As final approvals near, real draw of America’s Cup questioned
The business formula of the America’s Cup seems simple: If you race them, they will come.
But as city officials consider a waterfront investment deal finalizing the terms of the yacht regatta, they are left guessing just how many will come.
Along with the complex long-term agreement for race officials to fix crumbling piers in exchange for lucrative development rights on public property, the event’s popular appeal also is raising questions.
The event’s power to infuse cash into its host city is commonly touted as only less than that of the Olympics and World Cup. But low turnout of spectators and racing teams could make The City’s massive preparations a costly albatross.
The eyes of the sailing world will be fixed on San Francisco Bay’s 58 days of yacht racing over the next two years. But county supervisors are more concerned about how many spectators will patronize local hotels, restaurants and other attractions.
The City is set to spend $52 million preparing for the race, which it hopes to cover with sales and hotel taxes, plus fundraising by a nonprofit arm of the America’s Cup. But slow fundraising progress has raised red flags with city leaders.
Disappointing turnout for a November event in San Diego raised questions among local skeptics. Supervisor John Avalos said last week he doubts the claim that more than 5 million people will attend the 2013 finals, which could mean up to 500,000 people in The City on peak days.
“I’d say we’re not seeing that,” Avalos said.
Promoters say the regatta will create 8,800 jobs and $1.4 billion in economic benefits. But that analysis was conducted well before officials even agreed to hold the event here.
The analysis based its estimates on past America’s Cups in Spain, New Zealand and San Diego. The benefit estimates included a sizable economic impact from the racing teams themselves, which typically spend months building and testing vessels. But to date, only three of nine anticipated teams have signed up for the 2013 finals, casting doubts over such spending.
Critic Aaron Peskin, the local Democratic Party leader, calls the forecast laughable.
“We should be delighted if we get 25 percent of their pie-in-the-sky estimates,” Peskin said. “There’s no history of sailing regattas being a mass spectator sport in San Francisco or the world.”
Peskin called the regatta a “real estate deal masquerading as a boat race.”
Chief Operating Officer Stephen Barclay of the America’s Cup Event Authority says that while the benefit projections may be shaky, there is little doubt that plenty of sailing fans will come to enjoy a full schedule of events.
“Who knows if the numbers are underinflated or overinflated,” Barclay said. “It’s going to mean a lot of jobs and a lot of economic benefit — that’s the point.”
Read more at the San Francisco Examiner: http://www.sfexaminer.com/local/bay-area/2012/02/final-approvals-near-re...
