19 September 2007 3 Comments Print This Post  Email This Post

Some time ago, your housing choices were limited to a single family home, or an apartment which you would lease. That all changed when condominiums and co-ops where introduced as a new way to own real estate. Before this time, it was unheard of to own just part of a building, with the exception of special title situations like a tenancy-in-common. Now condos are the hot new thing among homeowners as well as investors. Just a few years ago, buying a pre-construction condo was almost a sure way to profits. A Chicago entrepreneur now wants to introduce yet another way to buy real estate, but he doesn’t want to sell you a home or a time share, he wants to sell stadium seats in sports arenas and ballparks. The full article is available on CNN Money.

I decided to feature this article because I think its a big idea that could change the way we do things. This new idea also solves a problem, which is the foundation of any successful new venture. It solves the problem of the lack of funding for new stadiums. With this idea, seats can be sold off pre-construction, just like a condominium in order to get the funding needed to build it. This may prove to be worth while to fans in the long run as you won’t have to pay for tickets every time. Of course all of this is speculation until we find out all the details such as pricing and terms.

Another great thing about this idea is that there is a real potential investment aspect. The possibilities are endless. Perhaps you can decorate and upgrade your seating area with luxurious amenities and resell it at a markup to an even bigger fan with deep pockets. Maybe you can rent your seat out on certain nights that you can’t make, or you can do so during a bigger event like a playoff game. How about the potential to profit from speculation? Say you buy a cheap seat in a new stadium of a team with a mediocre winning record, a few years later the team starts winning and all of a sudden your seat is worth a lot more than you paid. As you can certainly see, there is an investment potential just like any other form of real estate. However, the feasibility of utilizing this as an investment depend heavily on pricing and terms as well.

All in all, I think its a great idea that can really work. There is a market for this type of product. Sports fans sometimes spend a lot of money on crazy stuff. I’m sometimes in that situation, but my craziest splurge was a Joe Montana autographed mini helmet. I think the notion of owning part of the stadium you frequent is appealing to a lot of fans out there. It’s way too early to tell whether or not this idea will take off. The bottom line is supply and demand, and as long as the pricing and terms of the product attracts enough demand, it will work. On paper I think its a great new way to purchase a new class of real estate.