With two major NASCAR races and a huge impact on the region, Bryan Sperber and Phoenix International Raceway add plenty of fuel to the Arizona economy
Activity in the West Valley has hit an all time high as new hotels and mixed-use developments suddenly appear in what used to be stark dirt fields, but they are not for the upcoming Super Bowl XLII. The take-off of economic development is almost as fast as the blur of engine-revving cars circling at Phoenix International Raceway.
PIR pumps $473 million into Arizona’s economy annually, according to a recently released study on Phoenix International Raceway conducted by Arizona State University’s W.P. Carey School of Business. A staggering amount equal to what the Super Bowl is prospected to bring to the Valley. “The Super Bowl is predicted to generate $400 to $500 million,” says Julie Frisoni, marketing and communications director for the city of Glendale. “However, PIR happens every year.”
PIR’s economic impact figure is based on two NASCAR events, the second of which was added after heavy statewide lobbying in 2005.
Timothy Hogan, Ph.D., professor emeritus of ASU’s Department of Economics, directed the 2005 study. The new study updates the 2001 original study of PIR’s economic impact, but adjusts for inflation and increase in races and fans.
The raceway’s overall economic impact of $473 million takes into account visitor, organizational and induced expenditures, such as purchases by out-of-state visitors and business activities at PIR. The updated study identifies several other areas of growth including state and local tax revenues, as well as income generated directly and indirectly from PIR, which covers PIR employees’ wages and salaries and Arizona household additional income as a result of visitor spending, PIR operations and spending by PIR employees.
According to the study, visitors from out-of-state who attend PIR events spend $160 million annually on goods and services directly and indirectly associated with the raceway including dining, entertainment, lodging, recreation and shopping throughout the Valley. However, out-of-state monetary flow will shift away from dispersing over the entire Valley and become more concentrated in the West Valley as economic development increases in the area. “Over the years, with the University of Phoenix stadium and more hotels being built in Glendale, more activity will occur over in the West Valley,” Hogan says.
PIR President Bryan Sperber says the organization is working with ASU’s sports business program to conduct a complete study update, which should be finished by spring 2008. “It’s a pretty comprehensive program,” says Sperber. “The original study covered one NASCAR race, but the Valley has evolved and changed, and the landscape of the sport has changed.”
Preparing for the Rush
In preparation for out-of-state visitors, Avondale Mayor Marie Lopez Rogers says the city has two new Hilton hotels that are already sold out for the next three years during race times, and several mixed-use developments opening in time for Subway’s Fresh Fit 500 weekend in April. PIR holds two races a year bringing in a total of 375,000 race fans to the Valley. “I remember when we first started [PIR] 17 years ago, looking forward and dreaming of what NASCAR could be,” says Sperber. “I think we’ve reached or even surpassed that dream.”
Feeding the Economic Giant
Sperber says PIR’s success is due to two key pieces of legislation that propelled the growth of NASCAR racing in the Valley.
First, the creation of the bridge over Gila River. Second, the $5 million spent in widening access roads coming from the west, where most race car fans travel from to get to PIR. A little known fact about these public improvements is that racing fans paid for them. “The public enjoys wider roads and a bridge year round, while PIR uses it a couple days a year,” says Sperber.
In addition to public improvements and huge economic impact, PIR is a privately owned entity. “Most professional sports venues are owned by the public,” says Sperber. “New changes to [PIR] are all funded privately by us. That’s well over $150 million given to the economy in addition to the races.” Which is great news for the booming West Valley.
“The more the races grow, the more PIR puts into capital investments, which will make the experience better,” says Jack Lunsford, president and CEO of Westmarc. “As the experience gets better, there is more money spent that directly affects our communities.”
Dina Serin, economic development specialist for the city of Avondale, says PIR was a vital component of their 2007 marketing plan, which introduces a new message point and brand awareness that uses PIR’s success to help promote the city.
Marketing materials for Avondale’s Economic Development Department display the city’s slogan: Avondale is on the move… And you are in the driver’s seat.Keeping with the theme, calls to action sprinkle fliers and brochures: Rev up your RPMs at local shopping and dining destinations; shift into low gear by relaxing at one of the Hilton hotels; and take the wheel and experience Avondale for yourself.
“[PIR] is a great asset to our community and we plan on continuing to work with them,” says Avondale’s Development Director Claudia Whitehead.
Jacki Mieler, director of media relations for the state’s Office of Tourism, says PIR attracts people who might consider doing business or relocating businesses to Arizona. “NASCAR has a lot of high-profile sponsors who will travel to come see the races,” says Mieler.
Lunsford says the hope is that those high profile sponsors will see the growth and development happening and create new jobs that will further propel the Valley’s economy.
As PIR races into another exciting season, the economy fuels up on visitors experiencing all the Valley of the Sun has to offer.
|Evolution of PIR
PIR was founded in 1964 by a group of professional sports car racers that had a dream of building a racing facility. PIR was carved out of the foothills of the Estrella Mountains in the West Valley and was intended to be a new crown jewel of American open wheel racing. At that time the tourism industry in Phoenix was just starting to grow.
It wasn’t until 1988, when NASCAR NEXTEL Cup Series racing came to PIR, that auto racing in Phoenix really became a major sporting attraction for the area. The Checker Auto Parts 500 NASCAR Winston Cup Series race in November is said to be the largest one-day sporting event in Arizona. A study by Arizona State University proves PIR’s economic impact to be among the top in the state, and demonstrated PIR’s tremendous growth over just a few years.
PIR President Bryan Sperber has a few exciting changes for upcoming events that will further propel PIR’s growth. “With every event, we attempt to introduce and try new things. We live in an entertainment world where the lines are becoming more blurry in terms of live entertainment, music and sports,” says Sperber. “We have to keep [PIR] fresh, fun and exciting.”
AZ Business Magazine April May ’07 | Next: The Road to Success