Ivy League Regatta Rows Into Headwind

BOSTON ( TheStreet) -- It draws 300,000 spectators a year, fills tents with legions of eligible prep and Ivy League alumni but couldn't land a major sponsor until almost a month before it starts. While its rowing field is as strong as ever, the Head of the Charles Regatta is hurting this year.

"We have had to cut back significantly, and it's been a struggle," says Fred Schoch, the regatta's executive director. "If you asked me 45 days ago if we were going to break even, I would have said no."

Before Hopkinton, Mass.-based EMC Corp. ( EMC) stepped in as a sponsor, the tony rowing event on the Charles River between Boston and Cambridge was $500,000 in the red heading into its Oct. 16 and 17 races. Longtime sponsors Audi, owned by Volkswagen ( VLKAY), and VF Corp.'s Nautica ( VFC) pulled out, while firms including MetLife ( MET) and UBS ( UBS) felt the $50,000 to $100,000 they'd allocated to private hospitality tents in previous years could be better spent elsewhere. Even the state of Massachusetts, whose tourism board usually kicks in a portion of the proceeds, pulled out amid a revenue shortfall.

The regatta is just one of many events this year struggling to keep its head above water. Advertising and sponsorship revenue for all U.S. sporting events dipped an estimated $2 billion this year after holding at $32 billion in 2006 and 2007, according to Plunkett Research. Global advertising in general has decreased for much of the past two years, with the Nielsen Co. reporting ad buys down 6.8% for the first half of the year compared with 2008.

"I have friends who work at all the professional teams in Boston, and they're complaining about renewals and reductions," Schoch says. "If the pro teams are having a hard time, you can imagine the trouble that nonprofit events like Head of the Charles are having."

The regatta's budget woes stripped away some of its Cambridge tweed for amenities that are a bit more Boston common. Instead of wooing customers and potential hires in private hospitality areas, vendors and corporate human resources staff will have to spend $100 for a weekend pass to the regatta's new VIP tent if they hope to lure the buying and brain power of the prep school, Harvard, Oxford and Cambridge alums from the Reunion Village. At least they'll get breakfast and their first two drinks free.

That's more than can be said for the event's local funnel cake and falafel vendors, who lost their place at the table to food courts featuring Chipotle Mexican Grill ( CMG), Uno Chicago Grill and Groupe Danone's ( DANOY.PK) Stonyfield Farm. Locals like New Hampshire-based Pete & Jerry's Organic Eggs and Maine's Barowsky's Breads will help feed the athletes, who are being charged $10 more apiece in entry fees than they were last year to help keep the event afloat.

"In the end, this is a free public event," Schoch says. "If we could collect $2 from every person who comes to the regatta, our financial woes would be stanched, but that's not the case."

The Far Hills Race Meeting and its steeplechase races in Far Hills, N.J., felt a similar pinch last year. When some of the 40 or so corporations that usually rent tents on a hilltop overlooking the event were no-shows at Moorland Farms -- whose neighbors include Verizon's corporate headquarters and the Forbes family's estate -- it was considered a harbinger of hard economic times. Yet companies including Enzon Pharmaceuticals ( ENZY) and PricewaterhouseCoopers held their ground and, this year, organizers say there is steady demand for $30 to $50 event tickets and the $300 to $600 reserved parking spaces that host lavish caviar-pie tailgate parties.

History may have a bit to do with the races' resiliency, as the 89-year-old event dates back to the 1870 fox hunt in Montclair, N.J., that spawned its nickname: "The Hunt." That race's proceeds benefit a local cancer center, making portions of the higher parking and tent costs tax deductible. However, event organizers say they've stayed in the race largely by maintaining relationships and solvency in down years and looking to better times. That thinking is already helping the Head of the Charles, which has lured Audi back as a sponsor for 2010 and is in talks with L.L. Bean and Brooks Brothers to put an apparel company back on its racks.

"It's been a challenging couple of years, but it doesn't come to you -- you have to go to them," says Guy Torsilieri, co-chair of the Far Hills Race Meeting Association and president of the National Steeplechase Association's board of directors. "I don't want to say it's recession-proof, but we're doing OK."

-- Reported by Jason Notte in Boston.

Jason Notte is a reporter for TheStreet.com. His writing has appeared in The New York Times, The Huffington Post, Esquire.com, Time Out New York, The Boston Herald, The Boston Phoenix, Metro newspaper and the Colorado Springs Independent.

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