The Tennessee Titans Want A New $2.2 Billion Stadium

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Hey Friends,

The Tennessee Titans have an agreement in place with Nashville Mayor John Cooper to build a new stadium, according to a memo released by the team this week.

The new 1.7-million-square-foot stadium will reportedly be located just a few miles down the street from the Titans current stadium, cost ~$2.2 billion to build, and have a dome, enabling the venue to host year-round events that aren’t possible at Nissan Stadium — the Super Bowl, the College Football National Championship, the Final Four, concerts, conferences, and more.

As for financing, Axios says the Titans will contribute $800 million in private revenue for the deal, and the government/taxpayers will fund the rest through $500 million in bonds from the state, a 1% tax on all hotel room rentals in Davidson Country, and sales tax collected within the new facility and the surrounding 120-acre campus.

Furthermore, the Titans have agreed to fund upkeep for the stadium throughout the life of their lease, and the government will own the stadium when their lease expires.

But the interesting part of this announcement (to me, at least) is the reason why the Tennessee Titans and Mayor John Cooper feel a new stadium is necessary.

The Titans currently play at Nissan Stadium, which opened in 1999 and has housed the team for the last 23 years. The problem is that a provision in the team’s current lease requires the stadium condition to be kept on par with other sports venues built around the same time — and to achieve that level of quality, the team/city says it would require a renovation that costs ~$1.8 billion over the next 17 years.

But that seems like an unreasonably high number. No, I’m not an architect or engineer, and I don’t build multi-billion-dollar stadiums for a living. But take Gillette Stadium, for example. The New England Patriots stadium opened in 2002—just three years after Nissan Stadium—and it is currently undergoing a $225 million renovation that will add a 75,000-sq-ft hospitality space, a 218-feet high lighthouse with a 360-degree observation deck, and the largest outdoor HD stadium video board in the United States.

All $225 million of that project is being funded by Patriots owner Robert Kraft, and that means the proposed ~$1.8 billion Nissan Stadium renovation is 8x more expensive than the work at Gillette Stadium, despite being just three years older.

Furthermore, according to economist J.C. Bradbury, there isn’t a single stadium renovation across the NFL (in history) that cost more than $1 billion to complete, even after adjusting for inflation.

Heck, Buffalo is even building a brand-new stadium for $1.4 billion, and the Las Vegas Raiders recently moved into Allegiant Stadium, which is the world’s second most expensive stadium and costs $1.9 billion to build.

And don’t forget, the ~$1.8 billion number is for a renovation, not a new stadium.

So why do I think the estimated renovation cost is so high? Well, the short answer is I don’t know. Maybe that number includes construction, maintenance, lease extensions, and other contractual terms. But still, it’s undoubtedly an abnormally large number and something people should be questioning, especially taxpayers.

World’s Most Expensive Stadiums (total construction cost)

1. SoFi Stadium (Los Angeles): $5.5 billion

2. Allegiant Stadium (Las Vegas): $1.9 billion

3. MetLife Stadium (East Rutherford): $1.7 billion

4. Mercedes-Benz Stadium (Atlanta): $1.5 billion

5. Wembley Stadium (United Kingdom): $1.5 billion

And the elephant in the room here is that virtually all significant economic studies produced over the last 10+ years have found that publically funded stadiums don’t produce enough local economic value in return.

So at what point do we stop letting NFL owners socialize the construction costs of their new stadiums while privatizing their team's profits?

I hope that day comes soon—but with the demand for an NFL team outpacing the supply of currently available organizations, I wouldn’t hold my breath.

Have a great day. I’ll talk to everyone tomorrow.

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