MLS’ Fire to Pay $65.5 Million to Amend Stadium Lease, Play Home Games Downtown

Fire

MLS’ Chicago Fire Soccer Club – ranked last in home attendance (11,417/game) – has announced plans to amend their lease at SeatGeek Stadium to allow for future home games to be played “in other Chicagoland sports venues.” Majority owner Andrew Hauptman believes moving games from the suburban Village of Bridgeview to downtown Chicago will give the club “the opportunity to play [in front of] more fans than ever.” The Fire reportedly plan to start playing home games at Soldier Field (home of the Bears) next season. The team will continue to train and host its youth academy at the Bridgeview facility.

Howie Long-Short: Chicago Fire S.C. is paying $65.5 million to get out of their existing lease – a significant chunk of change for an organization that lost $6 million in 2017. Hauptman won’t be making a lump sum payment, though. The organization will pay the Village $10 million upfront and make an additional $5 million donation to upgrade sporting facilities around the stadium. The $50.5 million balance will be paid in $3.5 million increments annually through 2036.

At $65.5 million, Hauptman is paying $30 million more to move the team’s home games than he paid to acquire the club in 2007. But considering expansion franchises are now selling for $200 million, even with the buyout – and the $70+ million he’s lost over the last 7 years – the Andell Inc. co-founder is certain to come out ahead. MLS’ 1st commissioner Doug Logan reminds that “sports aren’t a P&L play, they’re an asset play. If owners can grit their teeth and stomach the operating losses along the way, what they’re really playing for is an appreciation in the value of the club – or in this case, the market agreement for the Chicago territory since MLS is a single-entity.

With the cost of expansion franchises continuing to increase (it was just $10 million when Real Salt Lake joined in 2005) and a scarcity of viable pro markets, there is a case to be made that the team could have played out its lease, ate the annual losses, rode the back of a growing league and still appreciated in value. Logan agreed. He said that his advice to Hauptman would have been to “put the absolute best product you can on the field and then market the hell out of it. One thing that is often overlooked when discussing Atlanta’s success is the phenomenal coach they had (Tata Martino, Mexican National Team) and his incredibly exciting style of play. If the team wins and you’ve done every promotion under the sun and the organization still isn’t drawing fans, then you look at the real estate.” In Chicago, the team has won playoff series in a decade.

Chicago Mayor Lori Lightfoot refused to confirm that Soldier Field is where the team is headed, but Logan insists it’s the only option – at least until there’s public money available to build the franchise a new venue on the North side. “Bridgeview is an industrial park – it’s Midway airport – and the neighborhoods that surround it are very ethnic in nature; it’s on Chicago’s orange L line. The young audience that the Fire wants to draw resides alongside the L’s purple line and that line, which runs closer to the lake front, doesn’t go past Soldier Field. Wrigley Field isn’t a fit. There really is no other place to play.

Relocating from a soccer-specific venue to a cavernous NFL stadium is a puzzling decision – particularly when you consider that the team drew over 17,000 fans/game in Bridgeview when it was winning. Sure, the league’s two best attended teams (Atlanta & Seattle) play in downtown NFL stadiums, but those clubs have captured the hearts of their respective cities. It’s unclear if that type of enthusiasm can be generated in Chicago with a “do-over.

To be clear, a change of venue isn’t going to turn the Fire’s fortunes around. Logan said that “lazy sports executives always blame their failures on the real estate and not their marketing plan.” He suggested that it’s going to “take a total rebrand for the club to achieve instantaneous success at Soldier Field.” The franchise is said to be considering the possibility.

Fan Marino: Chicago Fire S.C.’s best season was its first. Logan says that ’98 was a “charmed existence” – the team won both the Lamar Hunt U.S Open Cup and the MLS Cup. “A lot came together for that team to be successful. Peter Wilt – a top tier soccer executive – was the President. Anschutz was a great owner because he had deep pockets and let the soccer guys do their thing. Bob Bradley was as good an MLS coach as there has ever been and Piotr Nowak was like a 2nd coach on the field. It was just a magical season.

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Author: John Wall Street

At the intersection of sports & finance.

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