Companies do not have big money to spend like they did just a year ago. Now, a major business journal says the arena naming rights are worth only a fraction of what the city and county could have gotten.
The ESA opened nearly three years ago and the naming rights are still on the market. It took two years for the
N.C. State University
, and the
Centennial Arena Authority
to agree on how to split the money.
Experts say the political wrangling may have cost them millions of dollars.
Arena officials want $4 million a year for the right to splash a corporate logo across the ESA. According to an article in
Street & Smith's Sports Business Journal
, the naming rights are worth just $1 million a year.
In the article which appeared in the Aug. 13 issue, one expert says: "The local government has been so slow to legislate approval that they've missed the opportunity to sell in a good economy. It's cost them at least 30 percent annually."
Hurricanes president Jim Cain is shopping for a corporate sponsor.
"In retrospect, everybody regrets we didn't have the deal done before the arena opened. It's always better to have a name on the building when it opens than not," he says.
Cain is still confident the arena can ink a 20-year deal for $80 million. He points to the number of high-profile events the ESA hosts.
"You combine NHL hockey with ACC basketball. You add things like the NHL Draft, the NHL All-Star Game that's coming to the Triangle," he says. "And we think they've missed the number by $3 million a year."
"It's probably somewhere in between," says Hill Carrow, president of
Capitol Sports Management
, a division of
Carrow helped the U.S. Olympic Committee with sponsorships for the Salt Lake City Games. He thinks that the ESA is doing a lot of things right, like filling its calendar with concerts, games and other events.
Carrow says that the average naming rights deal sells for about $2 million a year before a three-way split.
"If all the money was going to the Hurricanes, they might be more flexible about the pricing. But because the Arena Authority and N.C State are involved, all three parties receive a cut from those funds," he says.
Arena officials hoped to have a deal in place by this fall, but they now say that is not likely. The sluggish economy knocked some potential corporate sponsors out of the running. Now they are aiming for the end of this calendar year.
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