Levi's Stadium 49ers

I walked down to the Levi’s building in North Beach on Wednesday morning to witness the announcement of something that’s been long rumored: the San Francisco 49ers and Levi Strauss and Co. had reached an agreement on the naming rights to the new facility in Santa Clara set to open in 2014. It will be known as Levi’s Stadium for at least the next 20 years, and the deal is worth $220.3 million, and Levi’s has the option to extend the deal “another five years for an additional $75 million or so,” according to the San Jose Mercury News.

That sounds like a lot of money, and it is. But while 49ers owner Jed York and Chip Bergh frequently called the agreement a “perfect fit” (if you’re against jeans-related humor, this was not the event for you), it appears the 49ers were forced to settle for two-thirds the price they initially wanted.

The deal is considerably less than the $330 million that the Niners were hoping to snag from a naming rights deal just a few months back. It’s also well below the $450 million that Met Life paid in 2011 to put its name on the new home of the New York Giants and Jets in New Jersey for 25 years.

On the other hand, Dallas Cowboys owner Jerry Jones, who opened Cowboys Stadium in 2009, is still holding out for bigger moniker money than he’s been offered so far.

And as long as we’re making comparisons, it’s worth noting that the San Francisco Giants are locked into a $50 million, 24-year contract with AT&T for their waterfront ballpark.

So it’s a good deal, not a great deal. It was a deal the 49ers agreed to for several reasons, chief among those was timing. The Santa Clara site is up for consideration to land the Super Bowl in either 2016 or 2017, and that was mentioned a lot by the four men on stage: York, Bergh, Santa Clara mayor Jamie Matthews and San Francisco mayor Ed Lee.

The San Francisco connection afforded by Levi’s was an oft-repeated theme, and that Super Bowl bid was not far behind. Lee, who awkwardly tried to celebrate how the first two letters of “Levi’s” might be in relation to the first two letters of his last name, also mentioned how the “L” and “I” in the name could refer to the specific Super Bowls (L and LI) that they’re gunning for. Lee also talked longingly about hotels getting filled up from San Francisco all the way down to San Jose and Santa Clara. Matthews talked about how those in the Bay Area don’t worry about city boundaries, they see themselves as citizens of a region. And with South Florida’s bid compromised by the announcement that upgrades wouldn’t be coming to Sun Life Stadium anytime soon, letting the world (translation: other NFL owners) know that the naming rights situation is settled can’t hurt the 49ers’ bid.

Jamie Matthews Jed York Chip Bergh Levi's StadiumYork also mentioned that “Levi’s isn’t going anywhere,” and maybe that’s a reason why they didn’t move toward a large deal with a tech company in the South Bay, a firm that might be flush with cash today but get bought and sold eight times over the next 20 years. Plus, Levi’s color scheme works a lot better with what the 49ers have going on than Facebook blue or the Google rainbow — if those companies even have an interest in spending their money on old fashioned marketing ploys like stadium naming rights.

In the end, there is no perfect company and perfect price when it comes to naming these giant facilities, there are only bad deals and bad corporate names. So the 49ers have to be somewhat happy: Levi’s is cooler than 3Com, and they are getting enough money to move along the Super Bowl bid process as well as pay off some bills:

The deal calls for the revenue to be split 70-30 between the public agency created to build the stadium and the 49ers.

The Santa Clara Stadium Authority will get $154.2 million over the 20-year deal, starting with $5.7 million when the stadium opens in summer 2014 and increasing 3 percent annually to $10 million in 2033. The revenue will help pay off the $850 million loan the stadium authority took out last year to build the $1.2 billion stadium.


Plus, winning the naming rights to a football stadium sounds great for Levi’s, but surely they wish they would’ve pounced back when the ballpark on 3rd and King was available. I couldn’t help but noticed their increased presence at AT&T Park this season, with “Levi’s Landing” and red Levi’s flags dominating the right field arcade. Does naming a stadium in Santa Clara mean people will buy more jeans and other apparel? Perhaps during a local Super Bowl and when the 49ers are winning. Then again, $11 million per year may not seem like much in 2030.

Bergh mentioned how excited he was to see Sourdough Sam run out on the field in a pair of Levi’s, and the denim jokes didn’t stop there. York referenced how Levi’s Stadium was a “field of jeans.” Bergh said the 49ers would “win one for the zipper,” which received groans from the assembled and a loud chuckle from Lee. There was also plenty of talk about Jim Harbaugh’s wardrobe. York said he’d try to get the head coach in a pair of jeans, and he succeeded mere hours later. (via @TaylorPrice49)

49ers in Levi's Colin Kaepernick Jim Harbaugh

Since Dockers makes khakis and that’s what Harbaugh really likes, I asked York whether a secondary partnership could work where Harbaugh wore the official pants of weekend duffers and those who don’t actually like “casual Fridays.” York’s response, unlike his new relationship with Levi Struass, was noncommittal.

“That’s one of those things we’re going to explore.”