Sprint buys arena naming rights
Proposed center garners $62 million in support from Overland Park firm
Overland Park ? Sprint Corp. on Thursday committed to paying $62.5 million over 25 years for the rights to name a new arena proposed for downtown Kansas City.
Sprint will pay $2.5 million each year for 25 years for the naming rights. The full payment is contingent on officials of Kansas City and developer Anschutz Entertainment Group attracting an NBA or NHL franchise to use the arena. If that doesn’t happen, Sprint’s annual payments would decrease to $1.7 million a year, or $42.5 million total.
But Gary Forsee, Sprint’s chairman and CEO, said he didn’t expect that to be a problem.
“The Sprint Center will be a showcase venue,” Forsee said at a news conference at the telecommunication company’s headquarters in Overland Park. “The Sprint Center … will serve as the focal point for increased tourism and will draw visitors from across the region.”
Forsee addressed concerns about signing a naming-rights deal when the company has laid off nearly 25,000 people since late 2001 by saying the $2.5 million annual payments equal less than 1 percent of the company’s $700 million marketing budget. Sprint employs about 65,000 people.
Forsee also blasted out-of-town companies, including St. Louis-based Enterprise Rent-A-Car Co., that are fighting a proposed $4 tax on car rentals to help pay for the arena. That tax, along with a $1.50 increase in the hotel room tax, goes before Kansas City voters on Aug. 3.
“They want to prevent economic growth and vibrancy for our region,” Forsee said. “And that makes no sense at all.”
He also pledged that his company would help in the campaign to get the tax passed. The tax is expected to raise $123 million toward construction costs of the area, estimated to cost $225 million to $250 million.
Shares of Sprint closed up 5 cents at $18.35 in trading Thursday on the New York Stock Exchange.