- The Washington Times - Wednesday, October 1, 2014

The Fall Classic could prove a fall windfall for the local economy, with the Washington Nationals potentially playing 10 sold-out playoff dates that could mean tens of millions of dollars in business for the team, its vendors and the local restaurants, bars, parking garages, souvenir stands, ticket scalpers and snack vendors who benefit from the team’s success.

The baseball team could play just two home dates, but in a best-case scenario for area businesses, the Nats would contest a five-game series and then two seven-game series in the quest to bring the city its first World Series title since the Calvin Coolidge administration. That deep postseason run scenario, according to D.C. Chamber of Commerce President and CEO Harry Wingo, could mean big bucks for some of his members.

“I couldn’t be more excited for the playoffs. It’s going to mean money for the city. I’m convinced,” Mr. Wingo said.

Brian Beauregard will drink to that.

Mr. Beauregard, the general manager of the Gordon Biersch Brewing Co. restaurant, just a block from Nationals Park in Southeast Washington, said he expects to see a similar number of people for each postseason date that the brewery restaurant welcomed for Opening Day. The Nats drew 42,834 for the season opener in April (the “official” capacity for the stadium is listed as 41,888), and the team expects to draw similar crowds for the playoff games that begin Friday afternoon.

Unlike in the Nats’ 2012 premiere playoff appearance, the first two games of the first series will be at home, as would a decisive fifth game if needed. The team also is assured of home-field advantage (and four potential home dates) in a league championship series, and as many as three home games should they make it to the World Series.

The average ticket price to attend a Nationals game this season was $35.24, according to Statista.com and Team Marketing Report, and average attendance this season was 31,844. The Nationals can expect to welcome almost 11,000 extra fans per game during the playoffs. At regular season ticket prices, that’s an additional $387,288 per game.

However, ticket prices for postseason games will jump exponentially. According to TiqIQ, the average price for a single ticket to the 2013 NLCS was $341.29. At that price, the Nationals would make nearly an additional $54 million for four home games during the National League Championship series than they would for four home games during the regular season, not counting the economic spin-off effects.

The team has a Fan Cost Index of $227.96, the eighth highest in Major League Baseball. The index estimates how much the average family of four spends per game for parking, a program, food, beverages and a team cap. If you divide that by four to get a rough cost per attendee, the average National fan spends about $57 for a game without factoring in the cost of a ticket. With an increase in attendance, the Nationals can expect to make an additional $626,320 on top of ticket sales if stadium and parking prices remain the same during the playoffs.

The stadium opened six years ago in the teeth of the Great Recession, and development of parcels in the neighborhood is only now achieving real momentum. City and business officials say one intangible economic benefit of the playoffs would be the marketing exposure the area around the park will receive from sustained national and international media coverage.

“I think we’re going to see more people realize what a gem we have in Nationals Park and the area around it,” said Mr. Wingo. “I’m excited, as the president of the D.C. Chamber of Commerce, [about] all the activity that’s going on in the area around on M Street. A lot of the promising activity is happening within walking distance of the park.”

Counting the impact

Calculating the economic impact of a successful sports franchise is not an exact science and can be a source of sharp debate.

When St. Louis hosted the World Series in 2013, the city forecast a $23.7 million economic stimulus from the team’s playoff run, according to Forbes. Accounting for a higher cost of living and a 1.26 percent increase in median income for the District compared with Missouri, that number would increase to almost $29.9 million if the Nationals make the World Series.

Gregory McCarthy, vice president of community relations for the Washington Nationals, said a lengthy playoff run would have a considerable impact on the community but the team could not give an estimate of how much.

If the Nationals and the Baltimore Orioles — who start their playoff run Thursday — meet in the World Series, the economic stimulus estimates could shoot up for both cities.

Although the city and team are optimistic that postseason play will bring money into the region, some economists argue that the subsidies and tax breaks cities offer to attract or keep professional sports franchises rely on inflated and unrealistic projections of the payoff.

“There’s not any evidence that there’s any tangible economic benefits from postseason appearances,” said Brad Humphreys, associate professor of business and economics at West Virginia University, who has studied the economic fallout from postseason play in a number of sports.

Fan money is certainly brought into the city, but it is money that otherwise would have been spent elsewhere, Mr. Humphreys said. Postseason play tremendously benefits the team and nearby businesses such as Gordon Biersch, but it pulls money from other businesses such as movie theaters, bowling alleys and bars farther away from the stadium.

Georgetown economist Ian Gale agreed.

“Expenditures on one team tend to crowd out expenditures on other forms of entertainment,” he said. “A couple may go watch the Nationals instead of going to a restaurant followed by a movie. If the couple spends $200 going to Nats Park instead of spending $200 on dinner and a movie, there is no net effect.”

Sports franchises and local officials “tend to focus on total spending by fans, but they ignore the crowding-out [factor], with the result that they overstate the economic impact of the team,” he said.

Nationals Park has been a lightning rod for criticism and political wrangling since it opened in 2008. The stadium’s financing included a substantial contribution from the District, mostly through $535 million in bonds that the city committed to repay in 30 years.

Mr. Humphreys said postseason play was certainly good for the financial health of the teams participating and could be good for city morale, but the economic net gain is minuscule.

“Having the Nationals in the playoffs will not really change how much beer D.C. baseball fans drink, just where they drink it.” Mr. Gale said.

The people who peddle the beer disagree.

“With the playoffs, my inclination is that [beer sales are] going to increase because there are going to be more people going out to watch the ballgame, where they might have just gone home without that opportunity being there,” said Justin Cox, founder and CEO of Atlas Brew Works, a Northeast Washington brewery that opened a year ago.


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