New Yankee Stadium AP Photo/Seth Wenig

The New York Yankees are defying the downturn in the economy first by building a premier new stadium, and then by incurring a huge debt load for the stadium’s construction. In fact the Yankees organization will have a total debt of 1.3 billion once their new stadium opens next month.

The debt for the new stadium is broken down like this:

• 1.199 Billion in Tax Exempt bonds
• 25 Million in taxable bonds
• 105 Million in loans led by bank Goldman Sachs for stadium cost overruns

One may wonder in a down economy how the Yankees cold afford to take on such a debt. Well the Yankees used Sponsorships, Premium seating sales, and ticket sales as collateral for the 105 million dollar loan. These three revenues stream are projected to make the Yankees 330 million dollars this year alone.

Add to that the concession sales which are housed with Yankees and Dallas Cowboys co-owned company, Legends Hospitality, and one can assume that the Yankees will make a ton of profit in 2009.

The Yankees have been pretty successful in marketing their premium seating, even in this down economy. Reports say they have sold off about 70% of that inventory. When we add these revenue streams to the fees collected by the Yankees by the Yes Network and other media outlets their projected revenue for 2009 comes in at almost 450 million dollars.

However we must also consider a player payroll toping 200 million dollars, steep luxury taxes, revenue sharing with other MLB teams, the cost of operating the new stadium, and the cost of front office and minor league operations. All of that paints a picture of a team who may be spending themselves into bankruptcy. Only time and fans at the stadium will be able tell how much money the Yankees can make.

One thing this points out for sure is that only huge brands, sporting or otherwise, can pull off these kinds of deal in this global credit crunch. The public of New York and banking institutions are betting the Yankees brand is bigger then the slumping economy.