In my view, this should be regulated by the SEC. Basically, all they're doing is sellling securities and they've told fans, you can buy and sell the PSLs. If that isn't a security, I don't know what is.
When I was a kid, one of my dreams was (and still is) to be able to go to all the Mets games when I retired. With the new prices, that's one dream you can kiss goodbye.
Here is the article in yesterday's NY Times.
****
No American market has witnessed anything like it: two baseball teams and two football teams will open three new stadiums within 17 months and 20 miles of one another, with everything set to be in place by the fall of 2010.
The teams are confident market research supports the increases, but season-ticket holders say the price they are being asked to pay in the new stadiums — the Mets’ $800 million Citi Field, the $1.3 billion Yankee Stadium and the $1.6 billion (and climbing) Jets-Giants stadium — is turning them into something other than fans. Instead, interviews with two dozen fans indicated, they are starting to feel like unwitting bankers.
“You’re asking me for money and giving me nothing in return,” said Steve Kern, a construction executive from Boonton Township, N.J., who owns two Jets season tickets. “I won’t be sharing in the revenues or get any perks.”
Kern, who organized a small protest outside the Jets-Giants exhibition game Saturday, said he objected to the sale of personal seat licenses, the one-time fees that simply give fans the right to buy season tickets at the new stadium the Jets and Giants will share.
The Giants have said they will charge from $1,000 to $20,000 a seat for their personal seat licenses; once fans buy the seat licenses, they will still have to pay from $85 to $700 a ticket. The Jets are expected to unveil their ticket plan Tuesday.
“Here I am, buying a stadium for John Mara,” said Hank Honig, an accountant from Middletown, N.J., who owns eight Giants season tickets, referring to the team’s co-owner. “I’d love to see him issue a registration statement like a stock offering that would disclose information we don’t know. This is a greedy ploy with the only benefits going to them.”
Mara, who has been dealing with an outpouring of complaints that he no doubt anticipated, responded, “They have ownership of their seats and can transfer it.”
Thomas Malmud, a real estate lawyer who has season tickets to the Jets, the Mets and the Yankees, said that paying for seat licenses made him feel as if he is helping the Jets’ owner, Woody Johnson, pay the team’s half-share of the new stadium. He seemed less upset with the Mets.
“The Jets and Giants want me to be an equity partner without any upside,” he said. “But with the Mets, the price has some relationship to the market for sporting tickets.”
His Mets seats will jump from about $88 a game to $175. “It’s a huge increase, but not unconscionable,” he said.
Fans are now calculating how expensive it will be for many of them to attend games at the new stadiums.
Tickets for the best seats at the 85-year-old Yankee Stadium, which sold for $1,000 a seat this season, will jump at the new ballpark to $2,500; in other areas of the stadium, they will range from $135 to $500 for season tickets. Prices for single-game tickets, which ranged from $14 to $400 this season, will be released later.
The best seats at Citi Field, which cost $276 at Shea Stadium this season, will soar to $495, with other season tickets ranging from $125 to $225 a game. Single-game tickets this season ranged from $5 to $117. (Citi Field’s capacity of about 42,500 compares with 57,333 at Shea.) Neither team has made known all of its prices. Both teams also say broad swaths of more modestly priced tickets will be available.
Typically, all four teams sell a majority of seats as season tickets.
The personal seat licenses will allow the Giants to collect an estimated $185 million, after taxes, which will help pay for their stadium bonds. Mara conceded that fans were helping to finance a stadium whose costs had more than doubled from what he called an initial, and sketchy, $750 million estimate.
“It’s impossible to build a stadium of this magnitude without public funding unless you do something significant with ticket prices or P.S.L.’s,” he said.
Dave Howard, the Mets’ executive vice president for business, said that Citi Field’s pricing was designed to make those who sit closest to the field pay the most so that prices can be kept reasonable elsewhere. “The market indicates that a sector of our fan base is willing to pay a premium price for a premium location,” he said.
The shift to Citi Field unsettles fans like Richard Mermelstein, a lawyer from Scarsdale, N.Y. Since buying two season tickets the day the Mets acquired Gary Carter in 1984, he has upgraded several times to loge seats behind home plate. His bill — $9,280 in 2006, $10,584 in 2007 and $13,060 this season — would spike to $24,300, or $150 a seat, next season if he moves to the seats designated as comparable to his Shea seats.
“Imagine how you’d feel if $300 goes to waste when they’re out of it in September,” he said.
The Mets have so far not agreed to let him downgrade to less expensive seats and he fears that if he goes on a waiting list, he may lose out entirely in relocating to Citi Field.
Howard said that some downgrade requests are easier to fulfill than others, as fans with seats at Shea that are comparable to the less-expensive ones sought by Mermelstein are served first. He also said that partial season-ticket plans might not survive.
“We’ve told our customers that if they want priority seating, they should have a full-season plan,” Howard said.
Season-ticket holders of the four teams said they were contemplating various strategies to cope.
Some, like Mermelstein, want to downgrade — or else drop their tickets.
Some, like Honig, want to flip some of their seat licenses for a profit — after holding them for the required minimum of one year — to pay for the remaining ones.
Some are seeking partners to shoulder the costs.
One public-relations executive in Manhattan, whose company did not permit him to speak publicly, was faced with a $120,000 bill for his six Giants seat licenses. He sold four of them to a major financial services executive for $30,000 each, a 50 percent markup. He retained two licenses, and has an option to buy back one of his partner’s licenses at market value.
Others, already sophisticated about reselling tickets on sites like stubhub.com, will try to recoup even more money by reselling tickets to attractive games.
Richie Brown of Manhattan, a uniform salesman, holds four fourth-row seats on the first-base side at Yankee Stadium that are jumping to $650 apiece from $220.
“It’s going to cost $2,600 to sit there on a rainy day in April to watch Kansas City,” he said. “You sit there saying, maybe at $220, you have a chance of selling them to somebody, but try selling four tickets at $650 each.”
Mark S. Rosentraub, a professor of urban affairs at Cleveland State University and an expert in sports finances, said that new-stadium economics were forcing fans to become smart, well-organized ticket brokers.
“You’ll have to put together packages where you sell your Royals tickets at a loss but hope you make it back on your Red Sox tickets,” he said. “If you’re used to seeing the Red Sox nine times, maybe now it’ll be four or five times.”
He said the Yankees, the Mets, the Giants and the Jets would not be setting their seat license and ticket prices so high without having studied data about the market from sources like StubHub. The Giants’ Mara offered a blunt lesson in market-driven economics on WFAN radio this month. “We have 130,000 people on our waiting list,” he said. “We could charge anything and still fill the stadium.”
(continued in next post).
