University of Virginia

Charlottesville, VA

Arena / Special Events Center Feasibility Analysis and Business Plan

In 2001 the University of Virginia commissioned B&D to complete a market and financial analysis for a proposed new arena and special events center on its campus.  At the time, the university’s basketball teams played in the nearly 40-year old University Hall.  The shortage of dedicated basketball support spaces, the limited amount of practice space, and the lack of modern premium seating combined to put the basketball programs at a competitive disadvantage, particularly with other Atlantic Coast Conference schools. To address these issues, we analyzed comparable facilities, evaluated the regional entertainment market, measured the region’s ability to support a larger venue, projected a likely event schedule, and developed a business plan and financial model to measure the financial performance of the new facility.  The study included surveys of the local community, season ticket holders, alumni, regional businesses, concert promoters, and managers of comparable university facilities.  The market analysis enabled us to project support for the facility and identify the areas on a county basis that represented potential markets for season tickets and premium seating leases.  A competitive context analysis evaluated the programming and operating strategy for similar arenas. The findings of the market analysis were the basis for a financial model that measured the performance of the financing strategy and the operations of the Department of Athletics and the arena with a 35-year operating pro forma.  The analysis resulted in a self-sustaining project financing plan that supported construction and operating costs. The $129.8 million, 15,219-seat John Paul Jones Arena opened in 2006, and in 2007, it received a Facility of Merit award from Athletic Business magazine.

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