French football club Paris Saint-Germain has begun the process of selling the naming rights to its Parc des Princes stadium and its future training centre.
The Ligue 1 champion has reached out to hundreds of prospective sponsors in order to assess interest in potential deals for the two properties. However, the club is not intending to bundle the properties together in one contract.
Work is set to begin on PSG’s new training centre, based in Poissy in Spring 2020. SportBusiness understands PSG is seeking to add the training ground naming rights early on in the building process so that the brand is involved from the development stage onwards.
Any agreement for the club’s stadium is unlikely to start before 2024, in line with the potential upgrade of the ground, and will see ‘Parc des Princes’ incorporated within the name.
The stadium redevelopment is still in the discussion phase and SportBusiness understands that the club’s overall commercial success means this not contingent on the signing of a naming rights sponsor. Industry sources said the stadium agreement is not a major priority for PSG, and that the club will not pursue a deal if it is unable to identify the right brand at the right price.
According to Daniel Haddad, head of commercial strategy at Octagon, which has advised brands on partnership deals with PSG, separating the stadium naming rights and training centre properties is the most effective strategy for PSG to maximize the overall value of its top-tier sponsorship opportunities.
Haddad told SportBusiness this morning: “A conservative market value for the stadium naming rights, depending on the final asset mix, would be a minimum €10m ($11m) to €15m per annum with a long-term commitment. The unique selling point of Paris and the lack of comparable inventory within the market could push the value north of that.”
The ‘Paris factor’, he added, would mitigate against the likely inclusion of the old Parc des Princes in the stadium name.
“The stadium naming rights should be viewed in the broader context of giving a brand the opportunity to own a significant piece of Paris real estate and extend their visibility and association beyond football,” he said.
“PSG will be able to effectively communicate the same ‘One City, One Club’ point of differentiation that they use with great success in the wider sponsorship sales strategy. Compare that with Spurs for example, who are selling a London-based proposition at a premium price point with multiple comparable major stadiums in the market; Emirates Stadium, Twickenham, The O2 and the redevelopment of Stamford Bridge.
“Although not a major Paris 2024 venue (hosting football only) this is another key selling point that can be used to show the longer-term value of the stadium naming rights.”
In terms of the training centre, Haddad would expect a minimum market value of anywhere from €7m to €10m per year depending on how PSG package the training centre rights.
Haddad said: “The value of this asset is to create a more valuable ‘Premium Partner’ position by providing the brand with a clear narrative in the training and development area as this is not an exposure-driven asset –although digital and content will generate significant media value.”
The asset, he said, will create an “enhanced opportunity” for a sponsor to differentiate from the ever-growing pool of PSG Global Partners.
“AON and Manchester United is the-best-in-class example here, although that deal does also include training kit. AXA’s deal with Liverpool is also a good example of how training/development can be used as powerful and credible activation theme in the right categories. There could be an opportunity for PSG to follow this lead and bundle the training centre rights with a premium ‘on-apparel’ position.
“In short, it is a good time to be PSG – a clear point of differentiation within the club football sponsorship market, shirt and apparel deals tied up at premium value for the long term, and premium rights to take into a healthy marketplace.”