Fans Flock to Buy Buffalo Bills Bonds: A Unique Opportunity for Retail Investors

The enthusiasm of Buffalo Bills fans is well-known, and Erie County is capitalizing on this passion by offering a unique opportunity for fans to invest in the team's new stadium. The county is set to price $110 million in general obligation bonds this week, with a heavily publicized retail order period aimed at attracting non-traditional investors, including the team's devoted fanbase.

Tapping into the Passion of the Bills Mafia

Giving Fans a Chance to Invest in Their Team

Erie County Comptroller Kevin Hardwick believes that the average person, who may not typically invest in municipal bonds, should have the opportunity to participate in this unique deal. The investor preview site, www.BuyBillsBonds.com, was created with these non-traditional investors in mind, providing them with a chance to support the team they love through a financial investment.

Leveraging the Bills' Massive Fan Base

The Buffalo Bills have a massive and passionate fan base, with an average attendance of over 69,000 in their current 71,000-seat venue in 2023. The team's popularity is further evidenced by the NFL's lucrative TV contracts, which dwarf those of other professional sports leagues in the United States. This dedicated fan base represents a significant potential market for the county's stadium bond offering.

A Novel Approach to Stadium Financing

While stadium-related bond deals have been open to retail municipal bond investors before, Erie County appears to be the first issuer to market its stadium bonds directly to the team's fans. Hardwick believes this is the right thing to do, as the fans have supported the team not only with their enthusiasm but also with their tax dollars, which have been used to maintain the existing stadium.

Tapping into Emotional Connections

The marketing strategy for the bond offering evokes the emotional connections that fans have with their team, similar to the "fan ownership" structure of the Green Bay Packers. However, as sports journalist Neil DeMause points out, the fans are not truly owners of the stadium, but rather "part bankers" of the facility.

Navigating the Financial Complexities

While the emotional appeal of the bond offering may be strong, financial advisors will need to help individual investors navigate the complexities of the deal. The minimum denomination is $5,000, and the bonds are only available on certain brokerage platforms. Investors in lower tax brackets may not benefit as much from the tax-exempt nature of the bonds, and they may be better off considering other investment options that offer a more favorable risk-return profile.

Assessing the Financial Risks

The bonds are rated AA, indicating a relatively low level of financial risk. However, the broader economic implications of the stadium project have been the subject of debate. Economists and analysts have found little to no economic benefit from stadium subsidies, and the decision to build an open-air stadium in Buffalo's harsh climate has been questioned.

A Potential Trend in Stadium Financing

If the county's strategy of targeting retail investors, including the team's passionate fanbase, is successful, it could become a trend in stadium bond financings. BondLink CEO Colin MacNaught believes that many issuers are looking for ways to make their bond offerings more retail-friendly, and the Bills' bond sale could serve as a model for other teams and municipalities.

Balancing Enthusiasm and Financial Prudence

While the enthusiasm of the Bills' fans is undoubtedly a valuable asset, it is essential to balance this passion with sound financial decision-making. The county's decision to offer these bonds to the public represents a unique opportunity for fans to invest in their team, but it also raises important questions about the economic impact of stadium subsidies and the role of government in supporting private businesses.