Orioles' new park is ticket to increased revenues Club's take at gate may rise $7 million

October 12, 1991|By Mark Hyman

The Baltimore Orioles can expect sharply higher revenues from ticket sales next year, even if fewer fans attend games at the new Oriole Park at Camden Yards than did this season at Memorial Stadium.

And if attendance at games next year surges to 3 million, a good possibility given the brisk business the Orioles are doing so far, tickets will generate almost triple what the team took in four years ago.

Those projections are contained in a financial report prepared recently for the Maryland Stadium Authority, which will be the landlord at Oriole Park. The stadium authority has a keen interest in the moneymaking potential of the new ballpark, because the rent the team will pay is determined largely by its profits.

According to the study, conducted by Public Financial Management, a Philadelphia-based consulting firm, attendance of 2.5 million will generate net ticket revenues of about $18.6 million. If 3 million fans show up, those revenues would rise to about $22.4 million.

Tickets historically have been the single largest source of revenue for major-league teams. As recently as 1988, the Orioles received 23 percent of their operating revenue from ticket sales, more than twice that of any other source.

Stadium authority chairman Herbert J. Belgrad said he wasn't surprised by the revenue projections.

"When you say the new ballpark will generate considerably higher revenues than Memorial Stadium, you are really saying we accomplished what we set out to do," he said.

"From the beginning of this process, it was clear that Memorial Stadium lacked the ability to generate revenues other [baseball] franchises were making. That has been the Orioles' concern from the beginning. It had to be addressed to retain the franchise."

Orioles president Larry Lucchino declined to comment on the accuracy of the stadium authority projections, saying he had not studied them.

Lucchino acknowledged, however, that the team probably will collect more from ticket sales next season, an adjustment he said was needed, because the Orioles historically have earned less from tickets than most other major-league teams.

"We're not going to be at the top by any stretch of the imagination," Lucchino said, referring to ticket revenue of other major-league teams. "We're moving from the bottom to somewhere near the middle or above."

In 1988, the team netted $7.8 million, according to information contained in documents used during annual rent negotiations between the Orioles and the city, which owns Memorial Stadium.

From net ticket sales, the Orioles received about $11.5 million in 1989 and about $13.2 million in 1990, according to sources familiar with the team's finances for those years. Those numbers could not be confirmed because, for the past three years, the city has declined to disclose information about the team's finances.

The team is expected to earn about $15 million from ticket sales for the 1991 season, according to the sources, who based their estimates on attendance last season at Memorial Stadium and the Orioles' published ticket prices.

Net ticket revenue is determined by subtracting taxes and other required payments from the face value of a game ticket. In the Orioles' case, the team's share of each ticket is reduced by a 10 percent admission tax, a 20 percent fee to the visiting team and a 2 to 3 percent fee to the American League.

Ticket prices at the $105.4 million, state-financed ballpark included increases of $2 and $1.50 for many box and lower reserved seats, respectively.

Another, equally important source of new revenue for the team is the seating configuration of the new ballpark. At Oriole Park, 53 percent of the seating will be higher-priced box seats; at Memorial Park, 31 percent was designated box seats.

In addition, the new ballpark will include about 4,400 club seats, an upscale concept unlike any type of seat location at Memorial Stadium. For $18 per game and a $500 per seat club membership fee, fans will have access to wider seats, upgraded food and drink and a climate-controlled lounge.

Lucchino said tickets to Orioles games would remain "moderate."

"A family can still go to a game for less than $10 [per ticket]. There are still plenty of bargain nights and special programs," he said.

Last season, an Orioles ticket -- average price of $7.59 -- was among the lowest-priced in the American League. Only two teams charged less -- the Seattle Mariners ($7.02) and Cleveland Indians ($7.16).

The average at Oriole Park will be $10.74. Five American League teams averaged as much as $10 this season -- the Toronto Blue Jays ($13.13), New York Yankees ($10.56), Boston Red Sox ($10.30), Chicago White Sox ($10.26) and Oakland Athletics ($10.04).

Lucchino said the Orioles probably would use whatever extra money they make from ticket sales at the new ballpark to offset rising expenses, including, he predicted, higher rent and player costs.

Picking up prizes

Winners from Fan Appreciation Day at Memorial Stadium can pick up their prizes Tuesday between 10 a.m. and 7 p.m. at the Orioles offices there. Winners must present their winning certificates and ticket stubs from last Saturday's game. For more information, call Lisa Siliato at 547-6150.

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