However, the situation moved more quickly than anticipated. In an order dated August 22 and signed by United States Bankruptcy Judge Mary F. Walrath (it's shared here), the court overseeing Sports Authority's bankruptcy granted the team's motion. The order notes that Sports Authority was authorized to assign the naming-rights contract to the Broncos as of August 18.
Meanwhile, the Broncos "shall pay to the MFSD the payment of $3,601,890 that was due to the MFSD on August 1, 2016 under the Naming Rights Contract." That's the payment Sports Authority didn't make, thereby opening up the opportunity for the Broncos to jump into the naming-rights game.
While there's been no official announcement from the Broncos about this development, the team had previously stated that it was fielding naming-rights offers from assorted parties — but was not considering one from O.penVAPE, a marijuana-related company. See the latest document below, followed by our previous coverage.
Original report, 6:36 a.m. August 4: As we've reported, the bankruptcy of Sports Authority meant that the company's name would eventually have to come off Mile High Stadium — or Sports Authority Field at Mile High, as it's been officially known since 2011, when the retailer secured the rights from Invesco, a financial firm.
And while we still don't know what moniker will wind up on the Denver Broncos' home, we have a much better idea how long Sports Authority's logo will linger at the facility — several weeks, at least, and likely a month or more.
Sports Authority's failure to make a $3.6 million payment by an August 1 deadline prompted the Broncos to file a motion in a Delaware bankruptcy court to take over the company's contract with the Metropolitan Football Stadium District. The contract, which went into effect in 2001, during the Invesco days, runs through July 31, 2021, and requires remaining payments of over $19 million.
But that doesn't mean the stadium will be rebranded by the time the Broncos kick off their first home preseason game, on August 20 versus the San Francisco 49ers.
As noted by Matt Sugar, director of stadium affairs for the MFSD, a hearing in the case won't happen until August 31 — and even if the judge okays the Broncos' motion, as is expected, there's no guarantee that the situation will be resolved by September 8, when the team faces off against the Carolina Panthers to mark the start of the regular season.
"After the hearing, we'll be discussing our options with the team," Sugar says. "But I can't anticipate what might happen with a potential new naming partner."
If the judge blesses the Broncos motion, "it affects us in a positive way," Sugar goes on. "It continues to allow us to receive money for the remaining portion of the naming rights, because they'll be assuming the contract. But with that said, the Broncos have brought this to the district, and the idea we both have is to look for a new naming-rights partner."
Those of you who wish the venue would revert to its old Mile High Stadium name, without any corporate sponsor attached, are out of luck — and the reason has everything to do with dollars and cents. The tax measure that partially helped fund the stadium, as well as Coors Field, ended in 2011, Sugar notes, "and with no tax revenue coming in, we depend a lot of the naming-rights dollars."
Indeed, the stadium district is currently in the midst of "doing a conditions assessment of our facility," Sugar notes. "We've got some preliminary numbers, and we're probably looking at over $300 million to maintain the facility over the next thirty years."
Sugar acknowledges that this is a hefty sum, "but think about what it would cost if we were to build this facility." The stadium, which hosted its first Broncos game on September 10, 2001 (the night before 9/11), "cost $400 million when we built it, but chances are it would be in the $1.2 billion-to-$1.4 billion range now. So the interest the stadium district has is in protecting the asset as long as we can, because nobody wants to be paying for a new stadium."
Naming rights certainly won't cover that entire cost, even if they go for substantially more than the current contract, whose original value was set at $60 million. But Sugar points out that "the Broncos have put in a lot of money over the years. Between us and the Broncos, it's at probably $100 million already. A lot of that comes from rent paid by the Broncos, which amounts to several million dollars a year. And there may be other opportunities for revenue. There's a light-rail station right next to the station and a huge development in the Sun Valley neighborhood just south of the stadium."
He concedes that "it's hard to tell where we'll be in year 29 of the next thirty years. But we're looking at everything we can to deal with these issues, because maintaining the facility gets more expensive the older it gets. We're talking about 1.8 million square feet and over eighty acres we have to maintain, and that makes it pricey. We're talking about parking lots, elevators, expansion joints. All these things have a certain life, which is why we're doing the conditions assessment now. We want to have a better idea of what we'll need to budget."
Not that he feels the stadium is on the verge of collapse.
"I think the district and the Broncos have been good stewards of the facility," he says. "It's hard to imagine that it's already fifteen years old, but it is — and it looks great. It's been kept in great condition, and we're keeping up with the times."
In the meantime, Sugar confirms, the Broncos have been talking with potential naming-rights partners. But that old Sports Authority emblem will definitely be on the stadium for weeks to come — and perhaps a lot longer.
Look below to see the joint release from the Broncos and the Metropolitan Football Stadium District about the team's motion to assume the naming rights. That's followed by two documents: the motion itself, plus the current contract.
Broncos/Metropolitan Football Stadium District release:
“Pending court approval, the Denver Broncos have assumed the Metropolitan Football Stadium District’s contract for the naming rights to Sports Authority Field at Mile High.
“This acquisition streamlines the process for securing the best possible long-term partnership for the naming rights to our stadium. As in the past, proceeds from stadium naming rights will be split 50-50 between the Broncos (who also provide sponsorship elements) and the MFSD.
“There is no timetable for securing a new naming rights agreement, and the name of the stadium—Sports Authority Field at Mile High—has not changed at this time. The Broncos look forward to working with the MFSD in establishing a new long-term relationship with a stadium naming rights partner.”
QUOTE FROM BRONCOS PRESIDENT AND CEO JOE ELLIS
“It was important for us to step up and assume this contract to expedite the shared goal we have with the Metropolitan Football Stadium District of finding a new naming rights partner. Together with the MFSD, we understand how important naming rights are to the future of our stadium.”
METROPOLITAN FOOTBALL STADIUM DISTRICT
“The Metropolitan Football Stadium District (MFSD) was informed that a motion was filed in a Delaware Court for the Denver Broncos to assume the naming rights contract for Sports Authority Field at Mile High.
“The filing of bankruptcy by Sports Authority had left uncertainty in the future of the naming rights of Sports Authority Field at Mile High. The Denver Broncos assuming the naming rights offers some clarity in the future of Sports Authority Field at Mile High.
“In anticipation of a potential court decision, the District Board directed the staff to prepare a request for proposals (RFP) to seek a valuation for a new naming rights partner. Those efforts will continue as both the court and District processes move forward.
“Pending court approval, the Denver Broncos will assume the MFSD contract with Sports Authority.
“Naming rights revenue is primarily used for capital improvements extending the life of the stadium well into the future, attempting to avoid need for public funding. The District and the Denver Broncos are currently conducting a facilities conditions assessment of the stadium and surrounding campus. Preliminary numbers indicate over $300 million will be needed over the next 30 years to maintain the facility.”
QUOTE FROM MFSD CHAIRMAN RAY BAKER
“This will allow the District to work closely with the Broncos to secure the best possible outcome for a new naming right partner. The District looks forward to working with the Broncos over the next weeks and months to secure the best deal.”