 Ballparkdigest.com Skeptical Over Hired Consultant’s Rosy Financial Picture for BallparkTwo articles on BallparkDigest.com that comment on economics of the project. 07/07/2010 5:19 PM A consultant estimates that a new Can-Am Association ballpark in Ramapo, N.Y., should turn a profit if things go well. But a closer look at the number shows that the city has almost no room for error and will rely on offseason events, not baseball, to cover debt payment. The report from Fishkind and Associates says that with the strong potential for offseason events at the ballpark, there's a very good chance all the revenue from the proposed independent Can-Am Association ballpark would cover debt payment and more -- some $3.2 million over 10 years. Bottle 9 Baseball will pay $175,000 annually in rent for the ballpark, but the bulk of revenues for the city will come from sales-tax revenues and other sources (some $775,000 during baseball season, discussed below) and $450,000 in direct revenue from concerts, non-baseball sporting events and other events in the offseason. When all is said and done, the ballpark should generate $1.4 million for the city, more than enough to cover $1.3 million in debt service. Also on the speculative side of the ledger: the city will receive half of all revenues generated from suite sales, broadcast revenue and naming rights, estimated to be worth $250,000 annually. This, too, seems highly speculative: we're now entering an age when broadcast revenue is nonexistent for most teams, while suite sales are slowed and naming-rights deals hard to acquire. We're just not sure a Can-Am Association team can pull off a naming-rights deal worth a quarter of a million dollars annually. In the end, Fishkind and Associates may be right about the potential for revenues in a new Ramapo ballpark. But their numbers have no margin for error, and we think their projections -- particularly on the revenue side when it comes to broadcast revenues and naming-rights deals -- may be unnecessarily rosy. Whether the city agrees as it debates borrowing $16.7 million to build the ballpark remains to be seen. New ballpark pitched in Ramapo for Can-Am team 03/08/2010 6:49 AM Ramapo (N.Y.) officials say they're willing to spend $25.5 million on a new 3,500-seat ballpark for an expansion team in the independent Can-Am Association and are already planning on an opening date of June 1, 2011 for the facility. Ramapo is located some 40 miles outside New York City, 30 miles from Yonkers and 45 miles from Wappingers Falls, the home of the Hudson Valley Renegades (short season; NY-Penn League). That city officials were promising a Can-Am team was news to several Can-Am owners we contacted over the weekend.
Still. the Ramapo folks we contacted were confident of coming to a lease with a Can-Am team. They're already pitching $12 and $7 ticket prices in a fan-friendly atmosphere. We have to wonder how realistic some of their expectations are: city officials say they'll have no problem selling 25 (!) suites at a time when suite sales have slumped across the entire industry. The new ballpark, as designed by DLR Group, would cost $17.5 million. Another $8 million would be spent on the acquisition of 67 acres for the ballpark site, raising the total project cost to $25.5 million. The city will bond the project but expects proceeds from the team lease to pay back the bonds, which raises the question of how much a Can-Am team is expected to pay under the lease -- as opposed to how much revenue the team can generate in a 50-game season. UPDATE: Crunching the numbers: It will take $700,000-$800,000 just for debt service on $25 million in bonds on a 20-year repayment schedule using current interest rates. No way this deal works without a lease where the city eats at least half the cost of the ballpark. http://www.ballparkdigest.com/news/index.html?article_id=2497
Michael Castelluccio
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