The Battery Atlanta, a 60-acre development around Truist Field, produced $53 million in revenue for the Braves in 2022.Atlanta Braves
Atlanta Braves banners are the only ones you see hanging over the porch railings of the apartments that line the neighborhood streets of The Battery Atlanta, the Braves’ mixed-use development surrounding Truist Park in Cobb County.
That’s because Braves banners are the only ones allowed in the 6-year-old development located north of Atlanta. The team owns all the apartments and included in the lease agreements is a stipulation that no other team’s banners can be hung over the railings.
That detail is indicative of the control that the Braves have over their $550 million, 60-acre development (82 acres counting the ballpark), which was designed 10 years ago and opened in 2017.
“The way you need to think about this,” Atlanta Braves CEO Derek Schiller said while standing in the plaza just beyond Truist Park’s right field gate, “is we are the developer.”
The residential lease stipulation is just one of the elements that makes The Battery a novelty in the sports world. It was the first time a sports venue and a team-funded mixed-use development was master-planned and built together, then opened simultaneously in just three years.
The Battery is the current paradigm for how sports teams can best benefit from fans and businesses’ desire for physical proximity to them. It shows how real estate risk can pay off for sports teams, if undertaken smartly.
The Battery produced $53 million of revenue in 2022 and has netted the team a combined $49 million profit the past two years from the development. Since the Braves’ final season at Turner Field (2016), their overall revenue has increased 104% to $535 million this past year, and the team returned to annual contender status, advancing to the postseason in each of the past five seasons and winning the World Series in 2021. Sports teams, which have flocked to The Battery to see for themselves, are watching closely.
“It’s unlikely that a new sports venue happens without at least an attempt to have some level of control or partnership of the development outside the sports venue,” said Schiller. “That, in and of itself, is a shift from 10 years ago.”
Surrounding sports venues with mixed-use development is not a new concept. It emerged earlier this century, in Columbus’ Arena District, and later in Los Angeles, with L.A. Live in 2007, and in St. Louis, with Ballpark Village, whose first phase opened in 2014. The latter two were some of the first team-driven developments. During the years since, the concept has shifted from a nice-to-have for teams to a need.
“The last 10 years has really just been the realization, ‘oh, this is a real opportunity for us,’” said Erin Talkington, managing director for real estate consultancy RCLCO’s sports practice.
What has changed? For starters, the recognition that real estate is somewhat risky but when done the right way it enhances teams’ valuations, a realization that wasn’t readily evident 10 to 15 years ago, said Blake Cordish, principal and vice president, Cordish Companies. That’s spurred the industry to become more sophisticated in its understanding of mixed-use development, and real estate more broadly.
“People are taking best practices, figuring out what mixed-use development is,” said Peter Feigin, who is president of the Milwaukee Bucks and Fiserv Forum and guided the team’s development of the 30-acre Deer District mixed-use area. “It’s truly not a secondary thought, it’s becoming a primary thought when you’re doing stadium and arena development.”
The mountains of considerations and challenges unique to each project mean there is no exact blueprint to copy and there will likely continue to be projects that don’t live up to expectations. Despite the risks, sports venue-adjacent developments are in various stages all over the country, at all levels of the sports industry. Ticket sales, broadcast distribution, and stadiums and arenas have all taken a turn as the sports industry’s primary economic drivers. Now, it’s land development and entertainment districts.
“And that’ll be the next phase of how you create real value that is above and beyond just owning a team,” said Oak View Group co-founder and CEO Tim Leiweke.
Retail, dining and entertainment establishments mix with residential and office space at the Cobb County development.Atlanta Braves
It’s not surprising that a company with real estate pedigree, AEG, helped kick off the team-driven, mixed-use development movement in sports with its L.A. Live development adjacent to what’s now called Crypto.com Arena. Sports venue-ancillary development was minimal until roughly 2015, when others, such as Green Bay’s Titletown, followed thanks to plunging interest rates, a raft of new arena and stadium projects, and new owners entering sports, including some with private equity backgrounds.
Differences between the real estate and sports industries were partly to blame for the slow start, said Eric Nordness, managing principal at Marquee Development. Sports owners and teams inherently take a long view of creating value; real estate developers are usually more highly leveraged and thus more driven by terminal value — the money they make when they sell a real estate asset. Plus, outside of hotels and retirement communities, there are few real estate verticals that require operations expertise.
It’s taken time, but the two industries are adapting to working together. Companies like Marquee Development, which spawned from the Chicago Cubs’ Wrigleyville project and has become a separate business that’s bridging the gap between the two industries on sports-adjacent mixed-use projects, and Cordish Companies, an entertainment venue developer with the same long view as team owners, have emerged.
While not a team, Oak View Group is the rare case in which a sports entity takes on both the owner and developer role, something Leiweke would have learned from his time at AEG. In OVG’s case, dispersing risk and the financial lift is critical. The company’s unprecedented development spree during the last few years — seven arenas in the last 18 months — was underpinned by the involvement of a wide variety of partners on each project, whether teams (City Football Group and the Seattle Kraken), entertainment companies (C3 Presents and Live Nation), developers (Sterling Equities), or celebrities (Pharrell Williams, Matthew McConaughey and Harry Styles).
“The partners we want to have are experts in the space,” said Francesca Bodie, OVG president of business development. “Where we sit is the facilitator and aggregator of those best-in-class.”
Two requisites determine whether a sports team goes down the mixed-use path on its own, or with partners: expertise in real estate (and governmental and public relations). And money.
“And if you don’t have them,” said St. Louis Cardinals President Bill DeWitt III, “then you look for a partner that does.”
A snow tubing hill, a Lodge Kohler hotel and TitletownTech partnership with Microsoft are among the attractions at the Green Bay Packers’ Titletown.Green Bay Packers
The sports industry is getting better at successfully navigating mixed-use projects. That starts with putting more resources and effort into understanding the community’s needs, implementing an overall vision and addressing key concerns, instead of down the road reacting to public relations headaches or building something people don’t want.
“It’s just a much more sophisticated way of trying to head off one of the major obstacles to these transactions in advance,” said Peter Breckheimer, a partner at O’Melveny & Myers. “It works to everyone’s benefit to do that. That’s been a lesson learned over time.”
That’s an even better idea given the heightened scrutiny over publicly funding sports venue projects.
“That’s really become the first question over the last 10 years,“ said O’Melveny partner Liz Dubeck. “People really want to say they don’t need to use public funds.”
In Cobb County, the Braves found a densely developed area with hundreds of thousands of people living and working, but without a town square-type setting. They also found local governments willing to partner, a critical aspect of any mixed-use deal. Public money paid for nearly half of the $672 million Truist Park, enabling the team to cover all costs associated with The Battery. That was easier for the Braves with the support of their corporate owners, Liberty Media, which floated a $165 million loan during construction that the team has since repaid.
Municipalities are seeing mixed-use developments work and their interest in them is growing, said Malaika Rivers, a partner at Lexicon Strategies, who worked on behalf of Cumberland, Ga., to attract the Braves and The Battery.
“It spurs economic development, it helps with the tax base, quality of life, it puts them on the map in many cases,” said Rivers, who is now working with the Atlanta Hawks on a mixed-use project next to State Farm Arena.
In many cases, public support is a must. Sports owners would probably like to self-fund more of these projects — again, control — but the sheer amount of money and risk required means that’s still unrealistic for many, even more so in the uncertain economic climate.
“You need to be prepared to put up $250, $300, $400 million,” said Braves Development Company President and CEO Mike Plant, who oversees The Battery.
At FC Cincinnati, whose owner Carl Lindner has a real estate background, the hoped-for financial impact from an eight-acre, $300 million mixed-use project that broke ground in April is both indirect and direct, said the Major League Soccer club’s co-CEO, Jeff Berding. The indirect impact is creating a place that people want to be, which naturally boosts traditional sports revenue streams, like ticket sales. The direct impact, Berding said, is, “a financial infusion into the club that will be material, because in MLS, respectfully, every million dollars means something. Could literally be the difference between being profitable or not.”
Titletown, the mixed-use area west of Lambeau Field, is managed by Title Development, the Green Bay Packers’ real estate development arm.Green Bay Packers
A giant hospitality venue
Sports entities looking to borrow ideas from successful mixed-use development predecessors have had to study individual cases intently.
“There is no kind of set way to do any of this, no blanket that you can unwrap and make work in each and every opportunity around the country,” said Leiweke. “Every one has to kind of fit the hole in the market.”
Leiweke could have been talking about deal structure, or the physical appearance of these developments. During the past decade, the sports world, and developers working within it, have gotten hip to the importance of making mixed-use developments around stadiums and arenas aesthetically interesting and inviting, and emblematic of local culture.
It’s nearly impossible to draw a straight line from beautiful public spaces to revenue generation, but they do create repeat visitation that translates into economic benefits, said Liam Thornton, ASM Global executive vice president, strategy and development. That’s especially important for a new organization like FC Cincinnati that’s still establishing its identity and staking a place in its city’s culture. The club’s chief development officer, Chad Munitz, said the development next to TQL Stadium will not feel like “Anywhere, America,” but instead uniquely Cincinnati.
“If you get plopped down to any mixed-use development around the country, you might not know where you are because you’ll see a lot of the same looking buildings and a lot of the same commercial tenants,” said Munitz. “And this will be very different.”
After the isolating COVID era, live experiences seem to matter more to people, one reason why group hospitality has become a more successful premium product at sports venues. Accordingly, the places where people gather matter more, too.
“In a lot of ways, this is just a giant group hospitality venue,” Schiller said of The Battery. “People are gathering for an experience that they can share with friends, family, even people they don’t know.”
COVID changed work culture, too, making it harder for companies to get employees into the office. Energetic mixed-use districts can do that, though, and the foot traffic from office tenants in turn fills the district with daily activity.
Seventy-five hundred people work at The Battery, in addition to nearly a thousand who live there, tacit acknowledgment of the industry’s most critical realization since the sports venue-adjacent mixed-use development concept kicked off: It can’t be over-reliant on the sports venue for visitors.
That’s a shift in thinking that ripples through every aspect of a development, especially the planning and programming of the development, according to David Carlock, who has worked on $5 billion worth of sports-adjacent mixed-use projects as founder and principal of development firm Machete Group. Even the busiest sports venues are quiet at 10 a.m. on a Tuesday.
“If that is the sun of your solar system and it’s dark all day,” said Carlock, “that’s a big challenge.”
Described as a “giant group hospitality venue,” The Battery Atlanta is also home to regional or national HQ for Comcast, Papa John’s and Thyssenkrupp.Atlanta Braves
The novelty of The Battery Atlanta stems from the Braves’ control of the project.
Once The Battery opened in 2017, the Braves, who were always the master developers, bought out their two development partners. The team decides on tenants, protects their corporate partners (see related story, Page 24), takes the profit, and even determines what kind of banners are suitable for apartment tenants’ balconies.
“Eight years we tried to do something like this at Turner Field,” said Plant. “Thank God, we couldn’t pull it off.”
Control over the project, which began in earnest in 2013, contributed to the unusual speed with which the development came out of the ground. A streamlined decision-making process and a corporate parent in Liberty Media that gave the team relatively free rein, and a clear exit date for Turner Field — after the 2016 season — all contributed to the pace of the project.
“You’re on the clock,” said Schiller. “You’re building this, it has to be done by a certain date in 2017 in order to do what we promised our fan base, which is make a better experience.”
Speed was key because The Battery is one of the largest developments in sports overseen by a single team. With the clock ticking, the team built office towers before they had signed leases, a huge financial risk that later paid off when Fortune 500 companies Comcast, Papa John’s, and Thyssenkrupp decided to move regional or national headquarters into those buildings. There were 14 cranes on the construction site at one point, but not a single one the day of the first game, April 14, 2017. It was essentially a 10-year project completed in three years.
“We were energized because of this incredible opportunity that we were going to create,” said Plant, “but it was hard. I’d never do it again.”
The St. Louis Cardinals worked with the Cordish Companies to develop Ballpark Village around Busch Stadium in 2014.Cordish Companies
While other sports venue-adjacent developments have struggled to profit financially, The Battery, six years in, is clearly boosting the Braves’ financial state. New revenue sources, such as tenant rent (from office, residential, retail, and event spaces), parking, and expanded sponsorship possibilities all boost the team’s bottom line. The latter has been key for the Braves, who saw corporate sponsorship revenue shoot up 89% during The Battery’s first year.
When baseball revenue nosedived 68% year-over-year in 2020 during the height of COVID, development revenue decreased only 5%. Three years later, as regional sports networks implode, the Braves’ traditional revenue sources, such as ticketing and concessions, have grown due to the millions of people visiting the development and stadium.
The development hosted 492 on-site events in 2022 (including 132 shows at the Coca-Cola Roxy theater and 95 games and events at Truist Park), which drew 10.1 million people. More than 3 million attended events at the stadium, the team’s highest annual attendance in 22 years. When the Braves won the World Series in 2021, 333,000 people were present for three home games. Only a third of those people were inside Truist Park.
Taxable property values at The Battery Atlanta have risen from $5 million in 2014 when the plaza was a wooded area, to $736 million last year, according to an economic impact report released by Cobb County. The Braves covered the county’s debt service in 2022, with $400,000 left over.
“Where does that money come from?” Plant asked somewhat triumphantly, spinning around in his conference room chair overlooking the stadium and The Battery, and pointing. “Right outside there.”