Bloomberg News

Playoff Trifecta Means Windfall Curbed by L.A. Traffic

May 18, 2012

Los Angeles hosts three playoff series this weekend, a boon for downtown’s Staples Center and a preview of the potential traffic gridlock that a proposed football stadium would add to the mix.

Basketball’s Los Angeles Lakers and Clippers and hockey’s Los Angeles Kings will play five more games over three days at the venue, owned by billionaire Philip Anschutz’s AEG Worldwide. The eight-day, 750-mile Amgen Tour of California bicycling race also will finish outside the arena on May 20.

For the weekend at least, the confluence of events has turned the teams’ shared home into the hub of a $5 billion-a- year sports economy in the second-largest U.S. city. The games mark the first time ever that three Los Angeles professional winter sports franchises have simultaneously advanced past the first round of the playoffs.

“You can certainly say this has been a good thing for Staples Center,” said David Simon, president of the Los Angeles Sports Council, a non-profit group. “You have three teams playing deep into May, and that’s never happened in the history of this building.”

While the games will draw thousands downtown, they won’t necessarily buoy the regional economy, since most spectators will be locals who would otherwise spend money on food, entertainment and merchandise elsewhere in the region, said Simon, who estimates a $5 billion annual sports impact.

Unless one of the teams goes to the championship round, the games are unlikely to draw much money from outside Los Angeles, Simon said.

Smog, Congestion

That leaves traffic, a constant irritant in a city that consistently ranks among the worst in the U.S. in congestion and air-quality studies. About 250,000 additional visitors will show up downtown over the weekend, Commander Andrew Smith, a spokesman for the Los Angeles Police Department, said by telephone.

Police and other city and state agencies have developed plans to coordinate traffic around Staples Center and facilitate the flow of cars to and from freeways, Smith said. The bicycle race, owned by Los Angeles-based AEG and sponsored by Amgen Inc. (AMGN:US), the Thousand Oaks, California-based biotech company, will defray overtime costs, he said.

“We are used to handling large events like this,” Smith said. “The only difference here is that we have a bunch of them stacked back-to-back.”

In addition to Staples, AEG owns the National Hockey League’s Kings and a stake in the Lakers. The company’s proposal for a 72,000-seat football stadium, Farmers Field, adjacent to Staples Center and the Los Angeles Convention Center has stirred debate over traffic and other issues.

‘Learning Opportunity’

“With Farmers Field opening, it’s going to cause a more rapid succession of events downtown,” said the LAPD’s Smith. “This is a good learning opportunity for us.”

Los Angeles City Councilwoman Jan Perry, whose district includes Staples Center, said she’ll monitor traffic and crowds over the weekend to get a taste of what to expect at Farmers Field.

“I want to see how it is with all these venues activated,” Perry said by telephone. “I want to see how the traffic patterns go.”

Los Angeles is the only city home to a combination of three NHL or NBA teams, and this is the first time all three reached the second round of the playoffs in the same year. Even the two NBA teams never before had advanced simultaneously.

Staples Center was the scene last night as the Kings beat the Phoenix Coyotes 2-1 on Dwight King’s tiebreaking goal in the third period. They took a 3-0 advantage in the best-of- seven series.

Tonight the Lakers, led by 14-time All-Star Kobe Bryant, will be looking to climb out of a 2-0 hole in their best-of- seven matchup with the Oklahoma City Thunder.

Packed Schedule

Each weekend day has two games. Tomorrow the Clippers and San Antonio Spurs, who lead their series 2-0 after last night’s 105-88 win, take the court at 12:30 p.m. Los Angeles time. The Thunder and Lakers play Game 4 at 7:30 p.m.

May 20 may pose the biggest challenge. Police will close streets downtown until the finish of the bike race outside of Staples Center, before the Kings and Coyotes take the ice at noon. Arena personnel likely will be rooting for the game to end in regulation, giving them time to lay down the hardwood for the Clippers-Spurs Game 4, scheduled to start at 7:30 p.m.

While surprising, the teams’ collective success has generated excitement. The Lakers have missed the postseason only four times since moving from Minneapolis in 1960. This year marks the Clippers’ fifth playoff appearance since relocating from San Diego in 1984.

Happy Days

The Kings’ lone Stanley Cup Final appearance came in 1993, when they lost 4-1 to the Montreal Canadiens.

“For AEG, you’re the happiest corporation in the world,” Victor Matheson, an economist at the College of the Holy Cross (78367MF:US) in Worcester, Massachusetts, who has studied impact estimates of sports events, said in a telephone interview.

Michael Roth, a spokesman for Los Angeles-based AEG, declined to comment on the how much extra revenue the company anticipates. He said the playoffs help compensate for the shortened regular seasons for both the Clippers and Lakers due to the National Basketball Association lockout.

“These types of events are a win for everybody,” Roth said by telephone. “Our 1,000-room hotel is completely booked. You won’t be able to get a table at any of our restaurants.”

To contact the reporters on this story: James Nash in Los Angeles at jnash24@bloomberg.net; Mason Levinson in New York at mlevinson@bloomberg.net

To contact the editors responsible for this story: Anthony Palazzo at apalazzo@bloomberg.net; Michael Sillup at msillup@bloomberg.net


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