Would one of you Big Soccer financial experts explain to me how the MLS could possible lose money in San Antonio when the MLS is getting: -------------------------------------- According to the memorandum: The team would get the Alamodome rent-free for 20 games a year. The team would keep all revenue from tickets, parking and concessions. The team would get half of any revenues from events it co-sponsored with the city, such as an exhibition soccer match featuring teams from Mexico. The city would receive 5 percent of any advertising signage sold by the team in the dome and 30 percent of the naming rights payments if a sponsor is lined up before the end of 2006. The city's cut would drop to 20 percent of the net revenue from naming rights if the sponsor isn't landed until after 2006. "Alamodome" would be a part of any name. The initial five-year lease would include four additional five-year extensions. The only penalty for breaking the lease would be for the team to pay a portion of the $426,000 the city spent sprucing up the dome offices. _____________________________ As I see it: Each team only spends 2.1 million on salaries per year .Let's say they spend 1.25 million on travel, advertising, and management. Each team gets 1.25 million from the 150 million addidas deal. Does that mean that they need to make 2.1 million to break even? 2.1 player salaries .75 travel and management .5 advertising ____ 3.35 total cost -1.25 addidas deal revenue ___ 2.1 added revenue to break even If they were to only average 14,000 per game at an average of only $10.00 a ticket that would mean they would break even. (10.00 x14,000) x 15 = 2.1 million. Moreover, my simplistic view does not include sponsorships, other soccer events, stadium naming right, concessions, or parking. Please tell me where I am wrong before I call Mr. Garber and tell him I'm ready to buy the Wizards and move them to San Antonio. (interst rates are low. i will get a second mrtg on my house) I'm not buying before they move the Metro Stars from the swamp. I don't want my money going down a sink hole.
Re: Is is possible to loose money in San Antonio? If you run with loose chicks, you will lose money. Seriously, the expenses outlined are far too low. Most teams spend $3-4 million on actually running the team, outside of player salaries. There are league-wide losses to consider and possibly broadcast timebuys. And possibly more. Sachin
The deal put forward in that article is the sweetest I've heard of for an MLS team. Getting access to parking and concession revenue is what many say is critical to making a leased stadium deal work. Throw in free rent and I think a San Antonio team would be in the black. Word from some at the Rapids was that we were "very close" to breaking even last season. Don't know exactly if very close is $10K, $100K or $1M in the red.
Re: Is is possible to loose money in San Antonio? Must be travel and staff, because it certainly isn't advertising.
Re: Is is possible to loose money in San Antonio? You also have to take into account... Corruption - FO people getting new Benz's as Christmas bonuses. Plus the various 'stripper parties' at headquarters, you think they (strippers) are coming for free. Kickbacks - to the San Antonio city govt., nothing is for free folks. Mafia - To avoid confrontations with the Texas Syndicate, weekly payments.
Re: Is is possible to loose money in San Antonio? If they are offering such a sweet deal, what's in it for them in the long-run? It looks like they won't be making very much off of MLS coming to town
Re: Is is possible to loose money in San Antonio? Who pays the operating cost for the stadium - cleanup, utilities, staffing. No idea how much these might be, but it could be significant.
Actually, Kansas City is the team in the rumors, right? As a standalone entity, I can't imagine how they could lose money. But they're on the hook for 1/12 of leaguewide losses. I think it's unlikely they could lose money even then, but only God and MLS' accountants know for sure. Remember, the standard is for, say, the Gals to pay rent to the owner of their stadium. So the Gals aren't as profitable as a standalone entity as you'd think.
Only if nobody comes to the games. But I suspect people would go. The intersting question will be... How many people have to attend in order to break even?
Well the Metrostars reported 5 million dollar yearly losses probably would put a partial dent into those rosey forecasts. And what about a training ground? I'm sure that would cost money to rent or build. But in all honesty, that deal sounds too good to be true. There is a catch somewhere. On the part of the city of San Antonio, they seem like they are desperate to get a full-time/partial tenant into that building.
Off topic, but has anyone commented on the irony of a Mexican team taking over the Alamodome? Anyone? Meh, anyway. It is completely possible to lose money in SA. The relocation or start-up costs would be considerable. Depending on how generous they are in terms of staff - marketing, public relations, technical, scouting, etc, plus marketing budget, their first year could be deep in the red. It's all about how far in the red are they willing to go? On the other hand, I think whoever takes on this team will be able to recoup any loossess in the first few years - at least do as well as Columbus (which, IIRC, makes a profit until the weight of every other teams losees is counted against them) Or? They'll BLOW OUR MINDS WITH INCREDIBLE ATTENDANCE FIGURES! We'll be all "whoa!"
Maybe it's too much info but I once had a wet dream about the Metros getting a deal like this from the Giants stadium. Never thought I'd see the day, although it's for a different team. Nothing short of hiring Nick Sakiewicz will make them lose money.
so funny i had to see it again - and you thought the punchline was in the beggining. jokes aside - hope this pans gold for mls
Press release from MLS http://www.mlsnet.com/MLS/news/mls_news.jsp?ymd=20050414&content_id=26672&vkey=pr_mls&fext=.jsp
We are gonna be so close to being profitable overall in the next few years. The turning point will probably be in 2007 or 2008, when the Metros (and hopefully DC) have a stadium.