As the NFL season opens, Sportico is examining one of the main components of ever-rising team valuations: the stadium. With the cost of materials rising, stadiums have become more than just places to watch football, as teams seek to earn year-round revenue beyond the 10 games they host each season. This is the fifth and final installment of a multi-part series.
The sight of thousands of people tailgating before an NFL football game may still be an indelible image of fall Sundays, but nowadays, so are scenes of entrepreneurs and corporate executives entertaining clients in luxury suites.
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That doesn’t mean teams have abandoned their traditional fanbase; it’s just that corporate America is embracing NFL games more than ever. And NFL teams, in their stadium planning, are embracing them right back, nowhere more than San Francisco.
“We have major demand for additional owner’s suite inventory,” San Francisco 49ers chief revenue officer Brent Schoeb said in a video call. The Owner’s Club Suites are the team’s top-level suite offering at 10-year-old Levi’s Stadium. Right now, there are 25 of them, all located in the stadium’s east SAP Tower, with another 150 standard suites encircling the field. After this season, the club will begin a $125 million project that will include renovating every suite, a refresh that will include new wine fridges in standard suites. But the big expense will be upgrading 111 regular suites to Owner’s Club Suites, making the pricier high-end suites nearly 80% of 49ers suite inventory.
“All we’re hearing from a lot of our current suite holders and prospective suite holders is that they’d like to be included in the owner’s suite area, which has been sold out since we opened,” Schoeb said.
Unlike other renovations in the league—such as the New England Patriots’ creation of a field level bar at Gillette Stadium that sacrificed some of the stadium’s least desirable general admission seats for a more profitable revenue source—the 49ers aren’t decreasing capacity. And no one is getting a better view. Instead, the team is trying to meet demand from well-heeled suite buyers wanting an even more luxurious experience.
For example, an upgrade to an Owner’s Club Suite includes a parking pass for the players’ lot right outside the stadium, plus high-end food offerings including oysters and sushi, and participation in the Appellation 49 program, where vintners from the Napa and Sonoma valleys pour tastes of wine.
The suites also come with access (usually free but sometimes requiring payment) to nearly every other event held at Levi’s—a valuable perk for every parent whose kids wanted to see Taylor Swift. Not insignificantly, Owner’s Club Suite-holders also gain admission to the club area behind the suites, where they can mingle and connect with other executives. The Niners’ Silicon Valley-heavy ticket base sees games as a way to entertain and meet potential investors.
While the owner’s suites have been sold out since Levi’s opened in 2013, “demand for the luxury premium product coming out of COVID certainly spiked for us,” Schoeb said. “It’s the highest demand we’ve ever had for premium.” Additionally, Schoeb said the post-pandemic surge in demand also appears to be driven by a desire to utilize suites as an employee-recognition perk—something he believes, at least anecdotally, is being noticed by other teams in the league.
The upgrades aren’t just to fulfill corporate demand, however. The facility also needs to compete with stadiums elsewhere in California and in Nevada to win tentpole events such as the Super Bowl, which it will host in 2026, and to be in the mix for hosting games during the men’s soccer World Cup that same year. As part of that aim, the renovations will also include upgrades to the scoreboards and displays, among other improvements, according to the executive. But while high visibility events obviously help the bottom line, it’s pleasing the fans who commit to cheering on the 49ers all season long that drives the vision for Levi’s.
“We certainly have a multiyear plan… but we don’t want to get too far ahead of ourselves,” Schoeb said. “A lot of this comes back from survey data of season ticket holders and fans—we don’t want to just shoot in the dark on what the innovations might be. We want to make sure they truly are enhancement for the fans.”
‘Less is more’
The 49ers are maintaining their existing inventory and upgrading their premium offerings, but new-stadium planning around the league is headed in a different direction. “Less is more,” Dustin Vicari, Elevate Sports Ventures executive vice president of property sales, said. “Fewer suites are being programmed into new stadiums, and that creates more scarcity and more demand. That’s a huge plus for recent and new stadiums.”
The rise of dynamic premium seating options is revolutionizing the way teams generate revenue beyond general-admission seating. This is one of the reasons NFL teams have turned to smaller stadiums, where the money made from multiple variations of high-end premium seating and amenities more than compensates for reduced seating capacity—and even reduced numbers of luxury suites.
The days of new NFL stadiums with 250 suites are over, with newer venues holding closer to 100 to 150 suites, depending on the market. Another trend: Traditional suite inventory itself has declined, while the number of mini-suites and loge boxes, like those in basketball and hockey arenas, have multiplied. The smaller luxury groupings provide another option to buyers—an alternative for companies that don’t need to entertain 16 guests. Or they can serve wealthy families or small businesses interested in experiencing the loge product without paying the full cost of a big suite.
The four- to eight-seat loge configurations have been a hit at Allegiant Stadium, according to Vicari, while the Titans are also planning for similar, more affordable loge boxes surrounding their new field.
“It gives marketing [staffers] much more variety and allows teams to get their demographics changed in the building easily, too,” Gensler sports leader Ron Turner said. “You get people who can afford to buy four loge seats that couldn’t afford a 12- to 14-seat suite. It’s getting new people into the building.”
While premium seating constitutes roughly 10-12% of overall capacity in most stadiums, general seating areas remain prevalent, and teams say they don’t want to price out fans. But the luxury bug is hitting general seating, as well. VIP level offerings—which typically have the best sightlines, and where celebrities, stakeholders and other noteworthy individuals can enjoy the games—have become a feature at EverBank Stadium, SoFi Stadium and Ford Field, among other stadiums.
Personal seat licenses (PSLs), which give one the right to buy specific seats in stadiums, have been part of new stadium financing—and have padded teams’ balance sheets—for roughly three decades. Some industry leaders point to the 2009 opening of the Dallas Cowboys’ AT&T Stadium—at a then-record cost of $1.3 billion—as setting a precedent for optimizing revenue from premium seating and PSLs. Premium seats command the highest PSL values in most stadiums, depending on the market, and seat location has become more important than ever as fans want to buy closer seats on the best yard lines.
Amenities attached to pricier PSLs—such as all-inclusive food and beverage options, and exclusive parking passes—generate more revenue than if they were plain seats. The combination of expanded club space, amenities and convenience is driving the value of the PSLs. And teams have discovered that offering at least eight to 10 different premium ticket offerings, as opposed to four or five, makes them more money.
It’s not just the price of admission new stadiums are after; it’s also the other things fans can spend money on once they’re in the house. And premium seating is an effective way to capture those dollars.
“You’re looking for ways to increase food and beverage per cap,” Turner said. “And that’s even for general admission… Everything is about leveraging as much per cap as possible while making the experience better for people.”
State of NFL Stadiums—A Sportico Series
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