Aug 3, 2016 Monica Mendoza
The Denver Broncos want to assume the naming rights of their own stadium and are willing to pay $19.9 million to do it.
The team has filed a motion in the U.S. Bankruptcy Court in Delaware to “assume the naming rights contract for Sports Authority Field at Mile High,” says a statement from the Metropolitan Football Stadium District, the owner of the stadium.
The contract has five years left.
“It was important for us to step up and assume this contract to expedite the shared goal we have with the Metropolitan Football Stadium District of finding a new naming rights partner,” said Denver Broncos CEO Joe Ellis. “Together with the MFSD, we understand how important naming rights are to the future of our stadium.”
The bankruptcy filing by Sports Authority had left uncertainty about the future of the naming rights of Sports Authority Field at Mile High. The Denver Broncos assuming the naming rights offers some clarity about the future of Sports Authority Field at Mile High, the statement says.
In anticipation of a potential court decision, the District Board directed the staff to prepare a request for proposals (RFP) to seek a valuation for a new naming rights partner. Those efforts will continue as both the court and District processes move forward,” a statement from the football district says.
“Pending court approval, the Denver Broncos will assume the MFSD contract with Sports Authority.”
Naming rights revenue is primarily used for capital improvements extending the life of the stadium well into the future, attempting to avoid need for public funding. The District and the Denver Broncos are currently conducting a facilities conditions assessment of the stadium and surrounding campus. Preliminary numbers indicate over $300 million will be needed over the next 30 years to maintain the facility.”
“This will allow the district to work closely with the Broncos to secure the best possible outcome for a new naming right partner,” said Ray Baker, chairman of the football district board of directors. “The district looks forward to working with the Broncos over the next weeks and months to secure the best deal.”
The deal would come just in time for the new season.
It’s only been five months since Englewood-based Sports Authority Holding Inc. filed for Chapter 11, but it put the football district in a bind. Sports Authority’s contract was in good standing until Aug. 1, when the next annual payment was due.
In June, a New York firm Hilco Streambank was hired to sell off Sports Authority’s intellectual property, which included the naming rights. But there were no takers of the contract, which had five years left and a price tag of $19.9 million. A spokesman for the company said Tuesday that he had no comment.
Bloomberg reports that 22 of the 32 National Football League teams play in stadiums with corporate names. Among the biggest deals, for example, is Levi’s Stadium in Santa Clara, home to the San Francisco 49ers. Levi’s paid $220 million for an 11-year deal. Citigroup paid $400 million for a 20-year deal with the New York Mets for Citi Field naming rights. The Dallas Cowboys, however, do not have a corporate naming rights sponsor.
The Metropolitan Football Stadium District includes seven counties in metro Denver and was formed in 2001 to raise sales tax dollars through 2012 for the stadium. When the stadium opened in 2001, it’s naming rights partner was mutual fund company Invesco Funds Group Inc., and the stadium was called “Invesco Field at Mile High.”
The phrase “at Mile High” — a reference to the Broncos’ former home Mile High Stadium — was part of the contract and in 2011, the Denver Broncos opened their season in Sports Authority Field at Mile High.