NR Growth Slows in Third Quarter

By Bill Miller

As noted on this site earlier this year, the first two quarters of 2004 saw a strong start for the sale of naming rights for professional sports facilities throughout North America. However, as also predicted here, the pace of new naming rights agreements has slowed dramatically as the year has gone on.

This trend continued in the third quarter of the calendar year as there were only three new major league or minor league naming agreements signed during this three-month period.

The three new agreements during the third quarter were major league deals in St. Louis and San Francisco and a minor league agreement in Des Moines.

The net gain for the quarter remained three despite the fact that Penn Traffic took the name of P&C Foods off of the home of the class-AAA International League's Syracuse SkyChiefs and A-League Syracuse Salty Dogs in early September. This loss was offset by the fact that the lease between the Central Hockey League's Corpus Christi Rayz and previously-named American Bank Center in Corpus Christi, TX necessitated adding that facility to our overall list.

As the following chart illustrates, there have been 208 naming rights agreements announced for major league and minor league sports facilities since the first agreement was completed for Buffalo's Rich Stadium in 1972. This total does not include any naming rights agreements for training facilities, concert & entertainment venues, theatres, college facilities, high schools or other venues.

There are a couple of key items to note. First, while there has been a drop from the explosion of deals completed since 1999, there have been at least ten naming rights agreements completed in every calendar year since 1994. Second, despite the continually slowing growth of naming rights sales during each quarter of the 2004 calendar year, the overall year is already among the top-five years ever for sales and could break into the top-two with a strong final quarter.

Announced Naming Rights Agreements

• 2004 (18; so far)

• 2003 (18)

• 2002 (24)

• 2001 (15)

• 2000 (24)

• 1999 (34)

• 1998 (14)

• 1997 (10)

• 1996 (15)

• 1995 (14)

• 1994 (9)

• 1993 (2)

• 1992 (1)

• 1991 (2)

• 1990 (4)

• 1989 (0)

• 1988 (1)

• 1987 (0)

• 1986 (2)

• ***

• 1972 (1)

Of the eighteen agreements announced so far in 2004, nine involved new names for existing facilities (San Francisco, Iowa, Texas, Seattle, Florence, Dunedin, Saskatoon, St. Lucie & Harrisburg); six were for new facilities (St. Louis, Corpus Christi Hooks, Corpus Christi Rayz, Clearwater, Victoria & Allentown); two exchanged one corporate name for another (Carolina & Kelowna) and one was the restructuring and finalizing of a deal preliminarily announced several years ago (Rochester/PaeTec).

Unfortunately, only seventeen of these agreements will be implemented as the proposed baseball stadium that was to be named in Allentown was unable to secure funding despite the presence of a naming rights agreement and will not be constructed.

Another positive development is the apparent strength in the sale of naming rights throughout other sectors of the sports industry not covered to this point at Naming Rights Online.

For example, in July, Sprint inked a reported 20-year agreement for a new arena in Kansas City with the final price being $42.5 million or $62.5 million depending upon whether a major league tenant is secured for the facility.

In addition, the City of Mount Holly, NC was able to secure $200,000 for the naming rights to a trail system and several entertainment and performing arts venues were able to secure naming sponsors during the latest quarter.

Posted. 10/04. Updated 1/05/2005.

Bill Miller is an Executive Vice President at The Leib Group, LLC in Mequon, Wisconsin. He is a regular contributor to Naming Rights Online and can be reached at bmiller@namingrightsonline.com