Taylor Swift performs at Levi’s Stadium in Santa Clara, California. Jeff Kravitz/Getty Images
- A new study shows that Levi’s Stadium brought $2 billion to the local economy in its first decade.
- It’s also on track to pay off construction debt 15 years early.
- The study found that a large portion came from non-NFL events, such as two Taylor Swift concerts.
Levi’s Stadium, home of the NFL’s San Francisco 49ers, was an economic boon for the Santa Clara area. And experiential spending on non-NFL events like concerts is partly to blame.
A new economic and financial analysis of the 49ers for Levi’s Stadium by market research and economic consulting firm SportsEconomics estimates that the venue generates more than $2 billion in direct revenue (such as visitor dollars spent on things like restaurants and hotels). generated dollars for the local economy. and indirect spending (external money spent in a community and later re-spent in the same area).
Of that, $546 million went toward employee earnings, with the stadium creating an estimated 12,000 full-time jobs in its first decade of operation.
In addition, the 49ers announced that, thanks to strong revenue streams and the sale of seating licenses, most construction debts were paid off more than 15 years early. The latter, also known as “Stadium Builders Licenses,” is similar to purchasing a membership that allows fans to purchase season tickets and gain premium access to other events. More than $300 million was raised before Levi’s Stadium opened and was used to finance construction.
Levi’s Stadium during a San Francisco 49ers game. HNTB
Non-NFL events contributed to the stadium’s success
Although the stadium was built for an NFL team, the study showed that a large portion of the economic impact came from non-NFL events, particularly live music concerts.
For example, SportsEconomics estimates that the local economic impact for fiscal year 2022 was $251 million. This included 12 NFL games and seven high-profile concerts, including The Weeknd, Coldplay, Elton John and Red Hot Chili Peppers.
These four concerts alone contributed $36.5 million to the economy. Meanwhile, the impact of regular-season NFL games used in the study ranged from $8.2 million to $17.9 million.
The Weeknd’s concert in Santa Clara also had a major economic impact. Kate Green/Getty Images
This momentum has continued into 2023 thanks to Taylor Swift. It is estimated that their two concerts at Levi’s Stadium in July generated a total of $33.5 million in economic impact for the region.
In a recent interview with Sports business and culture website Front Office Sports, 49ers President Al Guido said revenue from events unrelated to the NFL “definitely exceeded expectations.”
This isn’t surprising as people are spending more money on experiences in the post-pandemic world – what Bank of America has dubbed “funflation” – with the biggest example being Swift’s tour.
Data obtained by Fortune from research firm QuestionPro estimates that Swift’s “The Eras Tour” could generate $4.6 billion in U.S. consumer spending. Hits Daily Double reports that Swifties spent between $1,300 and $1,500 on hotels, travel and food for every $100 they spent on tickets, between four and five times the usual price.
The Las Vegas Convention and Visitors Authority credited Swift’s tour with bringing tourism back to pre-COVID-19 levels. And in Glendale, Arizona, their first concert helped generate more local revenue than the Super Bowl in February.
Taylor Swift during the MTV Music Video Awards. Mike Coppola/Getty Images for MTV
A big win for other teams
These numbers are a big win for sports teams seeking financial support to build stadiums. In the never-ending debate over who should pay for stadiums, the 49ers are trying to show that taking advantage of public assistance doesn’t necessarily have to be detrimental to an area.
If cities want to attract big-name artists and have a similar impact as Levi’s Stadium, they need more modern stadiums. Of the 20 U.S. stadiums used in the first leg of Swift’s tour, 17 were built or underwent major renovations in the last 15 years.
One of the main advantages of building new stadiums is that they can include more luxury suites. These high-end accommodations have become a key driver of teams’ demand for new stadiums because they generate more revenue than regular seating.
New stadiums in the NFL typically lead to the hosting of a Super Bowl, such as Super Bowl 50 at Levi’s Stadium in 2016. Robert Beck/Getty Images
Of the $1.3 billion needed to build Levi’s Stadium, $950 million came from loans from Goldman Sachs to the Santa Clara Stadium Authority (SCSA), a public entity separate from the city of Santa Clara Group formed to raise funds to build and oversee the operation of the stadium.
The $950 million in construction debt is nearing early repayment, which will save the SCSA an estimated $100 million in interest payments.
A similar situation recently occurred in Minneapolis, where debt from the construction of the Minnesota Vikings’ new stadium was paid off 23 years early, saving taxpayers $226 million in interest.
Public funding for the construction of Levi’s Stadium was approximately $114 million. Of that, $35 million came from new tax money, a 2% increase for hotels near the stadium.
The rest of the non-public funding — about $263 million — came from the NFL and 49ers’ stadium fund.
Guido thanked Bay Area citizens in a letter and praised the economic impact study in a statement.
“We have always viewed Levi’s Stadium as a strong economic engine for this community and the region, and we are proud that this report shows we have delivered on that potential and promise for nearly a decade,” Guido wrote in his letter.
Of course, not all public funding is sufficient for an area that subsidizes a stadium. Before analyzing Levi’s Stadium, most previous studies showed that a stadium’s impact rarely lives up to teams’ promises.
But now other teams have a roadmap detailing how they can fund a stadium in a way that helps many.
And if cities can get new stadiums and attract future Swift concerts, they can thank the 49ers.
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