Baltimore Board of Estimates Approves Contract For New Grand Prix Organizers

My blog from the May 17 "Sports Business Report" on PressBoxonline.com...

The Baltimore City Board of Estimates approved a contract with Race On LLC and Andretti Sports Marketing to run the Grand Prix of Baltimore for the next five years. The May 16 vote marked the second time during a three-month span that the city has chosen an organizer for the IZOD IndyCar race scheduled for Labor Day weekend.

J.P. Grant of Grant Capital Management is the leader of Race On, a Baltimore-based company that provides financial services to municipalities, and Greg O'Neill, owner of BMW Construction in Curtis Bay, Md. Race On LLC has contracted with Andretti Sports Marketing to run all commercial and operational aspects of the Grand Prix. Racing legend Michael Andretti formed Andretti Sports Marketing. Andretti's companies have previously resurrected race events in Toronto; St. Petersburg, Fla.; and Milwaukee.

The new contract was approved in a 4-1 vote, with City Council President Jack Young opposing the measure. City comptroller Joan Pratt voted in favor of the new contract, a change in her position from February, when the Board voted, 3-2, on the contract with Downforce Racing.

"J.P. Grant, his company is successful," Pratt told the Baltimore Business Journal. "I believe he is all in and will make the race successful."

The three other board members, who approved of both contracts, are Mayor Stephanie-Rawlings Blake and two people she appointed, George A. Nilson, solicitor, and Alfred H. Foxx, director of public works.

Tickets for the 2012 Grand Prix of Baltimore will go on sale on May 28 and be available via Ticketmaster and on the event's new Web site, RaceOnBaltimore.com.

In February, Baltimore City entered into an agreement with Downforce Racing to run the street race in 2012. But the company failed to meet several key benchmarks and the city ended the contract in late April.

But like the contract with Downforce Racing, the agreement with Race On LLC also contains key provisions. As the city endorses its third organizer of the race – Baltimore Racing Development organized the inaugural Grand Prix  in 2011 -- adjustments in the agreement suggest officials are taking steps to ensure financial security and greater control for the city.

The contract with Downforce Racing included a ticket surcharge lock box, in which a $3 surcharge would be added to each ticket sold. The city would collect and hold the proceeds of the surcharge fee to offset the costs of city services provided.

But that item does not exist in the new contact. Instead, there is a city services/racing event fee in which Race On LLC will pay a flat fee of $350,000, due 30 days before the race. For 2012, the fee was due upon approval by the Board of Estimates. It increases by $25,000 each year of the five-year agreement.

John Lopes, president of Andretti Sports Marketing, said he thought Baltimore was a key location for IndyCar.

"We studied what was happening in Baltimore and looked at the finances," Lopes said. "Looking long term, we believe this race can be the crown jewel of both the IZOD IndyCar series and the Le Mans series."

Two immediate, and noticeable, moves Andretti Sports Marketing made were changing the name of the race from the Baltimore Grand Prix to the Grand Prix of Baltimore, and unveiling a new logo for the event.
Lopes said the goal of the name change was to provide a new brand and feel for the 2012 event.

"A lot of debate took place internally about the race name," Lopez said, "and we decided that we didn't want to focus on one series but have the event itself be bigger than anything else."

As for the logo, Lopes said the group wanted to design something that tied racing to something iconic about the city.

"People look to what’s iconic about every race," he said. "In St. Petersburg, the logo contains palm trees. Tall ships are a symbol of pride in Baltimore, so we wanted to develop a look and feel that representative of building an iconic event."

Lopes also said that the group felt putting Grand Prix at the front set up a better opportunity for a title sponsor, because it is constantly evaluating the overall branding of the event. The group already signed its first sponsor, CBS Radio, and Lopes said it had inked deals with three other large sponsors that will soon be announced.

"Andretti Sports Marketing brings a significant amount of motorsports experience to the event," IndyCar CEO Randy Bernard said, "and combined with locally based Race On, provide the right elements to produce a successful race weekend. "It's important that the promoter that holds our sanction for the Grand Prix of Baltimore produces a first-class event that will make the city proud."

It's estimated that the inaugural Baltimore Grand Prix had a $47 million economic impact on Baltimore, while attracting more 160,000 people. The city terminated its contract with Baltimore Racing Development, organizers of the initial race, Dec. 30, 2011, after the group failed to pay more than $1.5 million to the city.

To view the complete set of provisions in the new contract visit my Sports Business Report at PressBoxonline.com.  Check back soon for more about Andretti Sports Marketing’s involvement in the race and plan for Baltimore.

Baltimore Again Will Host World-Class Soccer Match

The world's game will return to M&T Bank Stadium when Tottenham Hotspur Football Club plays Liverpool Football Club at 1 p.m. July 28. The match features two members of the Barclays Premier League, one of the top soccer leagues in the world.

Baltimore has become a popular location for international friendlies. In 2009, a sold-out crowd at M&T Bank Stadium witnessed Chelsea's defeat of A.C. Milan, while more than 35,000 fans watched Inter Milan play Manchester City a year later. The economic impact of those combined matches was about $25 million.



According to Terry Hasseltine, executive director of the Maryland Office of Sports Marketing, these matches also elevate Maryland's reputation in the international sports community as a viable site for significant sporting events.

"This puts M&T Bank Stadium, the city of Baltimore and the state of Maryland in a new realm of identity in the sports event landscape across the globe," Hasseltine said. "Soccer might not be the sport of choice in the U.S., but internationally it is, and having two clubs with global identification and followers playing in our facility, in our state, changes our sports recognition profile."

The match should draw impressive numbers, considering the popularity and status of the two teams. In a departure from previous matches held at M&T Bank Stadium, the Baltimore Ravens secured the 2012 contest themselves.

Tottenham Hotspur, also known as "Spurs," was founded in 1882 and has won two league titles, eight FA Cups, four League Cups, two UEFA Cups and the UEFA Cup Winners' Cup. Liverpool, commonly referred to as the "Reds," has won 18 league titles, as well as seven FA Cups, eight League Cups, five European Cups and three UEFA Cups.

"We are fully aware that the Premier League is big in the U.S.," said Darren Eales, Tottenham Hotspur director of football administration. "This match in Baltimore is the key fixture of our preseason tour, psychologically and physically for our players, and for bragging rights with fans. The U.S. tour is about getting our players ready for the season, and Baltimore will be an outstanding fixture."

Born in England, Eales played collegiately at Brown University and then professionally in the United States.
"Now, there are generations of [U.S.] fans who have grown up playing soccer and watching it on TV, so they know what is good on the pitch and what isn't," Eales said. "The match on July 28 will give them a chance to experience that environment in person."

In a statement, Liverpool managing director Ian Ayre said, "The prospect of playing a big game between two great Premier League clubs on American soil is one that I'm sure will excite lots of our fans, because nothing beats watching the team live."

Fenway Sports Group, the owners of the Boston Red Sox, acquired Liverpool in 2010. According to Baker Koppelman, Ravens vice president of ticket sales and operations,  the Ravens have relationships with that group and learned that Liverpool had expressed interest in playing in Baltimore.

"The process was very labor intensive," said Koppelman. "Between identifying the teams, negotiating contracts, scheduling … it took us about 12 months to finalize everything. Our goal is to present a great event, both in showing how we can put on destination matches for teams who tour the U.S. and for the fans."

Koppelman estimated that it would cost about $2.5 million to host this game.

Tottenham's connection to Baltimore-based Under Armour makes it an attractive team for this match. In March 2011, the club and Under Armour announced a five-year partnership, which will activate in July. Under Armour will provide Tottenham with performance apparel and replica product for the club's supporters around the world.

The fixture in Baltimore is part of Spurs' three-city summer tour, which also includes Los Angeles and New York.

"America is a big market for us anyway, and with Baltimore as the hometown of our partner, Under Armour, it was a perfect fit," Eales said. "Additionally, the Ravens and Dick Cass have done a very good job in putting this match together for Baltimore. M&T Bank Stadium is an awesome facility, and its setup, especially with the big screens, will make it exciting for our players to be able to compete in that type of environment."

An item that made securing the match tricky was that the teams could play only during one specific weekend in July, a time when the Orioles have a three-game homestand. Koppelman said the Ravens contacted the Orioles, and the baseball team was agreeable and worked with the Ravens to make the match possible. After Spurs and Liverpool square off at 1 p.m., the Orioles will host Oakland at 7:05 p.m.

"The Ravens, Maryland Office of Sports Marketing and the Orioles deserve a lot of credit for all working together to enable this event to take place," said Mike Frenz, executive director of the Maryland Stadium Authority.

Although there will likely be some overlap, especially in relation to the parking lots at the Camden Yards Sports Complex, Frenz said there was a plan in place for July 28. The MSA will be operating under standard NFL gameday traffic management plans and taking every step to ensure things run smoothly.
The Ravens and Orioles are also working together, especially in cross promotion. Koppelman said that someone with a ticket to the soccer match could also purchase a $10 voucher good for a $15 ticket to any of the three Orioles games that weekend.

The Camden Yards Sports Complex will be an active spot July 28, which Frenz said was good for the MSA.

"Part of the MSA's mission is to provide enjoyment, enrichment, education and business opportunities for citizens," Frenz said. "We think it's important to fully utilize these facilities and provide more diversity to our fans while maximizing our assets."

It seems fans agree.

Domenic Staiti of Carney, who owns a Ravens personal seat license, attended both of the previous matches and said he intended to be at M&T Bank Stadium July 28.

"The Baltimore area has so many soccer fans," Staiti said. "I personally grew up playing soccer and now coach children. I'm thrilled to be able to see world-class talent, like USA goalkeeper Brad Friedel, playing for Tottenham."

For fans like Staiti, these matches at M&T Bank Stadium provide extra value.

"I really enjoy the atmosphere at these soccer matches," Staiti said. "I was really excited to take my dad to see his favorite team growing up in Italy, Inter Milan, a few years ago, after they just won the Euro Cup.
That is a moment I will never forget."

The Ravens haven't ruled out making these matches a common occurrence each summer, Koppelman said.

"If it makes sense, we would look to host games like this on an annual basis," Koppelman said. "We have to evaluate the return based on the resources we have to put into the game, but as long as we feel people are interested and we can secure good teams, we are always interested in these opportunities."

Tickets for the match are available online at ticketmaster.com and baltimoreravens.com/tickets or by calling 410-547-7328.