UNLV Campus Improvement Authority Board Estimated Event Utilization and Financial Projections May 22, 2014
1 CIAB WORK SESSION 2
CIAB WORK SESSION RECAP KEY TAKE-AWAYS: There is a need in the market for a venue that can host large-scale events. Overall net positive economic impact benefit to City and State given incremental visitors and events Las Vegas is a unique market that can support premium ticket prices. Events most beneficial to Las Vegas impact 4 to 5 resort properties and generate at least 30,000 hotel room nights. Proximity to the Strip is vital. The stadium needs to be as flexible as possible in terms of configuration. An open-air stadium needs rigging capabilities in order to keep promoter costs down. Stadium is not anticipated to compete with existing venues for the vast majority of events envisioned to be hosted. A new stadium will greatly enhance the UNLV athletics program, as well as student involvement and campus pride. An enclosed stadium has greater potential to host non-tenant events than an open-air stadium. Participants were evenly spilt regarding their preference for an openair or enclosed stadium. Concerns regarding who and what will fund the project remain. PARTICIPANTS: CIAB Members MGM Resorts Live Nation Las Vegas Events LVCVA ESPN Events Rugby Sevens Caesars Entertainment Boyd Gaming Top Rank Ultimate Fighting Championship UNLV Athletics Other University Stakeholders Other Current & Former Las Vegas Entertainment Executives Other Stakeholders 3
2 ESTIMATED EVENT UTILIZATION
Las Vegas Stadium Event summary Event Progamming Summary Category SBS Existing SBS Future CSL Enclosed CSL Open-Air UNLV Football 6 6 6 6 MLS 0 0 17 17 International Soccer 1 0 2 1 Major Concert 0 0 2 1 Festival 0 0 0 0 Rugby 1 0 4 4 Signature 0 0 2 0 Major Non-Recurring 0 0 2 0 Las Vegas Bowl 1 1 1 1 New Bowl Game 0 0 1 0 Neutral Site NCAA Football 0 0 2 1 UFC 0 0 1 0 Boxing 0 0 1 0 Motorsports 3 1 3 3 Total Events 12 8 44 34 Total Events (excluding MLS) 12 8 27 17 Total Non-Tenant Events 6 2 21 11 Total Attendance 247,000 129,000 1,435,000 982,000 Total Attendance (Exluding MLS) n/a n/a 1,129,000 676,000 Total Non-Tenant Attendance 175,000 57,000 894,000 441,000 5
3 STADIUM COST ESTIMATE
Las Vegas Stadium Cost Estimate Items Within Cost Estimate: Demolition & Site Clearing Site Utilities Excavation & Foundation Structural Frame Roofing & Waterproofing Exterior Wall Interior Finishes FF&E Scoreboard Playing Field Equipment and Specialties Food Service Equipment Seating Vertical Transportation Plumbing Fire Protection HVAC Electrical Audio Visual Site Work General Requirements Open-Air OpenJAir Total&Construction&Cost $392,057,717 Total&Construction&Cost Soft&Costs $98,014,429 Soft&Costs Total&Hard&&&Soft&Costs $490,072,146 Total&Hard&&&Soft&Costs Domed OpenJAir&with&Shading Shading&System Project&Cost&with&40&ft&Small&Roof& Project&Cost&with&75&ft&Medium&Roof& Project&Cost&with&125&ft&Large&Roof& Retractable Roof Roof $392,057,717 98,014,429 $490,072,146 $497,407,341 $504,770,252 $514,172,081 Total Construction Cost $392,057,717 Total Construction Cost $392,057,717 Soft Costs 98,014,429 Soft Costs 98,014,429 Fixed Hard Roof Premium 173,921,957 Retractable Roof Premium 223,921,957 Project Cost with Domed Roof $663,994,103 Project Cost with Retractable Roof $713,994,103 Potential Added Costs: Add to Lower the Playing Field 25 below grade $10 to $20 million range Open-Air With Shading System Costs To Be Determined: Parking Site Improvements/Infrastructure Transportation Enhancements 7
4 FINANCIAL OPERATIONS
Las Vegas Stadium Key Assumptions General: Seating Capacities: Enclosed 50,000 Football / 800 Banquet & Meetings Open Air 50,000 Football / 700 Banquet & Meetings Premium Seating Inventory: Luxury Suites 50 suites, 1,000 seats Loge Boxes 30 boxes, 120 seat Club Seats 2,500 seats Parking Revenues from parking have not been included in this analysis Further information related to the potential stadium site will be needed prior to estimating parking revenue Management of Stadium Internal Third Party 9
Las Vegas Stadium Key Assumptions Revenue: Rental Income Net rental income is based upon industry standards, project team experience in similar markets/facilities, and market research Merchandise Assumed to be handled in-house 10 to 15% profit margin Ticket Incentives Assumed to vary by event per contract Based upon the type of event and ticket price This also includes facility income from will-call orders, mail orders and at-home printing Facility Fees Assumed to vary based on the event Maximum of $2.00 per ticket for concerts and motorsports event The facility fee collected would be determined by the Board Revenue CPI = 3% Expenses: All operating expenses are based upon project team experience in similar facilities Assumes most services handled on an in-house basis or subcontracted Insurance expenses are based on project team s industry clout and leverages policy rates Utilities are assumed to be $2,250,000 (4% annual growth rate) Expense CPI = 2.5% Salaries CPI = 2.5% Annual Insurance Increase = 3.0% Payroll Burden = 30% 10
Las Vegas Stadium Event Attendance Assumptions Enclosed Stadium Year One Events Open Air Stadium Event Type Number of Events Average Attendance Total Attendance Number of Events Average Attendance Total Attendance International Soccer 2 40,000 80,000 1 40,000 40,000 Concerts 2 27,000 54,000 1 27,000 27,000 Rugby 4 23,000 92,000 4 23,000 92,000 Las Vegas Bowl 1 55,000 55,000 1 55,000 55,000 New Bowl Game 1 55,000 55,000 0 -- -- Neutral Site CFB Game 2 55,000 110,000 1 55,000 55,000 Catered Events 100 500 50,000 75 500 37,500 Signature 2 40,000 80,000 0 -- -- Motorsports 3 45,000 135,000 3 45,000 135,000 Boxing 1 39,000 39,000 0 -- -- UFC 1 45,000 45,000 0 -- -- Major Non-Recurring 2 50,000 100,000 0 -- -- UNLV Football 6 39,000 234,000 6 39,000 234,000 Total 127 40,000 1,129,000 92 36,000 676,000 Major Events (excluding Catered Events, UNLV Football) Enclosed Stadium 21 Open Air Stadium - 11 Assumptions do not include a MLS tenant 11
Las Vegas Stadium Event Assumptions Event Type F&B Per Cap General Event Assumptions Year One - Both Stadium Scenarios F&B Per Cap Club/Loge F&B Per Cap Suites Novelty Per Cap Ticket Rebates Facility Fees International Soccer $10.00 $15.00 $30.00 $10.00 $2.00 $1.00 Concerts 20.00 25.00 50.00 15.00 5.00 2.00 Rugby 10.00 15.00 30.00 7.50 2.00 1.00 Las Vegas Bowl 10.00 15.00 30.00 5.00 2.00 1.00 New Bowl Game 10.00 15.00 50.00 5.00 2.00 1.00 Neutral Site CFB Game 10.00 15.00 50.00 5.00 2.00 1.00 Catered Events n/a 35.00 n/a n/a 0.00 0.00 Signature 20.00 30.00 50.00 5.00 2.00 1.00 Motorsports 10.00 15.00 25.00 5.00 1.00 2.00 Boxing 20.00 30.00 50.00 15.00 2.00 2.00 UFC 20.00 30.00 50.00 15.00 1.00 2.00 Major Non-Recurring 20.00 30.00 50.00 5.00 1.00 2.00 UNLV Football 5.00 10.00 15.00 0.00 2.00 1.00 Note: Ticket Rebates and Facility Fees are applied on a per-ticket basis Other Assumptions: Food and Beverage Commissions General 39% Club/Loge 25% Novelty Commission 15% Facility Fees Promoter Share 45% Suites 15% 12
Las Vegas Stadium Net Rental Income Rental Pricing Structure: $125,000 Las Vegas Bowl, New Bowl Game, Neutral Site College Football $100,000 Soccer, Concerts, Signature, Major Non-Recurring $85,000 Rugby, Boxing, UFC $75,000 - Motorsports $500 Catered Events $0 UNLV Football
Las Vegas Stadium Naming Rights & Sponsorship Enclosed Stadium Open Air Stadium Naming rights and sponsorship revenues are projected to be higher in a closed roof stadium Naming rights revenues start at $3.5 million (closed roof stadium) and $3.0 million (open air stadium) in year 1 and grow by 5% annually Sponsorship revenues start at $3.5 (closed roof stadium) and $3.0 million (open air stadium) in year 1, grow by 5% in years 2 and 3, and by the CPI (3%) in years 4 and 5
Las Vegas Stadium Premium Seating Enclosed Stadium Open Air Stadium Suites 50 suites (2 dedicated to owner/ sponsors) 45 sold (94% sell through) Annual Lease Price Closed Roof = $75,000 Open Air = $50,000 Access to all events Loge Boxes 30 loge boxes (4 seats/box) 30 sold (100% sell through) Annual Lease Price Closed Roof = $20,000 Open Air = $10,000 Access to all events Club Seats 2,500 club seats 2,375 sold (95% sell through) Annual Lease Price Both Scenarios = $1,500 Cost Per Ticket Per Game = $35
Las Vegas Stadium Ancillary Income Enclosed Stadium Open Air Stadium Food and Beverage per caps: General - $5.00 to $20.00 Club/Loge - $5.00 to $30.00 (excluding Catered Events ) Suites - $15.00 to $50.00 Novelty per caps range from $0.00 to $15.00
Las Vegas Stadium Other Event Related Income Enclosed Stadium Open Air Stadium Facility Fees Range from $1.00 to $2.00, depending on event Promoter Share 45% (on applicable event types) Ticket Incentives Range from $1.00 to $2.00 (excluding concerts) Concerts assume a $5.00 ticket incentive
Las Vegas Stadium Indirect Expenses Enclosed Stadium Open Air Stadium Expenses grown at 2.5% annually Salaries grown at 2.5% annually Utilities grown at 4.0% annually Overall payroll burden = 30% Does not include UNLV football game day staffing expenses Assumed equal for both scenarios Year 1 = $2.3M Grown at 3.0% annually
Las Vegas Stadium Net Operating Income Enclosed Stadium Open Air Stadium Enclosed Stadium: Total Facility Income: $23.1M to $26.3M Total Expenses: $11.0M to $12.4M Net Operating Income $12.0M to $13.9M Open Air Stadium: Total Facility Income: $15.9M to $18.1M Total Expenses: $8.9M to $9.9M Net Operating Income $7.0M to $8.3M
Las Vegas / UNLV Multi-Purpose Stadium Matrix Building Program Capacity Suites Loge Boxes Club Seats Square Footage Event Programming - Total Events UNLV MLS International Soccer Major Concerts Festivals Rugby Signature Major Non-Recurring Las Vegas Bowl New Bowl Game Neutral Site College Football UFC Boxing Motorsports TOTAL TOTAL - EXCLUDING MLS TOTAL - NON-TENANT Retractable Roof 50,000 50,000 50,000 50,000 50 50 50 50 30 30 30 30 2,500 2,500 2,500 2,500 900,000 900,000 900,000 900,000 6 6 6 6 17 17 17 17 1 1 2 2 2 2 1 1 0 0 0 0 4 4 4 4 2 2 0 0 2 2 0 0 1 1 1 1 1 1 0 0 2 2 1 1 1 1 0 0 1 1 0 0 3 3 3 3 44 44 34 34 27 21 Domed 27 21 Open-Air With Shading System 17 11 Open-Air 17 11 20
Las Vegas / UNLV Multi-Purpose Stadium Matrix Retractable Roof Domed Open-Air With Shading System Open-Air Event Programming - Average Attendance UNLV MLS International Soccer Major Concerts Festivals Rugby Signature Major Non-Recurring Las Vegas Bowl New Bowl Game Neutral Site College Football UFC Boxing Motorsports TOTAL TOTAL - EXCLUDING MLS TOTAL - NON-TENANT 39,000 39,000 39,000 39,000 18,000 18,000 18,000 18,000 40,000 40,000 40,000 40,000 27,000 27,000 27,000 27,000 0 0 0 0 23,000 23,000 23,000 23,000 40,000 40,000 0 0 50,000 50,000 0 0 55,000 55,000 55,000 55,000 55,000 55,000 0 0 55,000 55,000 55,000 55,000 45,000 45,000 0 0 39,000 39,000 0 0 45,000 45,000 45,000 45,000 1,435,000 1,435,000 982,000 982,000 1,129,000 894,000 1,129,000 894,000 676,000 441,000 676,000 441,000 21
Las Vegas / UNLV Multi-Purpose Stadium Matrix Financials Stadium Revenues Stadium Expenses Stadium Net Operating Income Building Costs Hard Construction Soft Costs Parking Land Other Total Project Costs Impacts Direct Spending Ancillary Resort Spending Taxes Sales Hotel Car Rental Funding Options Public Funding COI Private Donations Resort Industry Other Retractable Roof Domed Open-Air With Shading System Open-Air 23.1M 23.1M 15.8M 15.8M 11.0M 11.0M 8.9M 8.9M 12.0M 12.0M 7.0M 7.0M 616.0M 566.0M 416.2M 392.1M 98.0M 98.0M 98.0M 98.0M TBD TBD TBD TBD TBD TBD TBD TBD TBD TBD TBD TBD 714.0M 664.0M 514.2M 490.1M 22
5 NEXT STEPS
NEXT STEPS Deliverable Schedule On or before June 19th 1. Economic and Fiscal Impacts 2. Funding Model 3. Recommendation on Overall Feasibility 4. Development of Legislative Recommendations On or before July 24th 5. Draft Report Delivered On or before September 25th 6. Final Report Delivered 24
Thank You