Beijing prepares for Olympic venues’ future

updated 2:51 p.m. ET Aug. 25, 2008

BEIJING - Where Olympians ran, swam and slept, Chinese organizers see pop concerts, a public pool, soccer and luxury apartments.

Authorities are scrambling to make sure the 91,000-seat Bird’s Nest stadium and other venues are put to good use after the Olympics and September’s Paralympics. They want to avoid the fate of other Olympic hosts that were left with empty, debt-burdened facilities.

The NBA and private developers have been signed up to run stadiums and arenas. The Water Cube swimming center, due to become a public pool, raised money by licensing its name for a bottled water brand. The Bird’s Nest is taking bids from companies for naming rights.

“We believe that post games and for a long period of time, these venues will be used pretty well,” Du Wei, vice president of the Beijing Olympic Economy Research Association, a group linked to the Beijing organizers, told reporters. “The management companies will immediately open them up for public use.”

Still, Du and others say it could take decades for the Bird’s Nest and other venues to pay for themselves.

“We can’t expect in the short term all the investment will be regained right away,” Du said.

Beijing built 12 permanent and eight temporary new venues and refurbished 11 others at a cost of $1.9 billion, according to the city government.

The Bird’s Nest will be the highest-profile test case for the city’s ability to make them financially viable.

It has the advantage that it is the first big, modern stadium in a city where the main venue for rock concerts and sports has been the drab Workers Stadium, a 58,000-seat hulk built in 1959. But the new facility’s huge size and potentially high user fees could put it beyond the reach of many events.

The stadium’s deputy general manager, Zhang Hengli, declined to give financial details or information on planned events. But he told the newspaper China Business News it could take 30 years for the Bird’s Nest to repay its $220 million cost. Zhang said it needs at least $19 million in annual revenues to cover maintenance and debt payments.

Beijing is relying in part on a timeworn strategy of forcing state companies to share the cost of public facilities.

CITIC Group, the investment arm of China’s Cabinet, put up 48 percent of the money to build the Bird’s Nest and the CITIC-owned Beijing Guoan soccer club will make the stadium its home field.

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Zhang, the stadium official, declined to discuss naming rights. But China Business News said as many as seven companies are bidding. It said they include non-Chinese bidders, though attaching a foreign brand name to a national symbol that appears on China’s 10-yuan note might be judged politically unacceptable.

The stadium has raised $14.5 million by selling sponsorships to companies including 3M Corp. and German drug company Bayer AG. Their names appear on seats and other facilities.

The Water Cube was paid for by donations from ethnic Chinese abroad, making it cheaper to convert to public use. But in a city where the average income per person is $4,100 a year, managers say ticket prices will be kept low, which leaves less for upkeep of its pool and its futuristic bubble-wrap exterior.

“If we rely only on swimming pool tickets, we certainly will lose money,” Kang Wei, a deputy manager of the government company that owns the pool, said in comments on the Beijing organizers’ Web site. “So we will have other products to guarantee the operation in the long run.”

The Water Cube raised money by licensing its name for use on swimsuits and on bottled water made from Canadian icebergs.

Beijing began charting the venues’ future almost as soon as it was awarded the games in 2001.

Athlete housing was designed from the start as luxury apartments, with swimming pools, tennis courts, coffee shops and shopping. Chinese media say units sold out ahead of the games for prices of $2,900-$4,400 per square meter, high even for Beijing’s booming real estate market.

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