PB bank to pay $10.5M to put name on arena

Arkansas Democrat-Gazette - - FRONT PAGE - KAT STROMQUIST

Sim­mons Bank is set to sign a $10.5 mil­lion deal to re­name Ver­i­zon Arena be­gin­ning in 2019, arena of­fi­cials an­nounced Fri­day.

The five-mem­ber Pu­laski County board that over­sees the venue unan­i­mously voted to ac­cept a bid from the Pine Bluff bank for a 15-year agree­ment, ef­fec­tively end­ing spec­u­la­tion about which com­pany would at­tach its name to the North Lit­tle Rock com­plex.

Ver­i­zon Arena Gen­eral Man­ager Michael Mar­ion said the bank had ap­proached the arena to pro­pose the ar­range­ment, and that he had been “pleas­antly sur­prised” by the over­all level of in­ter­est in the nam­ing rights.

“That’s what’s been amaz­ing about this; the peo­ple reached out to us,” he said. “We’re go­ing to take this money and make some im­prove­ments.” The an­nounce­ment Fri­day of the agree­ment with Sim­mons Bank by­passes arena of­fi­cials’ orig­i­nal plan to put to­gether a re­quest for pro­pos­als from prospec­tive bid­ders be­cause there was “so much in­ter­est there was no need,” mar­ket­ing di­rec­tor Jana DeGe­orge wrote in an email.

Mar­ion de­clined to name other com­pa­nies that had ap­proached the arena about

the nam­ing rights, say­ing he had been asked to keep their over­tures con­fi­den­tial, but noted there was a “fidu­ciary duty to the tax­pay­ers” for the pub­licly owned arena to get the best deal.

Arena man­agers an­nounced a search for a new nam­ing-rights spon­sor in Septem­ber af­ter be­ing re­buffed by Ver­i­zon, where of­fi­cials with the telecom­mu­ni­ca­tions com­pany said they’d de­cided not to re­new the spon­sor­ship when it ex­pires next fall.

At the time, Mar­ion — who also over­saw the orig­i­nal nam­ing-rights agree­ment with All­tel for the venue, as well as a name change from All­tel Arena to Ver­i­zon Arena af­ter the merger of those com­pa­nies — said he was hop­ing for a more fi­nan­cially ad­van­ta­geous setup, as the terms of the ini­tial con­tract had not pro­vided on­go­ing op­er­at­ing rev­enue.

PAY­MENT STRUC­TURE

As de­tailed in a mem­o­ran­dum of un­der­stand­ing be­tween the two groups, the agree­ment with Sim­mons Bank is ex­pected to net the arena $650,000 per year dur­ing its first five years, $700,000 per year in the fol­low­ing five years and $750,000 per year in its fi­nal five years.

The pay­ment struc­ture is set up that way be­cause the value of the agree­ment goes up as time goes on, Mar­ion ex­plained. A con­tract could be fi­nal­ized within the next 30 to 60 days, ac­cord­ing to Eliz­a­beth Machen, the se­nior vice pres­i­dent and di­rec­tor of mar­ket­ing and com­mu­ni­ca­tions for Sim­mons Bank.

Machen said the Sim­mons Bank of­fer came to­gether af­ter hear­ing news re­ports that the arena was look­ing for a new spon­sor. She said com­pany of­fi­cials took note of so­cial me­dia chat­ter sug­gest­ing that the com­pany should make a play for the rights.

That buzz, plus the op­por­tu­nity to reach clients across states and a sense of the arena as an as­set to cen­tral Arkansas, where she said Mar­ion’s man­age­ment helps the venue com­pete above its weight class, all fed con­ver­sa­tions about a bid.

Chris White, Sim­mons Bank’s cen­tral Arkansas mar­ket pres­i­dent, said he also had been im­pressed by ex­pe­ri­ences in a client box the com­pany had main­tained there, more so than in other venues, which had helped fa­mil­iar­ize the com­pany with the prop­erty’s value.

“I think it’s great. I can’t wait. I’m ready for 2019,” he said.

Machen said the com­pany looked at re­gional nam­ing-rights ar­range­ments such as BOK Cen­ter in Tulsa and Wells Fargo Arena in Des Moines, Iowa, to re­search its of­fer.

Sim­mons Bank’s mar­ket­ing team has taken a closer look at nam­ing-rights ar­range­ments be­cause of the frag­mented me­dia and ad­ver­tis­ing en­vi­ron­ment, feel­ing that they of­fer “a level of client en­gage­ment that, maybe, tra­di­tional mass me­dia doesn’t give you,” Machen said.

In May, a gift from the bank re­named a foot­ball sta­dium at the Univer­sity of Arkansas at Pine Bluff to Sim­mons Bank Field. The com­pany also will spon­sor De­cem­ber’s King Cot­ton Clas­sic bas­ket­ball tour­na­ment in Pine Bluff, she said.

Sim­mons Bank op­er­ates roughly 200 branches across Arkansas, Colorado, Kansas, Mis­souri, Ok­la­homa, Ten­nessee and Texas and man­ages about $16.3 bil­lion in as­sets, ac­cord­ing to a news re­lease.

Chris Foy, whose Den­ver firm Im­pres­sion Sports & En­ter­tain­ment spe­cial­izes in nam­ing-rights deals, said that with­out re­view­ing the specifics, the ar­range­ment un­veiled Fri­day “ap­pears to be a very solid deal for the venue,” though he said its value for the bank will be de­ter­mined by how well the spon­sor makes con­nec­tions with arena vis­i­tors.

In an ear­lier in­ter­view with the Arkansas Demo­crat-Gazette, Foy had pro­jected that the even­tual spon­sor would likely be a bank­ing or health care com­pany with Arkansas ties.

Ver­i­zon Arena opened as All­tel Arena un­der a $7 mil­lion, 20-year nam­ing-rights deal in 1999 and changed its name af­ter the 2009 merger of Lit­tle Rock-founded All­tel with Ver­i­zon Wire­less. It hosts more than 400,000 vis­i­tors each year for con­certs, fam­ily and sports events.

IMPROVE­MENT PRI­OR­I­TIES

With the prospect of in­com­ing funds, Mar­ion said he’s been col­lab­o­rat­ing with the venue’s op­er­a­tions di­rec­tor on a pri­or­ity list of improve­ment projects.

New seats on the up­per level, a new roof or a re­vamped heat­ing and air-con­di­tion­ing sys­tem all could be in the works, he said.

Arena of­fi­cials also will turn their at­ten­tion to the mov­ing parts of a nam­ing-rights change, where ev­ery­thing from signs to shirts for arena em­ploy­ees to nap­kins will be on or­der.

Of­fi­cials also will work with Sim­mons Bank to craft a new logo and sort out other key de­tails.

In the arena’s ad­min­is­tra­tive of­fices Fri­day, em­ploy­ees dis­cussed lock­ing down sev­eral pos­si­ble Twit­ter han­dles that could re­flect the new name, which has not yet been fi­nal­ized.

“Hon­estly, we don’t know yet,” Mar­ion said. “Ev­ery­one agrees we need to fig­ure that out.”

As de­tailed in a mem­o­ran­dum of un­der­stand­ing be­tween the two groups, the agree­ment with Sim­mons Bank is ex­pected to net the arena $650,000 per year dur­ing its first five years, $700,000 per year in the fol­low­ing five years and $750,000 per year in its fi­nal five years.

Arkansas Demo­crat-Gazette/JOHN SYKES JR.

“We’re go­ing to take this money and make some im­prove­ments,” Michael Mar­ion, gen­eral man­ager of the arena, told the Multi-Pur­pose Civic Cen­ter Fa­cil­i­ties Board for Pu­laski County on Fri­day.

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