The Tennessee Titans have reached an agreement with Nashville government to build a new $2.1 billion domed stadium, a project that includes $1.26 billion total in money from the state of Tennessee and local revenue bonds. It’s among the highest totals of public funds ever committed to a U.S. sports venue, but one that city officials argue will save taxpayers money because of the onerous lease it replaces and the specific sources of the funds.
The metro government of Nashville and Davidson County will contribute $760 million via revenue bonds, and the state is adding $500 million via a one-time contribution. The Titans ownership has agreed to fund the other $840 million—including revenue from the sale of personal seat licenses (PSLs), and money from the NFL’s league-wide stadium loan program—plus a commitment to cover all overruns.
The Titans, which are worth $3.29 billion, will sign a new 30-plus-year lease to remain in the city. The stadium could be ready as early as 2026.
“When my father brought this team to Tennessee 25 years ago, I don’t think he could have imagined a better home for our organization,” Titans owner Amy Adams Strunk said in a statement. “I am thrilled that with this new agreement, we will cement our future here in Nashville for another generation.”
The stadium will almost certainly improve the economics for the Titans, which currently play in the 23-year-old Nissan Stadium, constructed at the time of their move from Houston. A modern, domed stadium will likely also help lure more winter concerts, bigger college football postseason games and maybe even a Super Bowl, all events with economic upside to the Titans as the venue’s operator.
For the city, the deal is an opportunity to get out of an obligation to keep Nissan Stadium a “first-class” venue until 2039, part of the original package to lure the Titans to Tennessee. The mayor’s office and metro council recently commissioned an independent report to assess how much it might need to spend to maintain that status, and the group concluded it would cost $1.75 billion to $1.95 billion over the next 17 years.
This deal, the city says, will dramatically lower that obligation, and shift it from the city’s general fund to bonds backed by a new 1% hotel/motel tax, and sales taxes collected from the stadium. Both that hotel/motel tax and the $500 million from the state represent funding that can only be used for costs related to a domed stadium, according to the announcement.
“This new stadium proposal protects metro taxpayers by not spending a single dollar that could be spent elsewhere on our core priorities like education and public safety,” Nashville mayor John Cooper said in a statement. “Doing nothing was not a legal option for us, and renovating the current stadium proved to be financially irresponsible, so we are proposing a new stadium paid for by the team, the state, tourists and spending around the stadium—not by your family.”
As part of the deal, the Titans will relinquish 66 acres of land near the stadium that the team controls as part of its current lease. That’s particularly noteworthy in that it bucks a growing trend of modern sports ownership, which is now as much about finding successful business synergies in real estate, media and technology, as it is about the franchise itself.
The Titans have agreed to cover costs of maintenance and upkeep on the stadium over the course of their new lease, a departure from the current agreement at Nissan Stadium. The metro government will own the stadium when that lease expires.
It’s just the latest NFL stadium project to draw significant public funding, despite increasing opposition to such expenditures. In 2016 the Las Vegas Raiders secured $750 million in county money for their new stadium, then a record for a pro sports venue. That was eclipsed earlier this year, when state and local officials pledged $850 million for a new Bills stadium near Buffalo.
The Titans are controlled by Amy Adams Strunk who took over following a complicated transition in the wake of her father’s death. It is the 23rd most valuable team in the NFL, according to Sportico’s rankings, and 34th among U.S. pro franchises.
Inner Circle Sports served as strategic advisor to the Nashville government on the deal.