Playing on Empty
Roll over to pick your seat
Ever been to a shopping mall that is struggling? The empty stores tell the even the casual consumer that the business is struggling. In the current economic difficulties, decisions made more than two years ago seem silly and poorly thought out. Truth is, way back in 2007 the personal wealth created by the real estate boom was the drug that allowed the populace to look at the future with beer goggle. Fans can keep spending because home price never go down.
(I do have contempt for that part of American society that over consumed. Using the equity in real estate as a personal piggy bank is reckless and shortsighted. Given the wide spread practice of this the entire economy has been put in peril by lack of personal fiscal prudence. Washington and Wall Street played a role but the consumer made the final poor choices.)
Today the Baltimore Sun reported on the poor progress of selling luxury suites at the University of Maryland--UM looking for suite buyers at Byrd. In 2007 adding 64 luxury boxes the Byrd Stadium made sense, beer goggle sense. Now as the grand opening approaches 24 (37.5%) remain unsold. The announcement was noted in this blog HERE .
From that prior post:
"The first phase of expansion - scheduled to be completed by August 2010 - includes 64 swanky suites with flat-screen televisions, food services, and indoor and outdoor seating. Maryland can't move forward with its other plans, though, until at least 50 of the luxury suites have been sold...Ten suites have already been sold..."
Help me with the math here but they could not move forward until 50 had been sold...but only 40 have been sold.
"The cost for phase one of the project is $50.8 million, to be paid entirely by the athletic department. Maryland sold the naming rights of the field to Chevy Chase Bank for $20 million last year, and borrowed $35 million from the University System of Maryland."
And given the lack of sales will there be any problems with paying back the loan?
As other sports have found the luxury box is not a sure thing and the revenue does not always justify the cost.
Please buy a box!
Would winning even sell these boxes?