Staples Center's name will never change, new agreement says
Staplesâ€™ original naming-rights agreement with AEG has been â€œextended in perpetuity,â€ the two companies said. AEG contends that the arrangement is â€œthe first lifetime naming rights extension for a major market arena.â€
The office supply store chain promised to pay almost $120 million in 1999 to put its name on top of Staples Center for 20 years. Neither party revealed how much more Staples will pay to lock up the rights for good, saying only that it was a fee previously agreed upon in their contract.
â€œThe lifetime piece to this sets a new precedent,â€ said industry watcher Dave Brooks, a senior writer at Venues Today magazine. â€œAEG accomplished something unique in pro sports.â€
Brooks speculated that Staplesâ€™ annual payments to AEG could change depending on how well its namesake arena continues to perform as an entertainment venue. If, for example, the Clippers basketball team is someday sold and moved to another city, Staples would get less exposure, so its payments might go down.
So far, however, Staples Center remains â€œa very prestigious building,â€ he said. It houses about 250 events annually, including games played by the world champion Los Angeles Lakers. The Grammy Awards and the Pac-10 basketball championships also are held there.
By Venues Todayâ€™s estimates, Staples Center is the No. 3 concert venue of its size in the world, grossing $43 million on 70 shows last year. Only Madison Square Garden and the O2 arena in London, which is also owned by AEG, took in more.
â€œA long list of sports champions, community leaders and entertainers have had some of their greatest moments at Staples Center, and we look forward to many more,â€ said Mike Miles, president of Staples.
The Framingham, Mass.-based company is one of 10 that pay AEG substantial annual fees for naming rights, said Todd Goldstein, president of AEGâ€™s sponsorship division. Other large sponsors include American Express, Nokia and British mobile phone provider O2.
AEG expects to gross more than $250 million from selling naming rights this year, Goldstein said.
-- Roger Vincent
Fans gather outside the Staples Center to pay their respects to singer Michael Jackson during the Michael Jackson public memorial service held at Staples Center on July 7, 2009 in Los Angeles, California. (Photo by Sandy Huffaker/Getty Images)