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Thursday, June 26, 2008

The Newest Investment Vehicle: "Personal Seat Licenses"?

How are football franchises managing to raise money for their new stadiums? Well, if the local city and state legislators won't pony up tax dollars, one option is to sell "personal seat licenses" ("PSLs") to well-healed and die-hard fans. The Jets are apparently contemplating whether to issue such licenses when they move into their new billion dollar stadium in 2010. Unlike season tickets, the Jets would license the rights to the seats. The licenses seem to have a perpetual duration (or, at least, certainly last beyond one season) and may carry a $30,000 price tag. The NY Post explains:

The most expensive package is for lower level seats, where the Jets would charge $5,000 up front, then $5,000 a year for five years in PSL fees. The season ticket itself would cost $1,650 a year. The cheapest option is in the upper level corner, where seats cost $200 down, $200 a year for five years and $1,000 a year for the ticket itself.

Plus, the license is transferrable, which could turn out to be a wise investment:

PSLs have also proven to be a wise investment for deep-pocketed fans. For example, the Panthers - whose seat licenses were sold in 1996 for between $600 and $5,400 each - are currently selling PSLs for $3,000 to $20,000 on Internet auction site eBay.

I am not much of a sports fan, so please forgive any ignorance reflected in this post, but that is a pretty good ROI.

[Meredith R. Miller

http://lawprofessors.typepad.com/contractsprof_blog/2008/06/the-newest-inve.html

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