Need help funding your new sports complex? Here are a few tips.
Receiving funding for a recreation center or sports complex can be made easier in the initial stages of development by providing potential investors with a well-defined idea of how the facility will be used. For example, if you wanted to open a bowling alley, you’d need to provide a financial forecast, based on a number of factors, including the size of the facility, its location, and the competitive landscape.
Obtaining development funding for a sports complex begins at the idea stage. Well-defined ideas that are clearly presented have a much greater likelihood of being financed.
Understanding the optimal way to approach funders, it’s time to consider the funders themselves. There are a number of ways to attain funding, here are a few non-traditional options for financing your sports facility.
Public Grants are Available for Financing a Sports Complex
One pathway to funding that should be considered is operating as a non-profit organization. Many would-be owners never explore the non-profit path, but it opens the doors to opportunities that aren’t available to for-profit businesses. One of those is the opportunity to apply for grants.
There are many public grants available because development funding for sports tourism complexes can have a positive economic impact on communities. One of those public grants is the Community Development Block Grant (CDBG) program. According to the Department of Urban Housing and Development (HUD), the CDBG is “a flexible program that provides communities with resources to address a wide range of unique community development needs.”
CDBG grants are disbursed annually. HUD determines the amount of each grant, based on a number of factors including population growth and the poverty level in the community.
It should be noted that setting up as a non-profit has little to do with the day-to-day operational side of your sports complex. It primarily impacts financial operations (i.e., how you collect funds and pay taxes).
Getting Private Investors to Fund Your Sports Complex
Many wealthy individuals in communities throughout the United States are seeking ways to give back. One way to do this is to fund a sports complex. While seeking investor funding requires patience and determination, it can be an easier route to securing development funding than approaching a traditional lending institution for two reasons:
- Banks have strict rules and regulations that must be followed
- The lending agent is most likely a disinterested third party – there are no heart strings to pull
That’s not to say that you don’t have to have your financial ducks in a row to get a private investor(s) interested. However, they are much more likely to share your enthusiasm and vision. Your ability to cast that vision and provide financial data to prove its viability is critical.
Using Public-Private Partnerships to Fund Your Sports Complex
A path to sports complex funding that we are seeing in more and more communities is public agencies partnering with private companies. Public-private partnerships (P3’s) combine the strengths of the public sector and private industry to build a venue that best serves the community. These types of partnerships have a tendency to draw in a number of stakeholders so communicating the vision, roles, plan and progress is crucial. Since these projects have a public element, communicating with the community is also critical. Determining what the community wants and assuring them that the project aligns with their wishes is central to this process.
No matter how your sports complex is funded, it’s important to begin with the end in mind. Whether or not you obtain financing will likely depend on what type of facility you want to open, and your organizational setup. Start your journey by establishing those details and your path to financing will be much clearer.
At Sports Facilities Advisory, we’ve helped organizations attain funding for a variety of projects throughout the country. Our experience and expertise can create more funding options for your sports facility project. To learn more, contact us today or call at 727-474-3845.