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Why replace the Trop?

By Aaron Sharockman and Stephen Nohlgren, Times Staff Writers
In print: Sunday, September 7, 2008

Tropicana Field: Teams with new ballparks, except for the Milwaukee Brewers, have raised player salaries faster than the major league average. 
	[JAMES BORCHUCK | Times]

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ADVERTISEMENT Related Links It depends: Are the Rays making money, or losing it? Yes Blog: Ballpark Frankness Charts: New stadiums' impact

For the first time in their 11 years, the Tampa Bay Rays are talking playoffs. Ticket sales are up 25 percent. Television ratings are growing even faster.

So why, in the middle of this surprising surge, are the Rays seeking a new stadium?

What's wrong with Tropicana Field?

In a word: money. The Rays say only a new stadium will generate enough revenue to pay higher salaries and field a consistently competitive team.

A St. Petersburg Times review of baseball finances supports the Rays notion that modern, more intimate ballparks make huge sums of new money. Attendance, ticket prices and team value all increase, often dramatically.

But the link between new stadiums and more wins is tenuous at best. Over the past decade, teams in new ballparks averaged only 2.2 additional wins. Five of the nine teams got worse.

A committee of civic leaders is examining whether the Rays need a new stadium, where it might be located and whether local governments should renew taxes to keep baseball in St. Petersburg.

In the end, it's not about indoor vs. outdoor.

It's not about downtown vs. Gateway.

It's about the bottom line.

The Rays and other major league clubs will not open their books to scrutiny. But a St. Petersburg Times examination of nine of the newest ballparks, all opened since 1999, reveals two trends:

• Attendance soared, even after the honey­moon glow of a new park wore off. In eight of the nine parks, attendance grew three times faster than the major league average.

• Average ticket prices grew twice as fast as the major league average. San Francisco Giants' tickets doubled in the first five years, from $11.08 to $21.72. Tickets in Detroit rose at a similar rate.

Combined, higher attendance and pricier seats produce staggering new revenues.

Giants average ticket sales rose from $18.5-million at Candlestick Park to $71.2-million at AT&T Park. Philadelphia's new ballpark brought in an extra $51-million a year, San Diego's $28-million.

And that doesn't include increased parking revenue. Or concessions. Or merchandise sales.

Higher revenues, in turn, enabled teams to invest some of that new money in players, the Times analysis shows.

The Giants spent $44.5-million more a year on players in their new park. Philadelphia increased its payroll $42-million; even small-market Pittsburgh added almost $27-million a year to salaries.

In fact, all teams with new ballparks, except for the Milwaukee Brewers, raised player salaries faster than the major league average.

Dollars and cents

It's a cool, breezy May night in Washington, D.C., as the Milwaukee Brewers take on the hometown Nationals.

The Nats are in last place, and hopes for a winning season already are dim. But the team's new 41,888-seat ballpark is three-quarters full of fans milling about the stands and beer stalls.

What's happening on the field doesn't matter much.

Inside the Lexus Presidents Club, pictures of presidents throwing out ceremonial first pitches line the dark-wood bar and restaurant, right behind home plate. Fans nibble on chocolate cupcakes, sink into leather chairs and watch through a private window as players take swings at the stadium's indoor batting cage.

It's a luxurious diversion, if you can afford it. A single ticket costs $325.

Welcome to the lucrative new world of modern ballparks.

"The focus used to be the seats have to be good, there has to be a place to buy a beer and a hot dog, and there has to be a place to use the john," said Joe Spear, whose firm, HOK Sport, has designed 10 of the past 14 new ballparks. "Now it's a lot richer experience. There has to be a lot more things to do. What you learn is that people don't want just hot dogs, they want crab cakes, premium sandwiches, imported beer."

Dave St. Peter knows the drill all too well. St. Peter, who went from managing a Minnesota Twins retail store to running the entire franchise, is scheduled to open a new publicly financed ballpark in 2010.

The stadium will feature a 102-foot-long high-definition scoreboard, 3,400 club seats and warming shelters for cold days. Most importantly, it will generate $40-million to $50-million more in revenue a year, St. Peter said.

"It's critical to ensuring a competitive team for the long term."

The Nationals won't discuss cash flow at their new ballpark, but the Washington Post estimates ticket revenues could double this year — and that's for a team that may finish with the worst record in baseball.

How does this all happen? How does a stadium so dramatically increase a team's revenues?

Prepare to open your wallet.

How they make money

The best seats at the New Yorks Mets' new ballpark next year will cost $495 a game, up from the $276 at Shea Stadium this season, according to the New York Times. Ticket revenues overall for the Mets could increase $100-million a year, even though Citi Field will have 15,000 fewer seats.

It's a common thread through all new ballpark construction:

Fewer seats. More demand. Higher prices. Bigger takes.

"You are creating demand, all the teams are doing it, realizing that poor people watch games on TV and rich people go to the game and show off," said J.C. Bradbury, sports economist at Kennesaw State University in Georgia. "The real money is in making sure you can get sushi and fine wine and sit 40 feet from home plate or in a luxury box."

Rays executives acknowledge a new ballpark would lead to higher ticket prices overall. But the increases would mostly hit premium seats, they say.

"You want to create the ability to monetize the small number of customers who can create the biggest revenue bang," said Rays senior vice president Michael Kalt. "What that does is it allows you to keep prices fairly constant for the great mass of average people."

It's not only tickets, though. New stadiums suck in money in other ways.

• Teams are turning the facing of their upper decks into LED image boards that can display electronic advertisements throughout the game. The Trop's facing is too small for that.

• Areas of a stadium are being built for private pre- and postgame parties. During the game, these serve as congregating points where fans can view the game. The Trop's design doesn't allow such flexibility.

• Luxury suites and VIP club areas are being sponsored by high-end businesses such as Lexus. A kids area in San Francisco is sponsored by Coca-Cola. Luxury suites at the Trop are relatively spartan and poorly designed. An overhang blocks fans from tracking high fly balls. The Trop's kids area is tucked into a dark corner of the outfield, where parents waiting with their children cannot watch the game.

Tropicana Field, opened in 1990 to lure baseball, was the last true multipurpose sports venue in America.

St. Petersburg officials thought the flexibility would beef up revenues. For a while, it worked.

Hockey's Tampa Bay Lightning and arena football's Tampa Bay Storm played in the dome and broke national attendance records. Rock icons Kiss drew 15,000 fans one night and singer-songwriter Alanis Morissette drew 20,000 the next.

But when the Lightning and Storm departed in 1996 for a smaller arena in downtown Tampa, the Trop lost its side business and was left with a cavernous design suitable for football but mediocre for baseball.

Renovation potential

Some seats are too far from the field, the Rays say. Many in the upper deck and along the baselines face into the outfield instead of angling toward home plate. You can't walk around the dome on the same level or watch the game while waiting for a hot dog.

"The Tropicana dome is the worst stadium in baseball," said Andrew Zimbalist, a respected critic of new stadiums and an economist at Smith College. "It's an unappealing place that doesn't have a lot of revenue-generating accoutrements that a lot of new stadiums have."

The Rays say even with gains in advertising and marketing, the Trop never will generate ticket revenues that other teams enjoy.

The seats are just not worth enough. Short of gutting the stadium and starting over, there is not much that can change that, the Rays say.

The stadium's roof design also presents a problem. After the Twins move into their new park, the Rays will be the only team in baseball to play in a fully enclosed dome. Seattle, Houston, Arizona, Milwaukee and Toronto play in domes that open when the weather is nice.

Retrofitting the Trop with a retractable roof would require tearing down the existing roof and installing new structural supports, Kalt said. In addition, the stands and playing fields would need elaborate new drainage systems to deal with Florida downpours.

"You're literally talking a couple hundred-million dollars," Kalt said.

Without dramatic change, the Rays are at a financial disadvantage.

According to an estimate produced by Forbes, the Rays took in an estimated $138-million in revenues in 2007, the third-least in baseball. The Detroit Tigers, who ranked 15th in revenues, by comparison, earned $173-million in a new ballpark.

Rays' officials, who typically discredit the Forbes estimates, say relative to other teams the magazine is correct. The Rays say they rank at or near the bottom in every category of revenue — from ticket sales to advertising to luxury suites.

Attendance gains at the Trop this year should add about $6-million to ticket revenues. Concessions and parking could add $4-million to $5-million. But that won't cover the $35-million gap between the Rays and Tigers, who are near the mid-point in revenues.

And the Rays wouldn't even pocket all of those increases. As part of Major League Baseball revenue sharing rules, the Rays must turn over about $0.31 of every additional $1 they make at Tropicana Field this year.

If they don't get a new stadium, the Rays say, they will keep falling further behind.

Only three teams in Major League Baseball are waiting on new ballparks and the revenue they bring — Oakland, Florida and Tampa Bay.

Behemoths like the Yankees and Mets are opening new stadiums in 2009, and Minnesota's new ballpark opens a year later. Icons like Wrigley and Fenway are finding new ways to pull in all sorts of money. Major renovations are planned or under way for Dodger Stadium in Los Angeles and Kauffman Stadium in Kansas City.

Collectively, these stadiums represent billions of dollars in new money for baseball, and renewed hope for the cities that build them.

"I don't think anybody made a mistake in building a ballpark they shouldn't have built," said Jim Grinstead, editor of the trade publication Revenues from Sports Venues.

But, Grinstead said, wins and losses is another story.

Coming next week

Will building a new stadium bring more victories for the Rays?

"You are creating demand, all the teams are doing it, realizing that poor people watch games on TV and rich people go to the game and show off."

J.C. Bradbury, sports economist at Kennesaw State University in Georgia

"There has to be a lot more things to do. What you learn is that people don't want just hot dogs, they want crab cakes, premium sandwiches, imported beer."

Joe Spear, of the design firm HOK Sport

"The Tropicana dome is the worst stadium in baseball."

Andrew Zimbalist, stadium critic and economist at Smith College