Having name on Miami Heat's arena benefits American Airlines even in bankruptcy, but court must agree
Among the many issues left up in the air, so to speak, by the Chapter 11 filing this week by American Airlines are the naming rights deals for the arenas where the Miami Heat and Dallas Mavericks play.
Early indications from American Airlines are the names will remain on the arenas, but ultimately the bankruptcy court will have to sign off on that.
A solid case can be made that the investment is an asset to the ongoing operation of the airlines, particularly in light of the teams that play in the arenas.
When the Heat and Mavericks played in this year’s NBA Finals, it was estimated by Front Row Marketing Services that each game brought more than $10 million in national advertising exposure. So the six-game series amounted to a $60 million benefit to the airline.
American Airlines pays $2.1 million a year in a $42 million naming rights deal in Miami that runs through 2019, and $6.5 million a year in a 30-year deal in Dallas.
That would seem to be a worthwhile investment, at least in the eyes of sports marketers. How it will be regarded by a bankruptcy court weighing the assets of a company that lost more than $12 billion in the past 10 years is difficult to predict.
Front Row Marketing, which represents numerous venues in naming rights deals, bases it calculations of the advertising value on exposure of the signage in the arena on the television broadcasts and mentions by the announcers.
"We don't know if that's right," American Airlines spokesman Tim Smith said during the 2011 Finals of the eight-figure estimate, "but there's value in it, and we're sure it's a large amount."
This year’s Finals were the second in which American Airlines has gotten a double shot of exposure from the Heat and Mavericks. And with the Heat emerging from the lockout with their Big Three stars intact, there is a good chance of the AmericanAirlines Arena hosting more championship series.
Naming rights holders have vanished on other venues due to bankruptcy procedures, including the former Trans World Airlines Dome in St. Louis. The Pro Player moniker remained on the Dolphins’ stadium for several years after Fruit of the Loom liquidated that division in bankruptcy.