If you have ever gone to a professional football game, you may have noticed how large the stadiums are. You may also have noticed that the stadium has amenities that have nothing to do with football such as restaurants, museums and party halls. How exactly do the owners of these stadiums get the money to build and maintain them over the course of 20 to 40 years?
Stadiums Are Often Funded by Taxpayers
While there is no evidence that a professional football team or its stadium does anything to boost the economy in a city, it doesn’t stop owners from demanding money. Politicians who don’t want to seem out of touch with what voters want approve these requests to appease the fans for another election cycle. In some cases, taxpayer funds are used to pay for the entire building with agreements that the city is only entitled to a small portion of the revenues generated from it.
Stadiums May Be Funded By Owners Themselves
It is no secret that the typical NFL owner is a billionaire who can afford to spend the money necessary to build a quality stadium. In some cases, they will actually put up funds necessary to build or significantly renovate it. This is often done if there isn’t enough political will to get the entire project financed.
Although an owner has PR teams dedicated to promoting these projects as beneficial to the community, those tactics don’t always work. As these owners have other business interests outside of the NFL, they don’t want to risk their image by refusing to work with the community on some level if needed.
Local Governments May Provide Land
If a local or state government isn’t willing to finance the stadium itself, it may provide the land necessary to build the stadium. This is true in Buffalo where Erie County owns the plot where New Era Field is currently located. The county also owns the stadium that it then leases to the team. As with most deals, the team is allowed to keep the majority of revenue generated from parking, concession sales and other purchases made during a game.
The NFL May Help If Necessary
The NFL has a stadium fund through which it will lend money to owners who want or need help financing their projects. Typically, the league requires that the owners pay up to 60 percent of the cost of the stadium on their own or through some other funding source. In most cases, the owners who request a loan are doing so knowing that they will make enough from their investment to pay it back plus interest without having to touch their own money.
Naming Rights May Help Pay for Renovations
If a stadium needs to be renovated or upgraded, a sponsor may pay for naming rights with the funds going to pay for the upgrades. The sponsor may also pitch in with branded signage and other materials that improve the game experience for fans while also helping to increase sales and visibility in a given part of the country. Although sports betting websites aren’t allowed to be stadium sponsors, they may strike deals with teams to provide funding in exchange for some sort of marketing partnership with them.
NFL stadiums today are more than just places where you sit in the stands and watch football for three hours. Instead, they are places where you can grab a full meal, get married or check your fantasy stats using its WiFi connection. As long as fans keep coming and spending money, the places where the teams play will likely become larger and offer more entertainment options on the day of the game.
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