By Mike Colpitts
Major sporting events and other big attractions that gain media attention like the World’s Fair and the Olympics pay-off big dividends for cities that host the venues. Big events also boost communitie’s real estate markets.
European cities are competing for major entertainment and sporting events to expedite real estate development and investment in the local economy, according to the Urban Land Institute, a non-profit global research and education association dedicated to land use, which examined events held throughout Europe. Attractions included the Barcelona, Spain 1992 Summer Olympics, Paris, France 1998 World Cup, Torino, Italy 2006 Winter Olympics and the Lisbon, Spain 1998 World Expo.
Few cities are able to maximize, however, long term financial benefits of hosting major events because impacts are difficult to project, and depend on community involvement and planning. Some cities do better than others in efforts to capitalize on major events. Atlanta, Georgia did extremely well capitalizing on the Olympic Games they held during the summer of 1996. The Olympic committee paid for many additions to the Atlanta commercial real estate landscape, including Turner Field, where the Atlanta Braves still make their home.
However, smaller Spokane, Washington experienced little residual financial benefit from hosting the World’s fair just a few years later when it did back in 1974. Spokane’s venture was unique in a couple of ways. It was the only U.S. city to hold a Bicentennial era World’s Fair and the smallest to host such an event. During the half a year it was open more than five million people attended the fair, which left the massive Riverfont Park for the community to enjoy.
“A key variable is the capability of the actors and managers in securing the optimum impact through focused and careful alignment of the event and its amenities with the long-term development requirements of the city,” the ULI report concludes. “Hosting international events can act as a catalyst or stimulus to shape and develop an urban investment market for several business cycles once an event has been awarded to a city.”
“This means that almost all events will have an impact on urban land and property markets, infrastructure, planning and land use. In many cases these impacts will be direct and immediate, but in other cases they will be indirect and will take place over time as business cycles play and out and development cycles work through available sites to expand market geographies.”
The report points to multiple advantages gained by cities and countries hosting an international event:
- The infrastructure and amenity requirements of the event are also useful for the city before and after the event.
- The boost in tourism is beneficial on its own, leading to other types of investment and trade opportunities.
- The land redevelopment required to host the facilities can spark regeneration of difficult sites and is also a stimulus for other development planning.
- The global media exposure of an event allows a city or nation to increase its identity and image to international markets.
- The scale of the effort required and the fixed nature of the deadlines mandate project management efficiency. This often leads to institutional innovation and improved governance and collaboration.
- The international and inter-governmental commitments made to win the event have the effect of “locking in” investment planning to protect it from being cast aside by other priorities.