Downtown L.A. businesses expect big profits on NBA All-Star weekend

While merchants in Texas count their profits from Super Bowl XLV, downtown Los Angeles business owners are hoping for a big score from their own high-profile sporting event next weekend.

Downtown businesses expect to reap hefty profits when the NBA All-Star weekend rolls into Staples Center, drawing thousands of big-spending celebrities, professional athletes and die-hard hoops fans for four days of basketball, dinners and parties.

Although Los Angeles hosted the annual basketball celebration seven years ago, economists predict this year’s event will generate even more profits. Now, visitors are expected to spend throughout the city but particularly at the trendy clubs, shops and restaurants at the L.A. Live entertainment complex and the 54-story JW Marriott and Ritz-Carlton hotel tower built next to Staples Center over the last three years.

An economic-impact forecast commissioned by the LA Sports and Entertainment Commission, a nonprofit group that promotes sports and entertainment events in the city, estimates the event will generate more than $85 million in spending. That is an increase of at least 7% compared with the spending by visitors and locals during the NBA All-Star weekend in 2004.


“If they are going to spend $85 million, I need to get me some of that,” Bell Cab driver Juan Rizo joked as he waited for customers near Staples Center, the home arena for the NBA’s Lakers and Clippers and the NHL’s L.A. Kings.

Already, restaurant managers, shopkeepers and fans as well as cab drivers are gearing up for the events, Friday through Monday. Staples Center has a capacity of about 19,000 for basketball games, but local boosters expect the event to draw at least 100,000 fans and participants.

The All-Star game itself is set for 5 p.m. Sunday, Feb. 20.

At Rock’n Fish, a seafood restaurant at L.A. Live, general manager Luis Villaneda plans to add extra staff to handle the crowds during the event.


“An event like the NBA All-Star weekend will bring in lots of business,” he said. “It will be like a big convention. It’s a captive audience.”

During the NBA All-Star weekend in 2004, Staples Center was surrounded by uninviting stretches of parking lots, warehouses and tired-looking office buildings. Today, the parking spaces and warehouses have been replaced by swanky clubs and restaurants like the Conga Room, Katsuya and WP24 at L.A. Live.

In 2004, most of the athletes and VIP guests stayed in hotels in Beverly Hills and partied at nightclubs in Hollywood. This year, NBA players and celebrities are expected to stay at the new 1,001-room JW Marriott and Ritz-Carlton hotel tower, within walking distance of the arena.

Organizers of the event also expect fans and athletes to spend most of their time and money at restaurants and clubs around Staples Center.

For example, actor Jamie Foxx will host a concert Thursday night at L.A. Live’s Club Nokia, which has a capacity of 2,300 people. NBA star Shaquille O’Neal will host two nights of comedy Friday and Saturday at the 7,000-seat Nokia Theater at L.A. Live.

NBA officials said they chose Los Angeles to host the event again partly because of the new development around Staples Center.

“As a destination city with warm weather and all the new resources, that makes it a very appealing destination,” said Ski Austin, NBA’s executive vice president of events and attractions.

Since the JW Marriott and Ritz-Carlton hotels opened in the glass tower next to Staples Center last year, the Rivera Restaurant on Flower Street has been booked solid almost every weekend, said Matthew Washton, the restaurant’s director of operations. The All-Star events are sure to draw even more patrons to the bar, he said.


Said Washton: “We are ready for anything that comes our way.”

Fans are also excited about the event.

Sam Alipio, a youth basketball coach from Palos Verdes Estates, has been to the last seven NBA All-Star weekends and is paying to bring several of his players to the events in Los Angeles.

“I am very much looking forward to making it eight straight NBA All-Star weekends, coming back here to my hometown, Los Angeles,” he said.

Economic-impact forecasts for Super Bowl XLV at Cowboys Stadium in Arlington, Texas, ranged from $30 million to more than $600 million. But Planalytics, a Pennsylvania business forecasting firm, estimated that direct spending for the game was $200 million to $250 million and would have been as much as $25 million higher if a severe winter storm hadn’t moved into the area days before the game.

When the All-Star weekend was held at Cowboys Stadium last year, a California-based consultant hired by the NBA’s Dallas Mavericks estimated that the event would generate $152 million in spending in North Texas.

But critics and Texas economists who studied tax revenue reports after the event said the estimate was greatly exaggerated. A Mavericks spokesman declined to return several calls for comment about the forecast.

Phillip Jones, president of the Dallas Convention and Visitors Bureau, declined to comment on the economic-impact study but called the event last year “very successful.”


Cowboys Stadium, the world’s largest domed stadium, held 108,000 spectators for the game, making it the basketball game with the highest attendance in history, according to the Guinness Book of World Records.

“Overall, the city was completely full,” Jones said. “Thousands of visitors from throughout the country showed up.”

Roy Weinstein, president of Micronomics Inc., the Los Angeles consulting firm hired to estimate the economic effect of the All-Star weekend in Los Angeles, said he studied economic-impact forecasts for several previous sporting events and found that the spending projections were sometimes overly optimistic.

For his latest study, Weinstein said, he was careful not to exaggerate the effect of the event in Los Angeles. “In this case,” he said, “every effort was made to be conservative.”