Milwaukee Bucks Deer District real estate project.
Source: Milwaukee Bucks
The Milwaukee Bucks, in their mission to repeat themselves as NBA champions, will begin playing against the Boston Celtics in the Eastern Conference semifinals this weekend. Off the pitch, the team is seeking $ 4 million a year for his rights District of the Deera 30-acre plaza that sits outside their bullring.
In an interview with CNBC, Bucks President Peter Feigin described the naming rights asset as obtaining the keys to “a city we created in the state of Wisconsin.” The Deer District is part of the team’s economic development plan, to which taxpayers have contributed $ 250 million. And the project also brought the Bucks to their $ 500 million plus arena, which opened in 2018.
The Bucks property group includes high profile investors Marc Lasry, Wes Edens and Jamie Dinan. The consortium bought the franchise for $ 550 million in 2014. It is now worth $ 1.9 billion, up slightly from $ 1.62 billion in 2020, according to forbes.
The Bucks rely on the Deer District to increase revenue outside the NBA.
“What pro teams are now underestimating is: you create the mothership and have it powered by a successful NBA team, and then raise the water around you,” said Feigin, who is also president of the team’s arena. , Fiserv Forum.
Rendering of the condo in Deer District in Milwaukee
Source: Milwaukee Bucks
The Bucks are proprietary
Over the years, more professional sports clubs have added real estate revenue to take advantage of their brands’ popularity.
The Golden State Warriors operate the Chase Towers, the commercial and residential buildings outside the Chase Center. This helped raise their valuation to $ 5.6 billion, up from more than $ 3 billion before the pandemic. Steve Baller, owner of the Los Angeles Clippers and former CEO of Microsoft, is moving his team to Inglewood and will leverage real estate around the $ 1.2 billion Intuit Dome. This could increase the value of the Clippers.
In Major League Baseball, the Atlanta Braves created The Atlanta battery, an entertainment and residential area. The Ricketts family, owners of the Chicago Cubs, also own properties surrounding historic Wrigley Field. NFL team owner Jerry Jones created “The stars” – A 91-acre mixed-use development in Frisco, Texas where the Cowboys practice.
The team-led real estate projects are cities within cities, where people “live, work and play,” said Jessi Sanchez, senior vice president of the consulting and sports appraisal firm. Playfly Premier Partnership. The company advised the Atlanta Falcons the naming rights around the Mercedes-Benz stadium.
Owners are looking to make more money from people who want to attend live sporting events, even if they’re not inside the arenas, Sanchez said. “They are real estate developers now,” she said. “They are no longer just a sports team”.
Sanchez compared Deer District to the Cubs entertainment district “Via Gallagher”. The MLB team sold the right to the naming rights to the global insurance company Arthur J Gallagher & Co. which is listed on the New York Stock Exchange.
Rendering of the condo in Deer District in Milwaukee
Source: Milwaukee Bucks
Feigin, the Bucks executive, said his team will “take advantage of opportunities to generate more revenue” with tenants, including a supermarket, pharmacy and a gym. The high-end apartments are part of the e floor Marriot has committed to a hotel due to open in 2023.
“We are completely close to development,” Feigin said. “We have a hotel that is a third way of doing things. We are thinking of other principles. We will have people who will work there and more people who will live there.”
What does it get for business partners?
Sanchez said the Bucks asking price for the naming rights could be in line with the market, depending on the exposure package. The terms of the suggested deal should be at least 10 years, as it predicted that sponsors would take half the time to exploit the rights.
Sanchez added that companies receive “more touchpoints” because mini-cities attract more than sports consumers but “health and wellness [consumer] to someone who loves entertainment, “he said.
Another selling point for the Bucks is the frequency with which they switch to national TV. The Deer District appeared on Disney’s ABC network during the finals. Such exposure “equals impression and value,” Sanchez said, noting the more than 60,000 people who have occupied the Deer District to watch NBA games outdoors.
Giannis Antetokounmpo b. 34 of the Milwaukee Bucks celebrates during the sixth game of the 2021 NBA Finals on July 20, 2021 at the Fiserv Forum in Milwaukee, Wisconsin. Copyright 2021 NBAE.
David Sherman | National Basketball Association | Getty Images
But the Bucks will have to keep winning to make this asset attractive. In the NBA, winning dynasties attract the best deals. It’s why the Warriors, who have returned to their ways of contending for the title, are on the verge of becoming the NBA’s most highly regarded franchise, surpassing $ 700 million in revenue in 2022. The Bucks have one asset that should help them sustain themselves over the years: 27-year-old superstar Giannis Antetokounmpo, a two-time regular season MVP and last year’s Finals MVP.
“This is what a team and a league organization looks like,” Feigin said. “We are picking up on what our narrative is and what our results are.”
He said the Bucks have seen an increase in business inquiries since July 2021, the month after winning the championship, but haven’t discussed the details. The team added Motorola as a partner for the jersey patch after that company walked away the Brooklyn Nets, who were just overwhelmed by the Celtics.
“You want victory to be your accelerator in style,” said Feigin. “These are the moments to exploit it”.
The Bucks face the Celtics on Sunday in the first game of their best-of-7 series.
