Two major financial institutions are vying to buy the naming rights for Cape Town Stadium for between R20 and R40m a year.
|||Cape Town - Two major financial institutions are vying to buy the naming rights for Cape Town Stadium for between R20 and R40 million a year.
It would meet most of the high annual costs of running the stadium, expected to hit R47.8m this financial year, against R12.2m income so far.
Since 2009 the venue has cost the city’s public purse R436m to run, but it has earned only R92m. The two companies have submitted formal proposals to the city on the rights.
At the same time, the city is in “robust negotiations” with the Western Province Rugby Union to convince it to move from its historic home ground, Newlands, to take up the anchor tenancy at the stadium.
This was disclosed by the city’s executive director for events, tourism and marketing, Anton Groenewald, in a briefing to the Green Point Ratepayers and Residents Association on commercialising the struggling R4.2 billion venue.
He outlined to the association’s AGM the business models the city was considering to operate the stadium profitably.
Its business analysts looked at profitable, working examples such as the Barcelona Olympic Stadium and the Allianz Arena in Munich.
Barcelona has a major retail component and hotel. Another successful practice was selling the naming rights, such as the Allianz Arena, so renamed when financial services company Allianz bought the naming rights of the Bayern Munich soccer club’s stadium.
The Allianz group had bought the naming rights from the club for 30 years for e20m (R247m), Groenewald said.
A local example was Sahara Park Newlands Cricket Stadium, where the naming rights had been bought by the Gupta family business, Sahara Computers.
Groenewald would not name the two companies eager for Cape Town Stadium’s naming rights, as a public participation report had yet to be tabled before the city’s marketing and events committee.
The option to buy the naming rights was part of the business plans presented to the public for comment.
Groenewald cautioned against undue optimism, however.
zara.nicholson@inl.co.za
Cape Times