TheCatsDomain.Com Message Boards: UK signs long term lease for Rupp

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Posted by Bama Cat (Member # 153) on 12-15-2016, 12:46 PM:

University of Kentucky men’s basketball will continue to play at Rupp Arena for 15 more years.

A new contract between Kentucky’s flagship university and Lexington Center Corp. — which oversees Rupp Arena — was announced Thursday morning at the Lexington Center board meeting. The agreement, outlined in a letter of intent signed by Lexington Center and UK officials, will ensure that the Kentucky Wildcats play at Rupp through 2033.

The university’s current lease with Rupp Arena terminates at the end of the 2017-18 basketball season. UK has played at Rupp Arena since the downtown Lexington arena opened in 1974.

As part of the agreement:

▪ UK has agreed to an annual base lease payment of $1.9 million to Lexington Center. That payment will increase by 2.4 percent each year.

▪ UK will pay Lexington Center $4.75 million each year for media rights.

▪ Lexington Center will receive 15 percent of merchandise sales and will be paid a not-yet-decided amount for parking.

▪ Lexington Center has agreed to add four club suites to Rupp Arena and to change roughly 10,584 upper level seats from benches to chair-back seats. The cost of those changes will not exceed $15 million.

UK also agreed to pay a one-time sum of roughly $1 million, about half of the more than $2 million that was given to Lexington Center for design work from a state coal severance fund. Lexington Center repaid the state coal severance fund last year.

Currently, UK’s annual lease payment to Lexington Center is a little less than $1 million. Under the new agreement, UK’s guaranteed payment to the center is more than $6.65 million in the first year.

UK will get the media rights and have additional club seats to sell, generating more revenue for UK Athletics, said Mitch Barnhart, UK Athletics director. Currently, Lexington Center has the media rights. It then pays UK a percentage of those media rights.

The media rights for Rupp have become more lucrative thanks to a technology upgrade that added more video screens. If UK sells more than $7.25 million in media rights, Lexington Center will receive 25 percent of the additional revenue.

Read more here: http://www.kentucky.com/news/local/counties/fayette-county/article121045233.html?utm_source=dlvr.it&utm_medium=twitter#storylink=cpy

Posted by CatFanInYankeeville (Member # 2025) on 12-17-2016, 10:36 AM:

I'm no contract guru, but I fail to see how this benefits UK athletics. We'll earn more revenue, sure, but it's costing us an arm and a leg. I was kind of hoping UK would build an arena itself. Keep everything in-house, so to speak. Modern, larger than Rupp...all those things so many fans have been asking for.

Posted by Tiptree (Member # 844) on 12-17-2016, 01:19 PM:

It would cost a lot more than $1.9 million per year to maintain an on-campus arena and pay down the debt incurred to build it. That isn't too bad of a deal, if you ask me.

I would LOVE an on-campus venue for basketball, but the economics are pretty dismal for those facilities. Short of an outright gift in the $30-50 million range, it just isn't going to happen.

Posted by catmandoo (Member # 1284) on 12-17-2016, 10:43 PM:

Tip, your probably are right but you never know what some old wealthy coal baron "might" be willing to donate to Kentucky basketball.

Posted by m hamilton (Member # 127) on 12-18-2016, 07:24 AM:

A $30-50 million gift would only cover approx. 10% of the cost of a new arena. Especially one anywhere near the size of Rupp!

Posted by catmandoo (Member # 1284) on 12-18-2016, 12:08 PM:

Rupp was built at a cost of 55 million which is very low to what a new arena would cost.

Posted by boomdaddy (Member # 2644) on 12-18-2016, 12:42 PM:

I wonder what it would cost to dome Commonwealth?

Of course, it doesn't matter now, if they just signed a long term lease.

[ 12-18-2016, 01:24 PM: Message edited by: boomdaddy ]

Posted by m hamilton (Member # 127) on 12-18-2016, 08:04 PM:

I'm guessing it would still cost several hundred Million dollars to dome a stadium like Commonwealth!

Posted by catmandoo (Member # 1284) on 12-19-2016, 12:18 PM:

It isn't going to happen.

Posted by m hamilton (Member # 127) on 12-20-2016, 10:20 AM:

I agree, unless a multi billionaire like Trump comes in and says I'll donate a half billion if you'll build an arena and name it after me!

Posted by catmandoo (Member # 1284) on 12-20-2016, 11:18 AM:

That would be great.

Posted by m hamilton (Member # 127) on 12-20-2016, 11:51 AM:

Either a Horseman or a coal man are the only two that come to mind for possibility of money in our area!

Posted by Tiptree (Member # 844) on 12-20-2016, 02:13 PM:

... or a deep-pocketed distillery.

Posted by catmandoo (Member # 1284) on 12-20-2016, 03:22 PM:

It's amazing where all the big bucks come from.

Posted by m hamilton (Member # 127) on 12-20-2016, 03:49 PM:

All I know is where they DON'T come from!