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SPORTS VENUES: AVENUES OF REVENUE

SPORTS VENUES: AVENUES OF REVENUE

Sport is gaining in prominence at the confluence of media and entertainment as sports stars morph into media icons. With increasing spectator interest, tournaments, competitions, and other mega sports events are being held across the world.. Given this scenario, there is a growing need for developing sports venues which not only offer an array of sports facilities, but which can at the least, be self-sustaining..

Constructing sports venues involves huge investments. The return- on-the investment on the facilites created were till recently met only by hosting sporting events. Most of these events are held only a few times in a year, and remain unused for a major part of the year. This scenario is changing now.

Managements of sports venues are now aggressively exploring business opportunities to improve the value proposition on their investment. Looking at using these venues for non-sporting events is one of them. Many a venue is being modernised and redeveloped towards this purpose. Some of the ways in which sporting venues are being used to generate revenues is to lease them for political meetings, conducting trade fairs &, exhibitions, film shoots, conferences, school meets etc.

Given high infrastructure and maintenance costs, most managements of sports facilities are looking at ways to generate revenues throughout the year. Developing hotels at, or in sports venues is an innovative approach being considered by some forward-looking sports venue operators.

Hotels and sports venues - A winning combination

A hotel at a sports venue is a relatively new concept that has immense potential. The concept is popular in the UK and is likely to spread to other parts of the world. No longer do sports venues languish in oblivion after hosting a major event, often in the media spotlight. Managements of stadia are leveraging the assets created, improving on them, and exploring opportunities for revenue generation with state-of-the-art hotels and complementary support services at these sports venues.

Venues with hotels at site help cater to the requirements of corporate clients for conferences. The opportunity to develop hotels at sports venues is huge and is likely to grow. Research by PricewaterhouseCoopers' (Pwc) shows that there are 1,300 rooms open at 11 hotels at major sports venues during 2007 in the UK. The possibility of growth is immense and projections are for 3,500 rooms at 28 hotels by 2010. Having a hotel in tandem with a sports facility is an interesting combination. With revenues guaranteed -and importantly - not being tied to sporting events, it is a win-win situation for the sports venue as well as the hotel operator.

Immense Potential

Sports venues provide an opportunity to synergise the hosting of sporting events with the operating of hotels at the venue. This integration will bring in revenues for both. During important sporting events, the venue can maximize revenues for itself a venue with facilities to accommodate sports teams, the accompanying entourage and visitors from afar. With good potential for revenue generation, this new business model is likely to be replicated in other parts of the world.

Other possible activity that can help boost revenues that accrue to such facilities is by :

  • • Extending hospitality to corporates
  • • Hosting sales and business conferences
  • • Tapping into the short breaks leisure market
  • • Allowing the venue to be used for banqueting
  • • Operating as extended-stay hotels

Some Upcoming Projects

Dubai Sports City: Sports, commercial and leisure development. It will cover 50 million sft with venues for hockey, cricket, rugby and sports academies. The venue will have a 33 floor 1,000-room hotel and is scheduled for completion by 2010.

Rose Bowl, Southampton & Brit Oval, London Four-star integrated hotels with spectator facilities with a combined room capacity of 345 rooms.

Lords Cricket Ground Lords has announced its intention for redevelopment with plans for a 100-room hotel.

Doncaster Race course. A 120-room hotel will be functional in 2008

St. Lawrence Ground. The St. Lawrence ground in Canterbury is to have a 130 bedroom hotel.

Twickenham VRugby Venue The venue in south-west of London is under redevelopment and will have a four star hotel.

Pwc research reports that in the UK, more hotels at or in sports venues are on the cards Sports venues ranging from rugby grounds, racing circuits, football stadia, cricket grounds and race courses will have built-in hotel facilities About 10 percent of cricket grounds and 16 per cent of race courses in that country will have hotels on site.

With sports events and sports tourism gaining in prominence, opportunities to develop sports venues to cater to non-sporting needs are likely to increase. Unlike the stadia of the old, sports venues today are leveraging the infrastructure developed to create multi-purpose leisure facilities in an effort to look beyond merely conducting sports events..

The future

The concept of hotels at sports venues will gain in acceptance. as more of them extend and reign their facilities to cater to the needs of discerning audiences. These venues can tap the non-match day leisure and conference/event business to improve their revenue stream as they improve their corporate hospitality facilities.. Dubai has taken a lead in this sector in the Asia region; and will take time to penetrate to other parts of the world. The time has come for sports stadiums to look beyond staging events and buzz with activity all year round. A beginning has been made, its only a matter of time when sports venues will bustle with activity all year round.

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