Location and functionality
When developing a stadium, the concept of it being a day to day revenue generator should be put into consideration. Therefore the choice of amenities and the location should be driven towards revenue maximization goals. To determine the choice of amenities and location the following factors should be considered. Regarding distance, I will ensure that the stadium is within reach. Therefore, I will recommend a distance of fewer than two kilometers from town (Fenwick, 2011). The aspect of functionality is critical when designing a stadium. With this in mind, the amenities to be put in the stadium are dependent on the activities taking place within the stadium. Since the stadium will be a multipurpose place, it will be essential to include a variety of facilities to meet the needs of the various users.
To ensure that the building budget falls within the recommended expenditures, I will thus consider the most affordable land in the town. The amenities to be placed in the stadium will be dependent on the amount of money available. Security and safety of the consumers is a crucial aspect. Hence, the facilities used in the entire stadium will comply with the national safety rules. I will also put in place security measures including security guards and alarms to ensure that the spectators’ cars are safe.
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Amenities need to focus on what the target consumers need most. As a professional sports investor, I will focus on ensuring that the seats put in the stadium are comfortable. I will also have spacious changing rooms with permanent indoor facilities such as mirrors, wardrobes, and showers for the players. The stadium should also have enough parking spaces. Stadiums are not only for games, but the entire community should benefit from it. The facility should be family friendly by design to take care of other community functions as well. In regard technology, the best technology in the market will be installed to avoid extra costs for constant replacement.
Sources of Funding
Sources of funding are crucial when planning for such a kind of massive investment. The following sources will be considered when setting up this project:
Private and public investors: Investors buy shares or part of the stadium ownership. In return, the stadium management may result in future pay a percentage of proceeds from the revenue collected in the form of dividends.
Commercial loans: These are debt –based funding agreement between the stadium and a lending financial entity. There must be underlying security for the loan to be granted and the loan should be paid back after a period of a calculated interest.
Government grants: This is funding from the government to ideas and projects that supply services to the public and has a better way of improving the economy. An application has to be done then the government will have to conduct an assessment through a special team to ensure eligibility is met before the finances are granted. This money cannot be refunded to the government.
Long term commercial contracts: Sale of facilities that will be used later once the stadium starts to operate lays a good capital plan, for example, the sale of seats and car park spaces.
Subsidies: This is a form of a reduced burden on some financial obligations. They can be in the form of cash. The local government may decide to cut taxes considering the positive impacts the stadium would have.
Own savings: The $400 million act as a self-financing fund. The advantage is that this money has no interest and it ensures a more significant right of ownership and control than all the other financial options.
Ongoing Revenue Generators for the Stadium
I will recommend the stadium is built in phases. This will ensure that the completed side can be utilized as we wait for the parts to be completed. For example, people can hire completed halls for functions. Since middlemen is fond benefiting from the commission hence increasing expenditures. Therefore, the stadium team to reduce the expenditures will conduct all purchases and outsourcing of staff. To avoid a lot of paperwork, information can be passed to the public through a website. The easiest way to make money from a website is by advertising other companies’ products on the platform.
Concerning location, if the stadium is located within a town or around a busy area, it may decide to give out spaces for running temporary businesses within its compound. I also believe that considering using a cheaper source of power will cut down electricity expenses. For example, installation of a solar system or wind power energy for lighting and as a backup during electric power loss will help save a significant amount of money. Water should also be preserved, and facilities using water should be controlled to avoid wastage (Portny, 2017).
Ways of Getting the City Involved
Partnership agreements can be formed between the stadium and the city council. There will be sharing of risks and once the stadium is completed the public at a reduced Furthermore the stadium can decide to leverage its assets can use the facility. This is where the city gives the stadium money for investment with an aim constructing the best facility. The city is likely to benefit from an economic growth once the stadium is completed (Fenwick, 2011).
Sharing Revenue
Revenue from a stadium come in the form of entry fee, parking fee and fee paid for holding corporate events. Partners and shareholders will receive a portion of revenue according to the number of shares they own. If a shareholder owns a certain percentage of shares in the stadium, the same rate will be used to calculate his/ her salary. These are called dividends. Team members will receive a monthly pay from the revenue collected payment is based on the contractual agreement available. Allowances are excluded from this amount. (Fenwick, 2011) The percentage of revenue obtained is given to the city in the form of tax. Employees receive a monthly payment from the income in the form of salary depending on the remuneration policy used (Portny, 2017).
Reference
Fenwick, M. (2011). UEFA Guide to Quality Stadiums. Switzerland: Union of European Football Associations (UEFA).
Portny, S., E. (2017). Project Management. New Jersey: Hoboken,NJ: John Wiley and Sons, Inc.
