As sports fans become more focused on social interaction, unique experiences, and getting value for their money, it can be a challenge to create spaces and cultures that appeal. A further challenge is that this same fanbase is shrinking; McKinsey reports that just 38% of Millennials are committed sports fans, down from 45% of Gen Xers. Some forward-leaning pro teams and municipalities have already begun addressing these challenges through proactive Capital Planning—the process of strategizing around market shifts and the long-term financial exposure of a facility. However, in the college and university space, it’s almost unheard of. Athletics master plans can be successful in generating donor excitement, but are they successful in adapting to market shifts or managing future financial exposures? This critical activity should be on every organization’s mind.
Why? Capital Planning reduces risk of deterioration or malfunction and maximizes returns on market, fan, or student preference changes. Things break, which makes Capital Planning useful in proactively addressing physical obsolescence, from annual wear-and-tear to life cycle replacements. Things also change, which makes Capital Planning useful in proactively addressing functional and experiential obsolescence, from shifts in operations, technology, and market demand. Capital Planning is also useful in capturing new or incremental revenue opportunities, for example from maximizing premium and ticketing sales, per caps, ancillary revenues, or donor giving.
A solid Capital Planning approach might look like this:
What are the ways your facility or institution is adapting to change? How are you planning for Capital Improvements?