What Should Birmingham Do About Its Stadium Situation?

What Should Birmingham Do About Its Stadium Situation?

On 21, Dec, 2017

To build or not to build? That is the question.

At a recent Birmingham city council meeting, the council discussed what to do about the stadium situation in Birmingham. The consensus seems to be that either the city will build a new stadium, or will upgrade Legion Field, the Old Gray Lady that has seen more than its fair share of events over the last half-century.

At the meeting, Atlanta was brought up, specifically what the city did with Turner Field, the former home of the Atlanta Braves. That led some to suggest spending $30 million in upgrading Legion Field as opposed to building a new stadium, which would be closer to downtown and be more modern but would cost significantly more – $174 million by one estimate.

Needless to say, there are strong opinions on either side. (That’s not counting the faction that doesn’t support upgrades or a new stadium.)

This debate is actually one that is common in commercial real estate. The “build or upgrade” question frequently comes up, especially when discussing legacy properties in an urban core. It can be cheaper to upgrade rather than build anew, but upgrades are almost always more limited in capability and capacity than what new construction can deliver (space issues aside).

The best way to answer the question is to conduct a thorough cost-benefit analysis that takes into account many different factors, such as:

  • Funding sources
  • Cost estimates
  • Depreciation
  • Estimated revenue generated
  • Indirect benefits (such as increased tourism, area property value appreciation, etc.)

According to the city council, Birmingham has an opportunity to be like Atlanta in terms of regional appeal. New stadium capabilities – whether they’re in the form of upgrades or a new structure – could be a big boon to a city that is growing and wanting to take a bigger role as a destination in the South.

It’s mainly a question of how these new capabilities will be realized, since most people agree that new capabilities are needed, and that means examining the cost versus the benefits.

It’ll be interesting to see what happens with the stadium question as the discussion continues to unfold. Nothing has been set in stone yet, and the end result – a new-and-improved Legion Field or a brand-new venue – has yet to be decided on.

Needless to say, it’s certainly an exciting time in Birmingham commercial real estate!

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