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 Ralston Arena loses $3.7 Million in first year

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iceguy Posted - 04/19/2014 : 08:45:26 AM
Link to September 2013 Audit Report

http://emma.msrb.org/ER760104-ER591328-ER993335.pdf

I ran across this and I thought it was interesting. I figured they were having money problems but to lose that much is shocking.
22   L A T E S T    R E P L I E S    (Newest First)
West O Mike Posted - 05/12/2014 : 12:20:49 PM
While that's the "required" parking, certain buildings require more parking than others. Elementary schools and churches have lower parking needs than high schools, for example.

And certain events create greater needs. A conference at the CenturyLink Center might not need so much parking if many attendees are from out of town and staying in nearby hotels.

On the other hand, a Zig Ziglar seminar does, since it caters to business people who likely aren't going to carpool.

What's legally required is usually a bare minimum. You probably need to do much more.

Blog: http://huskermike.blogspot.com
Greg S Posted - 05/10/2014 : 08:34:04 AM
This issue though is not just at 3,200. It's 3,500, plus events on the auxiliary. Not that you have big crowds on that one (though you can get a decent amount with youth tourneys). Plus you have people coming and going from that one, while one big event might be in the main. I know it was rough trying to get to things in that one when the Lancers or Beef have a good crowd.

Greg
iceguy Posted - 05/08/2014 : 4:20:34 PM
I asked an architect one time what the parking requirement is for a building and he said you need to have one stall for every four people that the building can hold. So if your building capacity is 3,200 you would be required to have at least 800 spots.
nousefouraname Posted - 05/07/2014 : 3:04:52 PM
Yeah, hard to compare. If there is no other city/street parking that's really accessible, you really need enough parking to accomodate a full building...and, you have to keep in mind there could be multiple events going on at the same time between the arena and the 2nd ice sheet.

Lots of downtown facilities don't build enough parking for a full house, because they know the surrounding lots will absorb the rest, but this is different. It's like when Werner Park first opened and they were running shuttles from Papio South. I remember that if they had a full house, the available parking would only be enough if something like 3.5 people were in every vehicle. Quite a bit to ask when the only other available parking is empty cornfields.
Pants Posted - 05/07/2014 : 01:11:24 AM
They actually probably have more parking than usually alloted for the capacity of a building. That lot is good sized for a 3,000 seat venue, the difference, is that unlike certain place, downtown being one of them, there is no parking anywhere else. Downtown, there are lots and garages all over the place. Now all there is around Ralston is Keno, Menards, and Horsemens park.
Greg S Posted - 05/06/2014 : 6:41:01 PM
The parking for Lancer games is brutal. I'm hoping the shuttle is not permanent and they either open more spaces when the hotel is done or figure something out. They also need to pave that grass right by 72nd that everyone parks in now.

Greg
nousefouraname Posted - 05/05/2014 : 3:09:13 PM
I drove by the place when they were having some arts and crafts show a while back. The place looked like anarchy. The people that were going to that event were making their own parking spots all over the place including sidewalks, curbs, side streets, other businesses parking lots, etc. There were signs telling people to go to horesemens park, but they were small and most people seemed to be ignoring them.

Bad situation, but one I'm worried could be an issue with the new UNO arena, honestly.
KCMavsDad Posted - 05/05/2014 : 12:38:57 PM
Should have mentioned that I'm talking about the Omaha Lancers STH's.

"Drop the puck Morrison"
KCMavsDad Posted - 05/05/2014 : 09:06:58 AM
Early in the season, due to STH complaints they designated the lot NW of the arena as STH only parking. I think it was about this time that they also started the "shuttle" program. My son has an ADA parking tag so we are able to park in front but still need to arrive 1 1/2 hours early to assure we get one of those.

It's truly a mess with the new hotel going up (which they will have to provide guest only parking for). Can't wait for that to happen. A garage would be nice.

"Drop the puck Morrison"
nousefouraname Posted - 05/05/2014 : 08:35:14 AM
It'll be interesting if building the hotel does help them in terms of tax revenue as well. I can see why they had to do it if they are losing that much money; however, building that hotel has taken a sizable chunk of their parking.

They are now having to run shuttles for most events because their lots tend to fill up; however, the location of the overflow parking has been a moving target. They've done shuttles from Horesemens park at times, but with the Derby this weekend, they weren't able to utilize Horsemans for the Hairball show on Friday. They were putting out facebook messages to go to the old Ralston Keno location next to Bushwackers.

Really confusing for their customers, I'd imagine. Especially ones that aren't getting their facebook messages. You can't afford to have those kinds of parking issues. Honestly, like I said when the Chasers were doing it, running shuttles is asking alot of your customers.

So, even if they start making more money off of tax revenue with the new hotel, that's coming with a tradeoff as well in terms of customer service.
iceguy Posted - 05/01/2014 : 09:24:29 AM
Yeah those other developments do ring a bell now. I asked the mayor what he was gonna do when UNO build their arena. He told me that it was not going to happen because UNO didn't have the money. He thought that UNO would use Ralston as their practice facility.
Greg S Posted - 04/27/2014 : 12:54:26 PM
quote:
Originally posted by iceguy

You are right Mike, Menards did not open until October 1 of 2013 and if Menards hits Ralston's projection of $40 million (I question all of Ralston's projections at this point) in gross sales then that would equate to about $1.54 million in additional revenue. So had Menards been open and hit $40 million in gross sales they would have only lost about $2.2 million. That is still not sustainable. Why did they rush to build this without Menards already built and open? Remember this project was going to make $500k in the first year without Menards. My personal opinion is that Ralston was trying to race and build this arena before we built our arena with the thinking that the money people would not support UNO building an arena with Ralston already having built one. Ralston gambled on this deal and appears to be losing. These GMs are not leaving because things are going great. They are leaving because the ship is sinking!



They were not racing against UNO. They were racing against Papillion (there was talk of the Lancers moving to an arena near Pennant Place where Werner Park is) and La Vista (also talk of an arena going where they were trying to land the Outlet Mall in conjunction with the Cordish development there). There was also talk of one in Gretna but I don't think that was deep in talks as the other two.

Greg
Greg S Posted - 04/27/2014 : 12:50:16 PM
I can't really think of any of the local arena's that met their financial goals. Even with it's success, the CenturyLink Center has not done so. They've had to refinance the bonds, go back to the state for additional financing, and tap into Omaha's general fund. I'm not really surprised things have not gone as planned with Ralston either. I really hope UNO is not banking on a best case scenario.

Greg
iceguy Posted - 04/26/2014 : 11:26:11 AM
You hit the nail on the head Pants. Arenas have high overhead costs. With TD Ameritrade when it is not in use you can just winterize it until it is time for the CWS. Ralston is trying to do so many things between the Lancers, Beef, UNO, and community events that they need a sizable staff for conversions and operations. They went into this with no plan and now they are paying. Remember this is the crew that did not budget their ice rink for a resurfacer.
Pants Posted - 04/25/2014 : 12:39:02 PM
TD keeps tourism and the CWS here, but also the NCAA pays for that stadiums mortgage. Those two weeks a year is the sole purpose of that stadium and keeps it running, anything else is just bonus. So the financials are taken care of for the most part. Ralston is losing money mainly because they don't have a ton of revenue to make. When you don't charge for parking or rent from your tenants, there isn't any income. Concessions are such a small portion of the pie. Operating costs like heating, cooling, utilities, electricity, maintenance, ticket takers, ushers, video crews, security, game day staff, and all that add up fast. This is another reason I was also skeptical of UNO's new building. I have a feeling the same will be said after the first couple years with UNO. But yes, the tell will be how the next couple of years go for Ralston as well. There is also a hotel being built next door, I'm betting they get taxes from that as well.
West O Mike Posted - 04/24/2014 : 12:24:14 PM
This is why I continue to be opposed to UNO's new arena from a financial perspective. I believe arenas are tough to justify money wise. The CenturyLink Center seems to be doing the best from a financial perspective, mostly because of the arena. The Mid-America Center in Council Bluffs is a prime example of a money pit.

The argument for an arena (or stadium) has to be that it brings events to the area that otherwise wouldn't happen. That's why TD Ameritrade Park makes sense; it keeps the College World Series in Omaha and allows the zoo to expand. We needed it, even if it sits empty from July 4th to early March. Nebraska's Memorial Stadium is needed, even though it sits empty 355 days a year.

I just hope that UNO is prepared to have the new Aksarben Coliseum dripping in red ink. I doubt they are. And since there are other venues in Omaha capable of hosting UNO hockey, I don't believe that UNO's new arena can be justified from a financial perspective.

Blog: http://huskermike.blogspot.com
iceguy Posted - 04/24/2014 : 08:14:49 AM
You are right Mike, Menards did not open until October 1 of 2013 and if Menards hits Ralston's projection of $40 million (I question all of Ralston's projections at this point) in gross sales then that would equate to about $1.54 million in additional revenue. So had Menards been open and hit $40 million in gross sales they would have only lost about $2.2 million. That is still not sustainable. Why did they rush to build this without Menards already built and open? Remember this project was going to make $500k in the first year without Menards. My personal opinion is that Ralston was trying to race and build this arena before we built our arena with the thinking that the money people would not support UNO building an arena with Ralston already having built one. Ralston gambled on this deal and appears to be losing. These GMs are not leaving because things are going great. They are leaving because the ship is sinking!
West O Mike Posted - 04/23/2014 : 12:23:57 PM
As I recall, sales tax from the new Menards store was supposed to help fund the new arena. The arena opened in 2012, but Menards didn't open until last September, so that contributed almost nothing to Ralston.

In that light, it's no surprise that Ralston lost money in their first year. The question is whether the losses will continue in 2014. Ralston gets 70% of the sales tax revenue from Menards, thanks to the arena law. If Menards' sales are $40 million a year (which apparently is their average), that likely equates to around $1.5 to $2 million in additional tax revenue.

Blog: http://huskermike.blogspot.com
Greg S Posted - 04/20/2014 : 11:58:22 AM
One thing I thought was weird. Was coaching there for an all day mite tourney. Was the same day as the Nebraska Penn State game. They did have the coffee shop and one concession stand open (so you could get beer). They did not open the bar. With lots of time between some of the youth games, you had to either go into the new Husker Express store there to watch or leave. They would have a made a ton of money if they had opened the bar.

They are really watching outside food being brought in too. Same day, got there at 7:15, had stopped and got a large coffee on the way, and they stopped me from entering with it. I get that they are trying to sell their own but their shop was not opening until 8, too late for me.

Greg
BIGHUSKERMAV Posted - 04/20/2014 : 12:44:48 AM
I wasn't aware of the rent issue. Interesting...

It definitely doesn't sound like it's being run well.
iceguy Posted - 04/19/2014 : 1:38:45 PM
The arena may be busy but remember they dont charge rent to their tenants. Also it was supposed to cost $29 million but ended up costing closer to $40 million when you factor in equipment etc. It is becoming more apparent that they dont know what they are doing.
BIGHUSKERMAV Posted - 04/19/2014 : 12:41:58 PM
Were there a lot of upfront costs that would have caused this? It seems like the arena is being utilized fairly well right now, between the Lancers, Beef and a few special events. It seems like they also do a lot of business hosting hockey leagues and community skating days.

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