A down economy and a competitive market combined to bring an end to a Nederlander Concerts’ management agreement to operate Phoenix’s Maricopa County Events Center, formerly known as the Sundome Arena, after three years.
The end of the agreement, however, does not mean Nederlander is bailing out of the Arizona market completely. According to CEO Adam Friedman, it was based on an evaluation of what it would take to bring the aging venue up to competitive snuff in a competitive region in the current economy with Nederlander and the county agreeing the cost wasn’t justified.
“When we made the agreement, it was on very favorable terms with an opportunity to take a venue in what at the time was a growing market and turn it into something special,” Friedman told Pollstar. “The county was great to work with. They were excited by the prospects, but they found themselves in a similar spot and it really is kind of basic economics.
“The good news is, there wasn’t a significant amount of capital spent on it and then it failed. That would have been really bad. This was trying to make a go of it in its existing configuration and existing conditions to determine whether or not it would warrant a significant capital infusion. The ultimate decision was no it wouldn’t,” Friedman said.
Nederlander continues booking shows in the Tucson area, and Friedman reports that the company, with its portfolio of quality small- and mid-sized venues, had a very strong 2008 and expects that to continue into 2009 with that business model.
“We are going to be fiscally conservative going into 2009 … but we feel pretty strong going into the year because of the direction of the industry,” Friedman said.
Maricopa County supervisor Max Wilson announced the settlement but praised Nederlander’s efforts.
“It is a sad day; once again we are witnessing the performing arts fall victim to a troubled economy,” he said in a statement. “Nederlander has been a great partner as we attempted to keep this venue alive. The metro area is extremely competitive when it comes to available performance venues. Unfortunately, we do not have sufficient capital funding for renovations required to make the Maricopa County Events Center a destination.”
The Maricopa Events Center was constructed in 1980 and donated to Arizona State University in 1984. Maricopa County took over the venue and partnered with Nederlander to operate it in 2005. With the end of the agreement, the county will turn the venue back over to the University. – Deborah Speer