San Francisco lost how much on America's Cup?
America’s Cup. The huge, worldwide event that that whole world cares about, except for people in the United States. Sure, a lot of locals uber’d down to the waterfront to look at the pretty boats and catch some great concerts including Sting, Counting Crows, Imagine Dragons and the Lumineers, but overall the interest seemed lackluster at best. Hotels expecting sellouts and homeowners who were planning on covering their mortgage with affluent Aribnb tenants were nothing but disappointed with the lack of visitors.
Larry Ellison is well known for doing things in a big way and the grand production and unbelievable come-from-behind victory were definitely in line with the expectations that were set. However, now that the event has passed, we can really dive into the economic impact and level of success that the event brought to San Francisco.
“San Francisco is still in the red from hosting the 34th America’s Cup, which so far has cost taxpayers at least $5.5 million, according to draft financial figures from the regatta that The Chronicle reviewed Monday.” (sfgate)
Bringing over 700,ooo people to the event over the 3 big months of the event (we’re still not really sure how long this whole thing was), the estimated economic impact on the San Francisco Economy was $364 Million. The most recent projected Revenue was $902 million, which was down from the original $1.4 Billion Economic Boost project in 2010. Yes, you read that correctly.
Without taking into account any long term effects on tourism, job creation and any other factors that could result from the exposure that San Francisco received from the event; San Francisco’s hosting of America’s Cup can easily be considered a failure. Any business that forecasted a $1.4B quarter and ended up with $364 would be criticized and it seems like America’s Cup should be, too. It wasn’t all bad, though. According to Mayor Ed Lee, The Cup “showcased our beautiful city to the world and brought thousands of new jobs, long-overdue legacy waterfront improvements, international visitor spending, and a boost to our regional economy,” Plus, we got a cool trophy…
“A $5.5 million deficit, all for a yacht race for billionaires,” said Supervisor John Avalos, who sees things a bit differently. “The whole event has been nothing more than a stupefying spectacle of how this city works for the top 1 percent on everyone else’s dime.” His thoughts? Spend the money on improving city services on outlying neighborhoods. Education would also be a great choice. Funding school music and athletic programs would have a much greater impact on children and the city in general.
As a comparison, The Democratic National Convention in Charlotte, N.C., last year infused nearly $164 million into the economy, according to a report by consultant Tourism Economics, and The New Orleans Business Alliance said hosting the last Super Bowl had an impact of roughly $430 million.
From SF Gate:
2010 Projections | March 2013 Revisions | Current Figures | |
Economic activity generated in the Bay Area | $1.4 billion | $902 million | $550 million |
Jobs created (direct and indirect) | 8,839 | 6,481 | 3,800 |
Spectators over three months of racing | 2.7 million | 2 million | 706,000 |
Costs to city’s general fund to host races* | $32 million | $22.5 million | $20.7 million |
New hotel, payroll and retail tax revenue for city | $24 million | $13 million | $6.6 million |
Racing syndicates | 15 | 4 | 4 |
* Does not include more than $180 million spent on long-planned city infrastructure projects completed to coincide with the regatta, including partial completion of a cruise ship terminal on Pier 27. The terminal is factored in, though, in the jobs, tax and economic impact categories.
So what’s next?
The winners of America’s Cup get to choose the next location, so Ed Lee has already begun to draft the paperwork to bring it back to San Francisco. Second time’s a charm?
CrawlSF
12/10/2013 @ 3:37 PM
San Francisco lost how much on America’s Cup? http://t.co/0uHBHzAHyN
gruvsf
12/10/2013 @ 4:37 PM
San Francisco lost $5.5 million on America’s Cup? http://t.co/frHZgeOqGB
rockatalic
12/10/2013 @ 4:39 PM
huh. What would that ACTUALLY have been used for? via @crawlsf San Francisco lost $5.5M on America’s Cup http://t.co/VvijrewwET
ConDri
12/10/2013 @ 4:44 PM
@rockatalic @CrawlSF Imagine what would have happened if Larry didn’t open the pocket book to get the US back in it & eventually win #fishy
rstone57
12/10/2013 @ 4:52 PM
San Francisco lost how much on America’s Cup? http://t.co/nP1kMKHeFR
Sam Landrum
12/10/2013 @ 5:41 PM
It was a joke. And Ed Lee is trying to bring it back again. I’ll pass. Like the supervisor said in the article, why not spend all that money on improving roads and put it towards education.
Matt Seliga
12/10/2013 @ 5:46 PM
Yeah. I would have missed the whole thing if they didn’t come back like that. I actually think it could have made sense if it was planned better. The pavilion could have had a lot more events, etc. and made a ton of money.
Sam Landrum
12/10/2013 @ 5:55 PM
The last time something was posted on this topic that I caught on FB (I think it was mezmer), there seemed to be some very confused individuals out there who don’t work in the service industry and def are NOT small business owners so really have no clue what’s going on in the community. This absolutely had zero positive impact on most small businesses in SF (for the most part this is true). I don’t know why all these politicians stroke the wealthy like this…well, I do know why; but seems pretty obvious there is a better solution to bring more of a positive benefit to this city other than some “international recognition” that most of us don’t care about anyway. As for Ellison … Just another egotistical billionaire spending his F U money. Thanks for sharing Matt Seliga
Sam Landrum
12/10/2013 @ 6:33 PM
Sam Landrum liked this on Facebook.
David Kleinschmidt
12/10/2013 @ 7:33 PM
I agree Sam! As a major sponsor of the entire event, I wasn’t impressed. Over estimating the attendance was a big mistake.
Jason Alexander Root
12/11/2013 @ 1:03 PM
Jason Alexander Root liked this on Facebook.