Multi-Purpose Stadium Market Feasibility Study

SUBMITTED TO The City of Savannah, Georgia

SUBMITTED BY C. H. Johnson Consulting, Inc.

September 25, 2014

DRAFT

TABLE OF CONTENTS

SECTION I

TRANSMITTAL LETTER SECTION II

INTRODUCTION …………………………………...... ………………..……………...1 SECTION III

ECONOMIC & DEMOGRAPHIC OVERVIEW.....………………………..…..………….....6 SECTION IV

SITE ANALYSIS…………………………………………………………….……………...... 19 SECTION V

HISTORICAL OVERVIEW & PEER REVIEW …………………………..…………………...27 SECTION VI

STADIUM CASE STUDIES………………...…………..…………………….…...... 35 SECTION VII

SURVEY RESULTS & DEMAND PROJECTIONS...…….….…………………………………46 SECTION VIII

ECONOMIC AND FISCAL IMPACTS ANALYSIS………………...….……………..………..64 SECTION IX

STADIUM FUNDING STRATEGY ………………………………..….……………..………..75

6 East Monroe Street | Fifth Floor | Chicago, Illinois 60603 | Phone: 312.447.2010 | Fax: 312.444.1125

www.chjc.com | [email protected]

SECTION I TRANSMITTAL LETTER

6 East Monroe Street | Fifth Floor | Chicago, Illinois 60603 | Phone: 312.447.2010 | Fax: 312.444.1125

www.chjc.com | [email protected]

September 25, 2014

Mr. Joe Shearouse City of Savannah 2 East Bay Street P.O. Box 1027 Savannah, GA 31402

Re: Multipurpose Stadium Market Feasibility Analysis

Dear Mr. Shearouse:

Johnson Consulting is pleased to submit this DRAFT report to the City of Savannah that analyzes the feasibility of developing a new multi-purpose baseball stadium that will also operate as a sports entertainment venue. Our report includes market feasibility analysis, a recommended program and an economic and fiscal benefits impacts analysis.

Johnson Consulting has no responsibility to update this report for events and circumstances occurring after the date of this report. The findings presented herein reflect analyses of primary and secondary sources of information. Johnson Consulting used sources deemed to be reliable, but cannot guarantee their accuracy. Moreover, some of the estimates and analyses presented in this study are based on trends and assumptions, which can result in differences between the projected results and the actual results. Because events and circumstances frequently do not occur as expected, those differences may be material.

We have enjoyed serving you on this engagement and look forward to providing you with continuing service.

Sincerely, DRAFT

C.H. JOHNSON CONSULTING, INC.

SECTION II INTRODUCTION

6 East Monroe Street | Fifth Floor | Chicago, Illinois 60603 | Phone: 312.447.2010 | Fax: 312.444.1125

www.chjc.com | [email protected] Section 2: Introduction & League Overview | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 1

INTRODUCTION Johnson Consulting was retained by the City of Savannah to provide market feasibility and an economic and fiscal impact study for a proposed multipurpose minor league stadium. The City wanted to investigate the merit of renovating the aging Grayson Stadium versus construction of a new minor league ballpark, and, if Grayson Stadium should prove to be obsolete, how it should be repurposed. Additionally, this study will examine new downtown minor league stadium developments in nearby regions to assess whether they have served as a catalyst for economic development in their areas. This study provides a straightforward analysis that outlines the market opportunity and economic impact of the project to utilize as a tool when discussing potential funding options for the proposed project.

OBJECTIVES OF THE STUDY Johnson Consulting has undertaken a program of services designed to accomplish the following major objectives:

. To analyze the market viability of a proposed multipurpose minor league stadium in Savannah, GA.

. To quantify the total economic and fiscal impact the proposed stadium will have on the local community, as well as the ability of the stadium to be a catalyst for economic development.

In addition to this introduction and methodology review, the report contains the following sections:

. Section 3 - Presents an economic and demographic overview of Savannah, GA and the regional market. The information in this section is an essential component in understanding the economic and market framework that will support a new multipurpose stadium.

. Section 4 – Provides a site analysis of the current Grayson Stadium site and surrounding area as well as best and highest use opportunities for the site, should a new minor league stadium come to fruition. Our analysis utilizes a proprietary site analysis to rank each site based on a number of important factors.

. Section 5 – Details the historical overview of the South Atlantic League, the Single-A baseball league in which the Savannah Sand Gnats play. This section also includes market demographics of other South Atlantic League teams to compare to Savannah.

. Section 6 - Includes a case study analysis of four minor league stadiums: NewBridge Bank Park in Greensboro, NC; Fluor Field in Greenville, SC; Joseph P. Riley Jr. Park in Charleston, SC; and Parkview Field in Ft. Wayne, IN. Each case study breaks down the history of the stadium, its funding sources, event demand and, when applicable, program recommendations for the proposed stadium in Savannah, GA.

. Section 7 – Includes results from our survey used to generate projections of attendance, number of events based on market potential, capture rate and comparable performance. This section further provides our recommended program of amenities at a potential new multi-purpose stadium in Downtown Savannah.

. Section 8 – Provides the economic and fiscal impacts of a new multipurpose baseball stadium in Savannah.

. Section 9 - Offers multiple national funding options and mechanisms utilized for stadium construction, as well as some local funding options.

APPROACH / METHODOLOGY In order to accomplish these objectives, the program of analysis conducted by Johnson Consulting has undertaken the following research tasks:

. Interviewed stakeholders to gather information, obtain work performed to date, and understand the expectations and objectives of this development

. Examined regional economic and demographic data and projected regional economic trends relevant to supporting the proposed development.

. Interviewed industry participants and those familiar with the local market to identify specific market opportunities

. Launched a local survey to assess interest from the local population

. Conducted an assessment of programming and utilization at peer facilities

. Prepared an economic and fiscal impact analysis based on projected demand

ABOUT THE CONSULTING TEAM C.H. Johnson Consulting (Johnson Consulting) is a nationally recognized authority on sports venues, stadiums, arenas, and mixed-use development projects. The firm works nationally and internationally for cities, counties, universities and private sector developers. Previous clients and work experience include the following: the minor league/spring training stadium at Osceola County Heritage Park in Kissimmee, Florida; the new Atlanta Braves Ballpark in Pearl, MS; the redevelopment of the Jerry Uht Ballpark in Erie, PA; a minor league stadium in Ocala, FL for the New York Yankees Class A-Advanced affiliate; an economic analysis for a Class AA baseball stadium in Biloxi, MS; and a market and feasibility analysis for a Frontier League expansion team in Franklin, WI. We offer clients assistance with the development of creative and

effective business plans for complex projects. We are able to integrate information from multiple parties into a single tool for use by governmental agencies to help execute complex real estate projects.

TERMS OF ASSIGNMENT This report is based on estimates, assumptions, actual operating data and other information obtained from our research, our prior experience with similar assignments, and information received from the Client and other sources. The sources of information and basis of estimates and assumptions are stated herein. Findings presented within this report are based on Johnson Consulting’s assessment of various data, market characteristics, discussions with project stakeholders, and documented assumptions. We cannot represent our projections as results that will actually be achieved.

EXECUTIVE SUMMARY A City has to provide an array of public amenities if it is of a certain size. Libraries, airports, museums, arenas, convention centers and ballparks fall into this category of public amenities. Some will debate the merits of each type of asset, but when residents, visitors, local corporations, and newly locating companies seek to visit or reside in a certain market, such amenities are crucial to their interests. Multipurpose stadiums can be catalysts for economic development, if the setting and motivations are aligned for success. Some markets have performed poorly. In these few instances common characteristics are present – a poor site is chosen, political gain is sought, or all dollars are consumed by the project.

Savannah is a unique, robust market due to steady growth and a diverse employment base, as well as the historical nature of the community. The population, median household income, rebounding employment figures and expanding list of companies indicate that Savannah is capable of supporting a new multipurpose stadium. Additionally, given the robust tourism industry, a newly constructed stadium should be able to capture a percentage of that tourism market that Grayson Stadium currently does not have due to its location and functionality. A well-located stadium especially should be able to generate additional demand from event holders, concert promoters and local event holders for its event space. New stadium projects can also bring about economic development in the immediate area to support the influx of residents and visitors to the area, ultimately raising property values and tax revenues within Savannah.

A new multipurpose stadium in Savannah will ultimately rely upon local corporations and residents, whose support and involvement will be critical to the team’s ability to attract sponsorship support and corporate

suiteholders from the local business community. A new stadium that will keep the Sand Gnats located in Savannah will be most beneficial for local residents because it will provide family entertainment options, seasonal employment and volunteer opportunities while also providing residents a facility for numerous special events outside of baseball. Grayson’s location and physical offerings do not have that opportunity, even if renovated to first-class standards.

Site selection is a crucial decision, and a myriad of factors, both objective and subjective, influence the potential performance and contribution of a facility. Poor site selection inhibits the ultimate success of a project and affects its performance for generations. Far too often, communities locate a facility on a site not because it is the most advantageous spot or in the location that will best contribute to the overall objectives of the community, but out of immediacy, availability, cost or other factors that speak to convenience over market strategy and product positioning.

If a new stadium project is approved, the City will gain the most benefit by selecting the largest, most open site to allow for adjacent mix-used development. This will create an entertainment district appeal which is very important for a stadium. The Savannah River Landing site meets these criteria and would be able to host multiple land uses, which will make for great mixed-use development and a true regional destination. In previous studies conducted by Johnson Consulting there has been a positive correlation between the number of event days held at an events facility and the proximity of hotel, retail and entertainment facilities. These adjacent amenities are available at the River Landing Site but not at Grayson Stadium.

Based upon the various data points, Johnson Consulting recommends a capacity of 5,500 seats, including fixed and berm seating, at a new multipurpose stadium in downtown Savannah. A stadium of that size will accommodate an outdoor concert, and can adequately serve a number of other multipurpose functions. Other recommended features include:

. Field Turf

. 12-16 luxury suites

. 2-3 Premium Clubs offering all-inclusive ticket deals ranging in price-level

. 360 degree, walkable concourse to allow unobstructed sightlines of the field

. Multiple group seating locations along the baselines to capitalize on the growing trend in minor league baseball.

Although Grayson Stadium no longer remains a suitable venue for professional baseball, Johnson Consulting is of the opinion that Grayson Stadium should be repurposed in order to remain a part of the many historic facilities found throughout Savannah. The Stadium’s configuration and location in Daffin Park lends itself to

becoming a highly utilized amateur venue for high school and youth sporting events. The adjacent land in Daffin Park can be transitioned and modified into baseball and softball fields with Grayson Stadium serving as the championship site, giving the City the ability to lure more regional and even national tournament events.

Johnson Consulting feels strongly that the development of a new multipurpose stadium will be a successful investment on behalf of the City of Savannah. It will keep the Sand Gnats from relocating and will likely serve as a catalyst to spur new development and entertainment in the Downtown district. A new stadium also offers a unique opportunity for the City of Savannah to further capitalize on its strong tourism base by providing additional entertainment options to its existing visitors, while also attracting new tourists by hosting events they were previously incapable of attracting due to a lack of adequate facilities.

SECTION III ECONOMIC & DEMOGRAPHIC OVERVIEW

6 East Monroe Street | Fifth Floor | Chicago, Illinois 60603 | Phone: 312.447.2010 | Fax: 312.444.1125

www.chjc.com | [email protected] Section 3: Economic & Demographic Analysis | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 6

ECONOMIC AND DEMOGRAPHIC ANALYSIS In order to analyze the market opportunity for a proposed South Atlantic League franchise, Johnson Consulting undertook a comprehensive review of market conditions in the City of Savannah, relative to the County, as well as state and national averages. We then compared this data to other South Atlantic League markets. The key objectives of this analysis are to identify structural factors, opportunities and weaknesses that may affect the market’s ongoing competitive situation, and to gauge the level of support that exists for the franchise.

While characteristics such as population, employment and income are not strict predictors of the performance of sports franchises, these metrics provide insight into the capacity of a market to provide ongoing support for an organization. We can also use these metrics to determine whether an area is able to capitalize on a new baseball stadium by adding new development, or revitalizing vacant retail/commercial locations.

In addition, the size and role of a marketplace, its civic leadership, proximity to other metropolitan areas, transportation concentrations, economic deal structure, management expertise, and the location of competing and/or complementary attractions directly influence the scale and quality of what can be supported within that particular market.

MARKET OVERVIEW Savannah is a city that promotes its history. Residents of Savannah have gone to great lengths to restore homes, public buildings and tree-filled squares to maintain the unique features of the city. This unique atmosphere helps Savannah’s tourism industry, which has boomed dramatically since the mid-1990s and now attracts over 12 million tourists per year.

This increase in tourism and other positive economic growth over recent years has enabled Savannah to take advantage of its history past to grow for the future. The Historic Landmark District is undergoing commercial revitalization that links it with the Victorian District and also reaches the eastside islands, the Southside and the industrialized areas west of Savannah.

Savannah has the unique distinction of being America’s first planned city. Designed with 22 of its original 24 public squares, visitors are drawn to the city’s representation of more than 8 prominent architectural styles of the 18th and 19th centuries. With over 13 million visitors in 2013, Savannah has capitalized on its unique history. With more than 50 companies providing guided tours in Savannah, visitors have various touring options available to them, including walking, biking, Segway, boat, and trolley transportation.

Figure 3-1 provides a map of Savannah and the surrounding region.

Section 3: Economic & Demographic Analysis | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 7

Figure 3 - 1

CURRENT POPULATION In 2014 the City of Savannah had an estimated resident population of 143,363 persons, representing 38.8% percent of the total population of the Savannah metropolitan area, with a total of 369,479 people. These population figures do not include the transient student population at colleges and universities in the Savannah MSA. Between 2000 and 2014, the population of Savannah increased at an average annual rate of 0.6 percent, which was slightly lower than the rate of growth observed throughout the Savannah MSA (1.7 percent per annum), Georgia (1.5 percent) and the U.S. as a whole (0.9 percent).

Section 3: Economic & Demographic Analysis | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 8

Table 3-1

Since 2000, the population of Savannah has grown 8.2 percent which is less than the rates of growth experienced over the same time frame in the MSA (24.9 percent), Georgia (22.2 percent) and the U.S. (12.5 percent). Looking at the annual growth rate from 2000-present, Savannah (0.6 percent) compares slightly better to the County (1.4 percent), MSA (1.7 percent), State of Georgia (1.5 percent) and the Nation (0.9 percent).

PROJECTED POPULATION GROWTH Population projections indicate that the population of the City of Savannah will reach 145,867 persons in 2019. Between 2014 and 2019, the population of the City is projected to grow at an average annual rate of 0.3 percent, for a total growth of 1.7 percent. These rates are lower than the rate of population growth forecast throughout the Savannah MSA, Georgia and the U.S. as a whole. These projections are likely not taking into account the Savannah Harbor Deepening Expansion project, which could add several hundred thousand additional jobs statewide.

Table 3 - 1

Section 3: Economic & Demographic Analysis | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 9

AGE CHARACTERISTICS The age characteristics of Savannah are generally consistent with those of the Savannah MSA, Georgia, and the U.S. as a whole. Savannah comprises a higher percentage of young adults aged 20-34 years (28.9 percent) than the MSA (24.2 percent), Georgia (21.1 percent), and the U.S. (20.6 percent) and also a lower proportion of children aged less than 15 years, accounting for 18.8 percent of the population of the City compared to 20.1 percent of the metropolitan population, 21 percent of the State, and 19.5 percent of the national population. Savannah comprises a lower proportion of adults over the age of 55 compared to the U.S. average, accounting for 22.4 percent of the City’s population, compared to 25.8 percent throughout the U.S. Although lower than the U.S. average, this age distribution is fairly consistent with the Savannah MSA (23.4 percent), and Georgia (22.7 percent).

Table 3 - 2

Age Distribution - City of Savannah (2014)

Age Group City of Savannah Chatham County Savannah MSA Georgia U.S. (Years) No. % No. % No. % No. % No. %

0-4 10,102 7.0% 19,786 7.0% 25,823 7.0% 690,237 6.9% 20,331,031 6.4%

05-14 16,904 11.8% 33,929 12.0% 48,319 13.1% 1,423,991 14.2% 41,634,820 13.1%

15-19 10,186 7.1% 18,848 6.7% 25,364 6.9% 712,405 7.1% 21,735,398 6.8%

20-24 16,588 11.6% 26,950 9.6% 32,074 8.7% 733,379 7.3% 22,712,390 7.2%

25-34 24,824 17.3% 45,748 16.2% 57,221 15.5% 1,392,851 13.8% 42,811,079 13.5%

35-44 15,816 11.0% 33,343 11.8% 46,111 12.5% 1,408,598 14.0% 41,174,682 13.0%

45-54 16,846 11.8% 35,105 12.5% 48,244 13.1% 1,420,959 14.1% 45,053,232 14.2%

55-64 15,245 10.6% 32,319 11.5% 41,972 11.4% 1,147,495 11.4% 38,892,217 12.3%

65-74 8,905 6.2% 20,156 7.2% 25,592 6.9% 678,966 6.7% 23,713,248 7.5%

75-84 5,312 3.7% 10,969 3.9% 13,282 3.6% 330,658 3.3% 13,379,604 4.2%

85+ 2,637 1.8% 4,717 1.7% 5,478 1.5% 123,551 1.2% 5,894,012 1.9%

TOTAL 143,363 281,870 369,479 10,063,090 317,331,714

Source: DemographicsNow, Johnson Consulting

MEDIAN AGE As of 2014 the median age of residents of the City of Savannah is 31.6 years, which is lower than figures recorded for the Savannah MSA (34.2 years), Georgia (35.6 years), and the U.S. as a whole (37.4). Between 2000 and 2014, the median age of residents of Savannah has decreased by 1 year, reflecting an opportunity for population growth in the near future as young families emerge. Minor League Baseball presents an entertainment option for young adults. The median age in Savannah indicates there is a large number of young professionals who are likely to utilize the entertainment and nightlife that the City of Savannah has to offer.

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Table 3 - 3

Median Age - City of Savannah (2000-2014)

Growth in Years 2000 2010 2014 2000-2014

U.S. 35.3 37.1 37.4 2.1

Georgia 33.4 35.3 35.6 2.2

Savannah MSA 34.2 34.4 34.2 0.0

Chatham County 34.4 34.1 33.9 -0.5

City of Savannah 32.6 31.6 31.6 -1.0

Source: DemographicsNow, Johnson Consulting

EDUCATIONAL ATTAINMENT In the City of Savannah approximately 16.7 percent of residents aged 25 years and older have earned a bachelor’s degree. This is slightly lower than the percentage throughout the Savannah MSA where 18.9 percent of residents aged 25 years and older have a bachelor’s degree, and is comparable to the state and national level, where 17.8 percent and 17.9 percent respectively have attained a bachelor’s degree.

Table 3 - 4

Educational Attainment - City of Savannah (2014) Age 25+ Population

City of Savannah Chatham County Savannah MSA Georgia U.S. No. % No. % No. % No. % No. %

Grades K-8 2,620 2.9% 5,007 2.7% 6,523 2.7% 288,077 4.4% 9,941,166 4.7%

Grades 9-11 9,511 10.6% 15,536 8.5% 20,871 8.8% 631,363 9.7% 17,338,170 8.2%

High School Graduate 27,935 31.2% 50,870 27.9% 69,521 29.2% 1,877,105 28.9% 59,555,076 28.2%

Some College, No Degree 20,141 22.5% 41,896 23.0% 53,904 22.7% 1,362,908 21.0% 44,824,095 21.3%

Associates Degree 5,474 6.1% 12,425 6.8% 16,330 6.9% 444,827 6.8% 16,244,267 7.7%

Bachelors Degree 14,981 16.7% 35,931 19.7% 45,034 18.9% 1,160,039 17.8% 37,815,987 17.9%

Graduate Degree 7,336 8.2% 18,728 10.3% 23,540 9.9% 652,762 10.0% 22,398,532 10.6%

No Schooling Completed 1,586 1.8% 1,964 1.1% 2,175 0.9% 85,997 1.3% 2,800,781 1.3%

TOTAL 89,584 182,357 237,898 6,503,078 210,918,074

Section 3: Economic & Demographic Analysis | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 11

UNEMPLOYMENT The following table shows the annual unemployment rates for Chatham County, the Savannah MSA, Georgia, and the U.S. from 2005 to 2014 according to the Bureau of Labor Statistics. The Savannah MSA, Georgia, and the U.S. have experienced similar fluctuations in unemployment, with the greatest increase occurring in 2009 with a 2.8 percent increase in the County, 2.8 percent for the MSA, 2.3 percent for Georgia, and 2.6 percent for the U.S. as a whole. Unemployment in Chatham County and the Savannah MSA has decreased consistently with the state of Georgia, but remains 1.5 percent and 1.1 percent higher than the national unemployment rate through July 2014, which is the most recent data available.

Table 3 - 6

Unemployment Rate - Chatham County (2005-2014)

Chatham County Savannah MSA Georgia U.S. Rate Change Rate Change Rate Change Rate Change

2005 4.5% - 4.3% - 5.0% - 4.9% -

2006 4.1% (0.4) 3.9% (0.4) 4.5% (0.5) 4.4% (0.5)

2007 4.1% - 3.9% - 5.1% 0.6 5.0% 0.6

2008 5.7% 1.6 5.5% 1.6 8.1% 3.0 7.3% 2.3

2009 8.5% 2.8 8.3% 2.8 10.4% 2.3 9.9% 2.6

2010 9.1% 0.6 9.0% 0.7 10.2% (0.2) 9.4% (0.5)

2011 9.2% 0.1 9.0% 0.0 9.5% (0.7) 8.5% (0.9)

2012 8.5% (0.7) 8.3% (0.7) 8.7% (0.8) 7.9% (0.6)

2013 7.7% (0.8) 7.5% (0.8) 7.4% (1.3) 6.7% (1.2)

2014* 7.8% 0.1 7.4% (0.1) 7.4% - 6.3% (0.4)

*June 2014 is most recent data available Source: Bureau of Labor Statistics, Johnson Consulting

Section 3: Economic & Demographic Analysis | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 12

HOUSEHOLD INCOME Income characteristics of the local market are a key indicator of the overall health and vibrancy of a market. In general, higher income levels lead to greater amounts of disposable income that can be spent on non- essential items, such as recreation and sports entertainment. In 2014, median household income in the City of Savannah is estimated to be $31,758 per year. This is below the estimated figures for the County ($42,378), MSA ($46,563 per year), Georgia ($48,202 per year) and the U.S. as a whole ($51,972 per year). This variance is consistent with that of the year 2000, and is projected to continue into 2019 with median household income in the City reaching $34,881, compared to the $47,555 for the County, $52,569 for the MSA, $55,155 throughout Georgia, and $60,447 for the U.S. as a whole.

Table 3 - 7

Median Household Income - City of Savannah (2000-2019)

CAGR* CAGR* 2000 2010 2014 2019 2000-2014 2014-2019

U.S. $42,253 $51,362 $51,972 $60,447 1.5% 3.1%

Georgia $42,783 $47,973 $48,202 $55,155 0.9% 2.7%

Savannah MSA $39,675 $45,499 $46,563 $52,569 1.2% 2.5%

Chatham County $38,016 $42,686 $42,378 $47,555 0.8% 2.3%

City of Savannah $30,095 $32,442 $31,758 $34,881 0.4% 1.9% * Compounded Annual Grow th Rate Source: DemographicsNow, Johnson Consulting

CORPORATE PRESENCE A strong corporate and business presence can be an important factor in the success of sports organizations because local businesses can attract residents and visitors to an area, provide disposable income, and support facilities and/or teams through donations, advertising, and the leasing of premium suites, party decks or VIP seating areas.

The following table shows the largest private employers throughout Metro Savannah as provided by the Savannah Economic Development Authority. As shown, the largest employers are concentrated within the aerospace equipment and healthcare industries.

Section 3: Economic & Demographic Analysis | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 13

Table 3 - 8

Largest Employers - Savannah

Employer Industry Employees

Gulfstream Aerospace Corporation Jet Aircraft, Aerospace Equipment 9,663 Memorial Health University Medical Center Hospital 5,000 Savannah-Chatham County Board of Education Public Schools 4,808 Ft. Stewart/Hunter Army Airfield Civilian Personell 4,637 S. Joseph's/Candler Health System Hospital 3,304 City of Savannah Government 2,795 Savannah College of Art & Design Education 1,750 Chatham County Government 1,600 Georgia Port Authority Ship Terminal Operation 988 Colonial Group Oil & Gas Operations 900 Armstrong Atlantic State University Education 602 SouthCoast Medical Group Medical Care 601 International Paper Paper Products, Chemicals, Corrugated Containers 600 US Army Corp of Engineers Civil Engineering 600 Savannah State University Education 586 Goodwill Industries of the Coastal Empire Adult Vocational Rehabilitation 560 JCB Americas, Inc. Construction Equipment 558 Georgia Power Company-Coastal Region Electric Utility 473 Imperial Sugar Refined Sugar 450 Brasseler USA, Inc. Dental Instruments 420 Mitsubishi Power Systems Americas, Inc. Gas/Steam Turbines 420 The Landings Club Private Club 400 CSX Railroad Line 308 TMX Finance Financail 302 Derst Caking Company Bakery 273 Dollar Tree Assundry Product Distribution 271 Source: Savannah Area Chamber of Commerce, Johnson Consulting

UNIVERSITY AND COLLEGE PRESENCE The following universities and colleges located within the Savannah area could offer unique partnerships for a South Atlantic League team, and/or the baseball stadium:

. Savannah State University: As the oldest public historically black university in the State of Georgia, Savannah State offers graduate and undergraduate studies including nationally accredited programs in the liberal arts, the sciences and the professions. The University’s program offerings include the College of Business Administration, the College of Liberal Arts and Social Sciences, College of Sciences and Technology and the School of Teacher Education, which lead to baccalaureate and master's degrees.

Section 3: Economic & Demographic Analysis | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 14

. Savannah College of Art and Design: A private University with locations in Savannah and Atlanta, Georgia as well as two international locations in Lacoste, France and Hong Kong, China. SCAD opened in 1979 with approximately 500 students and now has over 10,000 students. SCAD has worked with the City of Savannah to preserve its architectural heritage, which included repurposing and restoring historic building into college facilities. The college owns two historic theaters, the Trustees Theater and the Lucas Theatre for the Arts; both are utilized for the highly attended Savannah Film Festival, which has annually averaged approximately 40,000 in attendance. SCAD Athletics is a member of the National Association of Intercollegiate Athletics (NAIA), SCAD athletic teams have ranked consistently among the nation’s top 25 teams, in men’s and women’s swimming as well as men’s equestrian.

. South University: The University traces its heritage to 1899, when Dr. John Draughon established Draughon's Practical Business College in Savannah, Georgia. Since that time, South University has experienced continued growth transforming from a two-year college into a University offering four year degree programs - undergraduate and graduate - with campus locations in several cities nationwide, including Savannah, Georgia. South University is accredited by the Commission on Colleges of the Southern Association of Colleges and Schools to award associate, baccalaureate, masters and doctorate degrees.

SAVANNAH TOURISM

Overview According to a 2013 Visitor Report conducted by Longwoods Travel USA, 40 percent of overnight visitors were in Savannah visiting friends and family, slightly below the U.S. norm of 44 percent. More unique to Savannah, 19 percent of overnight visitors claimed that touring was the main purpose of their leisure trip, more than doubling the national norm of 7 percent.

Although Grayson Stadium plays into the historical feel of Savannah, a location more accessible to the downtown area would add to the visual appeal of the city and provide a change of pace for the visitors exploring the cities historical district. It would also attract other demographics of visitors who would not otherwise visit Savannah for its historical sites. It is important to consider ways to incorporate promotional efforts of the Sand Gnats through these avenues, as well as tap into what this demographic of people value in other leisure activities.

Another benefit Savannah provides is the consistency in which people travel to the city throughout the year. According to Savannah’s 2013 visitor report, overnight trips to Savannah are slightly higher during the months that overlap with the Sand Gnats season. 27 percent of all overnight trips occur between April and June, while 25 percent occur between July and September. The remaining months of the year (January-March and October-December) see 24 percent of the overnight stays in each of these quarters. This consistent influx

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of people throughout the year will allow for a fairly consistent market size to pull from when the stadium looks at hosting events, even after the baseball season is over.

Looking at the regional tourism industry as a whole, hotel receipts are 7.4 percent ahead of the first quarter of 2013, and first quarter 2014 economic analysis for the region shows the leisure/hospitality sector increased by 800 jobs to an all-time high of 24,100. The tourism-related sector now represents the largest major employment sector in the Savannah economy.

Local Attractions Table 3-9 lists a sample of local attractions for tourists in Savannah. Please note that this is only a small example of entertainment options in the City of Savannah.

Table 3-9 Tourist Attractions - City of Savannah (2014)

Category Location

2 Car Garage Contemporary Art Gallery Art Galleries Chroma Gallery

Brown's Reel 'Em N Deep Sea Fishing Charters Coastal River Charters Charters and Marinas Marshland Inshore Fishing Adventures Miss Judy Charters Sweet Lowland Charters

Tybee Island Charters Skidaway Island State Park Old Fort Jackson Forsyth Park Eco-Tourism Savannah's Historic Squares Tybee Island Beach Fort Pulaski National Monument Oatland Island Wilderness Southeast

Family Entertainment StarCastle Family Entertainment Center

The Mighty Eighth Air Force Museum SCAD Museum of Art Ships of the Sea Museum Museums Jepson Center for the Arts Telfair Academy of Arts & Sciences Numerous Historic Home Museums

Island Miniature Golf & Games Sports and Recreation Ogelthorpe Speedway Park 19 Golf Courses

Trustee's Theatre (SCAD) Theatre Lucas Theatre Savannah Theatre

All In One Destinations, Inc. Architectural Tours of Savannah, LLC Dolphin Magic Tours, LLC Ginny Howell Tours Golden Isles Touring Co. Greenfeet Walkabouts Tours Hearse Ghost Tours Mikki's Tours by Taste Personalized Tours of Savannah Plantation Carriage Co. Savannah Movie Tours Tour Buddy Tours by BJ Source: Savannahmeetings, Johnson Consulting

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ACCESSIBILITY Savannah is easily accessible via numerous modes of transportation, and as such can draw visitors from a wide catchment area:

 Airport: Savannah is well-positioned and located less than ten minutes from the Savannah/Hilton Head International Airport. This airport serviced approximately 1.6 million passengers in 2013, with approximately 823,500 enplanements and 818,600 deplanements. Over $1 billion has been invested since 2006 to renovate and expand airport infrastructure to accommodate the large number of tourists visiting the region.

 Road: Savannah’s highway transportation network includes the Jim Gillis Historic Savannah Parkway (I-16) which branches off from I-75 in Macon, GA and connects to Savannah’s historic district from the west. I-95 runs along the west side of Savannah and interchanges with I-16 on Savannah’s west side. U.S. Highway 17 runs parallel to I-95 and veers off in Hardeeville, SC to enter Savannah from the northwest corner on Hutchinson Island. Transportation within Savannah is facilitated by Veterans Parkway which runs north and south on the city’s west side and Harry S. Truman Parkway which runs north and south along the east side of Downtown Savannah. Highway 80 runs east and west through Savannah’s Midtown and ends at the Atlantic Coast on Tybee Island. Figure 3-2 provides a detailed look at the roadways.

Figure 3-2

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HOTEL INVENTORY There are 84 lodging properties within Savannah offering a total of approximately 14,000 rooms. There are 67 properties within the same radius offering at least 100 rooms – the largest properties are the 400-room Westin Savannah Harbor Golf Resort and Spa and the 391-room Savannah Marriot Riverfront Hotel. The average size for properties with at least 100 rooms is 167 rooms.

Table 3-10 lists a sample of the properties with at least 100 rooms within the closest proximity to Grayson Stadium.

Table 3-10 Sample of Hotels with 100+ Rooms - City of Savannah (2014)

Distance from Distance from Meeting proposed Property Grayson # Guest Rooms Space Riverfront site Stadium (Miles) (sq.ft) (Harbor St.)

Savannah Marriot Riverfront 4.0 0.2 391 36,000 Brice-Kimpton Hotel 4.1 0.4 145 5,518 Hampton Inn Savannah Historic District 4.4 0.7 144 - Holiday Inn Express Savannah Historic District 4.4 0.7 143 4,130 Hyatt Recency Savannah 4.6 0.9 351 33,000 The Bohemian Hotel 4.7 0.9 75 8,500 AVIA Hotel 4.7 1.0 151 7,962 Inn at Ellis Square 4.7 1.0 252 6,239 Andaz Savannah 4.7 1.0 151 9,362 DoubleTree Hotel Historic Savannah 4.8 1.1 150 5,160 Hilton Garden Inn Historic Savannah 4.8 1.1 133 2,988 Hilton Savannah DeSoto 3.3 1.2 162 21,512 SpringHill Suites by Marriott Savannah Historic District 3.5 1.3 162 1,200 Courtyard Savannah Downtown/Historic District 3.6 1.6 156 - Country Inn & Suites 3.6 1.6 102 1,000 Hampton Inn & Suites Savannah Historic District 3.9 1.6 154 - Mansion on Forsyth Park 2.7 1.7 126 13,000 The Westin Savannah Harbor Golf Resort & Spa 6.7 5.1 403 35,000 Homewood Suites by Hilton 3.7 7.4 106 1,008 Hilton Garden Savannah Midtown 4.3 7.4 132 7,850 La Quinta Inn 4.6 7.8 154 - Quality Inn Midtown 4.2 7.9 170 2,784 Total - - 3,913 202,213 Note: Hotels w ithin 10 mile radius of Grayson Stadium Source: Savannahmeetings, Johnson Consulting

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CONCLUSION Savannah is a unique robust market due to steady growth and a diverse employment base. The population, median household income, rebounding employment figures and expanding list of companies indicate that Savannah is capable of supporting a new multi-purpose stadium. Additionally, given the robust tourism industry, a newly constructed stadium should be able to capture a percentage of that tourism market that Grayson Stadium currently does not. A well-located stadium especially should be able to generate additional demand from event holders, concert promoters and local meeting holders for its meeting space. New stadium projects can also bring about economic development in the immediate area to support the influx of residents and visitors to the area, ultimately raising property values and tax revenues within Savannah.

A new minor league stadium in Savannah will ultimately rely upon the support of corporations within the area, as well as local residents. Their involvement will be critical to the team’s ability to attract sponsorship support and corporate suiteholders from the local business community. A new stadium that will keep the Sand Gnats located in Savannah will be most beneficial for local residents because it will provide family entertainment options, seasonal employment and volunteer opportunities while also providing residents with a facility that can host numerous special events in addition to baseball.

SECTION IV SITE ANALYSIS

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SITE ANALYSIS

In this section we present an assessment of the current Grayson Stadium site and an alternative site at Savannah River Landing for a proposed multipurpose baseball stadium location. This evaluation process uses our team’s experience with similar projects and results in a site analysis according to best practices for urban planning and economic development. This is critical to establishing a hierarchy for more detailed technical analyses of individual sites and provides a framework to assess other sites, if they are identified. It is also a key process in determining, and then confirming, the development goals and sensitivities for completing a potential multipurpose stadium project.

Site selection is a crucial decision, and a myriad of factors, both objective and subjective, influence the potential performance and contribution of a facility. Poor site selection can inhibit the ultimate success of a project and affect its performance for generations. Far too often, communities locate a facility on a site not because it is the most advantageous spot or in the location that will best contribute to the overall objectives of the community, but out of immediacy, availability, historical context, cost or other factors that speak to convenience over market strategy and product positioning.

The following site parameters are necessary considerations for the successful development of a new stadium in today’s modern baseball era:

. Provision of a site large enough to allow for not only a multipurpose stadium, but also subsequent expansion and adequate parking.

. A site that has destination appeal to patrons for pre- and post-event activities, and is visible and convenient to access.

. A site that leverages tourism dollars and other visitor positive impacts, rather than wastes them.

. Consideration of zoning, streetscape, transit connections, design standards, and land use around the facility that is conducive not just to the proposed Stadium, but to the development of a region-wide identity.

Furthermore, when considering potential sites for a new multi-purpose stadium, there are a number of civic goals that should be identified and pursued in selecting the most advantageous site. Some of these goals are subjective in nature and may appeal to intuition or emotions in a way that cannot be quantified. The act of defining common goals of various stakeholders helps to build familiarity and consensus for the project.

Ultimately, the preferred site is the one that exhibits the best overall mix of attributes, with broad recognition by all stakeholders that trade-offs are required as it is highly unlikely that a single site embodies the best of each attribute. In today’s market, goals and attributes to be prioritized include:

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. The primary goal should be to make the Stadium environment a recognized district, a unique destination, regional draw, and a necessary part of the Savannah experience for stadium attendees and tourists alike. Sites within the downtown area that are situated closest to the vast majority of tourists and the City hotel clusters will have the greatest benefit to the City.

. A Stadium should be highly visible and easily accessible from the major approaches into the city.

. The economic purpose of building a stadium is to maximize the amount of economic impact gained from collateral development or expansion of existing support businesses.

. A multipurpose stadium is built as an economic development tool, for entertainment, and as a community investment in the tourism, recreation, hospitality, and entertainment businesses. While the notable and ongoing direct benefits of bringing visitors (and their related spending) to Savannah is well established, there are also benefits associated with the construction of adjacent businesses, including new jobs. Such a project can also enhance the image of the community as a potential corporate location because it provides a premier source of affordable entertainment to the community.

Each of the goals and attributes outlined above are implicit in Johnson Consulting’s evaluation of the potential sites.

INITIAL SITE REVIEW The Consulting Team was provided an extensive tour of Grayson Stadium, which included a walk-through of the grandstands, club house, concession area and the surrounding land outside of the stadium. Additionally, the Consulting Team review the Savannah River Landing site as a potential location for a new multipurpose stadium.

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GRAYSON STADIUM SITE The current location of Grayson Stadium in Daffin Park offers several advantages, as the location of a multipurpose stadium:

. First and foremost, there are real and obvious cost savings, including land acquisition and construction that would result from not building a new stadium.

. Restoring and preserving the historic nature of Grayson Stadium as one of the oldest functioning ballparks in baseball is consistent with the City’s dedication to historic preservation.

. Grayson Stadium is currently interlaced with the surrounding residential and retail commercial community and has become part of the fabric of Daffin Park and the local neighborhood.

As with any site, there are also disadvantages, some of which are prohibitive as it relates to a desirable site for a Single-A Baseball stadium:

. Parking has been maximized on site and is still not sufficient for the desired attendance. In addition there is little la land available for additional parking

. Limited access to the site from the local road network results in insufficient egress and ingress to the site

. The distance from historic downtown Savannah significantly limits the opportunity for tourists to attend games at this site.

. The lack of amenities found in modern facilities and the increasing capital improvement cost of maintenance has rendered the existing facility obsolete as the home stadium for a Single-A Baseball franchise. Therefore, significant investments would need to be made in the existing facility to make this site a viable location for a multi-purpose Minor League Baseball stadium.

An aerial view of the existing site is shown below for reference.

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Figure 4-1

SAVANNAH RIVER LANDING For the purposes of a site analysis and comparison to the existing Grayson Stadium location, the Consulting Team chose a site location at Savannah River Landing. The Savannah River Land site is located on the eastern edge of downtown, adjacent to the Marriot Hotel and along the Savannah River. Please note that other sites within the Savannah River Landing or in other locations within the City of Savannah have not been included in this analysis, but may have similar advantages and/or disadvantages. The Savannah River Land site offers the following advantages:

. The sites proximity to the Historical Riverfront District is its primary advantage. Approximately 12 million tourists visit this area annually. A new multipurpose stadium at the River Landing site presents an opportunity to capture a large portion of Savannah’s visitors. Coupled with the proximity of nearby hotels, restaurants, and parking, a new multipurpose stadium could enhance the existing tourism base in Savannah.

. Construction of a multi-purpose stadium at Savannah River Landing would serve as a potential catalyst for future and additional development in this area which has sat vacant and underutilized for many years.

. Good ingress and egress to the site due to its proximity to the Truman Parkway. Site access will also improve after the capital improvements planned for Presidents Street Extension are completed.

There is one primary disadvantage to construction of a multi-purpose stadium at this site:

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. The cost for land acquisition, design, permitting, and construction of a new multi-purpose stadium would be significant when compared to utilization of an existing facility. However, if the City Council deems construction of a new multi-purpose stadium to be a priority for the citizens of this community, and the necessary funding exists, then this ceases to be a major concern.

It will also be important for the City to consider the best possible use for a particular site when choosing a location for a future multi-purpose stadium. Once built, the facility will likely determine the character of adjacent development for years to come.

Figure 4-2

EVALUATION In order to evaluate the strengths and weaknesses of both the Savannah River Landings site and the existing Grayson Stadium site, Johnson Consulting created an evaluation matrix that examines critical factors related to market considerations, project development, site access, site development costs. Site selection factors are rated as excellent, good, fair, or poor. Please note that site development costs rated on an alternate scale as high, mid, low or none.

For the purposes of this comparison, please be aware that an assumption has been made that the Grayson Stadium facility would be upgraded to be consistent with the proposed design of a new multi-purpose stadium. These factors will be critical for the City Council to consider when making the decision to construct a new multi-purpose stadium, and if so, where it should be located. Should the City Council elect to move

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forward with construction of a new multi-purpose stadium, then this same process could be utilized to assess the advantages and disadvantages of other potential locations. .

The comparative matrix appears in Figure 4-3 below.

Figure 4-3 Savannah Multi-Purpose Stadium Site Analysis Grayson Savannah Stadium River Landing Market Considerations

Visibility from highway and supportive land uses Fair Good

Leverage adjacent land uses Fair Excellent

Ability to yield a distintive project Good Excellent

Proximity to retail & restaurants Good Excellent

Proximity to existing parking Fair Poor

Hotels within walking distance Poor Excellent

Historical Significance Excellent Poor

Project Development Considerations

Site ownership and control Excellent Fair

Ability to construct appropriate parking Poor Excellent

Site Access

Vehicle Fair Good

Pedestrian Fair Excellent

Transit Fair Good

Site Development Costs

Site acquisition None High

Infrastructure Low Mid

Design, permitting and construction Mid High

Financing Options Mid High

Source: Ecological Planning Group, Johnson Consulting

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The Savannah River Landing site holds a competitive advantage against the existing Grayson Stadium site in many of the key elements listed in the matrix above. The City’s ownership of the existing Grayson Stadium site is more economically appealing than the Savannah River Landing site, where the potential acquisition cost remains unknown at this time. The Savannah River Landing site proximity to the downtown core, and its ability to leverage the existing 12 million visitors on an annual basis, makes this site most attractive in terms of creating a customer base for a new multipurpose stadium. As shown in Figure 4-4 below, the current site is located approximately 3.3 miles from the historic downtown district; however the Savannah River Landing site affords fans the ability to walk to and from the historic riverfront and downtown central business district.

Additionally, the River Landing site resides within the boundaries of the East Downtown Tax Allocation District (TAD), which affords the project additional resources to finance construction and operations of a future multi-purpose stadium. The proposed multi-purpose stadium would also provide a benefit to this struggling TAD; as shown in our case studies for similar minor league developments, because such projects often serve as economic catalysts for new development in to their surrounding community.

Figure 4-4

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CONCLUSION After touring the sites and performing the analysis summarized above the Consulting Team considers the Savannah River Landing site to be more attractive than the Grayson Stadium site for the location of a multipurpose stadium.

If a new stadium project is approved, the City will gain the most benefit by selecting a site that will also allow for adjacent mix-use development. This will create an entertainment district appeal which is can be important for the success of a future multi-purpose stadium project. The Savannah River Landing site meets these criteria and would be able to host multiple land uses, which will make for a true regional destination. In previous studies conducted by Johnson Consulting, our team has noted that there is a positive correlation between the number of events, and attendance at those events, and the proximity of the facility to hotel, retail and entertainment facilities.

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SECTION V HISTORICAL OVERVIEW & PEER REVIEW

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CLASS A & SOUTH ATLANTIC LEAGUE TRENDS

MINOR LEAGUE BASEBALL Minor League Baseball, which consists of 240 teams, was founded in 1869. These teams are predominately located in warm weather climates and range over 6 countries. In addition, they capitalize on small cities where there is a demand for baseball in particular. This League is a proving ground for athletes to get to the next level, Major League Baseball. The Minor Leagues also serves as a place for Major League players affected by injuries, in which they can rehabilitate with the benefits of still playing legitimate competition. Minor League Baseball is categorized into sub leagues from single A to AAA.

MINOR LEAGUE BASEBALL CLASSIFICATIONS Class AAA- This level of baseball usually consists of either older players who have had some Major League experience or younger players who are on their way to the Major League level of play. Often times the Major League parent club will bring an (AAA) player to fill in for an injured player for a short period, before returning to the (AAA) team.

Class AA- This is the most competitive level of play for Minor League baseball. It has often been said that if you can compete in (AA) baseball, then you can most likely play at the highest level (Major League). Younger and more talented players characterize this level of play.

Class A-Advanced- This is just a step above the rookie league and is known as more of a hitter’s league. Pitchers are usually learning how to pitch, in terms of location and velocity/control, while hitters are more likely to perform well (pitching is not at the highest competitive level yet).

Class A (Full Season)-Class A League baseball consists of two leagues, the South Atlantic and Midwest Leagues. All 29 teams are affiliated with a major league organization. These leagues consist mostly of players moving up from Short-Season Class A and Rookie leagues. Rarely do experienced first-year players remain in (A) baseball for extended periods of time.

CLASS A MARKET DEMOGRAPHICS There is no direct correlation between the location of teams and the size of their market. Cities are more often selected because of their location and financial terms, rather than the size of their population. In the South Atlantic League, populations range from 31,000 in Salisbury, MD to over 310,000 in Lexington, KY. In the Midwest League, city populations range from approximately 18,500 in East Lake, OH to over 255,000 in Fort Wayne, IN. The average size of a city with a South Atlantic team is 112,000 residents, slightly higher than the Midwest League average of approximately 80,000 people per city. In addition to population size not being a key determinant of the location of teams, cities with higher populations do not always achieve higher

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attendance. Rather, attendance is most heavily influenced by the physical location of the stadium, its surrounding support offerings, branding, management, and the age and condition of the facility. With that said, attendance and community engagement projections must be realistic in correlation to the size of each market. Demographic information will be explored in this section and the data will be used to give a better picture of Savannah’s position as a market for minor league baseball.

Table 5-1 provides a summary of key demographic information of Class A cities relative to Savannah.

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Table 5-1 Class A Population MSA 2014 MSA Rank 2014 City Rank 2019 MSA Rank Est Growth Rank Number of Rank Rank Rank Est Growth Rank Team/Market City 2014 HH 2019 HH Pop 1-30 Pop 1-30 Pop 1-30 2014-2019 1-30 Establishments 1-30 1-30 1-30 2014-2019 1-30 Lakewood BlueClaws Lakewood, NJ 19,993,387 1 56,444 16 20,350,803 1 1.79% 23 850,981 1 7,364,264 1 7,538,830 1 2.37% 22 Kane County Courgars Geneva, IL 9,582,872 2 21,952 27 9,851,527 2 2.80% 19 342,333 2 3,541,219 2 3,662,770 2 3.43% 18 Kannapolis Intimidators Kannapolis, NC 2,353,784 3 44,327 18 2,558,396 3 8.69% 1 85,567 3 902,416 3 985,937 3 9.26% 1 Lake Couty Captains Eastlake, OH 2,062,945 4 18,487 29 2,076,617 4 0.66% 27 79,902 4 850,402 4 861,924 4 1.35% 27 West Michigan Whitecaps Comstock Park, MI 1,018,027 5 10,493 30 1,056,177 5 3.75% 14 33,870 5 379,616 5 395,471 5 4.18% 14 Greenville Drive Greenville, SC 855,834 6 61,674 14 896,873 6 4.80% 10 28,547 7 334,249 6 352,126 6 5.35% 11 Dayton Dragons Dayton, OH 802,294 7 141,459 6 813,139 7 1.35% 24 28,004 8 329,072 8 335,644 7 2.00% 25 Greensboro Grasshoppers Greensboro, NC 744,672 8 279,560 2 779,252 8 4.64% 11 29,566 6 299,708 5 316,118 8 5.48% 10 Charleston RiverDogs Charleston, SC 719,421 9 127,248 8 776,793 9 7.97% 2 25,618 9 282,518 9 307,104 9 8.70% 2 Augusta GreenJackets Augusta, GA 581,427 10 198,832 4 607,881 10 4.55% 12 18,353 12 222,214 24 234,106 10 5.35% 12 Lexington Legends Lexington, KY 494,880 11 311,889 1 523,661 11 5.82% 6 20,345 10 199,804 9 212,548 11 6.38% 6 Lansing Lugnuts Lansing, MI 466,505 12 114,792 10 479,145 12 2.71% 17 16,390 14 184,691 13 191,146 13 3.50% 17 Asheville Tourists Asheville, NC 435,030 13 85,626 13 457,518 13 5.17% 8 19,128 11 184,509 11 195,984 12 6.22% 7 Fort Wayne TinCaps Fort Wayne, IN 425,178 14 258,931 3 439,065 14 3.27% 15 14,959 15 165,901 15 171,985 14 3.67% 15 Delmarva Shorebirds Salisbury, MD 387,040 15 30,566 24 411,520 15 6.32% 4 16,186 13 153,428 14 164,602 15 7.28% 3 Quad City River Bandits Davenport, IA 383,690 16 102,659 11 388,837 17 1.34% 26 13,539 17 157,051 16 160,138 16 1.97% 26 Peoria Chiefs Peoria, IL 379,881 17 115,509 9 387,086 18 1.90% 21 12,695 18 152,310 17 156,132 17 2.51% 21 Savannah Sand Gnats Savannah, GA 369,479 18 143,363 5 392,251 16 6.16% 5 14,083 16 140,448 15 150,344 18 7.05% 4 Hickory Crawdads Hickory, NC 362,534 19 40,496 21 373,141 19 2.93% 16 11,803 19 143,298 18 148,377 19 3.54% 16 South Bend Silverhawks South Bend, IN 318,756 20 100,942 12 323,408 20 1.46% 25 10,609 20 123,726 19 126,404 20 2.16% 23 Cedar Rapids Kernels Cedar Rapids, IA 262,088 21 128,484 7 271,917 22 3.75% 13 10,028 21 106,388 21 111,098 21 4.43% 13 Hagerstown Suns Hagerstown, MD 257,813 22 40,642 20 274,881 21 6.62% 3 8,551 22 97,945 22 104,839 22 7.04% 5 Wisconsin Timber Rattlers Grand Chute, WI 230,197 23 20,986 28 242,138 23 5.19% 7 7,386 24 90,193 23 95,352 24 5.72% 9 West Virginia Power Charleson, WV 225,167 24 50,940 17 222,356 24 -1.25% 30 8,471 23 97,083 22 96,421 23 -0.68% 30 Bowling Green Hot Rods Bowling Green, KY 165,035 25 60,604 15 173,191 25 4.94% 9 5,850 25 64,107 24 67,825 25 5.80% 8 Beloit Snappers Beloit, WI 160,423 26 36,869 22 164,776 26 2.71% 18 4,745 26 63,022 26 65,108 26 3.31% 19 Rome Braves Rome, GA 96,348 27 36,373 23 98,593 27 2.33% 20 3,307 27 35,996 26 37,103 27 3.08% 20 Great Lakes Loons Mindland, MI 84,042 28 42,033 19 85,256 28 1.44% 22 2,717 28 33,706 28 34,410 28 2.09% 24 Clinton LumberKings* Clinton, IA 48,351 29 26,387 26 48,200 29 -0.31% 28 1,883 30 19,824 30 19,886 30 0.31% 28 Burlington Bees* Burlington, IA 47,270 30 25,645 25 46,744 30 -1.11% 29 2,026 29 20,003 29 19,906 29 -0.48% 29 Average 1,477,146 91,140 1,519,038 3.41% 57,581 557,970 577,321 4.08% * Reside within Micro MSA not Metro Source: Johnson Consulting, Demographics Now, Facility websites

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As shown in Table 5-1, the MSAs with the highest populations are home to the Lakewood BlueClaws in the South Atlantic League and the Kane County Cougars of the Midwest League. Lakewood is able to draw from the New York-Newark-Jersey City MSA while the Kane County Cougars benefit from their location within the Chicago-Naperville-Elgin MSA. Savannah ranks 18th out of 30 Class A baseball markets in terms of population and fifth in terms of projected population growth at 6.16 percent. The Savannah market looks to grow at almost twice the five-year average rate of growth for a Class A minor league market (3.4 percent). Savannah also ranks fourth in projected growth in number of households at 7.05 %. Although the Savannah MSA population ranks in the bottom 50 percent of Class A baseball markets, the city of Savannah is the fifth largest of the Class A markets (and this estimate does not include the 12 million tourists that visit Savannah annually.

SAVANNAH AND THE SOUTH ATLANTIC LEAGUE The South Atlantic League, which was founded in 1904, is part of the Class A (full season) minor league baseball league. It is composed of fourteen teams all of which are affiliated with their respective Major League Baseball counterpart. After undergoing several changes to the league name and its members in the early years of operations, the league has remained in its current format since 1980 and operates out of Clearwater, Florida.

The Savannah Sand Gnats were founded in 1984. The Sand Gnats play at Grayson Stadium in Savannah. Initially built in 1926, Grayson Stadium was rebuilt in 1941 after significant damage by a hurricane in August of 1940. The team began playing in the South Atlantic League as the Savannah Cardinals in 1984 and remained an affiliate of the St. Louis Cardinals until 1996. Since 1996, the Sand Gnats were given their current nickname and have been affiliated with the Los Angeles Dodgers, Texas Rangers, Montreal Expos/Washington Nationals, and currently are the Class A affiliate of the New York Mets. The Sand Gnats have won four South Atlantic League titles, including a league championship in 2013.

SOUTH ATLANTIC LEAGUE DEMOGRAPHICS Johnson Consulting conducted a demographic analysis of each market in the South Atlantic League. This analysis focused on each MSA that is home to a South Atlantic League team. The following table provides a summary of the demographics for Savannah and where it ranks in comparison to other South Atlantic League markets.

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Table 5-2 South Atlantic League Markets (MSA) Rank out Demographic Variable Savannah of 14 Average High Low Population 369,479 10th 1,991,291 19,993,387 96,348 *Median Age 34 1st 38 43 34 Median Household Income $46,563 7th $47,131 $63,396 $37,964 Total Spending - Sports Admissions $2,864,792 13th $41,128,446 $456,489,118 $684,252 Corporate Inventory 14,083 10th 81,395 850,981 3,307 * Ranked from youngest to oldest South Atlantic League Markets (City) Rank out Demographic Variable Savannah of 14 Average High Low Population 143,363 4th 104,074 311,889 30,566 *Median Age 34 3rd 34 42 17 Median Household Income $31,758 13th $39,246 $48,702 $31,260 Total Spending - Sports Admissions $927,892 6th $2,381,256 $21,288,850 $234,059 Corporate Inventory 7,375 4th 5,299 13,931 1,362 *Ranked from youngest to oldest Source: Demographics Now, Johnson Consulting

Table 5-2 displays key demographic indicators of the Savannah MSA. As shown, the MSA ranks seventh out of twelve teams with respect to median household income, tenth with respect to population, and tenth for corporate inventory. Savannah represents the youngest demographic in the South Atlantic League, with a median age of 34 years old. The City of Savannah fares better when comparing the demographics of each city in the South Atlantic League, with the exception of median household income. The lower-than-average income in the Savannah area correlates in part to a younger overall population. Although this may indicate less available discretionary income for local residents, minor league baseball offers an affordable form of entertainment.

As a whole, Savannah is a strong market for minor league baseball. Two things that these demographics do not take into account are the approximately 12 million visitors to Savannah each year and the lack of competition from other professional sport teams in the area. Additionally, the Savannah Harbor Deepening Expansion Project should have an enormous impact on the demographics in Savanah, especially population, income, corporate inventory and spending.

CLASS-A STADIUM CHARACTERISTICS Johnson Consulting performed a comparative analysis of all Class-A team stadiums. This analysis includes the South Atlantic and Midwest Leagues, and draws comparisons between the populations of the relevant MSAs, the capacity of the stadiums, attendance, and potential revenue streams through single game ticket pricing and luxury suites. The following table outlines these stadiums.

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Table 5-3 Characteristics of Class A Baseball Markets

Single Game Tickets MSA 5 Year Avg Luxury Club Stadium Team Year Capacity Low High Population Attendance Suites Seats South Atlantic League McCormick Field Asheville Tourists 435,030 1924 3,500 2,374 $8.00 $30.00 - - Lake Olmstead Stadium Augusta GreenJackets 581,427 1995 4,822 2,910 $8.00 $12.00 - - Joseph P. Riles, Jr. Park Charleston RiverDogs 719,421 1997 6,000 3,991 $8.00 $18.00 8 - Arthur W. Perdue Stadium Delmarva Shorebirds 387,040 1996 5,200 3,307 $13.00 $30.00 6 258 NewBridge Bank Park Greensboro Grasshoppers 744,672 2005 7,499 5,598 $6.00 $9.00 16 - Fluor Field Greenville Drive 855,834 2006 5,700 4,889 $7.00 $10.00 18 - Municipal Stadium Hagerstown Suns 257,813 1930 4,600 1,710 $6.00 $9.00 14 - L.P. Frans Stadium Hickory Crawdads 362,534 1993 5,062 2,040 $7.00 $9.00 4 - CMC-Northeast Stadium Kannapolis Intimidators 2,353,784 1995 4,700 2,003 $7.00 $9.00 6 - FirstEnergy Park Lakewood BlueClaws 19,993,387 2001 6,588 6,150 $6.00 $9.00 20 - Whitaker Bank Ballpark Lexington Legends 494,880 2001 6,994 4,634 $10.00 $24.00 26 750 State Mutual Stadium Rome Braves 96,348 2003 5,105 2,765 $6.00 $10.00 14 1,269 William L. Grayson Stadium Savannah Sand Gnats 369,479 1926 4,000 1,949 $6.00 $9.50 - - Appalachian Power Park West Virginia Power 225,167 2005 4,500 2,526 $7.00 $9.00 14 - South Atlantic League Average 1,991,201 5,305 3,346 $7.50 $14.11 13 759

Midwest League Harry C. Pohlman Field Beloit Snappers 160,423 1982 3,501 1,068 $7.00 $9.00 - - Bowling Green Ballpark Bowling Green Hot Rods 165,035 2009 5,229 3,427 $10.00 $26.00 10 177 Cummunity Field Burlington Bees* 47,270 1970 3,500 914 $5.50 $8.00 - - Veterans Memorial Stadium Cedar Rapids Kernels 262,088 2002 5,300 2,509 $7.00 $10.00 12 - Ashford University Field Clinton LumberKings* 48,351 1937 3,000 1,728 $7.00 $8.00 - - Fifth Third Field Dayton Dragons 802,294 2000 7,230 8,451 $9.75 $13.75 30 1360 Parkview Field Fort Wayne TinCaps 425,178 2009 8,000 5,663 $5.00 $12.50 16 135 Dow Diamond Great Lakes Loons 84,042 2007 5,200 3,840 $6.00 $8.50 12 - Fifth Third Bank Ballpark Kane County Cougars 9,582,872 1991 5,800 6,452 $9.00 $13.00 - - Classic Park Lake County Captains 2,062,945 2003 7,273 3,793 $7.00 $9.00 20 - Thomas M. Cooley Law School Lansing Lugnuts 466,505 1996 10,000 5,284 $10.00 $22.50 26 1052 Stadium Dozer Park Peoria Chiefs 379,881 2002 7,500 3,035 $10.00 $10.00 20 - Modern Woodmen Park Quad City River Bandits 383,690 1932 5,500 3,519 $8.00 $14.00 20 252 Four Winds Field South Bend Silverhawks 318,756 1986 5,000 2,511 $9.00 $11.00 10 - Fifth Third Ballpark West Michigan Whitecaps 1,018,027 1994 10,700 5,385 $6.00 $14.00 24 - Neuroscience Group Field at Fox Wisconsin Timber Rattlers 230,197 1995 5,500 3723 $6.00 $18.00 3 72 City Stadium Midwest League Average 1,027,347 6,140 3,728 $7.64 $12.95 17 595 * Resides w ithin Micro MSA Source: Revenues from Sports Venues, Bureau of Economic Analysis, Respective Teams, Johnson Consulting

Class A (Full Season) baseball only consists of 30 teams in the U.S. The average MSA market within the Midwest League is 1,027,347 people, while the average MSA market for South Atlantic league teams is 1,991,201. The Savannah Sand Gnats rank 26 out of 30 in average attendances for Class A teams over the past five years. The 4,000 seat capacity at Grayson Stadium as well as the average ticket price is below average for organizations competing in Class A.

Table 5-4 compares six organizations that are closest in market size to Savannah.

Section 5: Historical Overview & Peer Review | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Sa vannah, GA PAGE 33

Table 5-4 Similar Market Snapshot Single GameTickets MSA 5 Year Avg Luxury Club Stadium Team Year Capacity Low High Population Attendence Suites Seats Four Winds Field South Bend Silverhawks 318,756 1986 5,000 2,511 $9.00 $11.00 10 - L.P. Frans Stadium Hickory Crawdads 362,534 1993 5,062 2,040 $7.00 $9.00 4 - William L. Grayson Stadium Savannah Sand Gnats 369,479 1926 4,000 1,949 $6.00 $9.50 - - Dozer Park Peoria Chiefs 379,881 2002 7,500 3,035 $10.00 $10.00 20 - Modern Woodmen Park Quad City River Bandits 383,690 1932 5,500 3,519 $8.00 $14.00 20 252 Arthur W. Perdue Stadium Delmarva Shorebirds 387,040 1996 5,200 3,307 $13.00 $30.00 6 258 Parkview Field Fort Wayne TinCaps 425,178 2009 8,000 5,663 $5.00 $12.50 16 135 Average 375,223 5,752 3,146 $8.29 $13.71 13 215 Source: Johnson Consulting

Although capacity, attendance, ticket prices, and premium seating are not sole indicators of success, this table enables comparison on a similar scale. The table compares two South Atlantic League teams and four Midwest league teams. Of the comparable markets, Savannah has the oldest stadium, as-well-as the smallest capacity and five year average attendance. Savannah is capable of supporting a new multipurpose stadium that is more centrally located in downtown for minor league baseball and special events.

SOUTH ATLANTIC LEAGUE STADIUM CHARACTERISTICS Johnson Consulting conducted an analysis of the characteristics of local stadiums within the South Atlantic League based on average attendance, year built/renovated, capacity, ticket pricing, luxury suites, and attendance as a percentage of total MSA population. This was done to identify the efficiency of each stadium, while also analyzing how demographics affect attendance rates. Table 5-5 compares Grayson Stadium and Savannah to other South Atlantic League stadiums in several areas, including their ability to draw fans from the MSA population, how the stadium size correlates to actual attendance, and the consistency of attendance over the past five seasons. These factors must be accounted for, as their impact on attendance can be such that a stadium outperforms what would typically be expected in a market of its size.

Section 5: Historical Overview & Peer Review | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Sa vannah, GA PAGE 34

Table 5-5 South Atlantic League Attendance Five-Year Year Avg Per Team Stadium Capacity MSA Population % of Capacity % of MSA Built/Renovated Game Attendance Asheville Tourists McCormick Field 1924/1992 2,374 3,500 435,030 67.8% 0.55% Augusta GreenJackets Lake Olmstead Stadium 1995 2,910 4,822 581,427 60.3% 0.50% Charleston RiverDogs Joseph P. Riles, Jr. Park 1997 3,991 6,000 719,421 66.5% 0.55% Delmarva Shorebirds Arthur W. Perdue Stadium 1996 3,307 5,200 387,040 63.6% 0.85% Greensboro Grasshoppers NewBridge Bank Park 2005 5,598 7,499 744,672 74.6% 0.75% Greenville Drive Fluor Field 2006 4,889 5,700 855,834 85.8% 0.57% Hagerstown Suns Municipal Stadium 1930/1981/1995 1,710 4,600 257,813 37.2% 0.66% Hickory Crawdads L.P. Frans Stadium 1993 2,040 5,062 362,534 40.3% 0.56% Kannapolis Intimidators CMC-Northeast Stadium 1995 2,003 4,700 2,353,784 42.6% 0.09% Lakewood BlueClaws FirstEnergy Park 2001 6,150 6,588 19,993,387 93.4% 0.03% Lexington Legends Whitaker Bank Ballpark 2001 4,634 6,994 494,880 66.3% 0.94% Rome Braves State Mutual Stadium 2003 2,765 5,105 96,348 54.2% 2.87% Savannah Sand Gnats William L. Grayson Stadium 1926/1941/2009 1,949 4,000 369,479 48.7% 0.53% West Virginia Power Appalachian Power Park 2005 2,526 4,500 225,167 56.1% 1.12% South Atlantic League Average 3,346 5,305 1,991,201 61.2% 0.76% Source: Revenues from Sports Venues, Respective Teams, Johnson Consulting

CONCLUSION Savannah presents a unique market for minor league baseball. Although our analysis shows that Savannah is a middle of the road market in terms of size for a Class A team (18 of 30), several factors should be considered in determining the city’s ability to support a new multi-purpose stadium. Projections for percentage growth in MSA population and the number of households for the next five years ranks in the top five for all Class A markets. Savannah represents the youngest median age of any South Atlantic League market and this can prove to be an asset for a City and a team looking to rebrand and capture a larger fan base. A younger demographic is more receptive to affordable entertainment that also offers amenities on par with the expanding wants and needs of the 21st century fan.

Looking at the current stadium characteristics in Savannah compared to other South Atlantic League markets, we see that the Sand Gnats currently play in the 2nd oldest stadium in Class A minor league baseball and currently ranks 26 out of 30 in stadium seating capacity. Grayson Stadium is also one of seven stadiums in Class A that do not offer club or luxury seating. Later in the report, evidence in comparable case studies will show that the availability of specialty and group seating would create additional revenues and increase community engagement. The timing of the Savannah Harbor Deepening Project and a potential stadium built in downtown Savannah could provide the Sand Gnats with the necessary increase in population and corporate presence to justify a larger and more attractive multipurpose stadium capable of hosting a variety of events outside of minor league baseball.

SECTION VI STADIUM CASE STUDIES

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MINOR LEAGUE BALLPARK CASE STUDIES In the following section, Johnson Consulting has analyzed several Class A minor league ballparks. Each of these facilities is different in terms of size, attendance, and lease agreements; however, they are all examples for the City to consider for the proposed stadium build in Savannah. The hope for Savannah, the region, and State is that combining a downtown site with the proven appeal of the Savannah Historical District will create an attractive location for shopping, dining, and baseball for an expanding demographic of visitors. The models here provide insights for Savannah in terms of additional economic development spurred by a new stadium development. The identified national facilities include:

. NewBridge Bank Park – Greensboro, NC

. Fluor Field at the West End – Greenville, SC

. Joseph P. Riley Jr. Park – Charleston, SC

. Parkview Field – Ft. Wayne, IN

Table 6-1 provides background on each of these ballparks:

Table 6-1

Savannah Stadium Project Summary of Comparable Facilities and Markets

NewBridge Bank Grayson Stadium Fluor Field Joesph P. Riley Park Parkview Field Ballpark

Location Savannah, GA Greensboro, NC Greenville, SC Charleston, SC Fort Wayne, IN Market Characteristics (20 mile radius) Population 391,146 725,790 666,601 571,406 426,158 Medain Household Income $47,395 $44,770 $46,614 $51, 786 $50,919 Number of Businesses 15,348 29,178 22,990 22,290 14,836 Total Spending on Sports Admissions $3,192,608 $9,434,451 $5,789,875 $6,069,704 $6,435,594 Facility Characteristics Year Opened 1926/1941 2005 2006 1997 2009 Development Cost $140,000 $21.5 million $23 million $19.8 million $30 million Anchor Tenant Savannah Sand Gnats Greensboro Grasshoppers Greenville Drive Charleson RiverDogs Fort Wayne TinCaps Class A South Atlantic Class A South Atlantic Class A South Atlantic Class A South Atlantic Class A Midwest League League League League League League Fluor Corp.; 10 years through Parkview Healthcare; $3 Naming Rights None Undisclosed None 2018 million for 10 years Luxury Suites - 16 18 8 16 Club Seats - - - - 135 Fixed Seats - 5,000 4,500 - 6,516 Total Capacity 4,000 7,499 5,700 6,000 8,100 Event Demand (2013) League Games 65 66 63 66 70 College 2 15 40 30 2 High School 35 - - - 14 Miscellaneous* 14 36 35 7 366 Total 116 117 138 103 452 * Includes festivals, concerts, charity evets and meetings Source: Demographics Now, Relevant Facilities, Johnson Consulting

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Section 6: Stadium Case Studies | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 36

NEWBRIDGE BANK BALLPARK GREENSBORO, NORTH CAROLINA

MARKET OVERVIEW NewBridge Bank Ballpark was built in 2005 and is the home of the Class A Greensboro Grasshoppers of the South Atlantic Baseball League. Located 75 miles west of Raleigh and 90 miles northeast of Charlotte, Greensboro is home to 279,560 people.

STADIUM OVERVIEW Total capacity is listed at 7,599 seats, including 4,900 fixed seats. The layout also includes 16 upper-deck luxury suites, 2 grass berms in right and left field intended for family seating, and a party deck down the third-base line. The left field concourse features the Grandstand Bar. Lease terms for the luxury suites range from three to seven year contracts at $17,000- $30,000.

COST AND FINANCING Negotiations for public funding ended when members of the Joseph M. Bryan foundation agreed to fund the entire development. The city of Greensboro agreed to provide the land and also agreed to provide $4.5 million in infrastructure. In exchange, the city was given 10 acres of private land to build a new social services building in Greensboro. At a total cost of $21.5 million, The Joseph M. Bryan Foundation used $11.5 million in reserve funds and borrowed $10 million to complete the development.

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Section 6: Stadium Case Studies | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 37

ATTENDANCE After averaging less than 200,000 in annual attendance for ten consecutive seasons, the Grasshoppers surpassed 400,000 in total attendance during their inaugural season at NewBridge Bank Ballpark. This was the 4th highest total annual attendance in Class A baseball that season. The team continues to rank among the top Class A teams in attendance, averaging almost 5,600 people each game during the past five seasons. The organization has also been able to develop an avid local fan base, with nearly 2,000 season ticket holders. Greensboro Baseball LLC has been aggressive in attracting outside baseball events to generate additional revenue and exposure. The Atlantic Coast Conference (ACC) has hosted their conference baseball tournament at NewBridge Bank Park in three of the last five years and the North Carolina State High School Baseball Championships in three of the last ten years. In 2014 alone, the ACC tournament attracted 55,000 people.

LEASE AGREEMENT The intent from the beginning of the project was for the Grasshoppers organization to purchase the ballpark from the Bryan Foundation when they had the capital available and both parties were able to agree on a fair value of the stadium. This plan came to fruition in August 2012 when Greensboro Baseball LLC bought the stadium for $12.8 million. Other key aspects of the lease agreement include the following:

. The Bryan Foundation agreed to a naming rights deal with First Horizon National Bank in 2005 for $3,000,000 over a ten year span.

. In April 2013, Greensboro Baseball LLC and NewBridge Bank extended their agreement for an additional four years through 2021.

. The team is responsible for basic stadium operating costs, maintenance, insurance payments and utilities.

. Greensboro Baseball LLC owns the rights to all advertising and sponsorship agreements.

OBSERVATIONS According to Jim Melvin, former Greensboro mayor and current President of the Bryan foundation, Greensboro was looking for a “win” in the community by building a new facility in Greensboro’s downtown area. Although development in the immediate vicinity of the park has been sluggish at times, recently finished and ongoing development projects demonstrate sustained economic growth:

. Greenway at Fisher Park is a 2-phase 196 luxury apartment development on Smith Street near the stadium. Construction on the second phase began on April 26, 2014 and features apartments with sight lines of the stadium, including a rooftop pool and bar. Bellemeade Development estimates a value of $20 million for the apartment development when completed.

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Section 6: Stadium Case Studies | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 38

. Plans for a 40,000-square-foot mixed-use building at the intersection of Battleground Avenue and Smith Street by developers Philip Cook, Jim Molinaro and Oliver Lloyd.

. Roy Carroll, a developer, announced plans for a $47 million mixed-use development on Eugene Street.

. The Steven Tanger Center for the Performing Arts is a $65 million project set to open in 2016 on North Elm and East Lindsay Street.

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Section 6: Stadium Case Studies | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 39

FLUOR FIELD AT THE WEST END GREENVILLE, SOUTH CAROLINA

MARKET OVERVIEW Fluor Field at the West End is home to the Greenville Drive and is located in downtown Greenville. With a population of 61,674 residents, Greenville is located at the foothills of the Blue Ridge Mountains in what is considered upstate South Carolina.

Over 250 international firms call Greenville home. Major businesses within the city includes: Perrigo Company of South Carolina, Greenville Hospital System, Fluor, Hubbell Lighting, Resurgent Capital Services, Bank of America, TD Bank, BB&T and Windstream.

STADIUM OVERVIEW Total capacity is 5,700, including 4,400 fixed seats, with room for up to 2,000 additional fans in two berms along the left and right field lines. The stadium also features 18 luxury suites. Modeled after Fenway Park, the Red Sox affiliate decided to feature their own 30 ft. wall in left field and build similar dimensions in center and right field. Of the 18 luxury suites, three are rented on a nightly basis, while the other 15 are leased on three, five and seven year terms at an annual rate ranging $20,000-$27,000. Fluor Field also offers a field level dugout that is available for up to 20 fans and includes catering options for $750 per game.

COST AND FINANCING Greenville Drive, LLC funded the $20.7 million stadium cost. In return, the city council approved $8.5 million to purchase the land from the Greenville School District and to fund improvements to the infrastructure in the area.

After being named the 2006 “Ballpark of the Year” by Ballparks.com and breaking the attendance record for minor league baseball in Greenville, the organization made $1.5 million in enhancements prior to the 2007 season. Taking advantage of Greenville’s corporate presence, the team added a playground sponsored by BI-LO, the Mountain Dew Dugout, Upper Deck area, Heritage Plaza and the 300 Picnic Plateau.

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Section 6: Stadium Case Studies | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 40

ATTENDANCE Attendance has been strong since the team moved to Fluor Field at the West End. In the Drive’s 2006 inaugural season at Fluor Field, the team raised its annual attendance by 215,000. Only the Lakewood Blueclaws and Greensboro Grasshoppers have averaged a higher attendance in the South Atlantic League over that time period. At a capacity of 5,700, Fluor Field continues to draw large crowds averaging 83.6 percent capacity during the 2013 season, the second highest average seating capacity in the South Atlantic League. Over the past five seasons the team has averaged 4,889 fans per game. In addition to the 70 scheduled home games for the Drive, Fluor Field hosts nearly 40 college baseball games each year. Fluor Field recently agreed to become the neutral site for the three game series between the University of South Carolina and Clemson University. A stadium record of 7,182 people attended in 2014 and both schools agreed to extend the three game series at Fluor Field through 2018.

OBSERVATIONS Flour field at the West End is owned by Greenville Drive LLC. The city of Greenville does not receive any income in rent from the team but the city has benefited from a 31 percent increase in property value in the West End since the field opened in 2006.

Since the opening of Fluor Field, the City has attributed 110 new businesses and 242 permits within a half mile of the stadium. The stadium site lies on a formerly contaminated construction site in the city’s West End. The construction of Fluor Field became part of the West Side Comprehensive Plan, an initiative to coordinate housing, public transportation, and area development. Other developments in the area include River Place, a $65 million mixed-use development consisting of a hotel, 73 apartments, retail and office space, and restaurants.

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Section 6: Stadium Case Studies | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 41

JOSEPH P. RILEY JR. FIELD CHARLESTON, SOUTH CAROLINA

MARKET OVERVIEW Located on South Carolina’s coastline, Charleston has become one of the premier travel destinations in the country. Similar to Savannah, tourism continues to be a major economic driver. In addition to the tourism industry, the city of Charleston continues to rely on the Port of Charleston, the military, and the medical sector as its four economic drivers. The Port of Charleston represents the 10th largest container port in the United States.

STADIUM OVERVIEW Joseph P. Riley Jr. Park is located on 5.5 acres along the Ashley River in the Northwest corner of Charleston, with the stadium itself measuring 174,000 square feet. “The Joe” opened at the beginning of the 1997 baseball season, and was funded by the City of Charleston for $19.5 million and is home to both the Class A Charleston RiverDogs and The Citadel baseball team. Prior to their move to The Joe, The RiverDogs played their home games at College Park, a stadium built in 1939 and more centrally located in Charleston on the campus of The Citadel. The RiverDogs saw their average annual attendance increase from 129,100 during their final two seasons at College Park to 232,000 in the first two seasons at Riley Park. The RiverDogs are the Class A affiliate of the New York Yankees competing in the South Atlantic League, while The Citadel competes in the Division 1 Southern Conference. Stadium capacity is listed at 6,000. The park includes eight luxury suites, three themed patios, and a general admission grass berm in right field. Of the eight suites, six are rented on a three year basis for $25,000 per year. The other two suites are rented on a nightly basis for $1,200.

COST AND FINANCING A unique agreement was formed to finance the $19.5 million park. The 5.5 acres that the ballpark sits on was initially owned by The Citadel. In 1996, the city of Charleston purchased the proposed site from The Citadel for $1. In return, the College will be allowed occupancy for the entirety of the stadium’s existence. The city of Charleston is responsible for maintaining the stadium through an extension of the Parks Department.

ATTENDANCE The Charleston RiverDogs averaged 4,292 people over 66 home games during the 2013 season. The five year average of RiverDogs home games is 3,991. Riley Park also hosts 30 home games for The Citadel Bulldogs, averaging between 300 and 500 people each game.

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Section 6: Stadium Case Studies | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 42

Outside of baseball, Riley Park attracts an extensive event mix each year. In 2014, the stadium hosts between 30 and 40 scheduled events, including a Florida-Georgia Line concert that attracted 13,000 people in June 2014.

OBSERVATIONS Charleston represents a comparable market to Savannah in several ways. Although Charleston has a larger population within a 20-mile radius, the cities of Savannah and Charleston are comparable in population size. Both cities are located along the Atlantic coast and represent the 4th and 10th largest container ports in the U.S. Charleston and Savannah have vibrant histories and the tourism industry plays a major role in each of their economies. Charleston has struck the perfect balance of creating a fan base through community engagement as-well as creating a brand that attracts visitors.

Savannah has the potential to make a similar impact in their community and create a national brand for itself. As Savannah contemplates a proposal for a stadium, Riley Park serves as a successful template for strong attendance and community engagement.

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Section 6: Stadium Case Studies | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 43

PARKVIEW FIELD FT. WAYNE, INDIANA

OVERVIEW The stadium opened in April of 2009 and is home to the Ft. Wayne TinCaps of the Midwest League. The TinCaps are the Single-A affiliate of the San Diego Padres and are owned by Hardball Capital, Inc. – the same ownership group that owns and operates the Savannah Sand Gnats. A naming rights deal was entered into with Parkview Healthcare for approximately $3 million. The stadium is considered to be one of the best minor league ballparks in the country, offering numerous seating options and some of the best service in professional sports. The publically-owned stadium sits on land open to the public and the surrounding property offers retail and residential space, along with a public park and amphitheater for local residents to utilize year-round.

The stadium has a total capacity of approximately 8,100 seats, including approximately 6,500 fixed seats. The wide variety of seating options that accommodate individual-ticket holders, small groups and large party groups is what makes this stadium unique. Numerous club seating options are available on every side of the field. In addition to reserved seat-backs, the top three rows behind home plate, called the Legacy Seats, offer padded seats with additional legroom and drink/food service. Along the left field line, there are high top tables offering food/drink service that seat four. Berm seating is available on a first come, first served basis and include cement rows mixed with grass that offer a bleacher seating-effect. A select number of beach chairs are also available at the top row of the berm.

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Additional group seating and picnic/grill options is available in the Treetops Rooftop Party Area, which offers an all-inclusive ticket (food and non-alcoholic beverages). The area features an indoor viewing area, as well as a large outdoor patio and rooftop bleacher seating to replicate rooftop bleachers at Wrigley Field. The upper deck of the stadium is lined with 16 luxury suites, 15 of which are leased out on long-term deals and one that is rented on a nightly basis.

The stadium also offers several meeting space options, including:

 SUITE LEVEL LOUNGE – Over 5,000 square feet of multi-purpose space room offers an upscale bar capable of hosting up to 200 guests for corporate and non-profit events, receptions and private parties.

 LINCOLN FINANCIAL EVENT CENTER – Located on the concourse level of the stadium, the year- round meeting space offers over 5,000 square feet of space that can be sub-divided for a multitude of functions. It is connected to a parking garage and can be used in conjunction with the Centerfield Amphitheater at Parkview Field.

 400 CLUB – Located in the batter’s eye in centerfield, the 400 Club was added to the Parkview Field in 2013. It offers dining options for patrons during the game, along with seven flat-screen TVs and an outdoor patio connected to the structure.

COST AND FINANCING Built in 2009 at a total cost of approximately $30 million, the stadium was a public-private partnership between the city of Ft. Wayne and Hardball Capital, Inc. – the owners of the TinCaps. The TinCaps have made significant capital improvements to the stadium, including privately funding the 400 Club. At a cost of nearly $1 million, the stadium club opened in 2013 and increased the team contribution to over $3 million in stadium additions since opening in 2009.

ATTENDANCE The TinCaps routinely draw large crowds, attracting over 400,000 in total attendance each year since the stadium opened. Special events at the stadium also draw an additional 150,000 the past three seasons. As part of the lease agreement, the stadium is open 365 days per year offering outdoor park space, 1/3 mile walking/running space, an amphitheater, and a picnic area for citizens and local employees. The stadium hosts several hundred special events each year, attracting over 100,000 people in addition to the TinCaps attendance. In 2013, 400 special events attracted over 150,000 people for charity events, run/walks, meetings, private functions and a Florida-Georgia Line concert.

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Section 6: Stadium Case Studies | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 45

OBSERVATIONS Parkview Field was a project that accomplished its goal of building a first-class stadium that provides a public resource for the local community. As a public-private venture, the stadium offers several multi-purpose meeting spaces and public access throughout the year. In the short term, the stadium has been an absolute success and local businesses and residents are supporting the team through group sales and the purchase of season tickets and luxury suites. The stadium has proven itself as a successful special event venue as well. Combining the baseball operations with special events – hosting outdoor concert, charity events, social and networking functions, etc. – has made Parkview Field a model stadium throughout the sports world.

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SECTION VII SURVEY RESULTS & DEMAND PROJECTIONS

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NEW MULTIPURPOSE STADIUM SURVEY RESULTS In order to assess the level of interest among Savannah residents and the regional marketplace for a potential new multipurpose stadium in downtown Savannah, Johnson Consulting conducted a Web-based survey of a sample of Savannah residents. Our survey instrument was developed utilizing a web-based program and was made available electronically via the City of Savannah’s website; a link was also posted through the Savannah Sand Gnats’ website. The survey taken by each individual was identical and the survey remained ‘active’ for a period of two weeks. The survey was open to all Savannah residents and anyone that visited their website making it difficult to determine the actual response rate. However, with nearly 3,000 responses our sample size is considered to be statistically sound.

SURVEY RESULTS The multipurpose stadium survey consisted of questions that concerned current involvement in Sand Gnats games, potential interest in minor league baseball, interest in new amenities, interest in special events and overall interest in the funding options for a new multipurpose stadium. The following summary of those responses indicates a high level of interest in the market for the proposed multipurpose stadium in downtown Savannah. Below are some of the findings based on those responses:

Figure 7-1

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. According to Figure 7-1, of the nearly 3,000 responses, 52 percent of the respondents identified himself/herself as a fan of the Sand Gnats, while 27 percent do not have a relationship with the team but are citizens of Savannah.

. Of the 5 percent of respondents who selected, “Other – please specify,” most indicated that they are not baseball fans.

. Less than 1 percent of respondents were identified as a corporate sponsor.

Figure 7-2

. In Figure 7-2, we asked the respondents to identify factors that prevent them from attending games or special events at Grayson Stadium. Of the 28 percent who selected, “Other, please specify,” the responses included “Crime, Lack of interest and fan behavior.”

. Figure 7-2 also indicates the three determining factors, aside from “Other,” with the largest response rate for not attending all games: Family Obligations/Time Conflict (14%), Lack of Quality Fan Amenities at Stadium (10%) and Location of Stadium (9%).

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As shown in Figure 7-3, approximately 54 percent of respondents would rate the current amenities at Grayson Stadium, “Good” or “Excellent.” The remaining 46 percent of respondents would rate the amenities as “Fair” or “Poor.”

Figure 7-3

Figure 7-4 asked respondents to list any special events they have attended at Grayson Stadium. The largest response, or 45 percent, was for “Charity Events,” followed by Concert (37 percent), High School Baseball Game (33 percent), Festival (26 percent), and College Baseball Game (17 percent). This question did not include Sand Gnats games in order to determine the number of special events attended at the stadium.

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Figure 7-4

Figure 7-5

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In Table 7-5 we set out to identify the likelihood of event holders hosting events at a new multipurpose stadium in Downtown Savannah. This allowed us to determine the number of new special events that the stadium could add to its events calendar. Fifty-five percent of respondents indicated that they would host an event, with an additional 24 percent being unsure. Twenty-one percent indicated that construction of a downtown stadium would not increase their likelihood to host an event.

Figure 7-6 below provides the text analysis of responses to the following question: “Please list any specific amenities that you feel a new multi-purpose stadium in Savannah should offer.” The size of the word found in the figure below correlates with the number of responses that contained such text within the responses.

Figure 7-6

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Figure 7-7

According to Figure 7-7 above, the respondents have shown mostly positive feelings towards the development of a multi-purpose stadium in Downtown Savannah, with 54 percent of respondents selecting “Very Positive” or “Somewhat Positive.” An additional 8 percent of respondents are neutral on the matter, while 38 percent view the potential new stadium in a negative light.

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Figure 7-8

Figure 7-9

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Figure 7-10

Figures 7-8, 7-9, and 7-10 all depict the level of potential support amongst Savannah residents towards the construction costs of a new stadium. Each graph indicates that there is considerable support amongst Savannah residents towards using tax dollars and even a bond issue to pay for a portion of the stadium. Figure 7-10 indicates that 73 percent of respondents believe the City should contribute at least 50 percent of the total cost. Respondents were informed that a typical new construction project for a multi-purpose/Single- A baseball stadium costs between $30-40 million prior to answering the question represented in Figure 7-10.

SURVEY SUMMARY The survey results show a significant amount of support for a new multipurpose stadium in downtown Savannah. There is noted opposition towards this project. However, the City should note that its residents wish to have both minor league baseball and a new multipurpose stadium that can host special events. Furthermore, the residents wish to have a stadium that offers with upgraded amenities and sits in a better location. The residents show support for a contribution from the City, either through the use of tax dollars or a bond issue. While typical public-private stadium projects in the past 20 years have seen a 65/35 percent city/private contribution, the results of the survey suggest that a majority of Savannah residents would support at least a 50/50 percent public-private deal for this project.

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RECOMMENDED STADIUM PROGRAM Given our examination of the Savannah market and review of Grayson Stadium, Johnson Consulting recommends building a new multi-purpose stadium in Downtown Savannah. To best substantiate our initial program and demand assumptions, Johnson Consulting compared a number of factors in Savannah to those of existing South Atlantic League Stadiums. Subsequently, we analyzed historical trends in attendance over the past five years, the average percent of capacity at each stadium in the league, and the percentage growth in attendance in the first two years of a new stadium.

The following illustration in Figure 7-11 describes the process and methodology that Johnson Consulting rendered to arrive at our recommended multi-purpose stadium program.

Figure 7-11

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RECOMMENDED PROGRAM Based upon the various data points as described throughout this section, Johnson Consulting recommends a capacity of 5,500 seats, including fixed seats and berm seating, at a new multipurpose stadium in downtown Savannah. A stadium of that size will accommodate approximately 6,500 - 7,000 for an outdoor concert, and can adequately serve a number of other multipurpose functions. Other recommendations include:

. Field Turf. . 12-16 luxury suites.

. 2-3 Premium Clubs offering all-inclusive ticket deals ranging in price . 360 degree, walkable concourse to allow unobstructed sightlines of the field. . Multiple group seating locations along the baselines to capitalize on the growing trend in minor league baseball. Although Grayson Stadium no longer remains a suitable venue for professional baseball, Johnson Consulting is of the opinion that Grayson Stadium should be repurposed in order to remain a part of the many historic facilities found throughout Savannah. The Stadium’s configuration and location in Daffin Park lends itself to becoming a highly utilized amateur venue for high school and youth sporting events. The adjacent land in Daffin Park can be transitioned and modified into baseball and softball fields with Grayson Stadium serving as the championship site, giving the City the ability to lure more regional and even national tournament events.

Additionally, the Sand Gnats could designate a weekend series, or perhaps a 4th of July weekend “Throwback Game” that could be played at Grayson Stadium. The team could wear throwback uniforms and give the fans an opportunity for a nostalgic game.

COMPARATIVE FACILITY AVERAGE CAPACITY ANALYSIS In order to set a base case for expected attendance we analyzed the average percent of capacity at each South Atlantic Stadium for the past five seasons in Table 7-1. The average throughout the league is 61percent, which would equate to approximately 3,355 fans per game for the Sand Gnats given a multi-purpose stadium with an expected capacity of 5,500.

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Table 7-1

South Atlantic League Attendance

Five-Year % of Team Stadium Capacity Average Capacity Attendance

Lakewood BlueClaws FirstEnergy Park 6,588 6,150 93.4% Greenville Drive Fluor Field 5,700 4,889 85.8% Greensboro Grasshoppers NewBridge Bank Park 7,499 5,598 74.6% Asheville Tourists McCormick Field 3,500 2,374 67.8% Charleston RiverDogs Joseph P. Riles, Jr. Park 6,000 3,991 66.5% Lexington Legends Whitaker Bank Ballpark 6,994 4,634 66.3% Delmarva Shorebirds Arthur W. Perdue Stadium 5,200 3,307 63.6% Augusta GreenJackets Lake Olmstead Stadium 4,822 2,910 60.3% West Virginia Power Appalachian Power Park 4,500 2,526 56.1% Rome Braves State Mutual Stadium 5,105 2,765 54.2% Savannah Sand Gnats William L. Grayson Stadium 4,000 1,949 48.7% Kannapolis Intimidators CMC-Northeast Stadium 4,700 2,003 42.6% Hickory Crawdads L.P. Frans Stadium 5,062 2,040 40.3% Hagerstown Suns Municipal Stadium 4,600 1,710 37.2% South Atlantic League Average 5,305 3,346 61% Source: Revenues from Sports Venues, Respective Teams, Johnson Consulting

HISTORICAL ATTENDANCE ANALYSIS The Sand Gnats have been experiencing a healthy and steady growth rate in terms of attendance at Grayson Stadium over the past five years, averaging 3.17 percent per annum. We utilized this metric in order to set our worst case scenario for expected future attendance. In other words, at minimum, attendance at Sand Gnats games should continue to increase at this rate, not taking into account a new stadium with better amenities and a more appealing location. Utilizing the 3.17 percent per annum growth would give the Sand Gnats an expected average per game attendance of approximately 2,011.

Table 7-2 Savannah Sand Gnats Total Attendance Likely Total Total Home Average Attendance Attendance over 70 Year Total Attendance Games per Game Rainouts Games 2010 120,426 66 1,825 4 127,725 2011 135,415 69 1,963 1 137,378 2012 117,372 63 1,863 7 130,413 2013 131,763 65 2,027 5 141,899 2014 124,013 60 2,067 10 144,682 Average 125,798 65 1,949 5 136,419 Source: Savannah Sand Gnats, Minor League Baseball, Johnson Consulting

The total attendance numbers have also improved since Hardball Capital, Inc. took over ownership of the team. While looking only at the numbers would show a fluctuation in total attendance, when you factor in

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rainouts it becomes clear that the team has seen steady growth in total attendance. Due to outdated and poor drainage systems at Grayson Stadium, the Sand Gnats are more susceptible to rainouts than a newly constructed stadium.

For instance, in 2014 the Sand Gnats attracted a total of 124,013 fans for the season, despite experiencing ten rainouts. Compared to the 2011 season, when the Sand Gnats attracted 135,415 fans with only one rainout, if the Sand Gnats had an extra nine games in 2014 the total attendance would arguably have been a single season record of approximately 144,682 fans.

TOURISM IMPACT As discussed in Section 3, Savannah benefits from a very strong tourism base of over 12 million visitors per year. This provides a secondary pool of fans that only one other team in the South Atlantic League – the Charleston RiverDogs – has the luxury of drawing upon. Unfortunately, as we showed in our site analysis in Section 4, Grayson Stadium’s location makes it extremely difficult to attract tourists. It sits too far from the large cluster of hotels and too far outside the Historic District to attract day-trippers and overnight visitors.

If the City of Savannah were to place a new multi-purpose stadium in Downtown Savannah, a more appealing location could attract Savannah’s tourists. According to Visit Savannah, approximately 7 million people stayed overnight in Savannah, while approximately 5 million were day-trippers. This equates to approximately 19,444 additional people to sell tickets to per game assuming 70 nights of expected home games. If Savannah were able to increase their marketing efforts and relationships with downtown hotels the team would begin to penetrate the tourism market. By attracting just five percent of overnight tourists, the team would gain an additional 972 fans per game. This additional pool of attendees will help boost the average attendance number above our worst case attendance projection.

NEW STADIUM ATTENDANCE IMPACT In order to determine our best case scenario for expected future attendance we analyzed the increase in attendance experienced at other new minor league stadiums. As shown in Table 7-3, on average, teams experienced a 100 percent increase in the first two years of a new stadium compared to the two final seasons in their old stadium. This would suggest the Sand Gnats would attract approximately 3,898 fans per game in a new stadium, given their five-year per game average attendance of 1,949 fans. If all 70 games are played in a season, this would equate to a total season attendance of 272,860 fans. Unfortunately, given Grayson Stadium’s poor drainage capabilities, these numbers will most likely never be achieved without a new multipurpose stadium that is better equipped to handle rain.

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Table 7-3 Impact of New Stadium on Attendance

Average Total Average Year Team Stadium Attendance 2 Attendance Year Percent Increase Opened Years Prior 1 & 2 Greensboro Grasshoppers NewBridge Bank Stadium 2005 180,813 417,801 131% Greenville Drive Fluor Field at the West End 2006 107,980 331,989 207% West Virginia Power Power Park 2005 110,785 236,432 113% Fort Wayne TinCaps Parkview Field 2009 239,721 391,736 63% Columbus Clippers Huntington Park 2009 522,522 650,969 25% WinstonSalem Dash BB&T Park 2010 150,095 312,365 108% Harrisburg Senators* Metro Bank Park II 2010 188,524 330,504 75% Birmingham Barons Regions Field 2013 232,946 420,509 81% Average 100% *$45 million renovation Source: South Atlantic League, The Baseball Cube, Johnson Consulting

Figure 7-12 below provides the results for the recommended capacity at a new multipurpose stadium in downtown Savannah.

Figure 7-12

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DEMAND PROJECTIONS Johnson Consulting projected the demand of a new multipurpose stadium in Savannah for its first ten years of operation. These demand projections were based on comparable facilities’ operations, characteristics of the local market area, and various assumptions that are described in this text, including conversations with other South Atlantic team representatives. For the purpose of this analysis the “base case” demand projections were used to project demand for Year 1 of operations for the Sand Gnats and other full-time stadium uses.

Table 7-4 summarizes the projected events and attendance for the stadium in its first three years of operations using three different scenarios (Worst, Base and Best Case).

Table 7-4 Savannah Multi-Purpose Stadium Summary of Events and Attendance

Worst Case Base Case Best Case Total Total Total Event Category Events Attendance Events Attendance Events Attendance

Sand Gnats 70 189,000 70 220,500 70 252,000 College Baseball 10 1,350 15 2,025 20 2,700 High School Baseball 15 1,350 15 1,350 20 1,800

Year Year 1 Concerts 3 9,450 5 18,000 10 40,500 Miscellaneous 15 13,500 20 18,000 25 22,500 Total 113 214,650 125 259,875 145 319,500

Sand Gnats 70 182,700 70 214,200 70 245,700 College Baseball 10 1,350 15 2,025 20 2,700 High School Baseball 15 1,350 15 1,350 20 1,800

Year Year 2 Concerts 4 12,600 6 21,600 11 44,550 Miscellaneous 16 14,400 21 18,900 26 23,400 Total 115 212,400 127 258,075 147 318,150

Sand Gnats 70 176,400 70 207,900 70 239,400 College Baseball 10 1,350 15 2,025 20 2,700 High School Baseball 15 1,350 15 1,350 20 1,800

Year Year 3 Concerts 5 15,750 7 25,200 12 48,600 Miscellaneous 17 15,300 22 19,800 27 24,300 Total 117 210,150 129 256,275 149 316,800

Source: Johnson Consulting

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As shown in the Table above, Johnson Consulting believes that there will be a slight ramp up in terms of number events for each “Case” in the first three years of operation at the new stadium, with the exception of South Atlantic League games that are set according to the league schedule. As with any new stadium, there will be a “novelty effect,” that will produce higher numbers early on in the lifespan of the stadium. Once that novelty wears off, the attendance and demand numbers will level off.

Table 7-5 Savannah Multi-Purpose Stadium

Projected Schedule of Events by Category and Year Category Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Sand Gnats 70 70 70 70 70 70 70 70 70 70 College Baseball 15 15 15 15 15 15 15 15 15 15 High School Baseball 15 15 15 15 15 15 15 15 15 15 Concerts 5 6 7 7 7 7 7 7 7 7 Miscellaneous 20 21 22 22 22 22 22 22 22 22 Total 125 127 129 129 129 129 129 129 129 129

Source: Johnson Consulting

Table 7-5 shows that the stadium’s anchor tenant, the Savannah Sand Gnats, will play its entire home schedule which consists of approximately 70 regular-season games at the facility (the total number of games played often fluctuates due to playoff games, rainouts and/or other weather-related events). Other baseball events include all non-South Atlantic League baseball games, such as high school and collegiate games/tournaments and championship games, clinics, and baseball camps. If the stadium design were to include synthetic turf, it would be able to host a wide variety of potential special events, including concerts, charity run/walks, festivals and other community outdoor events. Additionally, any enclosed luxury suites can serve as meeting space for local corporations or community groups.

In the stadium’s first full year of operations, the facility is projected to host a total of 125 events. These events include 70 regular-season home baseball games, 15 college baseball events (includes tournaments), 15 high school baseball events (includes camps/clinics and tournaments), 5 concerts and 20 “miscellaneous” events that include any other events that take place at the stadium. To remain conservative, Johnson Consulting has projected a ramp up period for concerts and miscellaneous events that will level off in year three. Each event category, and its projected demand over time, is explained in more detail in the following paragraphs.

Table 7-6 summarizes the projected turnstile attendance at the stadium by type of event, from Year 1 through Year 10.

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Table 7-6 Savannah Multi-Purpose Stadium

Projected Event Attendance by Category and Year Category Year 1 Year 2 Year 3 Year 4 Year 5 Year 6 Year 7 Year 8 Year 9 Year 10 Sand Gnats 220,500 214,200 207,900 207,900 207,900 207,900 207,900 207,900 207,900 207,900 College Baseball 2,025 2,025 2,025 2,025 2,025 2,025 2,025 2,025 2,025 2,025 High School Baseball 1,350 1,350 1,350 1,350 1,350 1,350 1,350 1,350 1,350 1,350 Concerts 18,000 21,600 25,200 25,200 25,200 25,200 25,200 25,200 25,200 25,200 Miscellaneous 18,000 18,900 19,800 19,800 19,800 19,800 19,800 19,800 19,800 19,800 Total 259,875 258,075 256,275 256,275 256,275 256,275 256,275 256,275 256,275 256,275

Source: Johnson Consulting

Total turnstile attendance at stadium events in Year 1 is projected to be approximately 259,875. Due to the “novelty effect” wearing off, attendance will dip to approximately 258,075 in Year 2, before rebounding and levelling off to approximately 256,275 for the next eight years. Turnstile attendance is a percentage of paid attendance (as high as 90 percent, depending on the type of event) and many of the projections, such as the economic impacts, are based on turnstile attendance. The largest share of attendance is projected for Sand Gnats baseball games, with 220,500 projected attendees in Year 1. Each type of event is described in more detail below.

. Sand Gnats Baseball Games assume that the tenant plays its entire home schedule in the facility. A South Atlantic League team’s schedule consists of 70 home regular-season games. In addition, the team’s playoff participation would extend its season and add more home dates, but these games are not included in the projections, as they are not certain to occur in any year.

. To remain conservative in our approach, Johnson Consulting has assumed attendance will remain relatively consistent over a ten year period. Beginning in Year 1, average turnstile attendance at regular Sand Gnats baseball games is projected to be approximately 3,000. Attendance projections are based largely on the recent historical average for the Sand Gnats which is shown in Table 7-2. We arrived at our attendance projection by taking five-year average attendance at Sand Gnats games (2010-2014) which equals 1,949. We then applied that five-year per game average to several metrics. First, we applied the five-year attendance to the average capacity percentage seen across the South Atlantic League, which equaled 60percent. When applying this percentage to the proposed capacity at the stadium in Savannah, we get an expected average attendance of 3,355 fans.

. A second expectation for per game attendance at Sand Gnats games was reached by taking the five- year compounded annual growth seen at Grayson Stadium (3.17 percent) and applying it to the five- year per game average of 1,949 for a new expected average of 2,011. This would be the lowest per game attendance we would expect to see, but given the new stadium impact and a better located stadium the Sand Gnats should be able to outperform this number.

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. Lastly, we looked at several new stadiums across minor league baseball to calculate the percentage increase in attendance when opening a new stadium. We calculated the total attendance average for two years prior to moving into the new stadium and compared it to the first two years after moving into the new stadium to account for the drop-off in novelty effect at the stadium. This showed a 100% increase, on average, across several new stadium openings which would equate to approximately 3,898 fans per game at a new stadium in Savannah.

. To further justify the expected increase in attendance at Sand Gnats game we examined the tourism industry in Savanna. Since the City attracts so many tourists each year (approximately 12 million), we factored in a percentage of tourists who would attend Sand Gnats games. In conversations with current Sand Gnats ownership, we came to realize that due to the location of Grayson Stadium, few tourists, if any, attend Sand Gnats games. However, with a downtown stadium located closer to the cluster of hotels frequented by overnight tourists, we anticipate the Sand Gnats could attract more overnight tourists to games. Conservatively, we approximate 5 percent of overnight tourists could attend a Sand Gnats game, effectively increasing the attendance by about 972 fans per game.

. Other Baseball Events are local and regional high school games and tournaments along with potential college baseball teams as sub-tenants, or part-time users of the stadium. This category of events also includes baseball camps and clinics.

. A total of 30 such events are projected in Year 1, with a total attendance of approximately 3,375. Not all of these events, such as a baseball camps, are expected to generate significant ticket sales and other related revenues. The number of other baseball events is projected to remain consistent at 30 through Year 10; however, the potential to add one or more college baseball team as sub-tenant would increase this number.

. Concerts and Miscellaneous Events are planned at the stadium as it will include synthetic turf and meeting space within the premium suites to allow for a large number of miscellaneous events. The initial projection estimates 5 concerts and 20 miscellaneous events in Year 1. The projected attendance for concerts will be approximately 18,000 in Years 1 and 21,600 in Year 2 for 6 concerts, before increasing to 25,200 for 7 concerts for the remaining years as we expect an additional concert to be added. As for Miscellaneous events, Year 1 projected attendance is 18,000, with Year 2 projected attendance at 18,900, with attendance leveling off for Year 3-10 at 19,800. Miscellaneous Event demand is projected to hold steady at 22 through Year 10. This category of events also includes community events, including corporate meetings and banquets, fun runs/walks, charity softball events and festivals.

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DEMAND SUMMARY The city of Savannah should expect that a stadium located in downtown Savannah would attract more residents and tourists to events at the stadium. The Sand Gnats have shown steady growth in attendance at their games, and could certainly see a boost in total attendance with a better location. Additionally, a new stadium could support numerous special events that Grayson Stadium cannot currently support. The additional events, along with a continued increase in attendance at Sand Gnats games, will bring thousands of additional people to events at the stadium and allow for further development down the road to provide entertainment options for before- and after-events at the new stadium.

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SECTION VIII ECONOMIC AND FISCAL IMPACTS ANALYSIS

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ECONOMIC AND FISCAL IMPACTS ANALYSIS This report section analyzes the total economic and fiscal benefits that would be generated by a proposed new multipurpose stadium located in downtown Savannah, GA. There are all kinds of economic, social, development and image benefits that could result from this project. This analysis quantifies the effect of the spending of visitors to this project, as well as the new business operation of the team and facilities.

The bases for the estimates are the recommendations and demand projections of the “Base Case Yr. 3” as described in earlier sections of this report. Additionally, Johnson Consulting’s prior development of economic analyses for other stadiums, sports complexes, arenas, and event centers, and specific knowledge of the Savannah marketplace and State of Georgia contributed to the analysis.

METHODOLOGY AND DEFINITIONS

Johnson Consulting entered direct spending into the nationally recognized input-output model “Impact analysis for planning” (IMPLAN) to estimate economic impacts. The model produces estimates of:

 Economic spending, which is defined as the total value of industry production that results from an activity. It includes both gross domestic product and spending to produce intermediate goods.

 Employee compensation, which is defined as the total payroll cost paid by an employer, including wages, all benefits, and employer-paid payroll taxes.

 Jobs, which are defined differently for one-time construction and ongoing activities. One-time construction jobs represent the amount of work completed by one person in one year. Ongoing jobs represent full-time equivalent employees on an annual basis.

Economic impact is defined as incremental new spending in an economy that is the direct result of certain activities, facilities, or events. For the purpose of this analysis, impact totals are discussed in terms of the Savannah economy. Impact levels are described as follows:

. Direct Spending – is an expression of the spending that occurs as a direct result of the games and events that occur in the stadium. For example, baseball game attendees’ expenditures on hotel rooms, shopping, and meals are direct spending.

. Indirect Spending –re-spending the initial or direct expenditures or the supply of goods and services resulting from the initial direct spending in the stadium. For example, a baseball game patron’s direct expenditure on a restaurant meal causes the restaurant to purchase food and other items from suppliers. The portion of these restaurant purchases that is within the local, regional, or state economies is counted as an indirect spending.

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. Induced Spending – represents changes in local consumption due to employees’ personal spending whose incomes are affected by direct and indirect spending. For example, a waiter at the restaurant may have more personal income as a result of the ball game attendee’s visit. The amount of the increased income the waiter spends in the local economy is called induced spending.

. Increased Earnings – measures increased employee and worker compensation related to the project being analyzed. This figure represents increased payroll expenditures, including benefits paid to workers locally. It also expresses how the employees of local businesses share the increased outputs.

. Employment – measures the number of jobs supported in the study area related to the spending generated as a result of the game and events occurring in the stadium. Employment impact is stated in the number of full-time equivalent jobs.

Furthermore, the City of Savannah attracts visitors from all corners of the country and even attracts international visitors, bringing their dollars with them. It is envisioned the proposed multipurpose stadium development will help lure and capture those dollars.

ECONOMIC IMPACT OF THE MULTIPURPOSE STADIUM Economic and fiscal impact analysis for the baseball stadium is based on demand and attendance levels as projected in Section 7 of this report. The demand and attendance levels at Grayson Stadium are reflected in Table 8-1 below, showing the best case, base case and worst case for events and total attendance at a new multipurpose stadium. On ticketed events, attendees refer to those going to see the baseball game, concerts or festivals, but not yet including the players (coaches, trainers, and other staff), members of the production teams, media, and others.

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Table 8-1 Savannah Multi-Purpose Stadium Summary of Events and Attendance

Worst Case Base Case Best Case Total Total Total Event Category Events Attendance Events Attendance Events Attendance

Sand Gnats 70 189,000 70 220,500 70 252,000 College Baseball 10 1,350 15 2,025 20 2,700 High School Baseball 10 900 15 1,350 20 1,800

Year Year 1 Concerts 3 9,450 5 18,000 10 40,500 Miscellaneous 10 9,000 15 13,500 20 18,000 Total 103 209,700 120 255,375 140 315,000

Sand Gnats 70 182,700 70 214,200 70 245,700 College Baseball 12 1,620 17 2,295 22 2,970 High School Baseball 12 1,080 17 1,530 22 1,980

Year Year 2 Concerts 4 13,500 6 22,950 11 47,025 Miscellaneous 12 10,800 17 15,300 22 19,800 Total 110 209,700 127 256,275 147 317,475

Sand Gnats 70 176,400 70 207,900 70 239,400 College Baseball 14 1,890 19 2,565 24 3,240 High School Baseball 14 1,260 19 1,710 24 2,160

Year Year 3 Concerts 5 18,000 7 28,350 12 54,000 Miscellaneous 15 13,500 20 18,000 25 22,500 Total 118 211,050 135 258,525 155 321,300

Source: Johnson Consulting

As shown in Table 8-2, the multipurpose stadium generates a total of approximately 129 events, with approximately 258,525 attendees in Year 3 of our Base Case scenario. This consists of approximately 70 Sand Gnats games with 207,900 total fans, plus an additional 2,800 players, coaches and support staff for a total of 262,345 visitors in Year 3. Additionally, the Stadium is estimated to generate 19 College Baseball games drawing 2,565 Total Visitors; 19 High School baseball games drawing 1,710 Total Visitors; 7 Concerts drawing 28,350 Total Visitors; and 20 Miscellaneous special events drawing approximately 18,000 Total Visitors.

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Table 8-2 Savannah Multi-Purpose Stadium Projected Attendance (Base Case Yr. 3) # of Players, # of # of Players Coaches & Total # of # of Events Attendance or & Coaches Support Visitors Spectators per Game Staff (A) (B) (C) (D) (E)

Sand Gnats 70 207,900 40 * 2,800 210,700 College Baseball 19 2,565 30 ** 570 3,135 High School Baseball 19 1,710 20 *** 380 2,090 Concerts 7 28,350 10 **** 70 28,420 Miscellaneous 20 18,000 0 0 18,000 Total 135 258,525 3,820 262,345

Notes: *Including baseball players, team staff, and sports reporters **Including collegiate baseball players, team staff, and sports reporters ***Including high school baseball players, team staff ****Including production staff Source: Johnson Consulting

The majority of attendees will spend on average $34 daily, with the remaining staying overnight and spending on average $143 daily, as shown in Table 8-3. The estimates for lodging, meals, and incidental expenses are based on per person, per diem rates for Savannah per U.S. General Services Administration for an October 2013-September 2014 period, which equates to an average amount of spending across various hotels, restaurants, retail and other establishments. Estimates for ticket purchase prices correspond to the weighted average ticket price presented in the Stadium proposal.

Table 8-3 Savannah Multi-Purpose Stadium Average Daily Spending Overnight Most Visitors Vistors

1 Lodging $0 $109 2 Meals, Retail and Incidental Expenses 25 25 3 Tickets 9 9 4 Total $34 $143

Notes: Lines 1 and 2 - Based on GSA Per Diem rate for Savannah. Lines 3 - Reflects weighted average of ticket price based on Stadium proposal.

Source: U.S. General Services Administration, Johnson Consulting

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Conceptually, multiplying the number of total visitors with average daily spending will result in total direct spending. However, not all visitors will spend money on lodging. Therefore, assumptions for visitors who do and do not require lodging need to be developed first. These estimates are shown in Table 8-4.

Table 8-4 Savannah Multi-Purpose Stadium Estimated Day and Overnight Attendees # of Person-Days % Overnight Visitors # of Room Nights

Of Visiting Of Visiting Of Visiting Of Of Of Players & Total Players & Players & Total Attendees Attendees Attendees Coaches* Coaches* Coaches*

1 Sand Gnats 207,900 2,800 210,700 5% 90% 10,400 2,520 12,920 2 College Baseball 2,565 570 3,135 2% 2% 50 10 60 3 High School Baseball 1,710 380 2,090 1% 1% 20 0 20 4 Concerts 28,350 70 28,420 2% 100% 570 70 640 5 Miscellaneous 18,000 0 18,000 1% 1% 180 0 180 6 Total 258,525 3,820 262,345 11,220 2,600 13,820

Notes: % Overnight Visitors indicate out-of-town visitors who stay overnight in hotels and thus are generating room nights. *Accounts for production staff for concert events Source: Johnson Consulting

The estimates conservatively assume that approximately five percent of Sand Gnats attendees and 90 percent of visiting players and coaches will require lodging accommodations. Therefore, total new visitors to the Stadium as well as players and coaches combined, are estimated to generate 210,700 person-days and 12,920 room nights. The estimates assume that two percent of College Baseball Events attendees, one percent of High School Baseball attendees, two percent of Concert attendees and one percent of Miscellaneous attendees will require lodging accommodation. Room nights for festivals could be larger, if such festivals blossom into major events. Combined, the Stadium is estimated to generate 262,345 person-days and 13,820 room nights.

Based on the assumptions shown in Table 8-3 and Table 8-4, total direct spending of all attendees (both visitors and those associated with team operations) is estimated in Table 8-5.

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Table 8-5 Savannah Multi-Purpose Stadium Estimated Direct Spending from Attendees

Calculations Estimated Amount

1 On Lodging $109 x 13,820 room nights = $1,506,380 2 Meals, Retail and Incidental Expenses $25 x 262,345 total person-days = 6,558,625 3 On Tickets $9 x 207,900 ticketed attendees = 1,871,100 4 Sub-Total $9,936,105 5 Team and Stadium Operations Year 3 Operations $2,500,000 6 Total $12,436,105

Source: Johnson Consulting

As shown in the table above, all visitors to the proposed stadium are projected to spend approximately $9.9 million annually during their visits and the operations of the Sand Gnats and stadium are estimated to have a direct spend of approximately $2.5 million, resulting in a total direct spending of approximately $12.4 million.

Based on the calculations and assumptions described thus far, Table 8-6 summarizes the total estimated economic impacts of a new multipurpose stadium.

Table 8-6 Savannah Multi-Purpose Stadium Estimated Annual Economic Impact

Multiplier* Impact ($Millions)

Direct Spending $12.44 Indirect Spending 0.20 2.49 Induced Spending 0.15 1.87 Total Spending $16.79 Increased Earnings 0.33 $4.15

*Reflects the impact for each $1 million of direct spending. Source: Johnson Consulting

As shown in the table above, a new multipurpose stadium is estimated to annually generate $16.7 million of total spending and $4.12 million of increased earnings.

FISCAL IMPACTS OF A NEW MULTIPURPOSE STADIUM Fiscal impacts are tax revenues that result from the spending and other income-generating activities at a new multipurpose stadium. This analysis estimates fiscal impacts for the governmental units that levy taxes in the jurisdiction.

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The fiscal impacts are the public sector’s return on investment. Fiscal impacts provide a partial offset to the capital and operating expenditures required to support the development of the facility. Although the incremental tax revenues cannot be expected to pay for a publicly-funded project in full, fiscal impacts are important because they improve the ability of the public sector to pay for the project. The overall economic impacts, including the fiscal impacts, provide a rationale for public participation in a project.

Based on the spending estimates, Johnson Consulting projected the fiscal impacts from major categories of tax revenues that are directly affected by a visitor’s activity: general sales tax, hotel/motel occupancy tax, corporate income tax, and individual income tax.

. Sales Tax – 7 percent in Savannah; 4 percent goes to the State and 3 percent goes to the County. Of the 3 percent that goes to the County, 1 percent goes to a Local Option Sales Tax (LOST) fund, 1 percent goes to a Special Purpose Local Option Sales Tax (SPLOST) fund and the final 1 percent goes to an Education Special Purpose Local Option Sales Tax (ESPLOST) fund.

. Room Tax (Hotel/Motel Tax) – 6 percent in Savannah.

. Corporate Income Tax – 6 percent in Georgia. The fiscal impacts represent only a fraction of the overall spending impact to the economy; these numbers reflect only the public sector’s increase in tax revenue resulting from the overall increased spending in the economy. The presence of a new multipurpose stadium would increase the values of commercial establishments located in the vicinity of the stadium, which in turn results in increased property tax supported by the project.

Table 8-7 shows the estimated annual fiscal impact for each phase.

Table 8-7 Savannah Multi-Purpose Stadium Estimated Annual Fiscal Impact Revenues

Tax Rate Taxable Spending Tax Revenues Distribution

State County City

Sales Tax - State* 7.00% $16,790,000 of total spending $1,175,000 $669,750 $ 505,250 - Room Tax 6.00% $1,506,380 of spending on lodging 90,000 - - 90,000 Corporate Income Tax 6.00% $1,679,000 or 10% of total spending** 101,000 101,000 - - Total $1,366,000 $770,750 $505,250 $90,000

* State = 4%, 3% County **Assuming that 10% of total spending goes to taxable corporate income of vendors. Source: Johnson Consulting

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As shown on the table, activities at a new multipurpose stadium in Downtown Savannah are estimated to generate approximately $1.3 million of tax revenues annually, of which approximately $770,750 goes to the State, $505,250 to the County, and $90,000 to the City. Figure 8-1 below shows the projected accumulated fiscal impacts to the State, County, and City for the first 15 years after Stadium construction.

Figure 8-1 Savannah Multi-Purpose Stadium Estimated Accumulated Fiscal Impact Revenues ($Millions)

$14.0 To State $12.0 $11.5 To County $10.0

$8.0 To City $7.6 $6.0

$4.0

$2.0 $1.3

$0.0 Yr1 Yr2 Yr3 Yr4 Yr5 Yr6 Yr7 Yr8 Yr9 Yr10 Yr11 Yr12 Yr13 Yr14 Yr15

Source: Johnson Consulting

As shown in Figure 8-1 above, within a 15 year span the accumulated tax benefit is estimated at $11.5 million for the State; $7.6 million for the County; and $1.3 million for the City. These projected figures do not account for additional revenue generated by new adjacent commercial developments or the increase in local property values.

Redevelopment projects can be tipping points for many communities. Through such catalyst developments, many communities find themselves with increased attractions and amenities that add to the quality of life for residents. The importance of a new multipurpose stadium cannot be overlooked. It can change the course of downtown Savannah and add vitality to attract residents and additional tourists. In the first year or two, the key is to make existing businesses do better by generating more revenues. Our experiences in previous studies and those outlined in our case studies section supports that they will. As the case studies section described, baseball stadiums drive ancillary development through proper planning, use of selected incentives, and community engagement.

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ONE-TIME IMPACT OF A MULTIPURPOSE STADIUM CONSTRUCTION In addition to the on-going impacts from the operation of the facilities, the construction of a new multipurpose stadium would create a one-time influx of spending. This construction spending results in a one-time economic and fiscal impact.

Typically, only hard construction costs are included in an impact analysis. Estimates for the multipurpose stadium that is envisioned for Savannah are approximately $30-40 million. Table 8-8 shows the calculation of the construction impact, from construction hard costs to the resulted construction jobs as well as economic and fiscal impact. We have assumed an estimated price of $35 million in order to calculate the potential construction impacts (Please note that this is just an estimate assumption used by Johnson Consulting for the purposes of this report and is not based on any projected figures discussed by the City).

Table 8-8 Savannah Multi-Purpose Stadium Estimated One-Time Construction Impact Multiplier or Amount Tax Rate

Est. Hard Costs for Stadium Development $35,000,000

Impact on Construction Jobs % of Costs Spent on Labor 55.0% Labor Costs $19,250,000 Average Construction Laborer Salary $30,000 # of On-Site Construction Jobs 640 ✓ Economic Impact % of Costs Spent on Material 45.0% Material Costs $15,750,000 % Spent Locally 80.0%

Direct Construction Spending $12,600,000 Indirect Spending 0.20 2,520,000 Induced Spending 0.15 1,890,000 Total Spending $17,010,000 ✓ Increased Earnings 0.33 $4,200,000 ✓ Fiscal Impact Sales Tax - State* 7.00% $1,190,000 Corporate Income Tax 6.00% 25,000 Total $1,215,000 ✓

*Assuming that 10% of total spending goes to taxable corporate income of vendors. Source: Johnson Consulting

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Construction jobs are estimated based on the amount spent on construction labor. For purposes of this report, labor costs are assumed to amount to 55 percent of construction hard costs, while the remaining 45 percent goes to material costs (Actual construction costs may vary.) In typical construction projects, labor costs typically make up 55 to 60 percent of total hard costs; material costs make up the remaining 40 to 45 percent. Applying this ratio to the $35 million construction hard cost, labor costs are estimated to amount to $19.25 million (material costs are estimated to amount to $15.75 million). As shown in the table, assuming an average construction laborer salary of $30,000, Stadium construction is estimated to generate 640 construction jobs. A suggested capital budget strategy to reduce costs is to form a separate public entity responsible for materials purchasing. This entity would not pay sales tax for materials purchased for Stadium construction, which results in a de facto savings in the project’s development budget.

Economic and fiscal impacts are estimated based on the amount spent on construction material and construction jobs. Not all construction materials are purchased locally. In the absence of an actual construction vendor/supplier list that identifies the location of the purchased materials, this analysis conservatively assumes that 80 percent of material costs, or $12.6 million, is spent locally. Applying the multipliers to this amount, such spending on material is estimated to generate $17.01 million of total spending and $4.2 million of increased earnings in the economy. Tax revenues are estimated to amount to $1.21 million.

SUMMARY OF TOTAL ECONOMIC AND FISCAL IMPACT Table 8-9 summarizes the annual economic and fiscal impact of a new multipurpose stadium in downtown Savannah, including the one-time impact of construction and annual impact of facility operations.

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Table 8-9 Savannah Multi-Purpose Stadium Summary of Economic and Fiscal Impact

ONE-TIME Impact ANNUAL Impact of Construction of Facility Operations

On-Site Construction Jobs (FTE) 640 na

Economic Impact Direct Spending $12,600,000 $12,440,000 Indirect Spending 2,520,000 2,490,000 Induced Spending 1,890,000 1,870,000 Total Spending $17,010,000 $16,790,000 Increased Earnings $4,200,000 $4,150,000

Fiscal Impact Sales Tax $1,190,000 $1,175,000 Room Tax na 90,000 Corporate Income Tax 25,000 101,000 Total $1,215,000 $1,366,000

Source: Johnson Consulting

CONCLUSION Johnson Consulting feels strongly that the development of a new multipurpose stadium will be a successful investment on behalf of the City of Savannah. It will keep the Sand Gnats from relocating and will likely serve as a catalyst to spur new development and entertainment in the Downtown district. A new stadium also offers a unique opportunity for the City of Savannah to further capitalize on its strong tourism base by providing additional entertainment options for its existing visitors, while also attracting new tourists by hosting events they were previously incapable of attracting due to a lack of adequate facilities.

SECTION IX STADIUM FUNDING STRATEGY

6 East Monroe Street | Fifth Floor | Chicago, Illinois 60603 | Phone: 312.447.2010 | Fax: 312.444.1125

www.chjc.com | [email protected] Section 9: Multipurpose Stadium Funding Outlook | DRAFT September 2014 Multipurpose Stadium Market Feasibility Study – Savannah, GA PAGE 75

MULTIPURPOSE STADIUM FUNDING OUTLOOK Funding a baseball stadium is a complex venture. It is a large capital outlay that often is considered a non- essential investment. But is that true? On one front yes, but on others, creating economic and recreational opportunities for residents, especially in a growing market like Savannah, is a duty of community leadership. If such a facility is built and operated properly, it creates a concentration of attractions in Savannah, pulling more distant regional residents to the core of the market, which in turn helps all local businesses do better.

Another issue to examine is the perception that baseball team owners make tremendous profit from a stadium’s operation. At the minor league level, this is simply not true. While there is an opportunity for a profit to be made if a team is run right, the team operation is an overhead expense to the parent team.

As a rule for Single A minor league venues, a team plays in a publicly-funded stadium and pays a negotiated lease payment. This is due in large part because profits generated through stadium operations are slim and would not be sufficient enough to fund the cost of development.

Due to the critical nature of financing such facilities often times the public and private sectors have partnered to develop a funding package that works for all parties. Overall, since 1995, approximately 70 percent of minor league baseball stadiums have been funded through a public-private partnership. As mentioned previously, although teams may be feasible, team-generated revenue alone will not be sufficient to pay down the debt on the stadium construction and has been historically underwritten by the public as an economic development and quality of life investment. The recent development of a new $36 millon minor league stadium in Biloxi, MS was funded by $21 million generated from City general obligation bonds and $15 million from the State in the form of BP Oil spill dollars.

In a perfect world, stadium funding sources should, as closely as possible, match funding to its beneficiaries. This is rarely done perfectly because some tools require enabling legislation, which are subsequent to a referendum, or are only generated after the project is up and running. As such, certain tools may be used to construct the project and there can be agreements made to replenish various funds used for the project in the short-term, but paid back by a more appropriate funding source once it becomes available. If such a direct correlation cannot be drawn, politics, leadership and governance can use an indirect source of funding to execute a project for the greater good of the community. Often a combination of these scenarios will facilitate a project.

For this project, we see a collaborative funding approach. Some could be project based, but also from the public sector. Currently, 4percent of the 7% sales tax in Georgia goes to the state of Georgia. However, spending by patrons occurs in the City and County so the City has to justify its investment by the value of taxes it gets from the stadium. It also has to realize that the project will enhance the downtrodden real estate

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today, existing and proposed hotel development and development on the site itself (retail, and hotel), and taxes that do come to the City and County from the project.

Our work indicates the following broad funding structure for annual revenue sources:

. Ticket fee from events held at the stadium. Half of this number would be dedicated to a facility capital reserve fund . Developer annual capital contribution based on fees on other attendees and any other sources the developer chooses . Any grants and annual amounts provided from adjacent communities, the County and the State . Balance paid by the City, either from dedicated incremental existing or new taxes earned in a district formed around the project and annual appropriations.

These potential revenue sources could be included in the lease agreement and the ownership group is prepared to begin negotiating the specific terms of the lease with the City.

FINANCING MECHANISMS There are essentially three typical financing options used for public facility financing, which are defined as follows:

. Pay-as-you Go Financing: Projects that are relatively small or that are financed in municipalities with rapidly growing tax bases are sometimes paid for directly out of appropriated funds. The majority of facilities, however, are financed with long-term debt so that the payment of capital costs corresponds to the period over which the facility is used and its economic benefits are realized.

. General Obligation Bond Financing: Long-term bonding using the general obligation of the city, county, and/or state, either directly as part of a capital outlay program or as guaranteed debt of an authority that would provide a strong credit and relatively low borrowing costs for the project. General obligation bonding is typically reserved for projects perceived to benefit the population as a whole, such as educational, environmental, transportation, or correctional facilities.

. Revenue Bond Financing: Various taxes, fees, or other dedicated revenues could secure revenue bonds for the arena. Revenue Bonds are another source of finance that can be used to build, own, and operate utilities, airports, transportation systems and public purpose facilities, such as arenas; these bonds have no power to tax. They derive their revenues from user fees and other sources and must finance general and capital expenditures out of these receipts and whatever they are permitted to borrow, which can be tailored to fit the specific requirements of the involved state and local governments.

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TAXING MECHANISMS There are several taxing tools utilized to provide assistance for revitalization of public facilities, which are defined as follows:

. Meal Taxes: Meals taxes have been used in several cities, particularly in the Midwest, to support the costs of convention and sporting facilities. Like hotel taxes, they are directed toward beneficiaries of the project and to some extent, non-residents. A subset of an overall sales tax, meals taxes can also generate substantial revenue.

. Hotel Occupancy Tax: Hotel taxes have the major advantage of primarily taxing out-of-town visitors rather than local residents. Public facilities in Orlando, Los Angeles, New Orleans, Atlanta, Charlotte, Houston, Indianapolis, Miami, Philadelphia, St. Louis, and San Francisco have their debt service paid totally, or in part, by dedicated hotel tax revenues.

. Sales Tax: Sales taxes provide strong credit structures because they are relatively predictable and tend to track with inflation and economic growth. A general sales tax increase, or expansion of the base, could provide a strong incremental revenue stream. However, these taxes are often difficult to implement because they primarily tax local residents and require referendum and/or state legislative approval. Sales taxes can generate huge amounts of revenue, but also burden the local economy. In some cases, municipalities have used a general sales tax increase over a fixed period of time to finance major capital projects. This quick-pay method enables municipalities to generate the necessary revenue over a short period of time, but a general sales tax is a blunt taxing instrument that does not provide a direct match between burden and beneficiary.

. Development Fee/Land Lease Income: Fees for the right to develop projects near the arena or elsewhere in the downtown area could conceivably be used to assist in funding. These so-called linkage fees have been imposed in other cities where available land adjacent to an arena or convention center is at a premium. Development fees or land lease income from hotels, parking decks, retail stores, and other uses that benefit from being located adjacent to an arena or convention center are sometimes used to help fund project costs. Such fees are unlikely to produce significant revenues in the current economy and they are typically not a creditworthy source for debt financing because of their speculative nature.

. Tax Increment Financing: Tax increment financings (“TIFs”) are based on the incremental property tax value of the ancillary economic development projects that are triggered by a major new facility. The tax base of a defined area (the TIF District) surrounding the project is frozen and any increases in the future tax base are used to repay TIF bonds.

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. SPLOST Financing: The SPLOST represents 1 percent of the overall 7 percent sales tax in Chatham County. 4 percent is allocated to the state of Georgia while the other 3 percent stays in Chatham County. One-third of that available tax revenue is allocated to SPLOST. In Savannah’s intergovernmental agreement for the use and distribution of proceeds from SPLOST, the city cites cultural and recreational facilities as potential uses for these allocated funds.

. Georgia Tourism Development Act: Passed in April of 2013, GTDA allows developers of new or existing tourism attractions to recover up to 2.5 percent of total project development costs. Eligibility criteria includes: attracting at least 25 percent of the attraction’s visitors from out-of-state, and investing at least $1 million toward a new development, or toward expansion of an existing tourism attraction

. Other Sources: Other sources of partial funding include car rental taxes, taxi airport access fees, and parking taxes.

CONCLUSION The various financing strategies and mechanisms detailed in this section are being utilized throughout the United States. As municipalities and local governments are becoming more aware of the economic and fiscal benefits that public assembly facilities create for the community, they are increasingly issuing public debt over either short- or long-term, the latter of which incurs significantly minimized risk due to the greater impact the venue produces for the community.

The best financing strategy varies from location to location, and is also influenced by the type of public assembly facility being considered. As the City of Savannah considers the future of a multi-use minor league baseball stadium, and weighs the economic benefits it risks losing by remaining at Grayson Stadium, a detailed analysis of available financing options, and the appropriateness of each, must be undertaken.