!?

 

I hope this sheds new light on some facts for what could be a smart business deal. Please share with friends!!!