(Bloomberg) -- Steve Ballmer spent 10 years building a new home for his Los Angeles Clippers basketball team — and $2 billion of his own money.
A lavish new star among the LA area’s galaxy of entertainment and sports venues, the 18,000-seat domed arena opens on Thursday, just days after Tom Cruise grabbed the Olympic flag in Paris and motorcycled toward the next Summer Games in Los Angeles in 2028.
Most professional sports venues depend on public financing. But Ballmer, the world’s eighth-richest person according to the Bloomberg Billionaires Index, paid out of his own pocket for the Intuit Dome, a hemispheric structure designed to resemble the mesh of a stretched basketball net.
“I’ve been more blessed than I have any right to think about,” Ballmer, the former chief executive officer of Microsoft Corp., said during a media preview of the dome last month. “I mean, this was not cheap. This was an expensive arena to build.”
The dome is outfitted with a phone charger next to each seat’s cup holder, wireless payment grab-and-go concession stands, cannons that fire T-shirts to the highest nosebleed seats and a massive double-sided screen dubbed the Halo Board with 233 million light-emiting diodes suspended from the arena roof.
Thursday’s grand opening begins with a two-night stand by singer Bruno Mars followed by artists including Usher and Olivia Rodrigo. The first basketball game will be played Oct. 26 when the National Basketball Association’s Clippers host the Phoenix Suns.
The Intuit Dome is the latest puzzle piece in a massive, privately developed, complex on the site of the former Hollywood Park horse-racing track in Inglewood, a city of more than 100,000 outside Los Angeles. It’s across Century Boulevard from SoFi Stadium, a $5.5 billion amphitheater that was privately financed by Los Angeles Rams owner Stan Kroenke and opened in 2021 as home to both the Rams and the Los Angeles Chargers of the National Football League.
“You’re gonna get what I think are the best stadium and the best arena in the world, you know, right here,” Ballmer said. He also owns the nearby Kia Forum, the former home of the NBA’s Los Angeles Lakers and now mostly a concert venue.
Los Angeles already has enough hotels and sports facilities to host the roughly 10,000 Olympic athletes who will compete in around 300 different individual events, as well as millions of spectators.
But giant sporting spectacles are failing to attract public support like they used to, partly because of how much they cost. Tokyo incurred expenses of $35 billion — nearly five times higher than what was initially projected — when it hosted the pandemic-delayed Olympic Games in 2021. The 2016 Olympics in Rio de Janeiro cost $13 billion, which exceeded projections by more than 300%.
The most recent estimate for the total cost of the Paris games was under $10 billion, although the overall operating costs are still unknown, according to an S&P Global Report.
Former Los Angeles Mayor Eric Garcetti projected that the games will turn a record-breaking $1 billion profit — a significant portion of which would go to the United States Olympic & Paralympic Committee, overseen by the International Olympic Committee. The LA 2028 budget rose to $6.9 billion last year from $5.3 billion, and it’s likely to continue climbing.
Public Financing
Typically, when sports franchises seek to build a new venue, they turn to their local community to help foot the bill. While municipal governments are usually cautious about allocating too much for a team, given other spending needs and a cap on taxpayers’ willingness for increased levies, teams have a powerful bargaining chip: They can leave and relocate to a locale willing to shell out the cash.
The Milwaukee Bucks opened the Fiserv Forum arena in 2018 with the help of $250 million of public funding. Most recently, the Carolina Panthers secured $650 million of public funds for a $1.3 billion renovation of Bank of America Stadium. And the city of Jacksonville, Florida, is sharing the cost of a $1.4 billion renovation for the Jaguars.
Ballmer also invested roughly $100 million in the city of Inglewood via a community benefits agreement that includes $80 million for affordable housing, assistance to renters and first-time homebuyers, and $12.8 million for school and youth programs.
One thing Intuit and SoFi lack is a mass-transit rail connection, a potential hurdle for what current LA Mayor Karen Bass vowed will be a “no car” Olympics in 2028.
SoFi will host Olympic swimming events after having hosted the 2022 and 2027 Super Bowls as well as matches in the 2026 FIFA World Cup. Intuit will host the NBA’s 2026 All-Star Game before the Olympic basketball games in 2028.
The Clippers will be leaving downtown LA, where they have played second fiddle to the Lakers since their current home court at the Crypto.com Arena opened in 1999. The exit comes as downtown struggles to recover from the pandemic, an economic crisis visible in Oceanwide Plaza, a bankrupt $1.2 billion development across the street from Crypto.com. It’s known as the Graffiti Towers since artists tagged the buildings, which are as tall as 49 floors.
The Lakers have 17 NBA championships, second only to the Boston Celtics. The Clippers have none — so far. But they do have a splashy new home.
“We are going to try harder,” Ballmer said. “We’re going to work harder. We’re going to do what we can in every way, shape and form — for our fans and for our team.”
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