In the last six years, four Twin Cities sports stadiums have opened — or been approved — but just one has made public its lucrative naming rights agreement.
The University of Minnesota’s TCF Bank Stadium, which opened in 2009, is the only recent example of a naming rights agreement that was made public — largely because the school itself, a public institution, would be the stadium’s primary tenant.
In keeping with an industry trend, the Vikings announced a naming rights deal with U.S. Bank last month for the team’s new publicly owned stadium, a deal reportedly worth about $200 million. But few details of the deal were released. Ten months ago, the St. Paul Saints and CHS, the nation’s largest farm cooperative, took the same approach for the team’s mostly taxpayer-funded baseball field.
Same for the Minnesota Ballpark Authority, the public entity that owns the Twins’ Target Field, and the Timberwolves’ Mayo Clinic Square, a unique practice facility and medical center that involved a nonpublic naming rights deal on a building that has received millions of dollars in public money.
A vocal minority
All of which raises this question: Does the public deserve — or even care — to know how much teams are making off the naming deals?
“It’s very likely a vocal minority that is demanding to know” the details, said E.J. Narcise of Team Services LLC, a Maryland-based company that has helped negotiate naming rights agreements for the National Football League’s Washington Redskins, Baltimore Ravens, Houston Texans and Carolina Panthers.
When the Super Bowl is held at the Vikings’ $1 billion stadium in 2018, Narcise added, “I wonder how many people in the state of Minnesota will be wondering what the deal points were in that naming rights deal.”
In most cases the naming rights money goes to the teams, who often then count it as part of their financial contribution to the project.
The revenue from naming rights agreements are often estimates. When the National Basketball Association’s Sacramento Kings last month announced its new arena would be known as the Golden 1 Center — named after a major credit union — the team said it was a 20-year agreement, but did not disclose an amount. The Sports Business Journal, quoting sources, said the deal was worth $120 million.
The Vikings agreement — despite the lack of specifics — was quickly praised by Michele Kelm-Helgen, who chairs the public body overseeing the stadium. Former state legislator Morrie Lanning, the chief House author of the Vikings stadium legislation, said after last month’s announcement that while he could “certainly now understand” critics who complained that the naming rights agreement should have been made public, those talks were never pushed. “We didn’t go down that road,” he said.
Neil deMause, the co-author of “Field of Schemes,” an unvarnished look at pro sports and taxpayer funding, said too many public officials do not push for naming rights money, or a disclosure of the agreements. ”It’s kind of been written off, [with politicians saying], ‘That’s just the way it goes,’ ” said deMause.
The university’s $35 million agreement, among other things, allowed TCF Bank to place its logo on everything from tickets to service worker uniforms and solidified the bank’s position as the dominant banking institution on campus, pushing two other high-profile competitors out of key campus locations.
Former state Sen. Larry Pogemiller, who later became Senate majority leader, was critical of the arrangement and said the university’s market value “had been put up for sale.”
‘City does not get involved’
In June, the Timberwolves opened their new facility in partnership with the medical giant at the former Block E in downtown Minneapolis. The city block, re-christened as Mayo Clinic Square, featured a sports medicine center and large signs with the medical provider’s name on the building.
While the city does not own the Block E development, taxpayers initially contributed $29 million to the project more than a decade ago in yet another attempt to invigorate the block. When that project fizzled, the city sold much of it for $14 million in 2010. But the city still owns the land under Mayo Clinic Square. In addition, under a new agreement that led to the Mayo Clinic’s partnership with the Wolves, the city continues to collect hundreds of thousands of dollars annually to help pay off the public debt.
But city officials said they know little about the naming rights agreement between the Wolves and the Mayo Clinic, both of whom are tenants in the building.
Hilary Dvorak, a city planner on the project, added that “the city does not get involved in naming rights of buildings.”
Wolves Chief Marketing Officer Ted Johnson said the team, which he said invested $25 million into the remodeling, asked the Mayo Clinic to be a partner and that a naming rights agreement was a “secondary” part of a complex business relationship. He declined to disclose the agreement’s details. “We approached the Mayo on the idea of having their name on the building,” said Johnson, whom Wolves owner Glen Taylor called the project’s leader.
“It’s complicated,” said Phillip Jaffe, the chief executive of Provident Real Estate Ventures, the asset manager for Camelot LLC, the business entity that now owns much of Mayo Clinic Square. “We really didn’t put a [separate] value on the naming rights. [It] was all just one big bundle” of development rights.
Under the agreement with the city, Camelot LLC will in the future be able to buy the land on which Mayo Clinic Square now stands from the city for one dollar.
With NBA Commissioner Adam Silver looking on, Taylor greeted the crowd at the grand opening of Mayo Clinic Square on June 17. “Though other teams have created naming rights, partnerships with medical providers, no one had thought of embedding an actual clinic within the facility itself,” Taylor said.
Minneapolis Mayor Betsy Hodges said the result was impressive. “It’s an extraordinary level of investment that they’ve brought,” she said. Casey Dzieweczynski, a city development official, said the city did not know how much money was spent remodeling Mayo Clinic Square, but had an estimate of $50 million from the building’s owner.
Across downtown, with the Vikings stadium now 60 percent complete, U.S. Bank spokesman Dana Ripley said estimates that the bank paid $220 million for the stadium’s naming rights were “on the high side,” but like the Vikings declined to provide details.
“It was important to us” to keep the naming rights deal private, Ripley said. “It’s pretty common practice” not to disclose the agreement.
Mike Kaszuba • 612-673-4388