A Forsyth County arena with an NHL hockey franchise would generate $6.6 million per year in county sales taxes and nearly $18 million in tax revenues annually for the state, according to an economic impact analysis obtained by The Atlanta Journal-Constitution.
The document, which the AJC obtained via the Georgia Open Records Act, provides a narrow window into financial projections from a part of the ambitious Gathering at South Forsyth project. The potential $2 billion project 30 miles north of downtown Atlanta includes an 18,000-plus seat arena and adjoining mixed-use development with apartments, offices, shops, restaurants, hotels and a community center.
The December 2022 report from Chicago-based Stone Planning only looks at the financial impacts of the arena and a potential NHL team. It does not include projections of potential tax revenue generated by the entertainment district that’s been pitched by Atlanta area auto dealer CEO Vernon Krause.
It also does not include any analysis of potential costs for taxpayers, such as for arena security, transportation improvements and other infrastructure spending, nor does it include analysis on any other potential financial support from the public.
Carl Hirsh, a managing partner with consulting firm Stafford Sports and a development team member, said the AJC obtained only the “best case” portion of the Gathering’s fiscal analysis. He said his firm commissioned studies on the surrounding mixed-use development as well as a report on the arena not having an NHL team as its anchor tenant.
The development team has downplayed an NHL connection since announcing the project, most recently not even mentioning hockey at an April work session with Forsyth commissioners.
“It’s one report that has a lot of different layers,” Hirsh said. “What (the AJC) got is the last layer, the top layer that said if we got everything, this is what it would look like.”
He declined to release the other sections of the analysis but said they found the project, located off Ga. 400 and Union Hill Road, would be financially feasible with or without the NHL cosign.
Economic studies for sports arenas and stadiums often receive broad pushback from economists, who argue they often inflate the positives while overstating the return on taxpayer dollars. Bob Boland, a sports law professor at Seton Hall Law School in New Jersey, said he sees potential with the Gathering proposal but said commissioned studies are often tests in salesmanship rather than crunching hard data.
“It’s more of a political campaign than a math problem,” he said.
Credit: HYOSUB SHIN / AJC
Credit: HYOSUB SHIN / AJC
The 18-page report estimated the arena by itself would spur $198.3 million in direct spending and about $78.4 million in indirect spending annually if it’s anchored by an NHL franchise. The arena is also expected to create 90 permanent jobs.
The report estimated the arena will cost $800 million to build, adding that the project’s construction will spur about $18.4 million in state income taxes. Construction is also expected to create 2,526 temporary jobs.
Using multipliers from the U.S. Bureau of Labor Statistics to estimate event attendance, the report found that Forsyth residents will make up a fourth of all NHL game attendees, while locals will comprise 20% of attendees for other sports and concerts at the proposed arena.
Kennesaw State University economist J.C. Bradbury, who researches and scrutinizes publicly financed sports venues, said the report is primarily based off assumptions and data provided by Stafford Sports. He said it’s hard to take the report at face value when it’s impossible to scrutinize the underlying data.
“Really what this analysis needs to be doing is convincing everyone, ‘Hey, we’ve done some market research that shows that people are willing to travel this far to see a hockey team,” Bradbury said.
Hirsh said the market study his firm conducted, which he declined to release, found ample evidence that Atlanta’s affluent and growing northern suburbs would travel to Forsyth to attend a hockey match, concert or large event.
Hirsh said the unreleased market study shows the north metro area is “a fabulous market,” surpassed only by New York, Chicago and Los Angeles.
Hirsh also argued that proposing a venue rivaling the size of State Farm Arena without an anchoring sports team is not novel. T-Mobile Center in Kansas City and Videotron Centre in Quebec City, Canada, boast similar numbers of seats without NHL teams. But those arenas do not face competitors like Atlanta’s State Farm Arena or Gas South Arena in Gwinnett County.
Credit: The Gathering at South Forsyth
Credit: The Gathering at South Forsyth
Credit: hshin@ajc.com
Credit: hshin@ajc.com
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