ESC report projects $11.5B in regional economic activity
Today, The4000, the community coalition supporting the construction of the downtown Entertainment and Sports Center (ESC), released The Renaissance Report, a comprehensive economic analysis of the impact of the new entertainment and sports center and related downtown development to Sacramento. [Download the Renaissance Report]
“The Renaissance Report makes clear that the significant private sector investment led by the Sacramento Kings will revitalize downtown Sacramento by unleashing $11.5 billion economic development over a 35 year period,” said Cathy Dominico, Managing Partner at the Capitol Public Finance Group. “From a pure hard cost economic return perspective, this represents a compelling multiplier effect and strong return on the public investment as measured by economic activity.”
The report articulates the significant job creation and economic benefits anticipated by the project and subsequent economic development. It concludes that Sacramento ESC project compares favorably with similar downtown revitalization efforts observed in Kansas City, Memphis, Oklahoma City and Columbus.
Specifically, the report outlines 8 key findings regarding economic benefits that will be generated by the City’s $258M investment:
1. Construction of the ESC and the ancillary development will create over 11,700 temporary construction jobs.
2. The ESC will create or preserve 4,000 permanent jobs: including over 3,700 new permanent jobs created by the ancillary development around the ESC and nearly 300 existing permanent full-time jobs that will move from the current arena to the new ESC.
3. Foot traffic from the ESC and ancillary development to the ESC will generate over $230 million in economic activity for the Sacramento region.
4. Over a 35 year period, the Sacramento region will see over $11.5 billion in economic activity – equating to $7.9 billion on a net present value basis.
5. Based on experience of similar markets, a public contribution of $258 million could be leveraged into a $1.2 billion investment into the development of Downtown Sacramento. Thus, every $1 of public money could be leveraged by approximately $3-$4 in private investment.
6. The new ESC alone will attract 1.65 million new visitors to Downtown Sacramento on an annual basis, with additional visitors coming to ancillary development to live, work and shop. Additional development outside the project area will attract even more visitors and further increase spending levels.
7. Hotels located within walking distance of the ESC and ancillary development in Downtown Sacramento will see an increase of over 248,000 guests who choose to spend at least one night in a downtown hotel.
8. Fiscal benefits for state and local government agencies created by the ESC and ancillary development will include almost $9.4 million annually generated by sales and transient occupancy taxes. Additional revenue would be expected to be generated by increases in other sources of government revenue.