NORTH MANKATO — An indoor recreation center in North Mankato could conceivably break even for the city by its fourth year, according to a financial feasibility study.
That’s what the North Mankato City Council learned Monday while reviewing revenue projections for the sports complex.
City officials say enough local sports groups have pledged to use the facility to make up a majority of the fieldhouse’s projected revenue, though the city budget would likely take a $190,000 total hit during the fieldhouse’s first three years of operation.
By year four, the fieldhouse at Caswell Park is estimated to take in about $627,000 in revenue, just over an estimated $621,000 in expenditures.
“We’ve been a proven operator of recreational facilities,” City Administrator John Harrenstein said. “We believe we can replicate that with the indoor fieldhouse.”
The facility would earn about $90,000 from various basketball activities, including court rentals, clinics and tournaments. Another $72,000 would come from volleyball activities, and about $133,000 would come from tennis.
An additional $122,000 is expected to come from concessions and beer sales, based on Caswell Park visitors’ purchasing patterns. Harrenstein said he expects similar sponsorship revenue compared to Caswell, though certain projections such as batting cage rentals, daytime programming, rentals and membership fees could vary as the fieldhouse gains traction within the community.
City officials say the fieldhouse would still operate well even if those projections don’t pan out. In that case, the fieldhouse would have an annual budget shortfall between $40,000 and $110,000, which is comparable to Caswell Park, All Seasons Arena and other similar public facilities in the area.
Harrenstein said the city’s budgetary projections don’t take naming rights fees into account. North Mankato is seeking to sell the naming rights for an annual contribution, which would go toward the facility’s operating expenses.
City officials project the fieldhouse would likely spend about $315,000 annually on staff costs, including part-time staff, day camp staff for community events and a tennis instructor. Fieldhouse supplies are estimated at about $103,000 a year, and the city expects to spend about $163,000 on various services and charges.
If all goes well, the fieldhouse could grow from an estimated 14,000 to 15,000 annual visitors when it’s first built to the 35,000 to 55,000 visitors at Caswell Park each year. The fieldhouse is estimated to bring in about $2 million in annual economic impact to North Mankato during its first few years, but that could grow as well.
The feasibility study comes as North Mankato requests $10.5 million from the Minnesota Legislature in an infrastructure bill this year.
That $10.5 million would mostly go toward the proposed fieldhouse, a long-sought community feature in the Mankato area, though about $3 million would go toward renovations at Caswell Park’s soccer complex. North Mankato would kick in about $5.5 million for the project.
City officials envision the fieldhouse as a combination sports complex and permanent dome with a variety of courts and indoor space. As Harrenstein pointed out, if the city wants state funding, the fieldhouse needs to balance its role as a community asset with a mission to become a “regional mecca” for amateur sports similar to Caswell Park’s softball facilities.
“We have to walk and chew gum at the same time,” he said.
Council member Jim Whitlock urged city staff to continue keeping the fieldhouse’s potential statewide appeal in mind.
“We can’t look at this as just a local facility,” Whitlock said. “We have to look at this as a regional facility given our location in southern Minnesota. We can draw north from the Twin Cities and the rest of the state, we can draw south from Iowa, from the eastern part of the state, and from North and South Dakota.”