A Closer Look At PSLs
MINNEAPOLIS (WCCO) — A lot has been made in recent days about Gov. Mark Dayton’s letter to Minnesota Vikings owner Zygi Wilf.
Dayton, a key part of negotiations on a new $975 million stadium, chastised the Wilf family for essentially shifting a portion of the team’s construction costs onto fans through a personal seat license, or PSL.
But lost in the political back-and-forth is perhaps the most important question: Who would PSLs affect and how would it impact them?
We wanted to talk with Greg Carl, the owner of PSL Source, a website that purchases PSLs for a number of NFL teams.
Carl, whose business made more than $250,000 in brokering and transaction fees last year, made one thing immediately clear: PSLs are here to stay.
“These NFL owners are businessmen,” Carl said. “[PSL] are a solid source of revenue, and fans are buying them. If no one was buying them, they wouldn’t sell them.”
And sell they do.
The San Fransisco 49ers broke ground in April on a new $1.2 billion stadium in Santa Clara. It’s scheduled to be completed in time for the 2014 season, but already the team has sold PSLs for six sections behind the Niners bench for $20,000 each. Other sections of the lower bowl are on sale for about $6,000 apiece.
The Atlanta Falcons, currently developing plans for a near-$950 million stadium to replace the Georgia Dome, have not yet thoroughly discussed the potential for PSLs.
But across the NFL, and sometimes in other sports, the three-letter acronym is popping up regularly.
“It is very much a part of the fabric of how we build new stadiums in pro sports, and sometimes, college sports,” Carl said. “It’s not unusual to have a negative reaction from fans, but so much about the Vikings plan is unclear right now.”
And in that ambiguity there may be profit.
In the past 11 years, Steelers PSLs have increased nearly eight times in value. Ravens fans have seen their licenses increase more than 240 percent. Bears PSLs have jumped 120 percent since the renovation of Soldier Field.
But not all fans consider licenses a good investment.
Some Cowboys fans originally shelled out a jaw-dropping $150,000 per seat license, only to find the value plunged after a softer, secondary market was established.
The average Dallas fan lost nearly $2,400 per seat since Jerry Jones’ new palace opened in 2009.
Some Jets and Giants fans got burned, too, losing an average of $3,200 and $190 respectively. Keep in mind the Giants won the Super Bowl last February.
“[PSL prices and value] won’t vary much from team to team, but it matters how much the team prices both the PSL and the tickets that accompany those licenses,” Carl said. “The mistake newer stadiums made was they miscalculated demand and overpriced both.”
Carl thinks the Vikings timing could not be better. The organization has an opportunity to learn from the positives of Pittsburgh, Baltimore and Chicago while avoiding the negatives of New York and Dallas.
The Vikings sent surveys to season ticket holders this week, gauging their PSL tolerance. Some of the highest numbers reportedly flirted with $25,000.
“I would hope that [New York and Dallas] are anomalies,” Carl said. “Anyone building a new stadium now should theoretically look at the [overpricing] of those models and realize they [can’t make the same mistake].”
Additionally, the team is not looking to use PSLs to fund a large portion of their construction costs (reportedly $50 million).
“That’s cake,” Carl said. “They can set prices reasonably, starting by licensing some 1,500 seats between the 40s. That would put them well on their way to $50 million.”
But, Carl says it’s possible the entire lower level could be licensed, not just premium sections.
“That might satisfy [Dayton’s] request for the people’s stadium,” Carl laughed. “We’ll see.”