F1: Series breaks ground on new Las Vegas it and Paddock building (Update)

F1 will invest half a billion dollars to set up and run the Las Vegas GP.  First year costs are largely from the cost to build the new multi-use pit/paddock/U.S. HQ

Ticket sales will bring in 1/4 billion dollars the first year, and hospitality and sponsorship another 1/4 billion dollars, so the race is expected to break even the first year and turn a big profit from year 2 onwards.

For comparison, the Indy 500, a 100+ year old event brings in nowhere near $1/2 billion per year, despite 300,000 in attendance. If the Indy 500 charged $2,500 per race ticket, the grandstands would be almost empty.

On 40 acres of land on the northeast corner of Harmon Avenue and Koval Lane, F1 will construct a 300,000-square-foot, four-story paddock building, which will serve as the hub of activity during the 2023 Las Vegas Grand Prix.

“It’s hard to make a statement in Vegas because everything is so big,” said Greg Maffei, CEO of Liberty Media, the ownership group of Formula One. “This paddock building will be a sign of our long-term commitment to the Vegas community. It will serve as a year-round attraction to our fans and will be one of our most spectacular facilities.”

Between the land and the construction of the paddock, F1 will be investing about $500 million in the facility alone, according to Gov. Steve Sisolak

“It’s going to change the landscape in the sports environment in Las Vegas forever,” Sisolak said.

“They told me between the land and what they’re building that they’re putting here, that’s a half a billion dollars, right here. On top of everything else they’re building. All the stands on the Strip, all the other things that they’re putting together. The economic impact this is going to make in the economy in Las Vegas is going to be astronomical.”

“The intention is for this to be a permanent event,” said Steve Hill, president and CEO of the Las Vegas Convention and Visitors Authority. “It’s going to be spectacular. We want it every year, and they want to be here.”

“This is a true investment in Clark County, in the community,” said Clark County Commissioner Michael Naft. “This will be a permanent facility. Yes, it will be used for the world’s greatest events, for Formula One events. But it will also be here year-round employing people, putting people to work. And also boosting our economy and giving us one more thing to be proud of.”

Formula One CEO Stefano Domenicali said the paddock building cements Formula One’s commitment to the city.

“We want to stay for a long time,” Domenicali said. “It’s with great excitement that we’re there to celebrate this moment that is just the beginning. … This will be the F1 statement in Las Vegas. We know when you come here you need to be big.”

“I think it’s going to be wild, to be honest,” said F1 star driver George Russell. “Super excited to come here and race in Vegas. I think we’ve seen the momentum that Formula One has in America, and bringing the race to Vegas is just topping that off at another level. As drivers, as people in the sport, we’re excited.”