Reds a home run for downtown economic development

Team generates $250+ million per year

CINCINNATI - For Greg Hardman, the Cincinnati Reds’ economic impact is easy to see.

Hardman gets double the foot traffic at his Moerlein Lager House across from Great American Ball Park when the Reds are playing. And sales there increase by as much as 25 percent.

The boost is even greater at The Holy Grail Tavern & Grille, which opened its riverfront location on Opening Day in 2011 to capitalize on the baseball crowds.

“We’ll probably see a 30 to 35 percent increase in business with the Reds being in town,” said Holy Grail co-owner Jim Moehring. “Opening Day is by far our biggest day of the year – hands down.”

For downtown business owners, professional baseball represents more than a beloved hometown tradition. The team is an economic engine.

Sure, there are the more than 2,000 people employed at the ballpark by the Reds and Delaware North Companies, the company based in Buffalo, N.Y., that handles all the team’s food, beverage and retail concessions.

Central Parking employs another 100 to staff the Hamilton County-owned garages and parking lots that service the ballpark and other riverfront attractions.

But the real economic power comes from the fans.

During the Reds 2012 season, the team had attendance of more than 2.3 million people for its 81 home games at Great American Ball Park. And historically, about half the fans who attend Reds games come from outside the Greater Cincinnati region, said Jeff Rexhausen, senior research associate at the University of Cincinnati’s Economics Center.

The Reds can't confirm that percentage is still accurate. But Rexhausen said the 2,800-mile reach of the Reds Caravan and the seven-state Reds Radio Network support the conclusion that the team draws a large percentage of fans from outside the region.

Half of last year's attendance would be roughly 1 million people from outside the Greater Cincinnati region who spent money here. And the typical visitor who comes to Cincinnati for fun spends about $465 over a two- to three-day trip, said Linda Antus, CEO of the Cincinnati USA Regional Tourism Network .

“The Reds’ economic impact is hundreds of millions of dollars a year,” Antus said. “Hundreds of millions is a very fair estimate.”

A 2003 study by UC’s Economics Center – done the year GABP opened – estimated the team’s overall economic impact at $253 million. And that figure is now a decade old.

Skeptics question true impact of teams

Still, there are plenty of skeptics who dispute those big numbers.

Local fans who attend Reds games are simply spending money there that they would spend elsewhere in the region at movie theaters, concerts or restaurants, said Andrew Zimbalist, an economics professor at Smith College in Massachusetts.

Zimbalist has for years been a leading critic of the deals that local governments across the country have crafted to build new ballparks and stadiums for big league sports teams.

He insists that communities almost never get an economic return that’s worth the hundreds of millions of dollars they invest in major league sports facilities.

Here in Greater Cincinnati, Hamilton County is still struggling under the cost of building Paul Brown Stadium for the Bengals, GABP for the Reds and the massive riverfront garages that support The Banks development.

County commissioners voted last year to cut in half the property tax rollback that was part of the stadium sales tax vote in 1996. That will add $10 million to the county’s ailing sales tax fund this year.

Commissioners also voted to use any casino tax revenues that the county gets to help balance the fund, which county officials have estimated will total $5 million to $6 million this year.

Those steps don’t solve the county’s sales tax fund problem, Hamilton County Administrator Christian Sigman said, but they certainly help reduce the structural imbalance.

Despite those troubles, Sigman said he absolutely views the ballpark as an economic driver for the region – largely because of the Banks project and other development around it.

“If you didn’t have the Banks development right up against it, if you didn’t have the park right up against it, it would be like any other urban stadium in America. People would just go home,” Sigman said. “All of it together drives the economic activity.”

Businesses say team is 'demand generator'

It’s hard to argue with local business owners who see Reds fans spend money during the season. The spending is strongest when the team is winning, business owners say, but it’s good even when the Reds aren’t doing as well on the field.

The 456-room Westin Cincinnati hotel typically books an extra 50 rooms when the Reds have home games on the weekend, said General Manager Wayne Bodington. And he said other downtown hotels see a boost during the season, too.

“I don’t think there’s any question but that they’re a big demand generator for hotels in Cincinnati – particularly downtown properties,” he said.

This will be the first Opening Day and Reds season for owners of Horseshoe Casino Cincinnati

, but the casino is banking on the team, too.

The casino has paid for prominent outfield signage inside GABP and a branded section in the ballpark’s Champions Club, an exclusive area along the first base line, said spokeswoman Jennifer Kulczycki.

The casino also is planning to buy seats as perks for its best customers throughout the season, she said. No shuttles between the two venues are planned at this point.

Koch Sporting Goods has been benefiting from the team for years. The store is three blocks from the riverfront on Fourth Street and gets twice as much foot traffic when the Reds play at home, said store manager Greg Koch.

Koch doesn’t necessarily think that means the stadium sales tax has delivered on its promise of regional economic prosperity, though.

He thinks business has been better in recent years largely because of the way the team is being managed and the fact that the Reds have been winning.

“The players that they have are fun to watch, and there’s some excitement,” he said. “The Reds have kept players around, which is really intelligent.”

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