The second-largest media market in the U.S. hasn’t called a professional football team its own since 1994. Soon, though, the City of Angels could host a team. Or even two.
Serious talks are underway for an NFL squad to call Los Angeles home. The move could be a financial boon for the city.
It’s estimated that 16,000 jobs and tens of millions of dollars a year in new tax revenue would arise from the construction of the stadium alone. There are potential sites in Carson and Inglewood, but only one is expected to come to fruition — if any.
Super Bowls alone would be sizable financial attractions for the city. An impact of $200 million to $500 million could be realized from one big game taking place. With L.A.’s warm weather and sprawling landscape for related events — such as media day, and of course, the parties — there’s no reason why the city couldn’t be in heavy rotation for the Super Bowl once every few years. After all, it’s been widely reported the NFL sees L.A. as a West Coast hub of sorts.
“The economic impact of regular-season games will exist, but it may not prove substantial given that much of the spending is likely to be reallocated from other forms of sports and entertainment in the region,” said David Carter, executive director of the
USC Marshall Sports Business Institute. “What will have a material impact will be the hosting of major events, especially the Super Bowl. Super Bowls will bring executives and fans to Southern California in droves for an extended period of time and this incremental spending across the board would not have occurred absent it.”
The biggest financial windfall, though, could come from hosting the Olympics. Los Angeles plans to bid for the 2024 Summer Games, and having a brand-new, state-of-the-art stadium would help entice the International Olympic Committee to bring the global event to the West Coast for the first time since 1984.
Events such as the Super Bowl and the Olympic Games indeed bring in an incredible amount of revenue to any city that hosts it. Tourists would travel from around the world, and pay good money to stay in hotels, eat at local restaurants and drink at bars. Arizona, which hosted the Super Bowl in 2015, said it expected a $500 million economic impact from an estimated 100,000 visitors.
But nothing is a sure thing when it comes to football and L.A. After all, the city had two teams and both fled following the 1994 season — fans lost interest and ticket sales were down. Many critics have since opined that with powerhouses USC and UCLA always fielding respectable programs on Saturdays, L.A. is truly a college football town.
Why would the NFL thrive in L.A. more than two 20 years later?
“Teams in Southern California failed the last time around due to a combination of perceived ownership and management issues, as well as stadiums that were viewed as subpar from the standpoint of generating meaningful revenue,” Carter said. “Now, with the NFL controlling the process, a deal will be struck that works for not only the league but also the team(s) entering the market. In doing so, the long-term viability of the team(s) will exist.”
Indeed, the NFL is taking a keen interest in making sure it works this time. The league appointed Executive Vice President Eric Grubman to oversee the process, and has had several meetings with the respective ownership groups from Oakland, San Diego and St. Louis to gauge interest and fit.
Since 1997, 20 new NFL stadiums have opened with the help of $4.7 billion in taxpayer funds, according to an analysis by the advisory firm Conventions, Sports and Leisure. How does this happen? To attract or keep teams in their towns, local governments dig into the coffers and pony up the funds to build these venues. Stadiums in Minneapolis and Atlanta are currently being built with $700 million in government funds.
Money and firepower are key, which is why the Inglewood City Council unanimously approved St. Louis’ $1.86 billion stadium plan that does not include any taxpayer dollars and clears a path for the franchise’s return to its roots.
Carmen Policy, a former NFL team executive with San Francisco and Cleveland who is working with the Carson project — Oakland and San Diego’s joint $1.7 billion stadium plan— said he expects the league to have a resolution before the 50th Super Bowl in February 2016.
NFL Media — which encompasses NFL Network and NFL.com — is already located in Culver City, and Southern California would be a prime candidate for other events such as the annual draft, all-star game and the already ongoing event where rookies are photographed for trading cards. The owners regularly converge in Los Angeles for meetings, too, and even Dallas — “America’s Team” — calls Oxnard home for its training camp.
But does the city really need the NFL — the most profitable pro sports league in the U.S.? And what kind of impact would the other area teams feel? The greater L.A. area hosts two NHL teams, two MLB teams, two NBA teams and two major college football programs. What would happen to attendance for those teams, not to mention commitment from corporate suites?
“Adding additional sports and entertainment options to this market may not only impact attendance, but also other important areas including sponsorship,” Carter stated. “An already strong competition for the entertainment dollar exists and adding to it would require all those in the region to redouble their marketing and customer service efforts.
In 2014, teams equally split a pot of $7.2 billion in national revenue. Each team received $226.4 million, which is mostly TV money. Just five years ago, that same pot was $3 billion.
Rich Marotta, a radio play-by-play man until the team moved to Oakland, believes the NFL will succeed this time around if it’s done right, but isn’t so sure the economic impact will be significant.
“I think it’s negligible,” he said. “I don’t think that’s a real factor in a city as big as Los Angeles. It’s not enough to really make a big dent.”
Many who oppose the return of the NFL cite traffic as a major concern. L.A. freeways are already gridlocked. How would adding a team — or two — with a massive stadium contribute to the city’s infamous problem?
“Games are played on the weekends. If you want to play Monday Night Football in L.A., it’s going to be a problem,” said Marotta, who grew up in the city. “But USC plays to 90,000-plus every week in the Coliseum right off the Harbor Freeway. You get traffic in any city going to the games. I wouldn’t say the appearance of a team for eight games plus two preseason games is going to really significantly alter or increase traffic problems.”
Football fans in L.A. have been yearning for the return of their favorite sport to their city, and it seems likely.
“(A team) can’t just say ‘we’re in’ and then show up and expect everyone to have a tremendous amount of passion … and think they’re larger than the community,” Marotta said. “There’s no reason to think that football won’t be a big success in L.A.”
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