Saturday, May 20, 2006

U-M Regents approve "Luxury Boxes"

In a controversial 5-3 vote, the U-M Board of Regents approved a $226 million renovation plan of Michigan Stadium. The plan put forth by Athletic Director Bill Martin calls for the construction of 83 private suites to be split between the east and west sides of the stadium and the addition of nearly 3,200 club seats. The University approved the hiring of HNTB Architechture which is expected to take up to a year to design the project. The concept plan for the project looks like this. A.D. Martin estimated construction on the "luxury boxes" (my words, not his) could begin in 2008 with the idea of being finished prior to the start of the 2010 football season. Seating capacity would be increased from the current 107,501 to 108,251 once construction is completed.

Michael Rosenberg did an excellent article in the 5/17/06 edition of the Detroit Free Press regarding U-M's plan for luxury boxes. As detailed in the article, these new structures will be mammoth. The structure on the west (press box side) will be the equivalent of a six-story building stretching from one endzone to the other. The structure on the east side will be the equivalent of an eight-story building stretching from one endzone to the other. The two structures would rise to a height of 82 feet, above the concourse, 7 feet higher than the scoreboards in either endzone. The two structures combined would cover 425,000 square feet.

If you build them, will they come? We know there are over 8,000 people who are on the waitlist for "regular" season tickets but are we sure there is enough of a high end market in economically depressed Michigan to sustain all these new luxury suites? U-M plans to charge between $55,000-$85,000 per season for a suite depending on the suite's location. Each suite has 16 seats meaning that in a 7 game home schedule each seat in the suite would cost $491 per game in the "low-cost" suite while it would cost $759 per seat /per game in the "high-roller" suites. This compared to the approximately $60 per seat/ per game the regular season-ticket holder now pays (not including PSD).

In addition to the 83 suites that have to be sold, there is the matter of the 3,162 club seats. The club seats will range in price from $1,800 ($257 per game) to $4,050 ($579 per game) plus have an annual mandatory PSD ranging from $1,500-$3,000 per seat depending on seat location. Now Sparty has found club seats to be a particularly tough sell at its stadium in East Lansing. MSU only sold about 1/3rd of its club seats last year and while U-M football is certainly not Sparty football, I am worried about the demand for this type of premium seating. However, in its presentation to the Regents, school officials stated that market research by the firm Convention, Sports and Leisure indicates a "strong demand" for the premium seats. I, however, remain skeptical about that one. I believe there is a strong demand for the 83 private suites but I firmly believe the nearly 3,200 club seats are going to be a tough sell here just as they are in Spartan Stadium.

For those who oppose the plan, you may want to visit the site As noted in an earlier post, the site was featured a few weeks ago in a story that ran on the front page of the sports section of the Sunday edition of the New York Times. The site is run by a dedicated group of Wolverines who want to preserve the tradition of the Big House and stop the madness of the construction of the luxury boxes. However, as Regent Laurence Deitch noted while voicing his vociferous objections to the plan, once the vote was taken U-M had essentially reached a point of no return on the project barring some unforseen catasophre. Thus, with the 5-3 vote approving the plan, it appears the ship has sailed on WHETHER this will happen. Since the plan IS going to be implemented, the focus now needs to shift to making the construction and the sale of the seats as successful as possible. GO BLUE!!!


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