Personal Seat LicensesPersonal Seat Licenses (PSLs), sometimes called CharterOwnership Agreements, are stadium financing tools,primarily existing in NFL venues. Approximately half ofNFL venues (15 teams) have raised capital through PSLsto construct <strong>the</strong>se buildings. There are two or threeteams currently building new venues which will alsooffer <strong>the</strong>m: San Francisco 49ers, Minnesota Vikings, andwhatever team ends up in Farmers Field in Los Angeles.PSLs are not only for <strong>the</strong> <strong>corporate</strong> fan. They aresold to nearly everyone in <strong>the</strong> venue. But <strong>the</strong> <strong>corporate</strong>fan is <strong>the</strong> person who is charged <strong>the</strong> most, especiallyin markets such as Dallas and New York, where PSLscan reach six figures for <strong>the</strong> absolute best seats in<strong>the</strong> house. Because a PSL is needed to obtain a goodseat in many NFL venues, <strong>the</strong>y can be purchased as acommodity. Several companies offer <strong>the</strong>m similarly tobuying a ticket on <strong>the</strong> secondary market.NFL Teams with PSLsDallas CowboysNew York GiantsNew York JetsCarolina Pan<strong>the</strong>rsOakland RaidersSt. Louis RamsBaltimore RavensTennessee TitansPhiladelphia EaglesChicago BearsHouston TexansPittsburgh SteelersCleveland BrownsCincinnati BengalsSeattle SeahawksAverage PSL Revenue Per Team:$144.2 millionAverage Number of PSLs Sold Per Team:48,221Always In Style: Beingspecial is no longer anamenity; it’s a necessity.In <strong>the</strong> 10,700-square-footCommissioners Club, membersenjoy a destination of luxurywith dark rich wood and plushvelvet and lea<strong>the</strong>r furniture.Teams Using or Potentially Using PSLsin <strong>the</strong> Future:San Francisco 49ersMinnesota VikingsLos Angeles franchise (Farmers Field)#SEATWinter2013 | www.alsd.com | S E A T | 49
Whereas in 1990 when <strong>the</strong> <strong>corporate</strong> VIP marketplace was considered onlyabout 3% of <strong>the</strong> marketplace, a new world-class professional venue nowusually has nearly 20% of its seats considered “premium.” Those 20% ofseats often equate to somewhere around 40%-50% of <strong>the</strong> total ticketrevenues created.Who Occupies Premium Inventory?Realistically, <strong>the</strong>re is only a small percentage of <strong>the</strong> <strong>corporate</strong>market that can afford suite ownership. Consider<strong>the</strong> following breakdown:Assume your suites lease for an average of $200,000per year. How much revenue would a company have togenerate to afford such a level of investment? The answerdepends on <strong>the</strong> profit margin of <strong>the</strong>ir industry, butwe will use 1% of gross sales (that would equate to 5%of net sales if profit margin is 20%). So to be considereda legitimate lease candidate, a company should generateat least $20 million in sales.Eliminating non-prospects such as retail, churches,schools, etc., <strong>the</strong>re are a total of 4.9 million businessto-business(B2B) organizations in <strong>the</strong> United States.Of <strong>the</strong> 4.9 million companies, only 2.5% (124,824) havesales of $20 million or more. By changing our parametersto those companies with minimum sales of $40million, only 1.2% of companies would qualify.These figures may seem discouraging, but <strong>the</strong>yconfirm that suite sales professionals must becomemore flexible and creative moving into <strong>the</strong> future. Oneway to capitalize on <strong>the</strong> wants of companies to be suiteholders without being limited to <strong>the</strong> size of <strong>the</strong> marketslisted above is to offer suite sharing opportunities.Suite sharing allows multiple partners to enjoy all<strong>the</strong> amenities associated with a suite at a fraction of <strong>the</strong>cost. For example, four partners share a suite for <strong>the</strong>season at $60,000 each. Your gross revenue has justincreased by 20% with <strong>the</strong> suite generating $240,000instead of $200,000.Using <strong>the</strong> same formula as above, $6 million or morein annual sales becomes <strong>the</strong> qualifying threshold forcompanies to be suite share candidates. The marketplaceat that level is three times larger than <strong>the</strong> marketplacefor single lease clients: 380,906 (7.7%) companiesgenerate at least $6 million in sales.A lot has changed over <strong>the</strong> past five years. Companiesthat were once premium customers could be outof business now; and some industry segments thatwere booming are suffering now. In addition, countercyclicalindustries have emerged, are now thriving, andare a viable target for suite sales.Below are business categories occupying premiumspace in four segments: growing, shrinking, and statusquo as well as counter-cyclical.Growing IndustriesAttorneys/Legal ServicesInsuranceBusiness/Management Consulting ServicesAccounting, Auditing & BookkeepingTelecommunicationsBeer, Ale, Wine & Liquor DistributorsDoctors OfficesShrinking IndustriesBanks, Bank Holding Companies & Credit UnionsTelevision, Radio & NewspaperFinance & InvestmentsGeneral Contractors & Home BuildersReal Estate Agencies & ManagersCar DealersMortgage Brokers & LoansReal Estate DevelopersTitle CompaniesPlumbing, Heating & Air Conditioning ContractorsStatus Quo IndustriesCasinosBusiness Services NECRestaurants & CaterersHolding Companies & O<strong>the</strong>r InvestorsManufacturing CategoriesCounter-Cyclical IndustriesComputers/High-TechCollection AgenciesCredit & Debt Counseling ServicesPawnbrokersCheck Cashing ServiceApartment-Related CompaniesEducational/Training CompaniesDiscount ChainsFast Food RestaurantsAuto RepairMedical-RelatedRemodeling ContractorsSelf-Storage– Ron Contorno, Full House Entertainment Database Marketingand Dr. Hea<strong>the</strong>r Lawrence, Ohio University50 | S E A T | www.alsd.com | #SEATWinter2013
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