University of Southern California

Los Angeles,

Arena Business Plan

In 2007 B&D was selected by the University of Southern California to complete an operating business plan for the Galen Center. The 10,000-seat, on-campus facility opened in 2006 after an aggressive capital campaign raised nearly $150 million. This planning effort was initiated by the university to study alternative operating strategies that would expand and enhance the benefits of the Galen Center to the university and to its athletic department. Included with the business plan were a series of recommendations for refinement of the management strategy, a proposed operating structure, and an analysis of the potential financial performance of the Galen Center. Through interviews with the entertainment industry we identified an outside event market that would use the building, provided certain operating efficiencies were introduced. We recommended a more aggressive use of the basketball practice facility, which would open up dates for other events. The expansion of the event schedule was projected to generate nearly $250,000 per year in additional net operating income. Additionally, this analysis was completed as part of a larger plan that addressed operations of the L.A. Memorial Coliseum. Based on our financial analysis, the university and its athletic department would benefit from economies of scale and other efficiencies if the operations of both facilities were combined. Furthermore, the use of a private management firm was considered beneficial only if the operations were combined.