Personal seat licenses should mean big bucks for Cowboys owner Jerry Jones

Dallas Cowboys owner Jerry Jones could bring in more than a $1 billion from personal seat licenses and suite sales at the new stadium.

Jones could take in as much as $735 million if he sells all 55,000 licenses, which cost $2,000 to $150,000 per seat, not including the price of the game tickets, according to a Star-Telegram analysis.

And with 200 suites already sold, the team has guaranteed itself at least $400 million in revenues based on the minimum suite price of $100,000 a year, including game tickets, with a 20-year lease.

The Cowboys declined to comment on the Star-Telegram analysis.

But sports economist Craig Depken said the revenues from the licenses will not only help the Cowboys pay for their $750 million portion of the $1.1 billion stadium but also add to the team’s bottom line.

"These numbers are bigger than people imagined," said Depken, a professor at the University of North Carolina at Charlotte who called the Star-Telegram’s analysis "reasonable."

"It’s underappreciated how much of a revenue enhancement the stadiums are for teams."

Jones has already made $74.5 million from the sale of licenses to 497 Founders all-access seats, which are the most expensive in the house and carry a $150,000 seat license.

And as of March, the team said it had sold over half of the 15,000 club seats with licenses costing $16,000 to $50,000, which generated at least $120 million if only the cheapest club seats were sold.

About 10,000 seats in the new stadium do not have any license attached to them, but the team has already sold all of them. It has also sold all the seats in the $100,000 PSL Founders sections and $2,000 PSL sections in the upper bowl.

The Star-Telegram analysis was based on license pricing and row-and-section information provided by the team. Based on typical stadium construction and information available about the Arlington stadium, the Star-Telegram estimated 20 seats per row in the new stadium. Adjustments were made for sections in the curve of the bowl that may have fewer rows or seats in them. The annual cost of tickets was not included.

The Cowboys won’t get all the money upfront. The suite revenue is spread over 20 years, and the Cowboys allow fans to finance a license over 30 years at 8 percent interest.

On the other hand

The revenue estimate has not been adjusted to account for tickets held back by the Cowboys for visiting teams, sponsors and employees. Licenses are not sold on those seats, and the lost revenue on them would be an estimated $34 million if the team held back 10 percent of its club seats and 5,000 general seats. All NFL teams hold back a portion of their available seats so they can be used by partners and visitors, but exact numbers are not released.

And although the team could make a substantial amount on the licenses, so will the tax man. NFL teams say they pay income tax on license revenues — the New York Giants say half their license revenue will go to taxes.

More money in the bank

The Cowboys have already secured over $390 million in funds for their portion of the stadium through a parking and ticket tax, privately issued bonds and an NFL loan. Based on that, the team would have to sell about 54 percent of its licenses to cover the remaining portion of its $750 million share of stadium costs.

NFL owners are increasingly looking at seat licenses to help fund construction of stadiums.

This summer, both the Giants and New York Jets said they would sell licenses costing $1,000 to $25,000 each to pay for their $1.6 billion stadium in New Jersey.

"The PSLs are a way for a team to contribute their share and their fans to contribute," said Jon Greenberg, editor at Team Marketing Report. "It’s not like this is a publicly owned team. This isn’t a nonprofit."

Shifting the burden

And with more public dollars being used to finance stadiums, sports-business experts say licenses shift the funding burden onto the people who use the stadium instead of the taxpayer who may never go to a game.

Greenberg said he is not surprised that the Cowboys, who are in a major media market and have a devoted fan base, set the highest license prices in the league so the team can build its stadium.

"Of course, [Jones] is a good businessman and he’s going to figure out a way to minimize his risk," Greenberg said.

Andrea Ahles, 817-548-5523

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