A new arena is a poor risk for Baltimore if the city is counting on attracting an NHL or NBA franchise, sports business experts say, but some agree with city leaders that a proposed 18,500-seat venue could be profitable without such an anchor tenant.
Neither the NBA nor the NHL offers many relocation or expansion prospects, analysts said, and the presence of basketball and hockey teams in Washington make the odds even longer for Baltimore.
"The market, which, whether we like it or not, is actually the Baltimore-Washington market, is pretty saturated as it is with sports," said John Moag, former chairman of the Maryland Stadium Authority and head of a Baltimore-based investment firm that specializes in sports. "And there's certainly not going to be any expansion in the NBA."
Franchise mobility might be greater in the NHL, he added, but the Washington Capitals struggle to sell tickets now, so there's no reason to believe the market could support two hockey teams.
Given such reservations, the announcement yesterday that Baltimore would seek developers for a pro-sized arena was a surprise (city and state officials say the arena will benefit Baltimore with or without a major team). Such a facility would cost at least $300 million, as much as 50 percent more than a 15,000-seat arena, Moag said. And it's unlikely such a price tag could be covered without public financing.
Some analysts think it's a good idea regardless.
"It's a resume-builder for Baltimore," said Don Hinchey, vice president of communications for the Bonham Group, a Denver-based sports marketing firm. "Without an arena, you're left out of the franchise discussion. A state-of-the-art facility is the price of entry."
Though the relocation market seems tepid at the moment, it's always fluid, Hinchey added.
In a conference call this year, NBA commissioner David Stern dismissed the idea of expansion but said relocations are possible.
"There's a very strong recognition - because of the pressures of revenue sharing - that if particular cities ... can't support a team, we should consider moving them to cities that can," Stern said. "I'm not totally on board with that approach, but it's increasingly gaining some steam among a strong group of owners."
Asked about the issue yesterday, league spokesman Tim Frank said: "At the moment, we do not have expansion plans nor do we have any teams looking to relocate."
