SMG Celebrates 40 Years of Facilities Management
Published: Apr 11, 2017
Four decades after signing the Mercedes-Benz Superdome in New Orleans, SMG is celebrating its 40th anniversary as one of the world’s leading private management companies with over 230 facilities in five countries.
“When SMG was created, private management of public facilities, convention centers and stadiums had not existed as an industry,” explained Doug Thornton, who today manages the iconic home of the New Orleans Saints for SMG and serves as the company’s Executive VP of Stadiums and Arena.
“If you think back to the mid-1970s, most sports facilities that had been built were all run by governmental authorities,” he explained. That included the iconic Astrodome in Houston, of which the Superdome was modeled. At two million square feet, the Superdome was double the size of the Texas stadium and would be one of the first to incorporate the use of skyboxes and projected video with an eight-sided “gondola” hanging 270 feet above the field. Originally, the Superdome was managed by a state authority, but after several difficult years of running over budget, then-Gov. Edwin Edwards solicited a proposal from the Pritzker family to help manage the facility. The Pritzkers were the successful family behind the Hyatt hotel brand who had built an anchor hotel next to the stadium and in 1977 agreed to manage the Superdome on behalf of the state of Louisiana, which had been losing millions trying to operate the facility.
“By the early 80s, their losses had been almost completely eliminated,” Thornton said. “The Hyatt brought cost controls, sales techniques and professional people who understood how to put a management team in place.”
The company went on to sign the Long Beach Convention Center and the Moscone Center in San Francisco, Thornton said. Following their success in New Orleans and seeing the potential to expand the business in the late 80s, Hyatt Management Corporation partnered with Philadelphia Flyers owner Ed Snider’s Comcast-Spectactor and later Aramark to create Spectator Management Group, the company today branded as SMG. In the late 1990s, Synder sold his interest back to Hyatt and Aramark,who then sold the company to American Capital in 2007.
In 1991, an ambitious Philadelphia native named Wes Westley transferred from Aramark to serve as SMG’s CFO, before being promoted to EVP of business development and then company president, a role he still holds today. Westley would oversee unprecedented growth at SMG, through acquisitions of leading firms like LMI and Ogden Corp as well as a long, sustained period of new client signings. Today, SMG manages some of the top facilities in the world, including NRG Stadium in Houston, University of Phoenix Stadium, Soldier Field in Chicago and the newly-opened U.S. Bank Stadium in Minneapolis. It operates world-class facilities across all venue types, like the BOK Center in Tulsa, the Colorado Convention Center in Denver and the James L. Knight Center in Miami. SMG manages facilities in Europe and Latin America, and operates its own food service division Savor.
“When I joined the company in March of 1997 we had 35 accounts,” Thornton said. “Today we have 233 worldwide and operate a very vibrant food service division that does over $350 million gross sales.” He added that SMG has a 92 percent renewal rate and manages more NFL stadiums than any other management company in the business. Another strong area of growth in recent years has been the amphitheater business, which includes the Lakeview Amphitheater in Syracuse and now the Greek Theatre in Los Angeles, which it operates on behalf of the city’s Recreation and Parks division.
“We’ve had growth in stadiums, we’ve had growth in amphitheaters, we’ve had growth in theaters,” explained Jim McCue, SMG’s Senior VP of Entertainment, noting that the company’s other recent signings included the soon-to-be-opened Wintrust Arena at McCormick Place in Chicago and the Citizens Business Bank Arena in Ontario, Calif., as well as the Denny Sanford Premier Center in Sioux Falls, S.D., and Pinnacle Bank Arena in Lincoln, Neb.
“And there’s a ton of talent out there right now that I’m really jacked about. Bands like Twenty One Pilots, The Chainsmokers and Thomas Rhett with Kelsea Ballerini,” McCue said. “The list goes on and on. I couldn’t be more enthusiastic about the talent that’s hitting the road right now.”
Thornton noted that while the venue landscape has certainly become more competitive and more dynamic, he said SMG is well-positioned to deliver for its clients and the next generation of live entertainment fans.
“Over the last 40 years we’ve seen the business mature quite a bit and SMG has been able to continue to bring value and expertise to our clients,” he said. “We continue to believe that the management techniques, and personnel and the vast network that we have built is a critical component of the SMG value proposition. It’s remarkable to see how far it’s come in the last 40 years.”