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Agenda
Team Services Assignment Background
Methodology
Naming Rights Research
Inventory
Findings and Comparables
2
Point of View
Achieving the City’s Goals
3
Team Services was enlisted to identify the true market value for Naming Rights to Harry Grove Stadium
The stadium would be referred to as “Company XYZ Field at Harry Grove Stadium” Our tasks:
Review current lease agreement between Frederick and the Keys Research comparable naming rights partnerships throughout Minor League Baseball (MiLB) Determine a reasonable package of stadium marketing assets to be reserved for a naming rights partner
Methodology
4
We set out to help the City of Frederick understand how the individual “parts” impact the sum of the whole
What individual assets/inventories that both the City and Team can bring to the table to drive maximum value for a partner
We Conducted our research based on:
Drawing upon our track record of success from a sales perspective as if we had to go out and sell it Providing the most realistic valuation based on real-world experience and that we have “lived this” before Evaluating naming rights opportunities based on numerous factors as well as the most applicable comparables
- Creating an “apples to apples” approach
We have built our point-of-view and conducted our research based on the following factors in order to give the City of Frederick the truest sense of what the naming rights proposition could be worth.
Comparables
• We provide information on comparable MiLB agreements, so as to justify the suggested price point for naming rights.
• When looking at these partnerships we investigated contributing factors such as total value of the deal, annual payment, facility characteristics and city population, among other variables.
City-Wide Opportunities
• City-wide opportunities are an important aspect and potential driver of naming partnerships and revenues.
• Building a relationship with the City can lead to additional business for a corporation as a byproduct of their naming partnership
Inventory
• Our analysis itemizes suggested and potential benefits for inclusion in a naming partnership for the stadium.
Methodology
5
6
Naming Rights Value Chart
Minor League Baseball Naming Rights Agreements
Venue Main Tenant City
Term in
Yrs
Total NR
Value
(in $M)
Est. Avg.
Annual
Payments
(in $M)
Chukchansi Park Fresno Grizzlies Fresno, CA 15 $16.000 $1.067
Raley Field Sacramento River Cats West Sacramento, CA 20 $15.000 $0.750
Huntington Park Columbus Clippers Columbus, OH 23 $12.000 $0.522
MCU Park Brooklyn Cyclones Brooklyn, NY 11 $5.500 $0.500
Richmond County Bank
Ballpark at St. George Staten Island Yankees Staten Island, NY 9 $3.600 $0.400
PNC Field Scranton Yankees Moosic, PA 5 $1.925 $0.385
Fifth Third Field Toledo Mud Hens Toledo, OH 15 $5.000 $0.333
Fifth Third Field Dayton Dragons Dayton, OH 20 $6.500 $0.325
The following chart encapsulates all relevant Minor League Baseball naming rights agreements that have been consummated with their corresponding financial terms.
However, we must look at all of these agreements individually to fully understand their relevance and meaning to Frederick’s situation
7
Naming Rights Value Chart
Werner Park Omaha Storm Chasers Sarpy, NB 5 $1.530 $0.305
Campbell's Field Camden Riversharks Camden, NJ 20 $6.000 $0.300
Parkview Field Fort Wayne TinCaps Ft. Wayne, IN 10 $3.000 $0.300
Classic Park Lake County Captains Eastlake, OH 15 $4.260 $0.284
Coolray Field Gwinnett Braves Lawrenceville, GA 16 $4.500 $0.281
Dow Diamond Great Lakes Loons Midland, MI 10 $2.800 $0.280
Trustmark Park Mississippi Braves Pearl, MS 10 $2.750 $0.275
Sovereign Bank Stadium York Revolution York, PA 10 $2.700 $0.270
Clipper Magazine
Stadium Lancaster Barnstormers Lancaster, PA 10 $2.500 $0.250
Oneok Field Tulsa Drillers Tulsa, OK 20 $5.000 $0.250
FirstEnergy Park Lakewood BlueClaws
Lakewood Township,
NJ 20 $4.800 $0.240
TD Bank Ballpark Somerset Patriots Bridgewater, NJ 15 $3.500 $0.233
Metro Bank Park Harrisburg Senators Harrisburg, PA 15 $3.500 $0.233
U.S. Steel Yard Gary SouthShore RailCats Gary, IN 10 $2.300 $0.230
Bethpage Ballpark Long Island Ducks Central Islip, NY 10 $2.100 $0.210
Minor League Baseball Naming Rights Agreements
Venue Main Tenant City
Term in
Yrs
Total NR
Value
(in $M)
Est. Avg.
Annual
Pymts
(in $M)
8
Naming Rights Value Chart
FirstEnergy Stadium Reading Phillies Reading, PA 15 $3.000 $0.200
Modern Woodmen Park Quad Cities River Bandits Davenport, IA 10 $1.850 $0.185
Principal Park Iowa Cubs Des Moines, IA 14 $2.500 $0.179
Frontier Field Rochester Red Wings Rochester, NY 20 $3.500 $0.175
AutoZone Park Memphis Redbirds Memphis, TN 25 $4.300 $0.172
Bright House Field Clearwater Threshers Clearwater, FL 10 $1.700 $0.170
Dell Diamond Round Rock Express Round Rock, TX 15 $2.500 $0.167
Silver Cross Field Joliet Slammers Joliet, IL 15 $2.250 $0.150
O'Brien Field Peoria Chiefs Peoria, IL 7 $1.050 $0.150
Alliance Bank Stadium Syracuse Chiefs Syracuse, NY 20 $2.800 $0.140
Cooley Law School
Stadium Lansing Lugnuts Lansing, MI 11 $1.480 $0.135
Security Service Field Colorado Springs Sky Sox Colorado Springs, CO 12 $1.500 $0.125
Appalachian Power Park West Virginia Power Charleston, WV 10 $1.250 $0.125
Regions Park Birmingham Barons Birmingham, AL 10 $0.990 $0.110
Pringles Park Jackson Generals Jackson, TN 15 $1.600 $0.107
Digital Domain Park
St. Lucie Mets & Gulf
Coast Mets Port St. Lucie, FL 9 $0.954 $0.106
Minor League Baseball Naming Rights Agreements
Venue Main Tenant City
Term in
Yrs
Total NR
Value
(in $M)
Est. Avg.
Annual
Pymts
(in $M)
9
Minor League Baseball Naming Rights Agreements
Venue Main Tenant City
Term in
Yrs
Total NR
Value
(in $M)
Est. Avg.
Annual
Pymts
(in $M)
Citibank Ballpark Midland RockHounds Midland, TX 20 $2.100 $0.105
Standard Bank Stadium Windy City ThunderBolts Crestwood, IL 10 $1.000 $0.100
Roger Dean Stadium
Jupiter Hammerheads, Palm
Beach Cardinals; Gulf
Coast Marlins & Gulf Coast
Cardinals Jupiter, FL 20 $2.000 $0.100
Hanover Insurance Park
at Fitton Field Worcester Tornadoes Worcester, MA 3 $0.300 $0.100
GCS Ballpark Gateway Grizzlies Sauget, IL 10 $1.000 $0.100
Louisville Slugger Field Louisville Bats Louisville, KY 20 $2.000 $0.100
AT&T Field Chattanooga Lookouts Chattanooga, TN 10 $1.000 $0.100
Avista Stadium Spokane Indians Spokane, WA 10 $0.900 $0.090
The Hangar (Clear
Channel Stadium) Lancaster JetHawks Lancaster, CA 10 $0.770 $0.077
Ogren Park at Allegiance
Field Missoula Osprey Missoula, MT 20 $1.000 $0.050
Melaleuca Field Idaho Falls Chukars Idaho Falls, ID 20 $0.600 $0.030
Centene Stadium Great Falls Voyagers Great Falls, MT 20 $0.200 $0.010
Naming Rights Value Chart
Based on all the naming rights agreements listed, it is important to note the impact of the agreements relative to Frederick:
Agreements by Total Value
• The average total value for MiLB naming rights deals is $3.193 million per agreement over 13.82 years.
• When removing the largest (Chukchansi Park) and the smallest (Centene Stadium) agreements, the average total value is $2.993 million per agreement over 13.67 years.
Agreements by Annual Value • Currently twenty plus universities and colleges have secured naming rights for their
home stadiums. The average annual naming rights value for MiLB teams with corporate partners is $227,000 per agreement .
• Once again removing the largest and smallest deals the average annual value of naming rights deals is $214,000 per agreement.
Agreements by Stadium Capacity • The average capacity of MiLB stadiums with corporate naming partners is 7,874. Since
Harry Grove’s capacity is less than the average capacity of stadiums with corporate naming partners, it is valuable to note the average value and term of stadiums with comparable capacities.
• Capacities 4,500-6,500: total value of $2.500 million over 12.5 years • Capacities 7,000-8,500: total value of $2.963 million over 12.46 years
Agreements by City Population • Using the city populations of the eight cities most comparable to Frederick’s population of
approximately 66,000, ranging from 55,000-77,500 the average total naming rights value is $1.98 million per agreement and the average annual payment value is $154,000 per agreement.
Key Findings
10
Agreements by Year Naming Rights Were Sold
• Naming rights partnerships since 2008 have averaged $2.874 million in total value over 10.88 years. In the eight years prior to that, the average naming rights agreement had a total value of $3.048 million over 13.42 years.
• *Reasons for these decreases include the state of the national economy as well as the trend of MiLB organizations in smaller markets adding naming rights partners.
Agreements by League Affiliation • The average total value of a naming rights agreement for Single-A MiLB teams is $2.651
million with a yearly average of $217,000. Teams that are not affiliated with the Single-A league have naming rights deals with an average total value of $3.335 million and $225,000 per year.
Agreements by Naming Rights Category • The most common naming rights categories for MiLB include banks with an average
naming rights value of $3.771 million and a yearly average of $257,000 and energy companies with an average naming rights value of $3.242 million with a yearly average of $198,000
Agreements by New or Existing Stadium • Out of the 51 MiLB stadiums with naming rights partners 32 were new facilities and 19
were existing. The average total naming rights value was $5.117 million for new arenas and $2.639 for already existing arenas while the average annual payments was $338,000 for new and $218,000 for existing.
Key Findings
11
Naming Rights Comparables
12
Team Long Island Ducks Worcester Tornados Harrisburg Senators Frederick Keys
City Central Islip, NY Worcester, MA Harrisburg, PA Frederick, MD
Stadium Bethpage Ballpark
Hanover Insurance Park
at Fitton Field Metro Bank Park TBD
Year Built 1999 1924 1987 1989
NR Sold 2011 2005 2003 TBD
Category Bank Insurance Bank TBD
Nielsen DMA 1 7 43 8
City Pop. 31,950 181,045 49,528 66,164
Capacity 6,002 3,000 6,187 5,500
League ALPB Can-Am AA-EL A-Carolina
Attendance (AVG
2012) 5,551 1,364 4,132 4,724
Total Naming
Rights Value (in
$M) $2.10 $0.30 $3.50 TBD
Term in Years 10 3 15 TBD
Est. Avg. Annual
Payments (in $M) $.210 $.100 $.233 TBD
The following is a snap-shot of comparable agreements that match up with Frederick based on various factors:
Comparative Analysis of Inventories
13
The following chart illustrates the potential inventory to be included in a naming rights agreement as noted by who may control such inventory:
COMPARATIVE ANALYSIS OF NAMING RIGHTS INVENTORIES
Element Description
Harry Grove
Stadium
Comprehensive
Naming
Rights Package
CATEGORY EXCLUSIVITY
Product Category Exclusivity x
SIGNAGE
Entrance Signs located at front entrance of the venue x
Ballpark Roof Sponsor/Venue name displayed on roof x
Marquee Ballpark name and logo on outdoor marquees (at the
junction of I70 and MD 355) x
Exterior Signage Venue identification signage on the ballpark exterior
(facing I70 and MD 355) x
Interior Directional Signage Signage directing patrons within the ballpark x
Exterior Directional Signage Signage directing patrons to the ballpark x
LED Signage Company /Venue name advertising on LED x
Highway/Street Directional signage leading to ballpark on surrounding
surface roads and highways x
Parking Signage throughout parking areas x
Street Name Street name leading to facility changed to incorporate
partner name x
14
COMPARATIVE ANALYSIS OF NAMING RIGHTS INVENTORIES
Element Description
Harry Grove
Stadium
Comprehensive
Naming
Rights Package
Team Dugouts Logo positioned over home and/or visiting team dugout
Scoreboard Corporate logo on main scoreboard panel
Stadium name above scoreboard x
Home plate Sponsor name/logo on the field behind home plate x
Interior Fascia Signage located on each baseline of the ballpark
MEDIA/ADVERTISING
Television Game Broadcasts Spot advertising during broadcasts of games x
Opening/closing billboards
Radio Game Broadcasts Spot advertising during broadcasts of games x
Print Advertising Stadium logo on cover placement on the Keys Game
Program x
Corporate full page Ad in Keys Game Program x
Corporate back cover advertisements for all Keys
pocket schedules x
Internet Advertisement on web stream broadcast of games
Exposure through ad placements on team website x
Exposure through link to sponsor website from team
sponsor page
Comparative Analysis of Inventories
15
COMPARATIVE ANALYSIS OF NAMING RIGHTS INVENTORIES
Element Description
Harry Grove
Stadium
Comprehensive
Naming
Rights Package
Media/Press Media/press backdrop for all events x
HOSPITALITY & ENTERTAINMENT
Corporate Suite Luxury suite for all regular season and playoff games x
Access to VIP lounge or Club Area x
Access to private meeting space x
Party Suite Party suite for corporate events
Season Tickets Four (4) prime season tickets in the lower level behind
home plate x
Charter Trips Road game charter trip x
Parking Four (4) VIP parking passes x
Appearances Player/coach/staff appearances x
Premiums Autographed merchandise by team personnel
Facility Usage Partner to use facility on non-event day(s) x
Comparative Analysis of Inventories
PROMOTIONS
Community Corporate name tie-in to various community relations
programs and promotions
x
In-Stadium
One (1) giveaway night sponsorship
x
One (1) firework night sponsorship
In-Game
One (1) video spot at start of the game
One (1) video promotion per game
x
x
One (1) In-game promotion between innings
x
ADDITIONAL EXPOSURE
Stadium Logo/Branding Development of a Sponsor stadium logo x
Logo and name exposure on miscellaneous items
throughout the venue (employee uniforms, cups,
tickets, , letterhead and collateral materials etc.)
x
Ballpark merchandise to be sold in the Team Store x
16
COMPARATIVE ANALYSIS OF NAMING RIGHTS INVENTORIES
Element Description
Harry Grove
Stadium
Comprehensive
Naming
Rights Package
Comparative Analysis of Inventories
COMPARATIVE ANALYSIS OF NAMING RIGHTS INVENTORIES
Element Description
Harry Grove
Stadium
Comprehensive
Naming
Rights Package
Tabling Opportunities Informational marketing booths at selected games x
Themed Area In-Ballpark Branded Theme Area
Networking Use of database for marketing E-blast/ Introduction to
other partners
Comparative Analysis of Inventories
17
Point of View
18
Based on Team Services thorough review of the specific factors that come into the naming rights equation, we have concluded that the City of Frederick could command a partnership in the range of $150,000-$250,000 on an annual basis.
• Based on a 15-year agreement, this partnership could generate between $2,250,000 and $2,750,000
Team Services recommends the City of Frederick and The Keys make every attempt to include an annual escalator clause in its agreement.
• Incorporating a standard escalator rate of 3% would push a $200,00 first year price to average $247,000 over the life of a 15-year agreement.
Our final value is based on many factors outlined throughout the presentation including:
• Relevant corporate named venues to draw the most direct comparisons • Compelling package of inventory devised to maximize such an agreement • Trend of leveraging a broad based relationship to drive a partnership for the team and City. Team Services believes that with the City assisting by providing business opportunities to a naming rights partner, the upper end of the valuation range is achievable.