Monday, March 8, 2010

New Regina Stadium

Hi everyone,

Hope everyone had a great weekend. It was around the +10 mark in Calgary over the weekend so I took advantage of that with some walking, running, and patio beers.

In the last 6-8 months, a lot of discussion has been centered around a new stadium in Regina to house the Saskatchewan Roughriders. Various options have been talked about including a dome stadium, open air stadium, and upgrading and fixing the existing Mosaic Stadium. Ultimately, some money has to be spent going forward.

Not surprisingly, the most costly option is the dome stadium, followed by the open air stadium, followed by improving Mosiac. Before I get into my opinions on what should be done, I will preface that if a dome is built it MUST have a retractable roof. In the summertime in Saskatchewan, there are few better things to do then sit outside on a +25 Saturday afternoon enjoy some beverages and cheer on the green and white. I would not go to nearly as many games in the summer if they were played with a roof over my head.


The attraction for the Dome stadium in Saskatchewan has less to do with the Riders and more to do with the ability to attract other large events such as concerts, trade shows, and other sporting events such as the Vanier Cup. The dome is being entertained largely because the provincial government is more likely to help fund a multi-use facility then a cheaper outdoor option, but used only for football.


Depending on the numbers you believe, a 33,000-38,000 seat dome with a retractable roof is estimated at $400-$500 million. I am going to estimate on the high side, as these things always have cost overruns and say $500 million. There is environmental remidiation from the old railroad, and increasing commodity prices that will push the price of this stadium upwards to the half billion dollar mark.


My biggest concern about the retractable roof dome is that it may turn into a white elephant for the province. Although we are starting to grow after years of stagnant population, we are still only just over a million people in Saskatchewan. We are also still a relatively rural population spread out over a large area with less than 50% of us living in or between our two large centers Regina and Saskatoon. That means we are counting on people to travel to Regina for events to make the dome stadium work. This may not be a huge issue, as people have shown they will travel for the Roughriders and events such as the Rolling Stones and AC/DC.


The success of the Roughriders over the last three seasons and the attraction of stadium concerts to Mosaic has created the buzz for the dome stadium. The Rolling Stones and AC/DC were very successful. The Roughriders have packed the house for every home game in the past three years. However, has anyone completed an analysis on whether there is additional demand for Roughrider tickets to warrant the additional capacity in a dome stadium? The one thing we as a province can not do is adopt an "if we build it they will come" attitude.

Another concern is that large concerts, while quite profitable, are becoming fewer at the scale that can fill a 35,000 seat stadium. The acts that can fill them are getting old and it is unlikely the Stones or AC/DC will ever be back to Regina, even with a Dome. The only act that is still touring that is guaranteed to fill a stadium is U2. The only other act I can think of that would fill a stadium would be a Zeppelin reunion. There are many other acts that can easily fill 15,000-20,000 seats such as Foo Fighters, Coldplay, The Killers, and various pop performers like Beyonce and Rihanna. However I doubt, with the exception of maybe Coldplay, that any of these acts would fill 35,000 seats in Regina. We just don't have the population for it. We are right next door to Edmonton and Calgary, which would also grab a date on the same tour and we would therefore not get many travellers from Alberta.

Ultimately, the criteria for building a dome should be does it make money and will it pay for itself. Dallas just completed its new stadium to house the Cowboys which was over a billion dollars but had cowboys owner Jerry Jones putting up a significant amount of his own money to help build the stadium. Jones is in the top 200 richest men in the world according to Forbes. Cowboys stadium was largely a statement of Jones' hubris and that stadium does not need to pay for itself necessarily.

However, in a lot of these new NFL stadiums the practice of seat licensing is becoming common to help recoup building costs. Depending of the quality of the season tickets, season tickets holders may be required to put up licensing fees for their seat in the tens of thousands of dollars IN ADDITION to the costs of their tickets. This happened at both Cowboys Stadium and the New Meadowlands in New jersey where the Jets and Giants play. A good idea when you have a fan base willing and able to do this. This base of licensing fees works as a type of endowment that helps cover operating costs from year to year (I believe it is refundable if season tickets are cancelled, but the next season ticket holder must pay it).

Now, no Rider fan is going to pay a licensing fee in the tens of thousands for a seat. However, as a Rider season ticket holder I would be willing to help pay my share for a dome or open air stadium. If 15,000 season ticket holders paid a one time fee of $1000 that would pay for 1/3 of the stadium. The Saskatchewan government could then make that contribution tax deductable.

Funding aside, I think that the football stadium should be only a portion of what is built. Twin ice rinks, a three quarter indoor soccer pitch, swimming pool and a fitness facility should also be a part of this development. This will guarantee people are using the facility year round through beer league hockey and soccer, minor hockey and soccer, and the profits from that will go a long way in paying for the stadium as a whole. Linking a hotel and casino to the stadium is a good idea, but tourism and hotel revenue can also be realized through a sports complex.

Overall, I'm just not confident a dome stadium will work in Regina (or Saskatoon for that matter). I think an enclosed open air stadium is a more logical option.

Cheers.

No comments:

Post a Comment