Sports Stadiums & Home Value
Impact of Sports Stadiums on Home Value
In mid-size towns and bigger cities, there are all sorts of community and neighborhood elements that can factor into home value. And often, we don’t separate them from one another; we think instead about city attractions in general, or the public transportation available in bigger towns, etc. Last year though, The Atlantic published a piece that highlighted one aspect of city living in particular as being worthy of consideration: the presence of a major stadium.
The article made the claim that sports stadiums are a bad deal for cities. It cited heavy tax bills, unfulfilled timelines on construction, and empty promises of job creation (not to mention crowds and traffic). It noted that in some cases stadiums absorb available funds that ought to be going toward much-needed infrastructure improvements, or even education. At the same time though, the article pointed out that municipalities “can support local sports without selling out their citizens.” The writer acknowledged various benefits of local sports teams, such as communal camaraderie and, in some ways, economic opportunity.
From this analysis it’s difficult to draw any sort of blanket conclusion about any appraisal effect from the presence of a stadium. And for that matter, there is no universal conclusion. A brand new stadium in a growing town is going to have a very different impact on valuation than an old one in an established city. But let’s consider a few more specific factors within this conversation, and with an eye on the near future.
One of the most relevant projects we can look at in terms of new stadium construction is San Francisco’s Chase Center. Newly built as a home for the NBA’s Golden State Warriors, the Chase Center is a billion-plus-dollar venue that was privately financed, and which is going to have its own hotel, condo units, and surrounding shops and restaurants. By all appearances, it’s checking off the boxes regarding what can make a stadium valuable to a community: It’s beautiful and exciting, it’s eco-friendly, it comes with amenities beyond sports, and, again, it was privately financed. At the same time though, one article looking at trendy San Francisco neighborhoods quoted multiple industry experts who were worried about the traffic around the Chase Center. They used this as reason to invest in nearby neighborhoods rather than those immediately surrounding the new stadium, which could go to show that adding a potential traffic hazard to an already-crowded area can be something of a deal breaker. The implication is that many may not want to live too close to the stadium, even if everything else about the stadium seems promising.
Potential For New Developments
When assessing the neighborhood around a stadium, it’s important to keep in mind that a stadium can become a consistent magnet for other businesses and developments. As a thought experiment of sorts, imagine just a stadium being built in the middle of an empty expanse within a big city. Wouldn’t you imagine that five years later it would be surrounded by bars, restaurants, condos and hotels? Or, with the sudden spread of gambling legislation across the U.S., might a new stadium also be a magnet for in-person sportsbooks, or new bars housing betting activity? This last point is actually worth considering even for older stadiums established in their communities. Major League Baseball, for instance, is the “old” member among America’s major professional sports, and has a number of historic stadiums that are firmly entrenched in their cities. Yet MLB betting is getting popular too, which means there’s plenty of potential for new, related businesses to pop up around these stadiums. Simply put, there will always be potential for commercial growth in a stadium’s vicinity, which can hurt or help nearby home values, but is certainly worth keeping in mind.
Smaller Towns May Be Different
For the most part data seems to suggest that homes near long-established stadiums can be more valuable, but that newer stadiums have not boosted values (and may even deflate them in some cases). But this is only taking big stadiums in big cities into account. As mentioned above, a brand new stadium in a growing town can be a different proposition. Consider, for instance, a mid-size town across the country from San Francisco: Raleigh, North Carolina has been a growing city for some time now, and has been included frequently in recent years on various lists relating to positive living environments. The city is just now working through a proposal for an extraordinarily rich downtown stadium complex (meant, eventually, to host an MLS soccer team). And while we can’t say yet what this might do for nearby home values, it may well be an example of a stadium catching a wave, so to speak – being built in the midst of existing growth, and thus possibly positioning itself as a further boost to property values.
Considering these and other factors there is no definite conclusion to be reached. It is clear though that at least in some cases, stadium proximity should be considered for its potential impact on home value.
Kai Hartley is a freelance writer who enjoys going to the movies, golf and Rubix cube.