Arizona looks for economic boost from sports
The College Football Playoff National Championship Game on Jan. 11 is the next in a line of major sporting events coming to Arizona that has the potential for both short- and long-term financial benefits for the state, analysts and backers say.
But while Super Bowl XLIX brought in over $700 million for the local economy, according to a study for the Arizona Super Bowl Host Committee by Arizona State University’s W.P. Carey School of Business, organizers of the College Football Playoff event say they plan to measure its success against previous major college football games in Arizona.
The Valley hosted the previous incarnation of college football’s championship contest, the BCS National Championship game, in 1999, 2003, 2007 and 2011. The revenue generated by hosting those games reached $646.2 million combined in economic impact, according to studies by W.P. Carey. Those games also reportedly created over 1,400 jobs, according to the same studies.
Brad Wright, co-chair of the Arizona Organizing Committee, expects the College Football Playoff National Championship to create more of an economic impact than any one of the previous BCS title games. The most recent BCS title game in Arizona created an estimated 595 jobs in the state, according to the Carey School study.
“We expect, now that this is a four-day championship game and events, we expect that number to be significant,” Wright said.
The organizing committee plans to take over an area of downtown Phoenix similar to that taken by the Super Bowl in January. Included will be Playoff Fan Central, a multiday festival at the Phoenix Convention Center that sits in the middle of the Championship Campus downtown, that will include both ticketed and free events, including outdoor concerts.
“We are expecting a very similar experience downtown,” Wright said. “We watched what the Super Bowl Host Committee did. They did a great job, they activated downtown with their Super Bowl Central making it really a point of pride for the community.”
This will be just the second College Football Playoff, after its inaugural season last year replaced the previous BCS format. Because of that, the organizing committee only has one other game to model itself on, the inaugural College Football Playoff National Championship in Arlington, Texas, last January. However, Wright says they are also trying to follow the same format as the Super Bowl with their Championship Campus downtown.
“We think it will be the place to be to experience the game, and everything about it, even if you don’t have a ticket to the game,” Wright said.
Those who spent any time around downtown Phoenix in the week leading up to the Super Bowl in February know the crowds the events drew, and how hard it was to go to just about any business downtown. While those crowds, which the Arizona Super Bowl Host Committee claimed totaled over 1 million, brought in a lot of money, they also caused a lot of stress on local small businesses – not that the businesses seem to mind, according to Wright.
“Everybody has been very positive,” Wright said. “I think people appreciate the huge economic impact that these games bring and these events bring.”
Wright also believes these events are well-timed for the Valley, as the region attempts to lower its unemployment rate, which stood at 6 percent in November compared to a national rate of 5 percent that month, according to the Bureau of Labor Statistics.
“The Super Bowl, this game, the economic impact is coming at a time when we can really use it,” he said. “Largely, I’ve heard that businesses and people are excited to have this game.”
Jean Moreno, the economic development officer for the city of Glendale, who also served as Glendale’s Super Bowl project manager, also has not heard any complaints from individual business owners but thinks there could be some potential fatigue in a broader sense with the organizing committees. In addition to this year’s Super Bowl and the college championship in 2016, Phoenix has been selected as the site of the 2017 NCAA men’s basketball Final Four.
“The organizing committee for each of these events is responsible for all the fundraising to support some of the operational expenses,” she said. “That would be the only area that would be a potential issue for our state because it is a significant fundraising endeavor for those host committees on the corporate level.”
The Super Bowl Host Committee set a fundraising goal of $30 million prior to February’s game.
Long term, hosting these large sporting events has the potential for major economic impact on the cities hosting the events and ancillary events. During the College Football Playoff National Championship for example, the organizing committee will be hosting 25 to 50 CEOs from companies across the country in an attempt to draw their business to Arizona. The Super Bowl Host Committee used the same tactic during this year’s Super Bowl.
“We do that because of the long-term economic development that will generate,” Wright said.
The hope, as with the previous college football title games Arizona has hosted, is to not only give a quick boost to the economy but also create jobs that can have a more lasting effect.
“If we can use this three-year spotlight, with these three, huge mega-events, to convince a couple of companies that Arizona is a great place to invest, to employ people, to bring jobs, that’s a win-win for all of us,” Wright said.
While the committee would not divulge which companies they will host during the game, Wright did say there were a number of high-level CEOs who traveled to Arizona during the Super Bowl and they expect a similar outcome for the College Football Playoff game. According to reports, more than 60 high-level executives were hosted at Super XLIX.
The committee hopes to draw in that business from outside the state by showing off the best of Arizona, with the help of partners like the Arizona Office of Tourism and its director, Debbie Johnson.
“This is the kind of publicity for our state that we could never afford to buy,” Johnson said. “We can’t go out and advertise in hundreds of countries to millions of people. So people get to have all of their eyes on Arizona.”
The long-term impact that could come from attracting these businesses to the Valley could outweigh the immediate economic benefit, or cost. A recent report from the city of Glendale said the Super Bowl at best created a financial gain of $13,000, and at worst it caused a loss of $1.2 million. The greater benefit for the city will come from the potential growth in jobs from hosting businesses during the game, The same is expected during the College Football Playoff.
Glendale, where the games are played, believes it has its own benefits for companies looking to start a business someplace quickly, and events like the College Football Playoff allow it to showcase that to business owners.
“The brand recognition that we build by hosting these events, basically gets us a second look,” Moreno said. “Then the way we sell it to these businesses is we have the ability to address their speed-to-market needs.”
Glendale also works with the Arizona Commerce Authority and the Greater Phoenix Economic Council to make sure they showcase the entire region, to these businesses that come for major events like the College Football Playoff.
If it was not clear that Arizona wants to host these events after attracting the Super Bowl, College Football Playoff and Final Four in consecutive years, it was solidified last month when it was announced that University of Phoenix Stadium would host games next summer for the 2016 Centennial Copa America, featuring national soccer teams from North, Central and South America as well as the Caribbean. Valley leaders have not yet grown tired of hosting these events, and in fact seem to be trying harder to get more of them each year.
Mike Nealy, executive director of the BattleFrog Fiesta Bowl, doesn’t think Arizona has done anything differently in bidding for these events compared to past failed bids. Instead, it has just been a perfect storm that has set up these major games coming to Arizona one after the other.
“Many of these events are a bid process and so you take them when you can get them,” he said. “There’s not too many cities that are as fortunate as we are to have hosted so many of these events. And if they keep coming, we are going to keep supporting them, so let them come.”
By Bill Slane