WSJ Article on PSU BOT / Beaver Stadium
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““I feel really comfortable with what we’re projecting going forward,” said Sara Thorndike, Penn State’s chief financial officer.”
Lubrano doesn’t meet his financial obligations for the baseball stadium but all of a sudden is concerned about funding the football renovations. Rich.
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2894461/““I feel really comfortable with what we’re projecting going forward,” said Sara Thorndike, Penn State’s chief financial officer.”
CONCLUSIONS
Optimism is a tendency to expect good things in the future. From the literature here reviewed, it is apparent that optimism is a mental attitude that heavily influences physical and mental health, as well as coping with everyday social and working life. Through an adaptive management of personal goals and development and by using active coping tactics, optimists are significantly more successful than pessimists in aversive events and when important life-goals are impaired.Clinics should develop an application form of optimism concept in Applied Psychology and in Psychotherapy. As a matter of fact, application form of optimism concept should be integrated in treatments and prevention programs respectively in mental and physical health, to improve well-being.
I can't imagine how conflicted he is over this. A tortured soul. On the other hand, couldn't they have put him on a payment plan? I kid. I kid.
Any of you that abstained or voted against the renovations should be forced to sit in section NK bleachers for every home game until the end of your term. No more cushy suites.
Also, you should have to make 4 laps around the stadium concourse up to a half hour before kickoff. No more elevators.
"Some Penn State trustees point to the University of California, Berkeley, as a cautionary tale.
Berkeley borrowed about $440 million in 2012 to renovate its football stadium, Memorial Coliseum. The school planned to pay for the work in part with pricier ticket plans, but those sales stalled and other athletic expenses continued to rise.
In early 2018, Berkeley’s chancellor agreed to take on a portion of the debt. As a result, the university will make about half of $18 million in annual debt payments through 2031 and pay even more thereafter—money that could have gone to other university priorities."
Sandy!
Thank you. The information you provide on issues affecting Penn State is much appreciated. In turn, I have passed it on to other alums I know who do not frequent this Board. Through the years we have done what we can to affect change, but our efforts have borne little fruit. Our power is, by its nature, very limited. Still, the information we receive from all sources has enabled us to reevaluate our relationship with our Alma Mater and, to the extent that we donate (I no longer do), enabled us to be more selective in where our dollars are spent.
First hand knowledge of funding shortfalls is a valuable thing.
If he were paying the promise letter by letter where would we be so far? Medlar Field at Lub Park? Lubra Park?
She got her MBA from Ohio State so I'd take that statement with a grain of salt. Seriously, how much more money can the university raise from ticket prices and concessions? Games are pretty much sold out so as it is.““I feel really comfortable with what we’re projecting going forward,” said Sara Thorndike, Penn State’s chief financial officer.”
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I understand but how much more will fans be willing to pay for tickets and concessions? The stadium is pretty much sold out now so they can't sell more tickets. They'll just have to charge higher prices for the tickets they're already selling.
Also, there's only so much donor money and we need as much of that as we can get for NIL.
I understand the need to maintain and upgrade the stadium. I'm just wonder how much could have been done for $350 million.
The expectations of fans are changing and revenue projections are banking on people willing to pay a premium for better accommodations and services. Younger fans especially desire more bang for their buck and simply going to a football game to enjoy the game is no longer the MO. We can argue until the cows come home whether this is the right approach, but I for one will be watching closely to see what type of premium seating becomes available when the west side renovations are completed. I’d certainly pay significantly more to have a cushy seat with easy access to rest rooms and concessions. The additional investment is worth it to me to not be crammed into an 8 inch metal bleacher seat with no ability to even stand up without tripping over the backs of people in front of me.
The idea of not having scones and lattes at a football game. Inconceivable.
At least the Cal renovation costs were exaggerated by virtue of the stadium being built directly on top of the fault line that was rated as constituting an “appreciable life hazard” in case of an earthquake, and that figure also includes the construction of a new building that’s essentially a combo of their Lasch Building and also is the home of a dozen Olympic sports.
The revenue AND expense projections used to arrive at "break even" for ICA (and more the expense side than revenue side, though both are important) were, IMO, extraordinary - and far out of line with both our long-term history and with reasoned analysis.
The fact that leadership would not address questions or even provide foundational information to support such claims was - and is - disconcerting, to say the least.
The idea that it is "supportive of football" to cripple the financials of ICA - if that were to happen - in order to build (1/2 of) a Mecca is, IMO, both short-sighted and unwise. In an uber-competitive environment, operating with an albatross around its neck does not further the success of an ICA department.
How excited will fans be to spend more money to watch a stale program? If CJF can’t deliver this year with a 5* QB as his returning starter (maybe onto the NFL along with our top two RBs next year), and/or if we end up in a meh bowl with a bunch of opt outs, I think people will find other ways to spend their time and money and that Mecca will be empty like school on Saturday.
If you’re going to be content with 10 wins and losses against our best opponents, why go broke fixing the thing that isn’t the issue? Assuming people will keep paying to watch this program ‘as is’ is a mistake.
I’m convinced you would have been opposed even if conservative financial estimates proved to be revenue positive. Serving on the board isn’t about financial integrity to you, it’s about propping up a long ago regime in the name of Dear Old State.
There was a $200 million dollar option just for deferred maintenance. Add that to the $70mm for winterization and you'd have $80mm left to play with at $350mm.
How much do you currently pay for seats and how much more are you willing to pay? Tickets currently cost roughly $150 each depending on the game. Do you upgrade to the Nittany Lion Club?
Let's assume 20,000 fans are willing to spend an additional $50 each ($200 per ticket vs $150). That would generate and additional $1 million per game or $7 million pe year. Compare that to the $700 million price tag and tell me how this pays for itself.
I understand that some of this will come from donations and other sources but it's a big nut no matter how you slice it. It seems to me that PSU could have done a lot with a $350 million upgrade. Other upgrades I've read about:
Georgia $68m
Tennessee $288m
OK State $55m
Florida $400m
Missouri $250m
FL State $265m
Cotton Bowl $140m
Nebraska $400m (being severely cut back)
That's part of my point. I think we're hitting up the same donors for the stadium AND NIL. Which is more important?
I understand what you're trying to say but the Jets averaged almost 80,000 for the last 15 years!
A couple of amplifications from the article:
1. the $44mm/45mm projected surplus is un-discounted cash flow over 30 years. Anyone care to take a stab at what happens if a NPV is calculated, as most organizations do with a project of this type?
2. "When asked what would happen if the athletic department couldn’t service the debt, Thorndike said she doubted that would be an issue and, if necessary, the athletic department could reduce expenses.
'Even if temporarily we had to let athletics borrow [from the school], we would do it with nontuition, nonstate education dollars,' she said.
The Athletic Department is not a legal entity and, thus, cannot borrow. Typically the way this works is that the school borrows from outside and then lends the money to the athletic department which repays it over time. If the athletic department cannot repay........
But Boom Boom is "comfortable" with all of this, so I'm comfortable.
Keep in mind that only about1/3 of the stadium is being renovated. Probably going to be difficult sell to squeeze more money from fans sitting in the relatively untouched areas. And I have no idea of what the economic of the press box are.
My understanding is that only a relatively small portion of the $70mm went to winterization. A good chunk went into developing this plan. Barry may have a better accounting.
What would that number be in today's construction environment? $1.25 billion or probably more? The can has been kicked down the road too many times. That's why it's so expensive now.
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Nowhere near that much. That's a 10% average annual rise over a ten year period. While recent increases meet or exceed it, construction inflation rates earlier were far less.
When that $70 million spend was approved, I was the only one to vote against it.
I voted No largely because I felt that what we were being told about what it would be spent on was not true. I was, as things played out, correct.
Ok, so maybe I exaggerated a bit. Sue me!
Seriously though, check out what happened during Covid that didn't correct itself and IMO never will.
Cost Index
Crunching the latest quarterly numbers and giving you the trends that matter, so that you have the insight you need going into the next quarter
www.mortenson.com
If these renovations were done in 2015 like at A&M, it would have been MUCH cheaper.
Yea, kicking the can down the curb is already why PSU is paying $700 million to renovate half the stadium. If they kick it down a few years again, it’ll be over $1 billion. Just do it now.Ok, so maybe I exaggerated a bit. Sue me!
Seriously though, check out what happened during Covid that didn't correct itself and IMO never will.
Cost Index
Crunching the latest quarterly numbers and giving you the trends that matter, so that you have the insight you need going into the next quarter
If these renovations were done in 2015 like at A&M, it would have been MUCH cheaper.
I understand your concerns and reasons for voting no in this instance and the stadium renovations. It’s a notable concern and I respect that. My question is, what alternative plan do you support to renovate the stadium with the necessary safety upgrades and other amenity upgrades to make it comparable to other stadiums? What is your plan to get to that point at a lower cost and how do you plan on garnering support for it to get the goal accomplished?
If they wait long enough, there will be no college football to worry about. There may be no Penn State either.
Then again, spending the $700 MM now could hasten Penn State’s demise.
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A lot more. Wait until the renderings come out to see all of the new premium seating options that will come at ridiculous prices. And they will raise prices for all the new seats that have chairbacks, which will probably be at least half of the stadium. Count on it, ticket prices are about to go way, way up. Demand, and capacity, will drop. The die hard fans will get priced out, the corporate executives with the bankroll will take their place. The environment will suffer as the passion in the stands will likely decrease. A tale as old as time for sports venues that chase the almighty dollar over everything else.
Concessions options at Beaver Stadium royally suck. So expect those to improve but also come with higher costs.
The index jumped 10-12% during Covid, but the curve has been flattening since, returning to the 3-4% previously seen..Ok, so maybe I exaggerated a bit. Sue me!
Seriously though, check out what happened during Covid that didn't correct itself and IMO never will.
Cost Index
Crunching the latest quarterly numbers and giving you the trends that matter, so that you have the insight you need going into the next quarter
If these renovations were done in 2015 like at A&M, it would have been MUCH cheaper.
Sure it would have cheaper to do whatever necessary in 2015, but Ms. Godamn Fu@king Excellence was busy with her fu@king Facilities Mater Plan which treated Beaver Stadium like an afterthought to be addressed in 2035. She was preoccupied with her Center for Excellence (why do people name schit like that?), tennis facilities, and building the most expensive competitive swimming facility in the US, instead of tending to the cash cow. Unfathomable. The explanation of priorities I was given: the fear was that all of the donors would be tapped out if they were hit up for Beaver Stadium first, and there would be no money for anything else. Well, goooooolllllllleeee!
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The vast majority of the stadium will continue to be bench seating - just as it is now.