Bermuda gains 2017 America’s Cup — with a heavy cost - Soundings Online

Bermuda gains 2017 America’s Cup — with a heavy cost

Author:
Publish date:

Bermuda wooed America’s Cup organizers with a $77 million package in its bid to host the 2017 regatta.

The figures were revealed in an address to the Bermudian House of Assembly by the island’s minister for economic development Grant Gibbons, according to stuff.co.nz.

Bermuda is still celebrating beating San Diego for the right to be the next venue for sport’s oldest trophy. However, the website predicted that it won’t take long for the economic realities to become apparent for the 65,000 residents of the British territory in the North Atlantic.

The key figures revealed by Gibbons include:

• A $15 million event fee to the America’s Cup Events Authority

• A $25 million underwrite to cover any sponsorship shortfall by the authority

• $14 million for site preparation and infrastructure for docks and the America’s Cup village

• $11 million in operation expenses for the America’s Cup village

• $12 million to cover transport costs, security, emergency services, insurance and legal bills

Spinning the good side of the equation, Gibbons predicted that the island could gain “approximately $250 million from hosting the event” and $14 million was predicted to come in from taxes and duties.

A Business Insider report earlier this year said Oracle co-founder Larry Ellison had threatened to move the America’s Cup when San Francisco changed the terms.

San Francisco taxpayers spent $20.7 million to host the race, the San Francisco Chronicle reported, not including more than $180 million in already planned improvements near the waterfront. And the city wound up $5.5 million in the red.

The event drew 700,000 people to the city during three months of racing in 2013. They spent $364 million, according to a report released by the Bay Area Council Economic Institute.

That was less than the $902 million that was projected months before the race and far less than the $1.4 billion figure that was bandied about in 2010.

Sir Russell Coutts, the New Zealand CEO of cup holder Oracle Team USA, was heavily involved in the process and made it clear that Bermuda had won the hosting rights from San Diego for an ability to deliver “two key criteria” — a centralized base to house all of the competing teams and its favorable time zone, which worked best for TV coverage that subsequently satisfied the needs of the event’s and teams’ sponsors, according to stuff.co.nz.

Bermuda has promised an extensive Cup village that could have all of the team bases in one location, with strong interaction for fans.

“That would have been very, very difficult in San Diego,” Coutts told the yachting website sailingscuttlebutt.com as he discussed the decision to go with Bermuda. “It’s just that they didn’t have an open space which could effectively house even six AC62 teams together. But, I should add, that’s quite a difficult criterion for most of venues to achieve.”