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The Stadium Curse Lives

Over the years, many people involved in sports naming rights have come to believe that there is a curse associated with a corporation, particularly a publicly traded corporation, placing its name atop an arena or stadium. For years, the stock of those corporations significantly underperformed the overall market. In fact, there is a large list of once proud companies whose names formerly adorned arenas and stadiums across the country that now littered the junk bins of business history, having been tossed aside like so much corporate ballast.

The names include the famous, or infamous, such as Enron, Adelphia and MCI, which were formerly the names of the homes of the Houston Astros, the Tennessee Titans and the Washington Wizards, respectively, and the not so famous, the CMGI, PSINet, and AmeriQuest, formerly atop the homes of the New England Patriots, the Baltimore Ravens and the Texas Rangers.

The curse may be asserting itself once again in the wake of the credit crisis now gripping much of the industrialized world. There are four new stadiums and arenas under development in the greater New York City area. Naming rights for two of those have been sold: for the new Mets stadium and for the new arena in Brooklyn which will be the playpen of the Brooklyn (nee New Jersey) Nets. So far, the results are not promising. The Mets will be playing in CitiField and the Nets in Barclays Arena, both global financial institutions suffering significant difficulties, each of which is paying $400 million for the naming opportunity. You wonder if their shareholders don't think there might be a better use for that money now.

Full post as published by Sports Biz on July 21, 2008 (boomark / email).