Ch 12: Facility Management Flashcards
International Association of Auditorium Manager (IAAM)
the professional trade association for the facility management field
what launched the construction of stadiums?
increase in the popularity of sport, such as pro baseball and college fball
what dictated the irregular sizes and shapes of the older ballparks?
constraints of urban space limitations
-fenway
what happened in 1927 (HOCKEY)
hockey owners built arenas to host their teams
-much like baseball
what occurred in arenas on non-hockey nights to fill empty seats?
boxing matches, Ice Capades
when ball arenas entered picture, how many tenants were there?
two
when did baseball only arenas become obsolete?
1960s
how were team owners able to make a good deal of money in terms of constructing an arena?
have the host city build the stadium
what did the 1990s see In terms of stadiums?
trend toward one-purpose stadiums again
arena
indoor facilities that host sporting and entertainment events
what are arenas built to accommodate for?
one or more prime sports tenants or to lure a prime tenant to the facility
what are some things that finance intercollegiate facilities?
- private donations
- endowments
- student fees
- fundraising campaigns
what can an owner do in terms of facility management?
owner can manage his/her own facility or contract out for private mgmt
what purpose does building adjacent practice fields serve?
increases event bookings
stadiums
outdoor or domed facilities for baseball, ball, soccer
is it easier to maximize bookings for an arena or stadium?
arena
what kind of entity almost always builds and owns convention centers?
a public entity
what are convention centers built for?
-lure conventions and business meetings to a particular municipality
why are convention centers publicly financed?
the rents and fees they charge do not always cover costs
what do university venues consist of?
stadiums and arenas that operate under diff economic factors
what dictates market for college venues?
student population
what do universities tend to provide the venue with?
tenant teams, certain amount of content thru the univ
metropolitan facilities
- venues in large cities (MSG)
- referred to as a “must play” due to audience size
- large capacities
local civic facility
- public facility
- smaller capacity
- located in small towns or cities
what do local civic facilities provide the public with?
the desired event at the best time of the year to avoid competition
sport event
specific dates, determined by league
concerts
booked months in advance
trade shows
multi day events in convention centers
what does federal gov’t allow in terms of facility financing?
state and local gov’ts to issue tax-exempt bonds
what does tax exemption lower?
it lowers interest on debt and reduces amount that stadiums cost
are convention centers private or publicly financed?
almost always publicly financed…raised taxes
funding of Big 4 pro sport venues from 1960s thru 2000s?
cost approx $24 billion w/ 64% thru tax dollars
-bonds/hard taxes/soft taxes
how is money to build facilities usually obtained?
by issuing bonds
two types of tax exempt bonds used by gov’t entities
- General Obligation
2. Nonguaranteed
general obligation bonds
backed by the local gov’ts ability to raise taxes to pay off the debt
what are the two types of taxable bonds issued by private entities?
- private-placement bonds
- asset backed bonds
difference b/w private placement bonds and asset backed bonds?
Private placement bonds provide a lien on all future revenues generated by the team. Asset backed bonds are secured thru specific asset
what does TIF stand for
tax increment financing
tax increment financing
available in a specific square mileage of land around the facility where the tax base is frozen and any additional taxes added are used to repay the TIF bonds
example of TIF
KFC Yum! Center is surrounded by a TIF district w/ a 6 square mile radius
hard taxes
include taxes on:
- local income
- real estate
- personal property
- general sales
what do hard taxes require?
voter approval b/c the burden of payment becomes that of the public
soft taxes
include added taxes to:
- car rentals
- hotels
- restaurants
- “sin”
- players
why are soft taxes easier to levy?
they affect a much smaller portion of taxpayers
what are some ways to gain private funding for a facility project include?
- naming rights
- food/beverage rights
- luxury suites/premium seating
- advertising rights
what do private donors provide to university athletic departments?
provide funding and have their names placed on the new facilities
why do cities subsidize sports?
sports facilities are thought to improve the local economy
what are 4 ways that sports facilities improve the local economy?
- Inc in construction jobs
- Ppl associated w/ team generate new spending in the community…expanding local employment
- team attracts tourists/companies to the host city
- new spending=multiplier effect (NYC)
when is building a stadium good for the local economy?
only if the stadium is the most productive way to make capital investments and use its workers
what affect does a new sport facility have on economic activity and employment?
extremely small effect
three categories of facility ownership?
- community/state
- colleges
- private facilities
community/state ownership/management
plethora of regulations and procedures in place
college ownership/management
funding is based on continued student growth, gifts, institutional subsidies
private ownership/mgmt
sole motive is for profit
what is the goal for management staff?
to provide a clean, safe, and comfy environment for patrons
functions of a facility?
- security
- cleanup
- marketing/sales
- scheduling/booking
- ops
- event promos
- finance and box office ops
private management
provides expertise with dedicated personnel and network of facilities that create leverage in making key relationships
what needs to be considered when marketing a facility
- location of venue
- culture of community
- production of events
what has allowed for easier booking of events?
the Internet
what is the driving force for ticket sales?
local economy
what is the gaol of promoting a facility?
keep financial risks low and profit margins high
copromotional model
facility and promoters split the risk and revenue
rental agreements
promoters pay specified amount up front and other costs covered by promoter
how do facilities generate revenues?
- tickets
- luxury suites/club seating
- concessions
- parking
- sponsorships
- rentals
what’re the primary expenses for facilities?
- mortgage/rent
- maintenance and repairs
ticket rebate
surcharge on ticket that goes to facility
ancillary revenue
sale of food, beverage, parking, fees, and sponsorships
marketing fund
profits from other shows put aside to invest in future programs
marketing director
in-house advertising agent for booked events
- buys media
- coordinates promos
- designs marketing materials
public relations director
can spin news and position. a facility in the best possible light
- coordinates TV broadcasts
- forges solid working relationships w/ TV and radio news directors
event director
in charge of safety and satisfaction of all facility users
booking director
devoted to booking events for the facility
-lots of time spent on telephone w/ agents and promoters
operations director
supervises facility prep for all types of events
what does an ops director spend facility’s annual expense budget on?
- labor
- maintaining and repairing equipment
- buying necessary supplies
advertising/sponsorship/signage salesperson
sells signage and event sponsorships
-commission only basis (usually)
group ticket salesperson
responsible for selling large blocks of tickets for various events to corps, charity orgs, schools
box office director
sells tix to events as well as collection of all ticket revenue
public facilities and energy per sq ft
consumer more energy per sq ft than any other retail industry
green management teams
reduce waste, cut energy usage and pollution, implement recycling programs
Americans w/ Disabilities Act
prevents discrimination against qualified ppl w/ disabilities
