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Playin' to Win

Sep 29, 2014 08:00AM ● By Cate Reynolds
Sports Ignite Economic Sparks in Maryland

By Mark R. Smith

After the Super Bowl or the World Series, or another prime time sports event, a media report usually follows about its economic impact.

The reports are often met with the presumptive calm that comes with expectation. For instance, when the Baltimore Ravens won Super Bowl XLVII, the University of New Orleans reported that the event generated a $480 million economic bang in host city New Orleans and the region. That eye-popping figure wasn’t a surprise.

While it’s understood that big time sports provide considerable combustion for an economic engine, there’s more to the whole picture.

Consider the impact of the smaller professional and collegiate leagues, as well as the amateur sports scene, that are also pieces of Maryland’s sports puzzle. They’re a source of greater economic clout than one might imagine.

Stadium Rights

That clout is well understood at the Annapolis & Anne Arundel County Conference & Visitors Bureau (CVB), which has one of its three full-time marketing salespeople (namely, Senior Sports Manager Kate Roth) focus on sports. Today, the CVB is already busy promoting the second local Military Bowl, which proved a success during its first year at the Navy-Marine Corps Memorial Stadium in Annapolis.

While the team hotels will be in D.C. next December (due to a prior contract), CVB staff is planning to set up official fan hotels for each team in Annapolis. That idea was spurred, in part, by last December’s Marshall vs. Maryland contest, when “occupancy was up 10 percent the night before the game, 38 percent the night of the game and 10 percent the following night,” says Connie Del Signore, president and CEO for the CVB, who noted that, “Even the BWI Airport Marriott sold 25 extra rooms.”

Also noting the $55,000 in merchandise sales, Del Signore said that the CVB tallied a $1 million impact from the Military Bowl for Annapolis and Anne Arundel County, which amplified to an estimated $13 million in the region. While the stadium also hosts the Major Lacrosse League’s (MLL) Chesapeake Bayhawks (see sidebar) and other events (see below), its main tenant is the U.S. Naval Academy football team, which begins play in the new American Athletic Conference [an offshoot of the Big East] in 2015.

That shift required stadium upgrades (costing $40 million since 2002), which included updated home locker rooms and expanded recruiting/hospitality areas at the south end zone last year, with more club level seating and hospitality space on the upper east section of the stadium coming for this season. At some point, seating may be added to the berm on the stadium’s north side.

Attendance for Navy games averages 35,000—in a stadium with a seating capacity of 34,000 (with ample standing room on the berm). Citing the program’s economic impact “would be conjecture,” says Eric Ruden, the U.S. Naval Academy’s deputy director of athletics, “but we do know that most of the city’s hotels are filled to, or near, capacity on the weekend of a home game, especially homecoming weekend.”

That’s Not All

But actual games don’t tell the whole story in this broad realm. The CVB attracted the Drum Corps Associates (DCA) World Championship Finals to the stadium for the past two Labor Day weekends, with more than 3,000 performers from 30 of the world’s best drum and bugle corps from the all over North America and Germany to perform in its “Super Bowl.” The performers and their families needed for more than 5,000 room nights in Annapolis and the county.

“So, while we assisted with the Military Bowl and work with the Bayhawks, we bring in our own sporting events,” Del Signore says. “For instance, we traveled to Ithaca, N.Y., and pitched the people who run the ‘S.P.O.R.T.S.: The Relationship Conference’ to bring it to Annapolis.”

The conference isn’t so much a sporting event, but is a noteworthy part of the local impact of the sports industry. It will attract 150 sports rights holders who are also in the business of presenting sporting events and want to grow them. “It took 18 months to book,” Del Signore says, “and most of the attendees are from the Midwest. One of our selling points was visiting Annapolis and using the stadium.”

That event “will bring in about 500 room nights,” she says, and “also means considerable future business, as we’ll give the attendees tours of our hotels and other sites.”

The CVB partnered with the Maryland Stadium Authority’s (MSA) recently rebranded Maryland Sports division on the endeavor, given the business (or marketing) fee of $20,000 paid to the conference to bring the group here.

“That’s why the additional hotel tax money we’ll see is such a good investment,” Del Signore sums.

Beyond the Pros

While those assessing the impact of sports often focus on the professional side, the amateur sports scene also provides plenty of pop, in some cases creating tens of millions of dollars in impact. A look into that side of the equation was provided by Terry Hasselstine, executive director of Maryland Sports.

“Consider this Memorial Day weekend,” Hasselstine says. “We had the men’s Division I, II and III, and women’s Division I NCAA Lacrosse Championships at Baltimore’s M&T Bank Stadium; the U.S. Lacrosse Women’s National Tournament, at Harford County’s Cedar Lane Regional Park; and the youth soccer event hosted by Elite Tournaments for 720 teams at various locations in central Maryland. That weekend alone [is estimated to have] generated more than $30 million in economic impact.”

While he’s anything but surprised by that figure, he regularly encounters people who are.

“The economic impact of sports is a big mystery to a lot of folks,” Hasselstine says, “but it shouldn’t be.”

For instance, he says that sports travelers spend about 15–20 percent more than the typical traveler and they often extend their trips to visit other local and regional sites once they’re here. “We’re lucky that we’re close the Nation’s Capital. Sometimes Maryland can be overwhelmed by D.C.’s proximity, but the advantages outweigh the disadvantages. Traveling groups can’t get what they get in our region if their event is in Central Pennsylvania, for instance.”

That makes sense to Mike Libber, owner of Columbia-based Elite Tournaments. His operation, which he likened to “a wedding planner for sporting events,” works with clients like the Soccer Association of Columbia.

“They have 6,000 kids in the organization—and that’s just for one club, out of the half-dozen in Columbia,” he says. “They supply the fields and we do the rest,” with “the rest” consisting of picking out the teams, selling branded Under Armour apparel, providing uniforms and equipment for the referees, booking hotel room blocks, etc.

On Memorial Day came the aforementioned 39th Annual Columbia Invitational Memorial Day Tournament. That’s when the proverbial cash registers started to ring.

The 720 teams with 18 kids per, plus many of their families with an average of about 2.5 people each required 9,000 hotel room nights at a two-night minimum. All told, including eating in the often overwhelmed local restaurants, the spending the tournament inspires ranges between $5 million to $6 million.

It’s Big Money

To get an idea of the tournament’s enormity, the event requires 80 fields at 40 area sites. “We use every public high school field in Anne Arundel and Howard counties, and more elsewhere in the region, during the event,” Libber says.

Those involved with youth travel sports “do have an idea of the kind of money these events generate,” he says, but he was with Hasselstine regarding the cluelessness of the general public. “I don’t think even the businesspeople have a real handle on the economic impact of such events and this industry,” Libber says. “When it comes to all of our 20 events in the state, even I can’t tell you the total impact.”

So great is the impact of amateur sports in Maryland, Hasselstine noted, that the MSA is finalizing a study on the subject.

Del Signore can relate. “Five or six years ago, Anne Arundel County did not understand the value to helping us help them rent their fields. They considered the fields for residents only,” she says, “but we showed [Maryland Speaker of the House] Mike Busch and Rick Anthony, both of the county office of recreation and parks, what the impact would be and that we could bring in revenue during the off season.”

She concluded with a comment that anyone could appreciate after The Great Recession.

“This business is recession proof,” Del Signore says. “If a child is in a tournament, there is no way that the parents can say that they aren’t coming.”


What’s Ahead for the Bayhawks?

Chesapeake Bayhawks Owner Brendan Kelly’s team has won three of the last four MLL Championships. He sees lacrosse growing at the youth, collegiate, and professional levels nationwide.

And he wants a new 22,000-seat stadium built, with a dozen adjacent fields, in Bowie.

So the Bayhawks hired the MSA, which works with economist of record Crossroads Consulting Group, of Tampa to conduct a $40,000 study, and it was found that the market cannot absorb such a stadium, but it can absorb the linear fields.

The MSA’s Terry Hasselstine says that the MLL has been “a steady league for five-plus years” and that the Bayhawks “are a great organization with a successful following,” and he feels that the dozen fields would be a good driver to grow the Bayhawks toward more visibility and, at some point, a new stadium.

“The 12 fields in a Bowie complex will be successful, but only if we’re part of it. Otherwise, it would just be multi-use fields,” Kelly says, noting the presence of other such facilities in Maryland. “There’s no reason to leave the [U.S. Navy-Marine Corps] stadium in Annapolis if the new project isn’t done right. We have a great relationship there. We are contracted there for four more seasons.”

Kelly is still hopeful for what he deems a more favorable conclusion. He and the Bayhawks’ first home face-off of the 2015 home schedule is set for Saturday, May 3, against the Long Island Lizards.