The Economic Value Of A Covered Stadium For Las Vegas, The Hospitality Industry, Nevada, & UNLV Dr. Mark S. Rosentraub Bruce and Joan Bickner Endowed Professor of Sport Management University of Michigan
How Many Times Have You Heard Statements Like These? • The Las Vegas metropolitan area (Las Vegas MSA) is one of the three major urban centers in the United States that is not home to a modern or covered stadium. • The absence of a covered stadium in Las Vegas region is even more surprising when one considers the vital role of special events in advancing Southern Nevada’s internationally dominant hospitality and tourism industry. Las Vegas has the infrastructure required to host the two largest conventions held each year in the United States simultaneously but lacks a world-class stadium. Such a venue will bring new events to Las Vegas and create real (or new) economic development. • If a covered stadium is built, resorts in the Las Vegas region and the local economy will benefit from hundreds of millions of dollars in new revenues. The events in this stadium could not be held at any of the facilities that currently exist in Las Vegas.
Why Can You Believe This Assessment? • Seven Separate Methodological Safeguards • The only events included are those that bring new visitors to the region • All substitution effects were eliminated by excluding spending by local residents • No value was included for the transfer of events from existing venues to the stadium • No event that could currently be held at any existing or planned venue was included
Why Believe This Assessment? • The benefits reported reflect spending only by new visitors • No indirect or induced benefits were included since the region’s resorts are unlikely to receive any additional benefits from the secondary effects produced by visitors’ spending. Those benefits, however, do reverberate throughout the regional economy to other businesses and households • The count of attendees at new events at the stadium was reduced by estimating the number of people who would still have visited Las Vegas even if the new event was not held
Other Safeguards - 1 • All Spending Data From LVCVA Surveys, Guy Hobbs, John Restrepo • Anticipated Number of Events Vetted With Hospitality Officials From Las Vegas • A Methodology Vetted By Other Academicians and A Career In Publishing Scientific Studies of the Economic Value of Facilities and Industries • A Track Record Of Post-Hoc Comparisons Of Validity of Projections
Other Safeguards - 2 • Separation Of Sectors Of The Economy To Better Isolate Effects For The Tourist Economy • Aggressive Estimate Of Spending On UNLV’s Campus To Carefully Project Effects Of Spending By New Visitors At The Resorts and In Las Vegas • No Inclusion of Benefits From Construction Despite Clear Gains For Labor and Construction Firms • If These Safeguards Removed, Estimates Of Benefits Increases By Almost 100 Percent
UNLV Benefits &UNLV and Las Vegas • Region Needs A Great Residential University • The Value of Football For The On-Campus Experience • Unifying All Parts Of Its Programs On One Campus • Gown-Town Relationships: UNLV Is The Pacesetter • Thomas & Mack: A Validated Model • A Commonality of Interests: UNLV, the Hospitality Sector, and Nevada -- In Short, No Losers At All
Why A Partnership With UNLV? • Thirty years ago the Thomas & Mack Center was built, and today it hosts numerous entertainment events vital for the region’s economy. A covered stadium will serve the community, UNLV, and the hospitality sector. The stadium will produce new regional economic development and tax revenues. • These benefits underscore the need for second partnership between UNLV, Nevada, Clark County, and Southern Nevada’s hospitality sector.
Building On Success No other university in the United States has ever established as successful a partnership with its regional hospitality industry and its state than has UNLV. UNLV has established a unique and extraordinary relationship with the region that creates numerous jobs and business opportunities for residents and the region’s resorts. The Thomas & Mack Center has generated new tax revenues for the State of Nevada, local governments throughout Southern Nevada, and to McCarran International Airport
What Would A Stadium Mean In Terms Of Direct Economic Benefits? • No University in the United States has a stronger record of partnerships with the hospitality industry • What’s Next? • Here’s What A Stadium Would Likely Mean For The Hospitality Sector and Las Vegas
Spending for 15 Events • Lodging $84.1 million • Food $100.2 million • Retail $52.0 million • Gaming $97.2 million • Local Transit $25.8 million • Sightseeing $4.1 million • Consumption at Stadium ($66.1 million) • Impact For Resorts, LV $327.1 million in direct revenue
Tax Revenues Generated - 15 Events • State of Nevada Sales Tax $13 million • Clark County Sales Tax $2.4 million • Live Entertainment Tax $4.3 million • Hotel Tax $10.1 million • Nevada Gaming Fund $6.6 million • Car Rental Tax $0.4 million • LVCVA Share of Hotel Tax $4.2 million
An Optimistic View -- 20 Events • Increment For Hospitality Sector - $436.1 million • New Taxes Produced - $48.7 million
Replacement or “Crowding Out” Effects • First large wave of studies focused on the impact of the Los Angeles Olympics on that region’s hospitality sector • Conclusion - More Events Do Not Necessarily Mean More Revenue As “Crowding Out” Effects Do Occur • Can That Happen Here With A New Stadium? • Yes • What Do We Do?
Crowding Effects and Management • Las Vegas Has A Management Team In-Place • LVCVA • LVE • UNLV • This Board • A Track Record Of Coordinated Success • The Need For A Covered Stadium • Programming To Match The Industry’s Needs
What Events? When? • Pac 12 Football Conference Championship - December • NFL Exhibition - August • New College Bowl Game -- December/January • Neutral Site College Football Game • International Soccer Festival (Summer) • Electronic Music Festival (Summer) • Country Music Festival (ACM Weekend)
What Events? When? 2 • UFC International Fight Week (Summer) • Tour Concert  (Summer) • Winter Kick Soccer Festival • Rock Music Festival (Summer) • X Games (Summer) • NFL Pro Bowl (January) • MWC Football Championship Game (December) • NFR Closing Event (December)
What Events? When? -3 • Wrestlemania • Political Conventions • NCAA Basketball Championships (Final Four) • Comic-Con • Boxing • MLS All Star Game • Corporate Events • NBA All Star Game
The Competition - Emerging Challenges • Orlando • New $100 million Sport & Entertainment District linked to the Amway Center • Enhancements To Citrus Bowl (in excess of $100 million) • City’s Goal -- Integrated Entertainment District From the Citrus Bowl to Dr. Phillips Center for the Performing Arts and Incorporating The Amway Center • More Integrated and Larger Version Of Denver’s Downtown • Extensive Partnership With Disney’s Assets • New MLS Stadium
The Competition - Arlington • Extraordinary Facility • Challenged With Limited Supply of Nearby Hotels • Challenged By Lack Of Integrated Development • Partnerships With Fort Worth & Dallas • Maximum Exposure and Attendance Flexibility
Conclusions 1 • Some Important Events That Can Add Economic Development For Southern Nevada & The Hospitality Sector Cannot Be Hosted Despite The Extraordinary Mix of Hotels & Entertainment In Las Vegas • Las Vegas Is One Of A Limited Number Of Metropolitan Regions Without A State Of The Art Stadium • A Covered Stadium Has The Potential To Host 15 Export Based Events Each Year
Conclusions - 2 • New Stadium & Events Can Add $393 Million To Regional Economy • New Stadium & 15 Events Can Add More Than $320 Million In Revenue For Las Vegas • The Public Sector Can Expect $32.5 Million In New Tax Revenues • The New Project Can Succeed Because Of The Extraordinary Track Record Of Achievement Between UNLV & The Hospitality Sector
Conclusions - 3 • Success Will Require Coordination Between Event Planning & Resorts • UNLV, LVE, & LVCVA Wrote The Book On That Coordination • Success Means Solving The Crowding Out Problem • But That Can Be Done, And That Coordination Means This Project And Its Benefits Can Be Secured • Of That I Have No Doubt • And Together The Transformation Of UNLV Get Also Be Advanced To Provide The Region With The Residential Campus It Needs & Deserves