Wednesday
Mar282012

Q&A: Can $1 Billion Stadiums Put An End To Cold Hot Dogs, Flat Beer, Lousy Seats? 

By Barry Janoff

March 28, 2012: Dave Checketts says yes, and as chairman/CEO for Legends Hospitality Management, he is in a position to make that goal a reality.

Legends Hospitality Management, founded in 2008, is jointly owned by the New York Yankees, Dallas Cowboys, Goldman Sachs and Checketts Partners Investment Fund. It was formed, in large part, to handle the hospitality (including food and beverage), merchandising, premium ticketing services and other fan amenities at the new Yankee Stadium, which opened in April 2009, and Cowboys Stadium, which opened in June 2009.

The cost to build each of those stadiums was put at more than $1 billion, a figure that has now become the standard for proposed stadiums. The San Francisco 49ers are currently receiving final approval for a new $1.2 billion stadium in Santa Clara, currently rescheduled to open in time for the 2014 NFL season. Farmers Field in Los Angeles, which is still awaiting approval for construction as the future home for an as-yet unnamed NFL franchise, and a rival stadium being planned for the City of Industry each have topped $1.2 billion in estimated costs to build. New stadiums being planned in Minnesota, Atlanta and elsewhere also are coming with a $1 billion price tag.

Checketts' career to date should be recounted while listening to Emerson, Lake & Palmer's version of Aaron Copeland' "Fanfare For the Common Man." In January, New Jersey-based Legends Management named Checketts as chairman and CEO. In addition, the private equity fund that he founded, Checketts Partners Investment Fund, became an equity partner of Legends Management following its acquisition of CIC Partners. 

Prior to that, his resume includes president and GM of the Utah Jazz, president of the New York Knicks, president and CEO of Madison Square Garden (including the Knicks, WNBA Liberty and NHL Rangers). GM of NBA International, chairman of the St. Louis Blues and founder of SCP Worldwide, which owns among other properties MLS franchise Real Salt Lake and ESPN 700 Sports radio station in Salt Lake City. He has also headed groups that sought to acquire the Los Angeles Dodgers and the St. Louis Rams.

In addition to the Yankees and Cowboys, Legends roster of clients includes the Rose Bowl (which currently is undergoing a $152 million renovation and upgrade), the San Francisco 49ers, the Tampa Bay Buccaneers (Raymond James Stadium), Oklahoma City Thunder (Chesapeake Energy Arena), Phoenix Suns (US Airways Center), San Diego Padres (Petco Park) and the University of Connecticut.

Checketts spoke with NYSportsJournalism about the Dallas Cowboys, New York Yankees, the challenges and benefits of heading up Legends and the role and responsibility that team owners have to the fans who ultimately pay the bills.

NYSportsJournalism.com: What attracted you to become chairman and CEO for Legends?

Dave Checketts: For 11 years at Madison Square Garden, I was constantly trying to upgrade the experience. Not only competitively on the court or on the ice, but I also wanted to have the best food, the friendliest ushers, the best in-arena experiences and events. What intrigued me about Legends was that the Steinbrenners and Jones families really are very passionate about the fan experience at the game. The whole idea that going to a game didn't mean any more that you were going to have a lousy seat or buy a bad hot dog and have to live with it. They decided to go out and make the whole experience at Cowboys Stadium and Yankee Stadium the best that it could be. So that whole idea of revolutionizing the fan experience at a game was what intrigued me.

NYSJ: Was there something specific that impressed you about the way Legends was conducting business?

DC: I had been going to Yankee Stadium for years and years; MSG had the television rights there. And then I went to the new Yankee Stadium and someone who worked there asked me while I was eating if I needed a napkin! Someone else asked me how my food was! That was a new experience. People were trying to help me. So when I got to meet the Legends guys, I asked, 'Where did you find these people? How did you recruit them?' And they said, 'They were the same people who worked at the old Yankee Stadium, but we brought in people to train them to be part of an upgraded fan experience. We built in incentives to promote customer service. And now we have completely fresh, amazing food.'

NYSJ: Looking at Legends, there is strong ownership on the Dallas Cowboys under Jerry Jones and strong ownership on the New York Yankees with the Steinbrenners, each with their own agendas. Beyond financial reward, how driven are they to work on behalf of the fans?

DC: They are genuinely interested in each stadium being legendary, not just for team performance and championships, but for the whole experience of being there. You can't go into either one of these stadiums and not be impressed by the way they look, their sense of history and the legacy that exists in those two iconic brands. They want the whole experience to be better. Frankly, there are plenty of places to use fewer dollars. And they know that there are plenty of other places where consumers can spend their dollars.

"You can't go into either one of these stadiums and not be impressed by the way they look, their sense of history and the legacy that exists."

NYSJ: Is part of your role to be a mediator or peacemaker when strong-willed people such as Jerry Jones and the Steinbrenners disagree?

DC: I won't have to be the principal of a school and dole out punishment. [Laughs.] Legends is based on the strength of these families, Goldman Sachs and my investors. Will there be times when I have to take a few hits, or be in the middle [of a disagreement]? I have no idea. All I know is that everyone is motivated and everyone is working well together.

NYSJ: Although they do have strategic marketing partners, neither Cowboys Stadium or Yankee Stadium have naming rights deals. Do you see that happening at either venue?

DC: With Cowboys Stadium, I believe they have been trying. At Yankee Stadium, I can't imagine that ever happening. While I was at Madison Square Garden, we got offers for huge amounts of money to rename The Garden. You can't rename The Garden. I don't think you could rename Yankee Stadium or Cowboys Stadium. Fortunately, that decision is not up to me.

NYSJ: How do you respond critics who way that only the people who pay the most can have the best experiences at a sports event?

DC: There are all types of people at football, basketball and baseball games. Some are in suites. They want incredible food, healthy food. And we certainly will satisfy the needs of those people. But the guy in the stands, we will take care of him as well. If you want a hot dog, you want it fresh, not one that has been sitting under a heat lamp. You want your food prepared fresh. But we also want them to have the option of buying a shredded beef sandwich. Having the best BBQ in the free world at Cowboys Stadium. There is a pastry kitchen at Cowboys Stadium where Executive Pastry Chef Katie Rangaram oversees the preparation of all of the pastries made fresh on the day of an event. It's a whole different approach; a whole new experience. And I think it's going to revolutionize sports.

NYSJ: Has this strategy to improve in-stadium experiences been impacted by the fact that  fans having more and better options to watch games without having to actually attend a game in person?

DC: It has. Legends wants to expand the experience that fans have not just during a game but before and after. We are going to do a better job, and a more-focused customer-service job, when it comes to creating an environment in and around the stadium. Eventually we will have a whole portfolio of businesses whose goal will be to upgrade and revolutionize the experience of attending a game.

NYSJ: How important has this whole category become to sports in getting new stadiums built and in getting fans to arrive early and stay late to spend money on the amenities?

DC: It is important, but it is very important for Legends to do it better than anyone else. Not just the quality of food and customer service, but in ticket services, media production services. Whatever we do, we have to be the gold standard. That is what's going to revolutionize the game. In the old days, a stale sandwich and soda that has gone flat would too often be the norm. Those days have to be over.

NYSJ: What do you think will happen with the situation in Los Angeles, where the NFL hasn't had a franchise since the 1994 season and two groups are trying to get approval for a new stadium?

DC: I know the NFL's owners would like to have a team there. But the battle between Edward Roski, who wants to build a stadium in the City of Industry, and Anschutz Entertainment Group, which wants to put [$1.4 billion Farmers Field] downtown, I do not know how to predict a winner there. Someone will get it, and someone will get it soon. But there are so many issues that first have to be settled.

NYSJ: The NFL has expressed interest in having the historic Super Bowl L in 2016 in Los Angeles, where the first Super Bowl - the AFL-NFL World Championship Game - was played at the Memorial Coliseum. Could it be played at the Rose Bowl?

DC: That's a great question. Legends is involved with the Rose Bowl [which is undergoing a $152 million renovation]. The BCS National Championship Game was played there in 2010 and will be played there again in 2014. It could seat 100,000. I was just out there, and it is beautiful. But whether or not the NFL would go to a non-NFL city, I just don't know.

"In the old days, a stale sandwich and soda that has gone flat would too often be the norm. Those days have to be over."

NYSJ: What's your opinion about the nearly $1 billion renovation taking place at Madison Square Garden?

DC: It's going to be beautiful. They've done a first-class job. When I was there we self-operated food and beverage, which they are still doing. But they've brought in restaurants, more and better food and beverage options, better quality offerings at concession stands. Going back to your earlier question, they are improving the experience for every fan who enters The Garden, not just the people in the executive suites. Plus, it's an impressive building. To take what was there and enhance it without destroying its character has been tricky. But they've done a nice job.

NYSJ: Did they save your old office as a monument?

DC: [Laughs.] No. It's long gone . . . There was a recent story in The New York Times in which they detailed the records of the New York Knicks head coaches since I left [in 2001] I don't know why they had to make it personal. We had a great run, but that wasn't just me. Patrick Ewing, Pat Riley, Jeff Van Gundy, Charles Oakley, we had a great in the 1990s.

NYSJ: When you look at the money being put into new stadiums and arenas, renovating venues and the upgrading of fan amenities, what does that say about the state of the economy regarding sports?

DC: It certainly doesn't show any signs of slowing down, which is amazing when you consider what the credit market has been like. It's red-hot now, when you consider [the new stadiums or arenas being planned in] Sacramento, the San Francisco Bay Area, Minnesota, Atlanta, there is a lot going on. At Legends, we will be very aggressive in our premium sales group, our food and beverage group and throughout the company. We have great operators and a great concept. And the owners who will align with us will continue to be the owners who want to give their fans an incredible experience.

NYSJ: Your investment company, SCP Worldwide, owns among other properties the  MLS franchise Real Salt Lake. How important have the new soccer-centric stadiums, many of which have naming rights deals, including Rio Tino Stadium in Salt Lake City, been to the growth of the league and soccer in the U.S.?

DC: In my opinion, MLS is the growth sport of the next decade. [The NBA] went through those years, which I witnessed in the 1980s and 1990s, where basketball teams went from being worth $10 million to $300 million. MLS is the next great growth area. MLS has a great group of forward-thinking owners. There is enormous interest in sponsorship. The new venues in Kansas City (LiveStrong Stadium), Salt Lake City (Rio Tinto Stadium), New York (Red Bull Arena) and elsewhere are very appealing to companies and fans. There is a great attraction for families. There is a fan-friendly attitude from players and the teams. There is a strong appeal to Latino consumers. So MLS has positioned itself quite well to grow.

"MLS is the next great growth area. MLS has a great group of forward-thinking owners. There is enormous interest in sponsorship."

NYSJ: What impact do you think the new $1 billion stadium being built in Santa Clara as the home of the NFL's San Francisco 49ers for the 2014 season will have?

DC: The stadium is going to be a gigantic improvement over Candlestick Park [where the 49ers have played since 1971]. It's going to be spectacular. [Owner/CEO] Jed York and the ownership group, have done a terrific job with the franchise. You saw it [this past season] and there is no reason to believe that it won't continue.  

NYSJ: What are your thoughts about Barclays Center in Brooklyn, NY,  which will be the new home of the NBA's Nets and showcase other sports and entertainment beginning in September?

DC: I think it's going to be great. It seems as if they are doing a first-class job. Brett Yormark [CEO/president of Nets Basketball/Brooklyn Sports and Entertainment] is a really talented executive. But they have to get the team going on the court.

NYSJ: What is the hottest area for new stadiums moving forward?

DC: I like the international play for new stadiums. There will be a lot of stadiums built in the Far East and in Europe, even though Europe is flat on its back. But there is a lot of interest from some very powerful teams in the English Premier League, Germany's Bundesliga,  La Liga in Spain. Those are huge operations. So you will see money being spent on stadiums and a high-level of in-stadium amenities.

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