FedEx ends naming-rights deal for Commanders’ stadium two years early

FedEx ends naming-rights deal for Commanders’ stadium two years early

Tooba Shakir 54 years ago 0 0

FedEx, the shipping giant that struck a $205 million deal in 1999 to have its name on the stadium of Washington’s NFL franchise, has ended its naming-rights agreement with the team two years early. The agreement was set to expire in 2026.

The move deprives the Commanders of roughly $15 million of remaining revenue from the deal and leaves them without a naming-rights partner for their Landover stadium while they search for a new home in D.C., Maryland or Virginia.

FedEx’s separate partnership with the team remains intact, along with the company’s long-running sponsorship deal with the NFL.

“We thank FedEx Corporation for its longstanding naming rights sponsorship and their work with our team and community and look forward to their continued partnership within the Commanders family,” the team wrote in a statement issued to The Washington Post. “We have already started the process of identifying our next stadium naming rights partner — a partner who will play a crucial role in ushering in the next era of not only Commanders football, but also a robust slate of top live events and concerts.”

Two people with knowledge of the decision said FedEx exercised an opt-out provision before the end of 2023 that stemmed from the sale of the team, which closed in July. It caught the Commanders by surprise amid renewed fan interest and after an influx of new sponsorship deals.

“FedEx is a longtime sponsor of multiple sports leagues, properties, and teams,” the company wrote in a statement to The Post. “We continuously review our marketing programs to ensure our investments are aligned with our evolving business objectives. As part of this review, we have decided to not continue as the naming rights sponsor of FedEx Field as we focus on our broader NFL sponsorship and opportunities that reflect our global footprint. We believe the future is bright for the Washington Commanders, and we look forward to watching the team evolve under their new ownership.”

A group of investors led by Josh Harris purchased the Commanders last year for $6.05 billion from Daniel Snyder, whose tumultuous 24-year ownership of the franchise eroded the fan base and led to numerous federal and NFL-led investigations into the team’s workplace and business operations.

The team’s naming-rights agreement with FedEx, completed soon after Snyder bought the franchise from the Jack Kent Cooke estate for $800 million, was hailed initially as a landmark deal for the team. But the relationship between the team and FedEx became increasingly strained.

Fred Smith, the founder of FedEx, was one of three minority owners in the franchise from 2003 until 2021, along with Robert Rothman and Dwight Schar.

The Post reported in November 2020 that a group of investors had offered $900 million for their ownership shares, which totaled about 40 percent of the franchise. Snyder initially attempted to exercise a right of first refusal to match the offers made to Smith and Rothman but not the offer made to Schar. That led to a dispute over whether Snyder could exercise that right in such a selective manner.

In March 2021, the NFL finance committee approved a debt waiver that enabled Snyder to take on an additional $450 million in debt and buy out the three limited partners for approximately $875 million. That agreement resolved a contentious dispute that had produced a grievance and an NFL arbitration procedure and had spilled into courtrooms. Rothman filed a federal lawsuit in Florida in December against Bank of America, accusing it of engaging in “improper financial dealings” during the process that led to Snyder purchasing the shares.

In July 2020, FedEx played a role in the franchise’s decision to change its controversial former name. FedEx notified the team in a letter that it would remove its signage from the stadium after the season if the team didn’t change its name. Later that month, the team announced it would “retire” the name.

Originally called Jack Kent Cooke Stadium when it opened in 1997, FedEx Field has deteriorated, and Snyder had long hoped to leave for a new stadium. But attempts to drum up competition between D.C., Maryland and Virginia proved fruitless, and the myriad investigations into the team’s workplace and operations slowed any momentum to move.

Harris’s purchase of the team included its training facility in Ashburn and the stadium and surrounding land. The team is contractually obligated to play its home games in a stadium built on the site in Landover until September 2027, after which it can stay or leave.

To improve the structure and fan experience in the interim, Harris and his ownership group have invested $75 million in upgrades to the stadium while developing a plan for a future venue. As the team awaits resolution to legislation that could pave the way for a stadium in D.C. and weighs its options in other jurisdictions, it’s unlikely a move would happen before 2030.

In the meantime, the Commanders are working with Elevate, a consulting firm led by San Francisco 49ers president Al Guido, to find a new naming-rights partner. It’s possible the team will land a shorter-term sponsor to carry it through the life of the Landover stadium. It could alternatively seek a partner for its remaining years in the current stadium as well as its start in a new venue, much like the Tennessee Titans did with Nissan. In November, Elevate secured a 20-year sponsorship deal with the car manufacturer that includes naming rights for the Titans’ current stadium and its new one, slated to open in 2027.

“They want the right partner, and they want a partner for the long haul,” Guido said of the Commanders’ ownership group. “That could mean that the partner continues on in the new building as a naming rights partner. It could mean that the partner continues on in a what we call a founding level [as an exclusive partner] in the new building. But I do think that … when deals like this occur, a partner of this magnitude coming online is going to be very interested in continuing on.”

Sports naming-rights deals have grown in prominence and value, affording franchises significant capital to help maintain the structures. San Francisco-based Social Finance Inc., a bank and financial services firm, agreed to a $625 million sponsorship for SoFi Stadium, the Inglewood, Calif., home of the Los Angeles Rams and Chargers since 2020. The Raiders’ stadium that opened the same year in Las Vegas has a 30-year naming-rights deal with Allegiant Airlines that averages more than $20 million annually.

The only two NFL stadiums that do not have naming-rights sponsorships are also the league’s oldest: Soldier Field in Chicago and Lambeau Field in Green Bay, Wis.

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