Friday, August 25, 2000

Businesses awaiting windfall from stadium

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Some owners hopeful; others wary

By Ken Alltucker
The Cincinnati Enquirer

        Proponents predict a windfall for downtown retailers and restaurants from the opening of Paul Brown Stadium, but Mike Maiello is waiting for proof.

        Business at Mr. Maiello's Head First Sports Cafe on Third Street was better than usual last week when 100,000 people took a free glimpse of the Bengals' new stadium. But as the only establishment within punting distance of the spectacular, arched stadium, Mr. Maiello expected more.

Ed Koch, owner of Koch Sporting Goods on Fourth Street, thinks the new stadium will hurt his sales. (Enquirer photo) | ZOOM |

        “We're really excited, though. It should help us,” Mr. Maiello said, preparing for the Bengals' second home game tonight. “Now, people will walk to the riverfront to see what's down here. It will be gangbusters on game day.”

        A block away on Fourth Street, Ed Koch sees a different problem. For years, his family-owned sporting goods store was the only place a Bengals fan could choose among a wide variety of football jerseys, coffee cups or other sports paraphernalia near the riverfront area.

        Now, fans can buy those goods at Paul Brown Stadium.

        “I think it can only hurt us,” Mr. Koch said. “All the (Cinergy) vendors used to tell Bengals fans to come to us. They won't do that anymore. We'll see.”

        The new Paul Brown Stadium is a cornerstone of a plan to revitalize the riverfront, which will include a new Reds stadium, the National Underground Railroad Freedom Center, retail shops and restaurants.

        A study prepared by the University of Cincinnati Center for Economic Education predicted a $300 million annual economic impact from the two new stadiums. That comes from people attending games and buying meals at restaurants and goods at nearby retailers.

        Overall riverfront construction — including the two stadiums, the museum, a reconstructed Fort Washington Way and private development — is expected to provide a one-time, $2.1 billion boost.

        Merchants like Bruce Campanello, co-owner of Campanello's restaurant at 414 Central Ave., hope those numbers are true.

        “We hope for the best but expect the worse,” Mr. Campanello said. “We usually do good the night before football games. It's usually out-of-town people here for the other team.”

        Mark Rosentraub, professor of economics at Indiana University and opponent of publicly financed stadiums, said a new stadi um, by itself, doesn't provide a financial benefit to the surrounding area.

        That's because stadium owners try to maximize revenues for themselves by selling fans more food, more goods and more entertainment. That leaves little extra cash to spend for the typical fan attending a weekend football game.

        “I think it offers a lot of fun — a great place to watch football,” Mr. Rosentraub said. “You normally wouldn't find a lot of economic activity around the stadium. The owner is trying to maximize revenues.”

        Cities like Baltimore, Indianapolis and San Diego have used publicly-funded stadiums to attract private investment, making the sports arena the center of a bustling urban area. But those successes took a lot of time and money.

        The chain of hotels and office complexes around Indianapolis' downtown arena represents $2.6 billion in private-sector funding over more than two decades, Mr. Rosentraub said. Camden Yards, the home of baseball's Orioles, is just one attraction at Baltimore's Inner Harbor, which includes an aquarium, restaurants and retail shops.

        David Ginsburg, executive vice president of Downtown Cincinnati Inc., said downtown will attract private investment with the opening of Paul Brown Stadium and the reconfigured Fort Washington Way, making it easier for visitors to get in and out of downtown.

        “It's an exciting time but also a fragile time,” Mr. Ginsburg said. “We have to make sure we just don't have single-attraction events.”

        Rob Baade, a professor of economics at Lake Forest College in Illinois, agrees. He said a football stadium that attracts people to the riverfront only a few hours Sundays will do little good by itself.

        “The reality is, the stadium acting alone can't rejuvenate an area,” Mr. Baade said. “It can provide a short-lived benefit, depending on how well the team plays.”

        Mr. Koch's son, Greg, said wins and losses are the main generator of new sales. Greg Koch disagrees with his father because he thinks the new stadium will provide a short-term blast of excitement among Cincinnati football fans, prompting them to buy more jerseys, footballs or other goods at the store. That excitement will quickly fizzle if the Bengals have trouble winning.

        “After four losses in a row, business goes down the tubes,” Mr. Koch said. “Even with a new stadium, I'd hate to be a store that only had Bengals merchandise after they are 0-4.”

       

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