The Game Future NRL Stadiums part II

[Vlad59]

thats not what Broncos pay, they pay around $350k a game for Suncorp last time I looked.

Depends I suppose if 'break even' includes everything related to game day ie marketing, ticket sales, membership costs, venue hire, corporate hosting costs etc etc. Some of that stuff is the same regardless of venue used.
If we are purely looking at how much it costs to rent a venue and how many tickets you need to sell to cover that cost than it would be a straight avg ticket price divided by venue hire cost.

That’s interesting as I’ve read the 30000 break even figure regularly over the years. Rental of $350000 a game sounds reasonable on that basis.

 

[Perth Red]

Are you getting enough corporates as a 1 off though?

That is where Roosters and Dogs at Accor get good deals being longer term tennants.

I suppose 1. it has a value add for existing corporates (they get 1 or 2 games at a much nicer venue) 2. It allows one off sales with more corporate facilities of higher quality. 3. It allows the semi corporate premium fan ticket options to be sold which wouldn't be available at a ground like shark park. So presuming you could get 16k to the game (and if NRL you should be able to) and thats paying the venue hire then anything above that is generating profit. What those margins are and how they compare to the profit margins at Shark park with LC usage on game day included couldn't say as dont have that info. I guess the goal is by playing in a far superior venue you build your fanbase and corporate support levels over time to generate more profit? Richardson has been pretty open that the use of the two suburban grounds is costing the Tigers a lot of potential revenue generation.

 

[SirPies&Beers]

thats not what Broncos pay, they pay around $350k a game for Suncorp last time I looked.

Depends I suppose if 'break even' includes everything related to game day ie marketing, ticket sales, membership costs, venue hire, corporate hosting costs etc etc. Some of that stuff is the same regardless of venue used.
If we are purely looking at how much it costs to rent a venue and how many tickets you need to sell to cover that cost than it would be a straight avg ticket price divided by venue hire cost.

do you work for broncos as well perth reds? you catching up for coffee dates with dave in your spare time. where you gets the info from?

 

[Wb1234]

thats not what Broncos pay, they pay around $350k a game for Suncorp last time I looked.

Depends I suppose if 'break even' includes everything related to game day ie marketing, ticket sales, membership costs, venue hire, corporate hosting costs etc etc. Some of that stuff is the same regardless of venue used.
If we are purely looking at how much it costs to rent a venue and how many tickets you need to sell to cover that cost than it would be a straight avg ticket price divided by venue hire cost.

5 million a year in rent is crazy money

Wonder if the broncos ever have enough money to build their own ground

 

[Wb1234]

I suppose 1. it has a value add for existing corporates (they get 1 or 2 games at a much nicer venue) 2. It allows one off sales with more corporate facilities of higher quality. 3. It allows the semi corporate premium fan ticket options to be sold which wouldn't be available at a ground like shark park. So presuming you could get 16k to the game (and if NRL you should be able to) and thats paying the venue hire then anything above that is generating profit. What those margins are and how they compare to the profit margins at Shark park with LC usage on game day included couldn't say as dont have that info. I guess the goal is by playing in a far superior venue you build your fanbase and corporate support levels over time to generate more profit? Richardson has been pretty open that the use of the two suburban grounds is costing the Tigers a lot of potential revenue generation.

Plus Allianz captains lounge or whatever it’s called only commbank has something similar

The one at Homebush is hopeless

And many suburban grounds a box is just second tier of a grand stand

 

[Perth Red]

That’s interesting as I’ve read the 30000 break even figure regularly over the years. Rental of $350000 a game sounds reasonable on that basis.

Last year it cost them $650k a game but that includes venue hire plus corporate box costs, activities on game day etc

 

[Perth Red]

5 million a year in rent is crazy money

Wonder if the broncos ever have enough money to build their own ground

It may sound it but when you consider they spent $7.8mill on game day costs and generated $23.2mill revenue on game day operations its not a bad return!

 

[AlwaysGreen]

5 million a year in rent is crazy money

Wonder if the broncos ever have enough money to build their own ground

Seeing it costs over a billion dollars to build a stadium you'd think not.

Unless you're a mental case.

 

[Perth Red]

Seeing it costs over a billion dollars to build a stadium you'd think not.

Unless you're a mental case.

yeh it'd only take about 200 years to recoup the investment lol

 

[Vlad59]

Seeing it costs over a billion dollars to build a stadium you'd think not.

Unless you're a mental case.

Well we are building a stadium down here which will return 43 cents for every $ invested by the taxpayer according to a government appointed analyst.

 

[Wb1234]

yeh it'd only take about 200 years to recoup the investment lol

If we are talking a billion then the capacity would be more than Suncorp

Plus they can charge rent to all the other tenants

 

[AlwaysGreen]

If we are talking a billion then the capacity would be more than Suncorp

Plus they can charge rent to all the other tenants

The broncos aren't building their own f**king stadium. Get off the nitro.

 

[yakstorm]

I heard the break even crowd for Allianz ( unless you get the primary tennant rate ) is 16k.

Venues NSW would drop that if want content that badly but when you consider traffic, extra travel time than only a few games would fit into that category.

even less when you rule out Roosters and Souffs to keep 'home' advantage

There are reasons clubs stay at these mostly sub par venues

If the Sydney clubs were prepared to work with the NRL to negotiate stadium deals, those economics change dramatically. From a Venues NSW perspective, unless it's a marquee game like ANZAC Day or Good Friday, there is minimal value in them offering cheaper rates for Allianz or Accor for only a couple of games from clubs like the Sharks, Sea Eagles, Dragons, etc.

That changes dramatically when, instead of negotiating say 1-2 games, they are suddenly negotiating 20, 30, 40 or more games.

This is one thing the AFL does well, and it's something the NRL tried, but the clubs pushed back on, is going into these negotiations in partnership. If the clubs & NRL are negotiating together, you can use the marquee games and events like Origin, to help push down lower tenant rates and often negotiate other benefits.

In the AFL - MCG deal, in exchange for 45 clubs games per year, the GF and 10 Finals games over 5 years, each club games $100K to play home games at the venue and a share of 68.9% of all revenue derived from AFL games.

NRL possibly can't get a deal like that, but between hem & the clubs could work out something between all the VenueNSW venues (Commbank, McDonald Jones, WIN Stadium, Accor & Allianz) that's more beneficial than what the clubs are negotiating currently.

 

[Wb1234]

If the Sydney clubs were prepared to work with the NRL to negotiate stadium deals, those economics change dramatically. From a Venues NSW perspective, unless it's a marquee game like ANZAC Day or Good Friday, there is minimal value in them offering cheaper rates for Allianz or Accor for only a couple of games from clubs like the Sharks, Sea Eagles, Dragons, etc.

That changes dramatically when, instead of negotiating say 1-2 games, they are suddenly negotiating 20, 30, 40 or more games.

This is one thing the AFL does well, and it's something the NRL tried, but the clubs pushed back on, is going into these negotiations in partnership. If the clubs & NRL are negotiating together, you can use the marquee games and events like Origin, to help push down lower tenant rates and often negotiate other benefits.

In the AFL - MCG deal, in exchange for 45 clubs games per year, the GF and 10 Finals games over 5 years, each club games $100K to play home games at the venue and a share of 68.9% of all revenue derived from AFL games.

NRL possibly can't get a deal like that, but between hem & the clubs could work out something between all the VenueNSW venues (Commbank, McDonald Jones, WIN Stadium, Accor & Allianz) that's more beneficial than what the clubs are negotiating currently.

68.9 percent of food and drink sales ?

 

[yakstorm]

68.9 percent of food and drink sales ?

I imagine it extends also to things like hospitality.

 

[Perth Red]

If we are talking a billion then the capacity would be more than Suncorp

Plus they can charge rent to all the other tenants

Suncorp costs them around $6mill in rent a year. How many years do you think a $1bill stadium would take to recoup at $6mill a year savings, then consider they'd also have to pay for maintenance and upgrades lol

 

[Wb1234]

Suncorp costs them around $6mill in rent a year. How many years do you think a $1bill stadium would take to recoup at $6mill a year savings, then consider they'd also have to pay for maintenance and upgrades lol

With the forecast of over 1 percent in rate cuts over the next 18 months they could get a long term loan at 4 percent or less

Stadium return would be around ten percent pa with origins magic soccer and union internationals dolphins concerts a league super rugby etc

If one club could make it stack up its broncos

Funny you don’t talk about how bad stadium investments are when it’s the afl

lol!

 

[SirPies&Beers]

Suncorp costs them around $6mill in rent a year. How many years do you think a $1bill stadium would take to recoup at $6mill a year savings, then consider they'd also have to pay for maintenance and upgrades lol

you work for stadiums queensland perth reds?

 

[Trifili13]

The Broncos will be able to fund a new stadium from the additional annual grant money dished out by the ARL when the new TV deal is signed.

No team is building its own stadium, they can't afford it no matter what the interest rates are.

 

[Perth Red]

With the forecast of over 1 percent in rate cuts over the next 18 months they could get a long term loan at 4 percent or less

Stadium return would be around ten percent pa with origins magic soccer and union internationals dolphins concerts a league super rugby etc

If one club could make it stack up its broncos

Funny you don’t talk about how bad stadium investments are when it’s the afl

lol!

haha, economics not your strong point?
So Expense: 4% loan on $1bill plus upkeep costs
Savings $6mill a year plus $15mill rental from 30 or so events and games a year (Rental at $350-500k)
And thats if you could build a 65k stadium for $1bill, which you cant, and if someone gifts the land to build it on lol

So basically $21mill income V $40mill interest expense, plus maintenance costs annually. Sounds a cracking deal, cant see why Broncos havent done it yet!