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ASM, MSFA renegotiate U.S. Bank Stadium management deal

U.S. Bank Stadium exterior

We suspect this won’t be the only revised management contract in the sports-facilities world. Citing extenuating circumstances, the Minnesota Sports Facilities Authority (MSFA) and ASM Global extended the U.S. Bank Stadium management deal while lowering payments.

The original contract to operate the home of the Minnesota Vikings was set to run through 2026. Under the new terms for U.S. Bank Stadium management, the contract will now run through 2031 and guarantee payments of $110.7 million over the course of the contract. The original deal started with an annual payment of $6.75 million, rising 2 percent annually.

But with COVID-19 heavily impacting both the sports and events industries, ASM took a huge hit on the revenue side. The new deal gives ASM Global lowered costs and also the flexibility to make up past-due payments. From the Minneapolis Star Tribune:

COVID’s impact will be felt by ASM Global over a total of three fiscal years, which began with the fiscal year 2020 ending last June 30 when ASM recorded a $1.7 million shortfall. For this fiscal year, which ends June 30, ASM projects a $2.3 million shortfall. For fiscal 2022, beginning July 1, ASM projects a $1 million shortfall.

In the new deal, ASM will have to make up the shortfalls in payments to the MSFA, but will have until the end of 2031 to do so.

Beginning in fiscal 2023, however, ASM is on the hook for the full annual guarantee of $7.3 million with no forgiveness possible, Vekich said. The new deal also bars ASM from exiting the contract.

It’s been a rough year for U.S. Bank Stadium. Besides the loss of almost all non-football events and only partial attendance for later Minnesota Vikings games, the stadium has reverted back to a construction site, with the distinctive exterior replaced. The original black zinc panels have been replaced after designers discovered they were not as sturdy as anticipated, leading to many water leaks within the facility.

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August Publications