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Stadiums want their fans back: 'We need up to 10k people to break even, not 2k'

26 January 2022 7:53 PM
Tags:
Rugby
The Money Show
Ellis Park Stadium
Bruce Whitfield
Emirates Airline Park
Stadiums
level 1
lockdown regulations
spectators
empty stadia
outdoor gathering
Pieter Burger
stadia

Bruce Whitfield interviews Pieter Burger, MD of Emirates Airline Park (Ellis Park Stadium).
Image: © andreawillmore/123rf.com

There are huge costs attached to running a stadium including ongoing maintenance, cleaning and security.

A lot of South Africa's stadiums were having a tough time even before Covid-19 struck.

The lockdown restrictions accompanying the pandemic have made things much worse and government is under pressure to open up sporting venues.

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Under current Level 1 regulations, a maximum of 2,0000 people are allowed to attend outdoor events, allowing for the “50% capacity rule” for facilities.

Some of the country's premier stadiums can seat up to around 60,000 spectators.

The FNB Stadium, or Soccer City, outside Soweto has a capacity of over 94,000.

Bruce Whitfield interviews Pieter Burger, MD of the 62,000-seater Emirates Airline Park (Ellis Park Stadium).

There's an old saying that a white elephant eats just as much as another elephant... so yes, it does cost a pretty penny [managing a stadium].

Pieter Burger, MD - Emirates Airline Park (Ellis Park Stadium)

It's been a scene widely across southern Africa... with the impact of the pandemic... A lot of facilities have dilapidated to such an extent [as the revenue streams dried up] that it's pretty much going to cost you more just to repair them than to open them up...

Pieter Burger, MD - Emirates Airline Park (Ellis Park Stadium)

Burger outlines some of Ellis Park's normal running costs and how they have been coping with the additional pressures of the pandemic.

Including salaries of your maintenance staff, big-ticket items like cleaning and security... you're looking at a running cost at Emirates Airline Park... of about R2.4 million a month. That's excluding additional operating costs of opening up events at different levels of capacity... that's just keeping the pitch at a World Rugby standard that everyone expects it to be

Pieter Burger, MD - Emirates Airline Park (Ellis Park Stadium)

Looking at just the cost of pitch maintenance throughout the course of the year... keeping it at a World Rugby standard... you can easily budget between R1.5 million and R2 million per year.

Pieter Burger, MD - Emirates Airline Park (Ellis Park Stadium)

Their saving grace has been good, prudent management and looking at alternative revenue streams, he says.

In rugby and sport and entertainment there are no reserves... Rugby's revenue streams are fairly rudimental and I think this has forced one to try and mitigate your risk of having all the eggs in one basket by diversifying revenue streams.

Pieter Burger, MD - Emirates Airline Park (Ellis Park Stadium)

It must be said as well, in terms of rugby, that for the four big clubs in southern Africa the main shareholding resides with shareholders and equity partners... They also played a major role in enabling us to get through the two years to where we are today.

Pieter Burger, MD - Emirates Airline Park (Ellis Park Stadium)

Managing through Covid has added additional costs

Opening up for 2,000 you'll break even, more or less... You're looking at easily R200,000 just for opening it up, so to break even - depending on your ticketing prices etcetera - you need between 7,000 and 10,000 people just to break even...

Pieter Burger, MD - Emirates Airline Park (Ellis Park Stadium)

Listen to the interview on The Money Show:




26 January 2022 7:53 PM
Tags:
Rugby
The Money Show
Ellis Park Stadium
Bruce Whitfield
Emirates Airline Park
Stadiums
level 1
lockdown regulations
spectators
empty stadia
outdoor gathering
Pieter Burger
stadia

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