Big Game’s Economic Impact Expected to Top Earlier Bowls
By CONNIE LEWIS
San Diego Business Journal
There may be fewer corporate jets parked at Lindbergh Field for Sunday’s Super Bowl than the two previous times San Diego hosted the event.
Bookings have been slower leading up to the big game, especially compared to 1998, when many hotels were sold out more than a year in advance. And restaurateurs aren’t expecting to see the freewheeling spending that characterized earlier events.
Even so, no one is really complaining.
The San Diego Convention & Visitors Bureau anticipates that the game’s economic impact will be at least equal and possibly better than that of five years ago. The projection is based on the expectation that the game’s increased potential for drawing crowds in successive years will offset some of the downside potential of the sluggish economy.
Truly an extravaganza
The 1998 game attracted 122,000 visitors and generated $295 million, according to a study by PricewaterhouseCoopers LLP. Direct spending was about $125 million, said Sal Giametta, a spokesman for the convention and visitors bureau.
In 1988, the Super Bowl drew 77,500 visitors to San Diego. It had an economic impact of $136 million and direct spending of $65.6 million, said Skip Hull, vice president of CIC Research Inc., which crunched the numbers.
“The Super Bowl is truly an extravaganza,” Giametta said. “That’s why cities compete fiercely for the event, and all who have hosted it say they’d have it again. But the game is not immune to what is going on nationally.”
While revenue earned by corporate hotel chains based outside the area doesn’t stay, the city does keep 10.5 cents in transient occupancy tax from every dollar that guests pay for their rooms. From the state’s sales tax, the city gets another penny on the dollar. It also benefits indirectly from other taxation, such as property taxes, Hull said.
Other impacts include salaries and tips, as well as the revenue generated by local suppliers and vendors of hotels, restaurants, clubs, amusement parks and other entertainment venues.
An added benefit, free of charge, is the promotional value San Diego gains from nationwide media exposure.
“It’s difficult to quantify the value of it,” Giametta said. “We don’t pay a dime for it. It has already started and it will be ongoing throughout the event. What we call it is ‘top-of-mind awareness’ of our (tourist) destination.”
The final numbers likely will depend on which two teams wind up playing. In sports terms, certain teams “travel well,” meaning high numbers of their fans traditionally follow them wherever they play.
“We’re trying to get a feel for how things will go this time around, but a lot depends on which teams play,” said Scott Stamp, a partner at Ross Wheller Enterprises Inc., which owns the San Diego Brewing Co., a couple miles from Qualcomm Stadium.
The Green Bay Packers, a team known to “travel well,” were eliminated from the playoffs Jan. 4, but expectations for tourism will ramp up if one or two teams from a cold-weather city make it to San Diego.
“Ideally if two teams come from the Northeast, the fans will travel longer to get here, and they’ll stay longer because they came from the cold to sunny San Diego,” said Sal Giametta, a spokesman for the San Diego Convention & Visitors Bureau. “And when they stay longer, they will spend more money.”
Had the Packers beaten the Denver Broncos in 1998’s game, Stamp said, “we could have sold even more beer.”
Visitors more restrained
Meanwhile, hotels are starting to fill up, although Luis Barrios, general manager of the Catamaran Resort Hotel and chairman of the San Diego County Hotel/Motel Association, noted that “corporations just aren’t spending as lavishly as in the past. “They’re being restrained in the way they do business.”
Of the 900 rooms the NFL booked at the 1,000-room Town & Country Hotel, 400 were returned, said General Manager Duke Sobek. “Groups were hedging,” he said. “But now they’ve picked an additional 300.”
Confident that the Town & Country will be sold out for the event, prices have held steady, he added.
Rates vary for a four-day stay, including Sunday, the day of the game the standard minimum for a group booking. But according to a spot check, most have been bumped up by at least 75 percent.
Downtown, at Ruth’s Chris Steak House, the staff is preparing for a “blockbuster business week,” said General Manager Joe O’Donnell. He expects to serve just as many guests at the fine-dining restaurant as he did during 1998’s Super Bowl week. However, he anticipates the average ticket to drop to $70 a head, $10 less than before.
“Last time, they spent a crazy amount of money,” O’Donnell said.
“Any time you can get more business in January, it’s a great thing to have,” said Stamp.
