Raiders Las Vegas PSLs $75K for top club seat?
The Las Vegas Raiders version of the Oakland Raiders will have prices for personal seat licenses (PSLs) that, at up to $75,000, are equal to that for Levi’s Stadium, where the San Francisco 49ers play. That is unless the Silver and Black take note of the level of rancor and knock down their asking price before the stadium opens for NFL business in late 2020 or 2021.
According to documents obtained by the Las Vegas Review Journal‘s Rick Velotta (who was a guest on Zennie62 on YouTube Livestream and you can watch that interview here), but not shown to the public, the Oakland Raiders are set to have Las Vegas Stadium club level personal seat license prices between a low of $20,000 and a high of $75,000. That PSL range is comparable to that for Levi Stadium in Santa Clara, California, and where the San Francisco 49ers play. According to two sources for 49ers online PSL purchases, the highest club level seat (not VIP) is $75,000, and not $80,000 as the Review Journal reported. The Niners VIP level is the suite level, where the seat licenses go from $100,000 to $210,000
This makes the reported PSL price range for the Oakland Raiders in Las Vegas for club seats to be the same as that for the 49ers, but with one major difference: local economic demographics.
In Santa Clara, where the Niners play, the median household income (MHI) increased from $93,500 in 2014 to $102,191 in 2017. By contrast the median household income for the entire state of Nevada – a range used because the Raiders report that 73 percent of their ticket purchases in Las Vegas came from fans with Nevada license plates – was $55,180 in 2016. In Clark County, Nevada, where the Raiders Las Vegas Stadium is located, the MHI is even less: 52,629. So, Nevada’s MIH is approximately $45,000 less than that for Santa Clara County, and Clark County’s is approximately $47,000 less than that for Santa Clara County – yet the Raiders are charging the same level of personal seat license prices, according to the Review Journal.
The even more shocking news is of change in MHI since 2005 in Nevada. Between 2005 and 2016, the highest MIH for Nevada was in 2007 at $63,739 – then the MHI dropped to a low of $52,017 in 2012, before increasing again, but only to $55,180. So Nevada resident households were better able to buy Raiders PSLs in 2007 that in 2016, the last year for which reliable MHI data was collected.
Reports of this regional difference by buying power sent the Zennie62 YouTube Livestream audience into a lather on the Tuesday night, July 10th when this data was introduced. A contingent consisting mostly of Oakland Raiders fans who are upset the team is planning the Las Vegas move, the PSL price versus regional median household income difference was a new point of anger and questions from the fans. Comments like “See something is rotten in Demark and we’re going to have it lol” by John Marx were common. And Barry Lee of Texas observed “and wheres the logic now to move from a bigger market to a smaller market where the income average is down?” Korey Brown wrote “I have not heard 1 finance expert say this is a good deal for Vegas or it’s people.”
And when one looks at the Atlanta Falcons club seat PSL range of between $10,000 and $40,000, then the questions of what’s going on with the Oakland Raiders in Las Vegas really start to come. The Atlanta MHI was $62,613, and versus $55,180.
With all of this news of market disparity with price comes a number the Las Vegas Review Journal quoted that, if true, means the Raiders are not going to pay what they said they could afford for the PSL contribution to stadium construction. Orginal reports had the Raiders saying they would contribute $200 million, then $250 million to the stadium construction cost from PSLs. But the Review Journal claims the Raiders only project $160 million from PSL sales – a difference of $90 million, less.
In the approved stadium budget documents, PSLs are not broken out, nor are they listed as a source of revenue. Instead, a “Raiders Equity Contribution [“ that is “ncludes closed construction debt financing pursuant to Senate Bill 1 (2016 Special Session), Section 36.1(e)(2)” is said to represent a total of $850 million. That represents the much-talked about but never actually confirmed line-of-credit from Bank of America. That said, the stadium budget document reports that $172,367,000 was spent from that source at the time the document was presented to the Las Vegas Stadium Authority May 23, 2018.
Moreover, the total stadium budget was set at $1.8 billon – with no specifically earmarked fund to pay for cost overruns. Yet, Don Webb told the Review Journal there would be cost overrus that were “minimal” due to the tariffs on steel and aluminum. Just what “minimal” was, was never defined.
Yet, on July 7th, the Raiders construction boss that is Don Webb said to the Review Journal that (to quote the publication) “steel and aluminum tariffs ordered by President Donald Trump would have a minimal impact on the project’s cost because most of the structural steel was ordered well before the tariff announcements.” And the publication reports that Webb said “there could be some minor price fluctuations for steel and aluminum products subcontractors use.”
Parking Costs and Off-Site Infrastructure Costs Not Included In Stadium Construction Costs
The other cost item not mentioned must be discussed with the mention of the PSL revenue problem. The cost to find 14,000 spaces has caused a land purchase need that this vlogger estimated could drive development cost for parking as high as $200 million. What was not talked about was how the Raiders intended to pay that cost, even as it was agreed they would pay the cost. The Raiders’ Webb is mum about the parking issue, pointing to the September deadline as the point when they will present the plan. That’s well and good, but how much will it cost, and what does that add to the stadium price tag?
Far more questions than answers and an overall cost versus revenue picture that points to overruns and not surpluses.