A consultant’s report on UNLV’s proposed 60,000-seat domed stadium pegs “all-in costs” for the project at just less than $900 million, including $700 million for the venue itself.
But the report by New York City-based Sterling Project Development warned the venue’s $700 million budget might not be enough for what UNLV officials are calling a “Mega Events Center.”
“It would be reasonable to assume that the Mega Events Center (as now sized) may ultimately be completed for an amount that is 10 percent to 20 percent higher than the all-in budgeted amount of $700 million,” according to the 12-page Due Diligence Report dated this month. That would push the cost of the stadium alone to from $770 million to $840 million.
The costs outlined in the report are important because Don Snyder, UNLV’s point man on the project, has avoided public discussion of the project’s cost. The report is the first document made public that outlines the project’s cost.
Among other details, the report described the following:
Demolition and relocation of about 350,000 square feet of current playing fields and athletic facilities.
Demolition and construction of eight campus service buildings of about 58,000 square feet.
A stadium of 1.15 million square feet on a 12-acre footprint.
One and a half years of relocation work and 30 months for stadium construction.
Expectations that 59 events each year would attract nearly 1.9 million attendees, generating gross annual revenue of $97.4 million.
A planned revenue stream that includes event booking fees, ticket sales, ticket fees and contracted income such as sale of suites, naming rights, sponsorships and signage.
Operation and maintenance costs forecast at about 50 percent of event income.
The consultants said the annual revenue estimate “represents an ‘overly optimistic’ outcome” and described maintenance and operation costs at 50 percent of event income as “somewhat optimistic as well.”
Project costs were based on analysis of a Nov. 12 project estimate by Eiman Consulting and a conceptual design study dated Aug. 20 by Turner Construction.
University officials are trying to cut costs in response to Las Vegas hotel-casino companies that have said the project’s scope and cost were too high.
The report addressed that issue, suggesting UNLV establish “a basic program outlining the size and scale of the project, with the hopes that all key stakeholders will be able to agree on a ‘lowest common denominator’ upon which the design and business modeling efforts will be based.”
UNLV made a bold move this week when it severed its relationship with private partner Majestic Realty, owned by California billionaire Ed Roski. UNLV and Majestic had worked together since October 2010 on the stadium plan as part of the UNLVNow program, which included new student housing and retail space on campus. Majestic had committed $360 million to the stadium project and was going to build the new housing and retail. That’s now off the table.
UNLV officials said Majestic was dumped because a private stadium partner made it hard to forge a partnership with the hotel-casino community.
“The fact is that the partnership in its current form has been met with tepid reactions from both the hospitality as well as the convention and event industries in Las Vegas,” the report said. “Therefore, with the marketplace having spoken, UNLV needs to use this dynamic as an opportunity to redefine the project, as well as the roles and responsibilities of the major stakeholders who would benefit most from the Mega Events Center.”
Contact reporter Alan Snel at firstname.lastname@example.org or 702-387-5273.