FBR watching recession's effect on golf fans - East Valley Tribune: News

FBR watching recession's effect on golf fans

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Posted: Saturday, December 27, 2008 7:44 pm | Updated: 11:31 pm, Fri Oct 7, 2011.

Tiger Woods regularly skips the FBR Open, the wildly popular Scottsdale stop on the PGA Tour, but almost nobody else does.

That includes the hundreds of thousands of golf lovers who pour into the Tournament Players Club in January to watch the pros — or at least pretend to while quaffing a brew or two — and the millions who sit snowbound in the northern climes catching the action on TV.

At least, that’s been the history of the PGA’s most attended tour stop. But the severe economic slump is a precedent-setting factor that could change the course of the FBR Open.

“No one has a crystal ball, and it’s impossible to say how the economy will affect the FBR Open or other spring sporting events,” said Ray Artigue, executive director of the MBA Sports Business Program at the W.P. Carey School of Business at Arizona State University. “Everyone who has a head planted firmly on shoulders knows there will be some adverse impact, but it’s difficult to say how much.”

Still, Artigue believes sporting events are likely to be hurt less than other tourism draws. And, so far, at least, that is proving true for the FBR Open, said John Felix, this year’s tournament chairman.

The Thunderbirds, a Phoenix-based philanthropic group, stages the annual event, selling everything from individual entry tickets to hundreds of sponsorships and corporate marketing opportunities.

Some sponsors are downsizing their commitments, Felix said, but new ones have signed on to take up the slack.

“We’re well aware of how things are going in the economy,” Felix said. “But whatever changes they are making in their own companies, they are not taking the FBR Open off their calendar.”

That’s critical because the annual January event is much more than just a golf game.

BIG SPENDERS AND JOBS

It’s an economic engine that annually leaves Valley businesses and municipal tax coffers an estimated $180 million richer, generates the equivalent of more than 1,500 full-time jobs, and positions the Valley as the place where corporate VIPs vacation in winter.

That’s according to a study of the 2007 FBR Open completed by ASU’s MBA Sports Business Program.

Big spenders ring up big tabs at local hotels, restaurants and shops during the weeklong extravaganza, according to the study.

And the event venue itself is a huge cash generator. It costs more than $53 million just to prepare for and put on the event, according to the study.

Companies ultimately foot the bill. Title sponsor Friedman, Billings, Ramsey Group, corporate giants like Honeywell and Xerox that lend their names to pro-ams preceding the main event, and other businesses that slap their monikers on everything from special viewing venues to hole markers, ante up big bucks for naming privileges.

They and other businesses also rent skyboxes or tents at Corporate Village to provide venues to schmooze clients and prospects.

The Thunderbirds snag big fees for all those perks. The take pays for the event and generates plenty of leftover cash, all of which is donated to charities.

After paying the bills, the Thunderbirds donated a PGA Tour-record $8,652,542 to hundreds of charities after the 2008 FBR Open.

But with the country’s corporate giants looking more for financial bailouts than for ways to spend their shrinking budgets, the outlook for spending at such events as the FBR Open is not so clear.

SPONSORS HANG ON

Still, title sponsors are in place for all the special venues and pro-ams, Felix said. And vendors who want to reserve space in the big marketing tent to pitch their products have scarfed up the available spots, he said.

The Thunderbirds are still working on selling Corporate Village tents and skyboxes, Felix said. After the major title sponsorships, they are the biggest-ticket items.

Skyboxes, which include food and beverage services, go for $35,000 to nearly $48,000 depending on prime viewing spots, Felix said.

The priciest options, the Corporate Village tents, start at $35,000 and go up based on size and location.

The tents come with nothing but a canvas shell. Companies typically spend at least as much as the tent tab on gourmet food and beverage services. And they often dress the basic digs up with posh decor such as massive solid wood bars, elegant chandeliers, plush seating, fancy linens to cover the plastic dining tables and elaborate floral centerpieces.

Last year, to accommodate the Super Bowl crowd, the Thunderbirds boosted the number of skyboxes from 200 to 230, and filled up 33 Corporate Village tents.

Felix said it’s too soon to say how many of each will sell out this year.

But as for general attendance, he’s expecting a big crowd, maybe not Super Bowl-sized but at least comparable to other recent — and more economically sound — years.

RECORD CROWDS

A record 538,000 golf-watchers showed up last January, admittedly boosted by VIPs in town for Super Bowl XLII who idled away days before the gridiron match at the FBR Open.

In 2007 — the year ASU conducted the survey — 508,000 came through the gate.

Most attendees, except for the golfers, their entourages, PGA officials and media, were locals. But the nearly 30 percent who came from somewhere else to attend the FBR Open were mostly from the coveted corporate crowd.

They stayed in upscale hotels like the Fairmont Scottsdale resort, dropping lots of cash on restaurant and room tabs, and spending an average $271 per person per day.

Combined, they spent $62 million.

The Fairmont is expecting a good boost from the tourney again this year, said Bob Foster, general manager of the 649-room luxury resort adjacent to the TPC.

“I suspect we’ll do almost as well as last year, maybe down slightly,” Foster said.

“We’ll have five to 10 of the top golfers. On Thursday, Friday and Saturday, we’ll be absolutely full. We are probably not going to be as tight in the shoulder (days).”

Most reservations, except for the golfers and their entourages, come in mid-January, Foster said, so it’s still mostly a guess. But Foster said he’s confident he’ll fill up because of the proximity to the TPC and popularity of the event.

Rachel Sacco, president of the Scottsdale Convention & Visitors Bureau, is equally optimistic.

“The FBR Open is a one-of-a-kind — the largest and one of the most successful of the PGA events,” Sacco said.

But even if attendance is down, the tourney’s economic benefits extend far beyond the direct spending of visitors, she said.

Extensive TV coverage of the final rounds establish Scottsdale and the Valley as a premier golf destination, she said.

Inquiries to the visitors bureau about future vacation options spike during the days and weeks after the event, especially from cold, snowy locales, Sacco said.

“I think it has a huge impact on the viewing audience,” she said. “It is the best showcase for Scottsdale. People talk about it for weeks afterwards. It is etched in their memories. The TV impact creates demand year-round. We couldn’t pay with our entire budget for that kind of coverage.”

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