There has been a boom in stadium and arena construction in the U.S. over the past two decades. Between 1989 and 2009, 103 of the 118 sports venues utilized by teams across five professional sport leagues (Major League Baseball, National Football League, National Basketball Association, National Hockey League, and Major League Soccer), were either newly built or had undergone major renovations. The total estimated construction costs for these facilities approached $27 billion. And these numbers do not include the recently opened stadiums such as the $1.6 billion New Meadowlands Stadium hosting the NFL Giants and Jets or the Minnesota Twin’s $400 million Target Field, both of which opened this year.
This article will offer a brief overview of the history of sports facility financing as well as a discussion of the types of bonds utilized to fund these projects. It will focus on a few representative financings while noting critical factors that bondholders should take into account before purchasing specific types of sports facility bonds.
Larry Levitz is a contributor to Muni Market Update. The opinions expressed are his own.