Skip to main content

Barclays Center CEO Yormark: arena was "overstaffed" (so jobs to be cut); more "big events" (with high prices) sought; Nets' tickets cost more after "sampling opportunity" because "we are a business"

Bloomberg TV yesterday published Barclays Center: Growing Pains and Lessons Learned
Sept. 30 (Bloomberg) -- Bloomberg’s Stephanie Ruhle takes you inside the business of the Barclays Center in Brooklyn, New York with Brett Yormark, CEO of the Barclays Center and Brooklyn Nets, as the arena celebrates its one-year anniversary. They speak on Bloomberg Television’s “Market Makers.”
"It's exceeded our expectations, to brand the Barclays Center and obviously to drive the economics," Yormark said. "I think we have had an incredible first year. We can certainly get better."



Cutting staff, less marketing

"We now know how the building behaves, we know how to staff it more efficiently," he said. "It takes 12 months to understand really the dynamics of the building. We are looking for anywhere between 15% and 20% worth of cost savings for next year."

How get those savings?

"Staffing is a big way we can do it," Yormark said. "Because we overstaffed, both on the full-time and part-time.... 80% of people are coming in from the front entrance. So to have staffing levels at the other entrances, we do not need that anymore. We can deploy that staff to the front entrance."

That also raises questions about how many of the widely touted 2000 jobs, some 1900 of them part-time, would be kept.

"We do not need to market as much," Yormark continued. "We built this great brand. When we launched a year ago, we spent considerable dollars branding the Barclays Center as a destination. We have now arrived and we do not need to spend those dollars any more.

Hockey: Brooklyn fan base

"When you can have two major franchises that can provide you close to 90 guaranteed dates a year, that is good for the balance sheet," Yormark said of adding the New York Islanders in 2015. "We think hockey's going to sell. If you just about tonight, the first preseason game of the year. We have sold over 13,000 seats. Over 24% are coming from Brooklyn. There is a built in hockey fan base here in Brooklyn. Our research validates that."

More events? No, more expensive

"You had 200 events last year," Yormark was asked. "Do you need to increase the number of events?"

"Not necessarily increase," he responded. "Our goal was volume and variety. Let's test a couple of things. As we look at Year Two, we look at certain things differently. One thing that we want to consistently do is have big events. When you think about the stars that came here this year"--he cited Paul McCartney, Jay-Z, the Rolling Stones, Barbra Streisand, Beyonce--"those are the ones that really matter."

Nets tickets

"We did raise our [Nets] ticket prices in Year Two," Yormark continued. "We did decide that, after giving everyone a sampling opportunity, we are a business and we had to raise tickets, and we did,"  "We are mindful of that increase, but we did raise tickets."

Consider his rhetorical shift. (“We have 2,000 seats priced at $15 and under," Yormark told RealGM 6/15/12. "It’s been our goal from Day One to have affordable seating and pricing for anyone that wants to experience Brooklyn Nets basketball."

Somehow he didn't use the term "sampling opportunity." Now prices are $25.

This past June, Yormark was told by an unskeptical interviewer, "You're putting some reasonably priced tickets out there."
"We made a commitment," Yormark responded easily. "Michael [sic] Prokhorov and his team, obviously wanting to do right by Brooklyn. So when we moved to Brooklyn, we put aside 2000 seats every night and we priced them at $15 and under. So that anyone in Brooklyn that wanted to root on the home team, Brooklyn Nets, had the wherewithal to do that. Now we've modestly increased that $15 price for next year, but for that inaugural season, which we just concluded, anyone that wanted to see the Brooklyn Nets, regardless of their economic situation, had the wherewithal to do so. And we were very happy about that that, because obviously, we're all about the fan, and we're about the community."

In closing

In the Bloomberg TV interview, Yormark said, in closing, "It is all about the customer engagement and making them feel really good about the experience here and them wanting to come back," he said in closing. "They have to be treated the right way. And our goal from Day One was to make sure that every fan was treated like a celebrity."

Comments

Popular posts from this blog

Barclays Center/Levy Restaurants hit with suit charging discrimination on disability, race; supervisors said to use vicious slurs, pursue retaliation

The Daily News has an article today, Barclays Center hit with $5M suit claiming discrimination against disabled, while the New York Post headlined its article Barclays Center sued over taunting disabled employees.

While that's part of the lawsuit, more prominent are claims of racial discrimination and retaliation, with black employees claiming repeated abuse by white supervisors, preferential treatment toward Hispanic colleagues, and retaliation in response to complaints.

Two individual supervisors, for example, are charged with  referring to black employees as “black motherfucker,” “dumb black bitch,” “black monkey,” “piece of shit” and “nigger.”

Two have referred to an employee blind in one eye as “cyclops,” and “the one-eyed guy,” and an employee with a nose disorder as “the nose guy.”

There's been no official response yet though arena spokesman Barry Baum told the Daily News they, but take “allegations of this kind very seriously” and have "a zero tolerance policy for…

Behind the "empty railyards": 40 years of ATURA, Baruch's plan, and the city's diffidence

To supporters of Forest City Ratner's Atlantic Yards project, it's a long-awaited plan for long-overlooked land. "The Atlantic Yards area has been available for any developer in America for over 100 years,” declared Borough President Marty Markowitz at a 5/26/05 City Council hearing.

Charles Gargano, chairman of the Empire State Development Corporation, mused on 11/15/05 to WNYC's Brian Lehrer, “Isn’t it interesting that these railyards have sat for decades and decades and decades, and no one has done a thing about them.” Forest City Ratner spokesman Joe DePlasco, in a 12/19/04 New York Times article ("In a War of Words, One Has the Power to Wound") described the railyards as "an empty scar dividing the community."

But why exactly has the Metropolitan Transportation Authority’s Vanderbilt Yard never been developed? Do public officials have some responsibility?

At a hearing yesterday of the Brooklyn Borough Board Atlantic Yards Committee, Kate Suisma…

Forest City acknowledges unspecified delays in Pacific Park, cites $300 million "impairment" in project value; what about affordable housing pledge?

Updated Monday Nov. 7 am: Note follow-up coverage of stock price drop and investor conference call and pending questions.

Pacific Park Brooklyn is seriously delayed, Forest City Realty Trust said yesterday in a news release, which further acknowledged that the project has caused a $300 million impairment, or write-down of the asset, as the expected revenues no longer exceed the carrying cost.

The Cleveland-based developer, parent of Brooklyn-based Forest City Ratner, which is a 30% investor in Pacific Park along with 70% partner/overseer Greenland USA, blamed the "significant impairment" on an oversupply of market-rate apartments, the uncertain fate of the 421-a tax break, and a continued increase in construction costs.

While the delay essentially confirms the obvious, given that two major buildings have not launched despite plans to do so, it raises significant questions about the future of the project, including:
if market-rate construction is delayed, will the affordable h…

Revising official figures, new report reveals Nets averaged just 11,622 home fans last season, Islanders drew 11,200 (and have option to leave in 2018)

The Brooklyn Nets drew an average of only 11,622 fans per home game in their most recent (and lousy) season, more than 23% below the announced official attendance figure, and little more than 65% of the Barclays Center's capacity.

The New York Islanders also drew some 19.4% below announced attendance, or 11,200 fans per home game.

The surprising numbers were disclosed in a consultant's report attached to the Preliminary Official Statement for the refinancing of some $462 million in tax-exempt bonds for the Barclays Center (plus another $20 million in taxable bonds). The refinancing should lower costs to Mikhail Prokhorov, owner of the arena operating company, by and average of $3.4 million a year through 2044 in paying off arena construction.

According to official figures, the Brooklyn Nets attendance averaged 17,187 in the debut season, 2012-13, 17,251 in 2013-14, 17,037 in 2014-15, and 15,125 in the most recent season, 2015-16. For hoops, the arena holds 17,732.

But official…

So, Forest City has some property subject to the future Gowanus rezoning

Writing yesterday, MAP: Who Owns All the Property Along the Gowanus Canal, DNAinfo's Leslie Albrecht lays out the positioning of various real estate players along the Gowanus Canal, a Superfund site:
As the city considers whether to rezone Gowanus and, perhaps, morph the gritty low-rise industrial area into a hot new neighborhood of residential towers (albeit at a fraction of the height of Manhattan's supertall buildings), DNAinfo reviewed property records along the canal to find out who stands to benefit most from the changes.
Investors have poured at least $440 million into buying land on the polluted waterway and more than a third of the properties have changed hands in the past decade, according to an examination of records for the nearly 130 properties along the 1.8-mile canal. While the single largest landowner is developer Property Markets Group, other landowners include Kushner Companies, Alloy Development, Two Trees, and Forest City New York.

Forest City's plans unc…

At 550 Vanderbilt, big chunk of apartments pitched to Chinese buyers as "international units"

One key to sales at the 550 Vanderbilt condo is the connection to China, thanks to Shanghai-based developer Greenland Holdings.

It's the parent of Greenland USA, which as part of Greenland Forest City Partners owns 70% of Pacific Park (except 461 Dean and the arena).

And sales in China may help explain how the developer was able to claim early momentum.
"Since 550 Vanderbilt launched pre-sales in June [2015], more than 80 residences have gone into contract, representing over 30% of the building’s 278 total residences," the developer said in a 9/25/15 press release announcing the opening of a sales gallery in Brooklyn. "The strong response from the marketplace indicates the high level of demand for well-designed new luxury homes in Brooklyn..."

Maybe. Or maybe it just meant a decent initial pipeline to Chinese buyers.

As lawyer Jay Neveloff, who represents Forest City, told the Real Deal in 2015, a project involving a Chinese firm "creates a huge market for…