Socer Business Bits: Dynamo Stadium, UFL & More

houstonThe Houston Business Journal is reporting that Dynamo President Oliver Luck remains committed to a downtown stadium.  The project remains held up by the use of a tax increment reinvestment zone in the Houston area.  By way of brief refresher, according to the City of Houston website, Tax Increment Reinvestment Zones are:

special districts created by City Council to attract new investment to an area. TIRZs help finance the cost of redeveloping or encouraging infill development in an area that would otherwise not attract sufficient market development in a timely manner. Taxes attributable to new improvements (tax increment) are set-aside in a fund to finance public improvements in the zone. Zones in the City of Houston have been created for one of three reasons:

  • to address inner city deterioration
  • to develop raw land in suburban fringe areas
  • to proactively address the decline of major activity centers

Total cost of the 21k stadium is expected to be about $80 million with the Dynamo ownership (primarily AEG and Golden Boy Promotions) funding about $60 million.  The rest of the funds could come from tax credits,  the TIZ money and from some of the stiumulus money floating around.  The TIZ program will also provide the property for the stadium.  According to Houston President Oliver Luck, multiple banks are lining up to provide financing for the construction project.  As we have noted previously, this is a great time for construction, with the cost of materials and labor way down.  Also, these are the type of projects that can bring jobs and income into the economy.  The economic benefit of stadium projects is also debatable, but during a downturn there is a definite economic upside.

As a brief aside, we spent last night in East Hartford, Connecticut at a UFL game between New York and Florida.  The UFL is an upstart football professional league muddling through its inaugural season.  The UFL is following the single entity model with league ownership of the various teams.  Attendance was very slight, with most attendees seemingly using free tickets to get in the door.  League TV ratings are hovering below 100k per game. which is well below MLS numbers  Despite this seemingly bleak situation, the League has remarkably signed tv contracts worth $70 million over two years, far in excess of MLS contracts.

One final note.  The Galaxy/Dynamo match won’t kick off until 11:25 Eastern on ESPN2, making it a late night for east coast fans.  The gams is preceded by a college football matchup (which will likely run long).  ESPN has built a  25 minute buffer between with a scheduled pre-game show, but there is a good chance some of the game will be chopped.