(Bloomberg) — Stan Kroenke, known as the “Silent Stan” when he bought the Rams football team, rarely celebrated or celebrated victories in public.
Last Sunday, five seasons after the National Football League franchise moved from St. Louis to Los Angeles — and moments after his team won the conference championship — the 74-year-old billionaire let loose.
“Who’s House?!” Kroenke accepted a trophy midfield in front of 70,000 fans at the $5.5 billion Sophie Stadium, allowing the crowd to give their regular cheers of shouting, “Ram’s house!”
Even before kickoff on Feb. 13, against the Cincinnati Bengals in Super Bowl LVI, Kroenke’s team and stadium stand to be the big winners. According to sports-industry analysts, sponsorships, ticket sales and Kroenke’s real estate are all poised to benefit as the franchise’s winning records and a state-of-the-art venue feed off each other.
“This validates the massive investment made to move the Rams to LA and build the most spectacular stadium on the planet,” said Mark Ganis, co-founder of Chicago-based sports consultancy SportsCorp Ltd.
The twin themes of the NFL’s big money and power also weave through Kroenke’s success. According to Sportico, their $750 million Rams purchase in 2010 is now worth $4.68 billion, making it the league’s No. 3 franchise. That’s a substantial portion of the $12.5 billion fortune he earned through sports and real estate, according to the Bloomberg Billionaires Index, and does not include his marriage to Walmart Inc. heiress Ann Walton Kroenke. His Kroenke Sports and Entertainment also owns the Denver Nuggets basketball franchise, the Colorado Avalanche hockey team, and the London-based Arsenal Football Club.
The Rams’ presence in Los Angeles also owes much to Kroenke’s dominance and the NFL. In November, Kroenke and the league agreed to pay $790 million to compensate the city of St. Louis for the team’s relocation, to avoid a lawsuit that threatened to bring confidential details of league finances into public view. .
That episode solidified the narrative of a league whose colonial owners only answer to themselves, a recurring flash point for fans — and non-fans — who want the game to model a better vision of American society. The run-up to the Super Bowl is coming to the fore amid controversy over off-season firing, with only one Black head coach left in the league with about 70% of players being Black, with one ousted coach Brian Flores suing the NFL. for discrimination in its recruitment practices.
Kroenke and Ram declined to comment for this article.
entertainment options
Super Bowl victories—or lack thereof—usually have limited value to established teams. The Dallas Cowboys, which is worth $6.92 billion, making it the most valuable NFL franchise, hasn’t won a big game since 1995. But as a new team in a market where fans have tons of entertainment options—the Dodgers, the Lakers, UCLA and USC basketball and soccer games, concerts, the beach—the Rams have to prove themselves as a hot ticket. is needed.
“A Super Bowl win could increase franchise value by about 5%, on top of the regular annual growth we’ve seen in recent years,” said Kurt Badenhausen, sports-valuation reporter for Sportico, in an email. , He estimated that the value of rams had increased by 14% last year.
Unusual for owning a team, Kroenke built Sophie Stadium, which is also home to the NFL’s Chargers, without the use of government funding. He is developing the surrounding area, the former Hollywood Park horse-racing track, into a mixed-use community of apartments, offices and shops that is three times the size of Disneyland and the largest real estate project in the western US.
Read more: Kroenke and Ballmer bet on the crowd at the biggest L.A.-area project
It is still a work in progress. According to the development’s website, the NFL occupies four floors of the first office building of the project, with three floors still available for lease. The site has 500,000 square feet (46,000 sq m) of additional office space and a 300-room hotel. The 6,000-seat YouTube Theater with its rooftop Sophie Stadium opened in August, and the first of 2,500 residences will be completed this summer.
Kroenke’s project is a boon to Inglewood, a Los Angeles suburb that fell on hard times in the 1990s when the area was hit by riots and the Lakers basketball team and Kings hockey franchise camped out for a new arena in downtown LA. Was. A memory of Inglewood’s checkered past came on Jan. 30, when a violent brawl in the parking lot of Sophie Stadium before a Rams-49ers game left a San Francisco fan in a medically induced coma.
Kroenke is not alone in benefiting from the success of the Rams and their stadium. The NFL negotiates television deals, sales and licensing contracts, with proceeds divided equally among the league’s 32 teams. Meanwhile, local revenue from ticket sales, concessions and corporate sponsorships goes to individual franchisees.
The cheapest Super Bowl tickets were recently trading for over $4,900 each on the StubHub website, while nearby parking spots were listed north of $300.
“The related holdings, particularly the real estate and control of the stadium, go a long way toward building franchise value,” sports consultant David Carter said in an email. “It is critically important to assess not only fan interest, but also corporate interest. A competing team in a major media market showcasing a new stadium may be looking to use SoFi as a backdrop on sponsorships or other businesses. Don’t get lost in hope.
According to SportsCorp’s Ganis, the stadium will get a lot of free publicity on a TV broadcast that cost advertisers $6.5 million for a 30-second spot.
“They called him the ‘Silent Stan’ in St. Louis,” he said of Kroenke. “But he’s also a ‘Solid Stan,’ because he sees things through to the end. The world is going to see it at Sophie Stadium.”
–With assistance from Scott Carpenter and Christopher Palmery.
© 2022 Bloomberg LP
