Location Model in the National Football League: Predicting Optimal Expansion and Relocation Sites

Article excerpt

Abstract:

The National Football League has experienced both expansion and relocation of its franchises in the past decade. It is a dynamic market; the relocation of a NFL franchise is an annual possibility. This study looked at the demographic and economic factors that determine the current locations of NFL teams. The top 50 metropolitan areas were empirically examined to explain why some cities have an NFL team and others do not. These factors included population, per capita income, the number of other sports franchises, and the number of Fortune 500 companies, geographic factors, and television ratings for "Monday Night Football." This model can identify cities for possible expansion and those that would serve as relocation sites in the future. Special attention was paid to the Los Angeles and New Orleans markets.

Introduction:

The National Football League has experienced a dynamic period of expansion and relocation in the past decade; the league seeks to position itself with the optimal configuration for long-term growth of the professional football market. Although expansion is not a current short-term goal for the NFL, the relocation of weak teams remains an annual possibility.

Moving an existing sports franchise is not new. After the 1995 season, Los Angeles lost both of its football teams. The Rams moved from the old Rose Bowl in Pasadena to the brand-new TWA Dome in downtown St. Louis. The Raiders moved from the Los Angeles Coliseum to the newly renovated Oakland Coliseum. In 1996, the Cleveland Browns moved into a new stadium in Baltimore and became the Ravens. Most recently, the Houston Oilers moved to Tennessee and became the Titans in 1999.

The city of Los Angeles, which lost its chance to gain an expansion team in 2002 to Houston because it was unable to approve financing for a new stadium, remains without a team. Although this leaves the second largest television market without its own team, it also offers a credible relocation threat for existing team owners in their new stadium negotiations with local authorities. (1)

Expansion and relocation of franchises in professional sports leagues have been studied for baseball and basketball; however, as far as the researchers know, a location model had never been created for the National Football League. Bruggink and Zamparelli (1999) produced a location model for Major League Baseball. The top 50 metropolitan areas were chosen for the sample. The explanatory variables for the regression model are population, population growth, and per capita income, in addition to the number of other professional sports teams in the area, the number of headquarters for Fortune 500 companies in the area, and the distance to the closest city with a baseball team. As one would expect, all variables had positive coefficients in the regression model. A more recent sports model by Rascher and Rascher (2005) estimated the probability that a particular city will have a National Basketball Association team by using the same core set of variables and adding factors such as the average NBA Nielsen television ratings for each city.

One interesting application of our model was applied to the New Orleans Saints football team. Even before the Hurricane Katrina damage to the Superdome, the owners of the Saints hinted that a move to a new location was in the offing. (2) Of course, this is the typical ploy to gain public subsidies for a new or improved stadium, but the closure of the Superdome for the 2005 season made this relocation potential very real. The re-scheduled 2005 games found the Saints playing in the welcoming city of San Antonio with capacity attendance at the Alamodome. Although the Saints played the 2006 season in a repaired Superdome, they are in position to pursue one of two options after 2006: 1) stay in New Orleans with a long term city commitment to help build a new or improved stadium, or 2) move to a new location in Los Angeles (Maske and Shapiro, 2005) or San Antonio (Orsborn 2006). …