Formula 1’s owners Liberty Media will purchase land for the pit and paddock complex to be built for next year’s Las Vegas Grand Prix for $240 million.
The track layout unveiled last month showed the circuit will utilize exiting roads for the majority — including a major section on the iconic Strip — but with currently undeveloped land to the east of Koval Lane being used for the pit and paddock, as well as the start/finish straight. On a Liberty Media earnings call, Liberty CEO Greg Maffei confirmed the level of investment that the sport will be making into the circuit itself.
“As we have noted before it’ll be night race down the Strip and notably — and differently than most places — Formula 1 and Liberty Media are self-promoting the race in partnership with local stakeholders and Live Nation,” Maffei said.
“Liberty Media did enter an agreement to acquire 39 acres east of the Strip to lock in circuit design and capacity for the pit and paddock, among other hospitality and race support venues. I expect that transaction to close in the second quarter and the purchase price was $240m, funded by cash on hand at an F1 group level.”
Explaining why Liberty was willing to take on promoter duties and invest so much into the event, Maffei says the logistics and local knowledge played a part, as well as the potential to expand promotion to other races.
“I think I indicated we’re buying 39 acres for $240m and that’ll be the site of the pit and paddock and some other hospitality, we don’t have other financial details at the moment of what will be spent there.
“Our decision to promote Vegas in conjunction with Live Nation and local partners is driven by a couple of things. One, proximity — it’s fairly easy, relatively, being in Denver to get to Vegas for us to do the work and we have knowledge of local U.S. markets relative to many other markets. But more importantly we see the opportunity of being a promoter is a way to expand our understanding of the business, understand how to be the best F1 product on the track for other promoters as well, to take the opportunity to grow our knowledge and understanding and potentially promote other races down the road.
“Vegas is going to be large and a perhaps unique opportunity, so from a financial perspective we think this one sets up pretty well to be worth the time/extra focus to become the promoter.”