• Looking Back At Speculation On The New Yankee Stadium

    Posted by on February 9th, 2013 · Comments (5)

    It’s interesting to look back, today, at what Ken Belson wrote about the new Yankee Stadium on July 23, 2006:

    Making the most of a winning tradition and their home in the nation’s biggest city and media market, the Yankees generate nearly $300 million in annual revenue, according to an individual with knowledge of the team’s finances. He requested anonymity because of his continuing professional relationship with the team.

    The Yankees’ haul is produced by its share of the No. 1-ranked regional sports network, YES, as well as the more than four million fans who flock to the Bronx in a season and pay top dollar for tickets, parking and food at the 83-year-old shrine known as the House That Ruth Built. The Yankees also get some of the highest licensing and advertising fees in Major League Baseball.

    TO keep up with the escalating prices that it pays its players — a surge that Mr. Steinbrenner himself set in motion — the Yankees need still more revenue. Yet they have extracted about as much as they can from Yankee Stadium, which now suffers from a dearth of luxury boxes, parking and retail outlets. The Yankees’ bottom line is also hammered because the team, like the Mets and Red Sox, must pay millions of dollars to prop up less-prosperous teams. Effectively penalized for their success, the Yankees have become a symbol of baseball’s partially inverted economics.

    Mr. Steinbrenner, who declined to comment for this article, is grooming his son-in-law, Steve Swindal, to take over the team. Meanwhile, the Yankees are trying to cut their payroll by using younger and cheaper players when possible and staking their financial future on a new megastadium.

    “The new stadium is going to have all the tradition of the old stadium, with all the modern amenities,” said Randy Levine, the team’s president. “Bleachers will be there. Restaurants will be open. There will be a great hall when you walk into the stadium that can be used for events. The idea is to make this a year-round destination.”

    Set for a 2009 debut, the stadium, including building costs and debt payments, will carry a $1 billion price tag. To pay for it, the Yankees will need to generate an additional $50 million to $60 million a year in revenue, according to analysts. Mr. Levine declined to discuss how much money the team expects to earn in its new digs, though he ruled out selling the naming rights to the stadium.

    Other baseball executives and analysts, though, question whether the stadium will be as much of a bonanza as the team may hope. The Yankees already sell out most of their current seats and suites, they say, and the new stadium will have several thousand fewer seats. To offset that loss, the Yankees plan to have 60 suites in the new stadium, three times as many as they offer now. If the stadium does not create a financial windfall for the Yankees, it is likely to cast a financial pall over other teams that are making an art out of chasing dollars with the same urgency that they chase titles.

    “The Yankees have created tremendous expectations and have created the need to continue spending,” said Henry D. Fetter, the author of “Taking On the Yankees: Winning and Losing in the Business of Baseball.” “The Yankees have created a target for everyone else to aim at and been a stimulus for innovative management.”

    This was all six and a half years ago. And, now, the new Yankee Stadium has four years under its belt today. Given the current perspective, what do you think…is the new Yankee Stadium a bonanza for the franchise or not, and, why?

    Comments on Looking Back At Speculation On The New Yankee Stadium

    1. Raf
      February 9th, 2013 | 9:25 am

      I’d have to say it is. The Pinstripe Bowl, luxury boxes, Mohegan Sun Cafe, NYY Steak and Hard Rock Cafe make it so. Now the stadium is making money year ’round instead of a couple of tours here and there during the offseason.

      There was also the issue of ADA compliance at the old stadium, those went away with the opening of the new stadium.

      The Yankees were already making money hand over fist with the YES Network (which is their primary driver), the new stadium is just another revenue stream.

    2. February 9th, 2013 | 9:42 am

      I do give the Yankees credit for trying to make the Stadium a place that is in use, beyond April to October. They seem to be really working hard at it. And, they do have football games, boxing and concerts there, etc.

      But, I doubt that many, at all, go there to hang out at NYY Steak or the Hardrock from November through March if there’s not an event there. But, maybe I am wrong.

      Outside of tours, if they do them in the off-season, and the occasional wedding or corporate event, I don’t see them doing much there outside of football and the concerts.

    3. Evan3457
      February 9th, 2013 | 10:54 am

      Financially? Yes. They certainly make far more revenue off it. But then they have to; they spent hundreds of millions of dollars on it.

      For me, it’s a lot more comfortable place to watch a game. Is it as “dangerous” as the old Stadium? No. But I was there in the post-season 2009, when the Yanks had a team people thought could win. It was rocking in both game 6 vs the Angels and game 6 vs. the Phillies.

    4. Garcia
      February 9th, 2013 | 2:30 pm

      I’m a fan of the YSIII but I have to say it is embarrassing seeing the place 1/2 empty during last year’s ALCS, as well as game 5 of the ALDS. I think the Yankees did a “great” job of f-ing over the die-hard Yankee fan, I have zero desire to attend a game in person.

      I still do go to a game, but it’s more because someone in my inner circle wants to go and a.) they have never been to a baseball game OR b.) they still haven’t gone to the new stadium.

      I did a lot of work in Pittsburgh last year, and I enjoyed the overall baseball experience more than going to see my favorite team. The Yankee games are just way too expensive, and I think the team leaves a lot to be desired.

      I’d love to see the company of Stein, Trost, and Levine be humbled with an attendance # that doesn’t make it past north of 3 million.

    5. Garcia
      February 9th, 2013 | 2:33 pm

      In reading RS blogs, I love that the two fan bases’ are totally disgusted with their team’s ownership. All the success both teams have had has definitely come at a cost: make as much money as possible, no matter who you piss off.

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