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THE HOUSE THAT YOU BUILT

Let's daydream for a minute.
It's opening day, 1998.
Nearly 50,000 fans are tightly packed into Bank One Ballpark's dark green seats, eagerly anticipating the first pitch in America's grandest and most expensive new generation of baseball stadiums--$70 million more than the next most expensive ballpark, Denver's $215 million Coors Field.

The retractable dome is open, letting the warm April sun shine down on the zoysia-grass field. The Phoenix skyline is visible over the left-field wall, and Squaw Peak beckons above right field.

Excitement fills the air. The smells of beer, hot dogs, peanuts and freshly cut grass commingle, creating that unmistakable baseball fragrance. The dream of Major League Baseball in Phoenix has finally arrived.

The Arizona Diamondbacks' chief executive officer, Gerald J. Colangelo, stands up in the Diamondbacks' tastefully appointed team suite, slightly to the third-base side of and overlooking home plate. He heads to the more exclusive and intimate confines of the owners' luxury suite directly below.

A smile crosses Colangelo's face as he descends the spiral staircase he ordered to connect the two suites. He passes through the owners' suite and picks up a cool drink inside the adjacent 400-square-foot owners' lounge.

He congratulates himself for pulling off the nearly impossible--again.
He thinks back a few years, when taxpayers covered $48 million of the $101 million cost of building America West Arena, completed in 1992. He recalls the tremendous impact the new venue had on the value of his Phoenix Suns basketball team. The revenue generated by the arena's luxury suites, 19,023 sold-out seats and advertising placards helped increase the estimated market value of the Suns 45 percent to $156 million.

Not a bad return for his partnership, which purchased the Suns for a mere $44.5 million in 1987.

The Bank One Ballpark takes up where the arena left off in extracting revenue beyond the sale of tickets. Money will pour in from premium and suite seating, concessions, merchandise, restaurants, advertising, media deals, naming rights, tours, interactive videos and parking.

Nothing even remotely related to ringing up sales has been left to chance.
The Bank One Ballpark also greatly expands public investment in sports facilities Colangelo controls. The public kicked in at least 85 percent of the cost of the ballpark, compared with only 48 percent for the arena.

"Now that's leverage," Colangelo says to himself as he sits down in his seat in the owners' suite. He knows the view will be great. Years earlier, he had his team of architects prepare three-dimensional, computer-generated drawings of views from the owners' box.

Colangelo scans across the field and sees 75 luxury suites, each leased at $100,000 per year, generating at least $7 million for the team. His eye delights in 5,500-plus club seats in front of the suites. At a $600 premium for each seat, they kick in another $3.2 million for Colangelo and Company. Ten million dollars already tucked into ownership pockets, and the season hasn't even begun.

Before the inaugural season ends in late September, his Diamondbacks are expected to draw 3.2 million fans who will buy $40 million in tickets--one of the highest gates in Major League Baseball. Total revenue for the year should surpass $80 million, an amount that puts the rookie Diamondbacks in the upper economic echelon of baseball.

Net profits should hit $13 million.
Colangelo looks into the outfield at 5,000 or so $6 seats; they have been designed to dispel any perception that the publicly owned Bank One Ballpark--with an average baseball ticket price of $12.50, plus seat premiums--is elitist. He ponders how many of the workingman's cheap seats were long ago snapped up by scalpers and resold--quite legally--outside the stadium gates for much higher prices.

A twinge of guilt crosses Colangelo's mind. The Diamondbacks' coffers might never have begun to fill if a reluctant public hadn't been subjected to an unpopular $238 million tax to build the ballpark. But, after all, the free market rules.

And speaking of the market, Colangelo wonders just how much the fledgling team is worth, as his young and comparatively low-paid Diamondbacks take the field to a thunderous roar from the ecstatic crowd.

Win or lose, some financial experts predict his team could soon surpass the market value of baseball's most profitable franchise, the New York Yankees, whose television-driven $185 million net worth may have peaked unless a new stadium is soon built.

Not a bad outlook for the expansion team Colangelo and his wealthy partners bought for $130 million.

Play ball!

Let's end the daydream, and ask a question from the land of reality: Can it be true that Colangelo and his Diamondbacks partners will use public subsidies and favors--many unrecognized by or unknown to the public--to make a financial killing, while thousands cheer the Diamondbacks on?

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John Dougherty
Contact: John Dougherty