Professional sports in the 21st century are multifaceted operations, and a major aspect of these multi-dimensional entities is real estate investments. The recent New York Times story discussing the relocation of sports stadiums downtown addresses this in part.
When the centerpiece of these real estate investments is a brand-new sports facility, teams have increasingly been shrewd to make supporting investments near their shiny new home.
These additional investments, which typically can include things like restaurants, hotels, retail, office buildings, apartments or condos, make considerable sense because they can generate additional incremental revenue for the franchise every day of the year…even on nights when there are no events at the facility.
Enter Sacramento’s Golden 1 Center, and the Sacramento Kings owner, Vivek Ranadive.
Ranadive played an integral role in saving the franchise from relocation when he purchased the team in May 2013. A year later, the Sacramento City Council approved public financing to build a new basketball arena.
The facility opened in September 2016 at a final cost of $558.2 million, with approximately $223 million contributed by the City of Sacramento. But truthfully, that only scratches the surface of the total investments which have been (and are still being) made in the broader area known as Downtown Commons.
For example, in October 2017, the Downtown Sacramento Partnership and the Greater Sacramento Economic Council released these findings:
The $1 billion investment in Golden 1 Center and Downtown Commons has built investor confidence in the city, and helped to drive nearly $1 billion in additional urban investment since 2015 Downtown property sales have totaled nearly $885 million since Golden 1 Center construction began. In the last year, 11 downtown properties with more than 1.3 million square feet of space sold, totaling approximately $359 million. Downtown employment grew 38 percent since arena construction began 26 new ground floor retail businesses were created in the last year, with another 23 new businesses set to open in the coming months. On average, foot traffic at 7th & K streets has increased by 51 percent on event days. Golden 1 Center created more than 2,000 food and beverage jobs, accounting for over $31 million in wages, and nearly $79 million in new gross regional product. Golden 1 Center also contributed $3.5 million to the region’s agricultural economy by activating local producers and sources for food, beverages and ingredients to serve arena guests. In 2017, Golden 1 Center was ranked within the top 15 U.S. venues and in the top 40 worldwide in ticket sales, attracting over 1.6 million attendees who spent more than $71.5 million in downtown Sacramento.
As someone who has visited Sacramento annually over the last 10 years, from my vantage point, there is no question there is a palpable difference in the city’s downtown vibe, attitude, and economic activity. There is a burgeoning sense of pride, opportunity, and optimism, and slowly, the enhanced feasibility of working, playing, and living within the confines of downtown Sacramento only adds fuel to the city’s rejuvenation and momentum.
The Golden 1 Center has already established itself as a first-rate sports facility, aesthetically and technologically. As a result, the G1C won Sports Business Journal’s “Facility of the Year” award in 2017.