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Jets Expect Big Green from Auction of Best-Seat Licenses: Experts predicting team could see six figures for VIP section of new stadium

 

The Star Ledger

Maura McDermott

 

Link to Article on NJ.com

 

Thursday, August 28, 2008

The auction for seats in the Jets' new Coaches Club could fetch prices close to the cost of a luxury car, and will likely prompt other major-league teams to follow suit, sports industry experts said yesterday.

The team will be the NFL's first to hold such an auction. This fall, fans will bid over the internet and by phone to buy 2,000 personal seat licenses for the most exclusive section of the stadium, according to the Jets. The licenses -- which sell for a one-time fee and can be resold, like taxi medallions -- give holders a form of control over the seats, with the right to buy season tickets.

The Jets and Giants are both selling seat licenses to help fund their $1.6 billion stadium in the Meadowlands, due to open in 2010. But only the Jets are selling some at auction.

The strategy "is a wave of the future," said Marc Ganis, a leading consultant to major-league sports teams. "It allows them to increase revenues while taking the moral high ground -- they are charging what the fans are willing to pay and not arbitrarily selecting a number."

The Jets' members-only club provides unlimited food and soft drinks, a patio 20 feet behind the home team's bench and views of post-game interviews.

Less exclusive club seats will sell for $5,000 to $25,000, according to the team. Non-club seat licenses are selling for $4,000 to $20,000. No upper-tier seats will require licenses.

Season ticket holders will get first priority in buying the regular, flat-price PSLs. The auction, however, will be open to the general public, according to the team.

The 2,000 auctioned seats will likely go for "a premium" over the $25,000 top flat-price PSL, Ganis predicted.

"Will they get a 100 percent premium over that? I don't know about that," he said.

Ganis said he knew of no other major-league teams to auction seat licenses. However, the Chicago Cubs' auction of 70 season tickets for new seats near their dugout earlier this year was "wildly successful," with prices 40 to 50 percent higher than the regular $220-a-seat price, Ganis said.

The Jets may be the first NFL team to auction PSLs, but they won't be the last, predicted Kyle Burks, founder of Seasonticketrights.com, a website where fans buy and sell seat licenses.

Burks predicted the team could get up to $70,000 for each Coaches Club license. That's how much a fan paid on Burks' site for licenses behind home plate at the San Francisco Giants' stadium, in the site's highest-price transaction, according to Burks.

The Jets are not saying how the auction will work -- whether it will be an eBay-style auction where prices soar as high as fans push them, or more like a blind auction for a home, where the buyer puts in a bid and hopes for the best.

Burks predicted it will be more like a home sale.

Fans will likely bid as much as they can afford to pay, so they'll get the best shot at seats, he said.

An eBay-style auction would be chaotic and likely result in lower prices, he said.

Steven Korenblat, an attorney who represented Citigroup in its naming rights deal with the Mets, agreed the Jets would get the highest prices by requiring "blind" bids.

"It gives those running the auction a great deal of leverage to figure out what the demand is and then they can go back and do another bite at the apple without anyone being aware of discounts," he said.

But, he added, "You would hope they could avoid the possibility of people paying remarkably difference prices for essentially the same seats, because that will come out eventually and create disparities and disappointment."

Howard Bloom, who publishes an internet sports business newsletter, predicted the Jets might even get six-figure prices for the Coaches Club licenses, if Fortune 500 companies are eager enough to entertain clients there.

"Let's just say you can close a million-dollar deal by taking your client to a game," Bloom said. "When you have to get the ticket, you do whatever you have to do to get the ticket."

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