Atlanta Braves Holdings, Inc. (BATRK) Earnings Call Transcript & Summary

Please go ahead.

Okay. Welcome, everyone, to our Braves Investor event. Before we begin, I would like to remind everyone that this presentation today includes certain forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Actual events or results could differ materially due to a number of risks and uncertainties, including those mentioned in Liberty Media's most recent Forms 10-K and 10-Q filed with the SEC. These forward-looking statements speak only as of the date of this presentation, and Liberty Media expressly disclaims any obligation or undertaking to disseminate any updates or revisions to any forward-looking statements contained herein to reflect any change in its expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based. With that, we are very excited to have investors here with us at Truist Park. This is the first time we've had investors here since 2018. It's an opportunity for us to provide an update on the Braves business. And of course, revel in the glory [indiscernible] of being world champions. I apologize to those on the webcast, but for those in the room, we are passing around the World Series ring to many delighted reactions. Joining me in the room today, we have Derek Schiller, President and CEO of Atlanta Braves; Mike Plant, President and CEO of Braves Development Company and other representation from Braves management. There are a few slides that accompany today's remarks, specifically related to the Battery Atlanta when Mike speaks. They are posted to our Investor Relations website under the Events and Presentations tab. [Operator Instructions]. For those in the room, we ask that you raise your hand and just wait for a mic to be passed to you so we can pick up the question. [Operator Instructions] If you have any issues, please reach out to [email protected]. And with that, I will turn it to Derek.

Thank you, Shane. And thank you to everybody joining on the webcast and especially for everybody that's joined us here in person. First, you're coming to us from the press conference room. I think as Shane mentioned, the last time we were all together or had the opportunity for this group to be presented to was 2018. So a lot has happened in the world around us as well as obviously here. This is actually a new route since 2018. So welcome to the press conference room, if you watch any Braves games and see press conferences, Brian Snitker. He will be sitting right behind where I'm standing and telling you all about hopefully how the Braves won and all the fun things that happened. Speaking of which, for those that are here, you obviously are getting to see a chance of looking at the World Series ring that we designed as part of the culmination of winning the World Series. We're really proud of what that ring represents. And I thought I would start there, which is talking a little bit about what we accomplished last year and even prior to that and then how that has helped us coming into this year and maybe even how that helps us moving forward. Obviously, winning is no secret ingredient. It is something that helps us in a lot of different ways. But if you look back towards last year and you were really at this point in time in the 2021 season, there was a lot of doubt about what the success of the team on the field was going to be. But if you actually even go back, call it, 6 months, maybe even 8, 9 months prior to that, envision, we're in the midst of COVID. We're in the live event business. So COVID hits us remarkably hard, and we're uncertain about things. But one of the differences, and I think the decisions that we as an organization made was a very calculated approach to how we would come back from COVID. And what I mean by that is we took an opportunity which we felt it was just that to reinforce our relationships that we had with our customer base, our season ticket holders, all ticket holders, our corporate partners and anybody that had a relationship with the team. So amidst of COVID, we're not playing games in front of fans. We actually stood up our ticket sales department, by example, and allowed them to work from home and have them continue to make not just sales calls, but more importantly, checking calls, relationship calls. And I think what that did for us is it gave us great indicators as we started the 2021 season. The other thing that we did was we actually continued to sell tickets, going from the 2020 off season into 2021. You might remember, we weren't sure whether or not we were actually going to have games with fans or when those games with fans would occur. And so we made the decision, we're going to keep all ourselves on. And that really helped us. So once we started welcoming fans live, in person here at the ballpark, we had first in a great indication from all those relationship check-ins, where our fans would be, where our corporate partners would be, the things that are important to them. But then also on our understanding of how we would open up, and you saw the results of that, right? We started with a limited attendance but quickly propelled into full attendance and had incredible success. In fact, we finished the year 2nd in the league in attendance, largely based upon some of the things that I've indicated here. Those same things were actually some of the key indicators and the key reasons which propelled us into winning that world championship rank. And what I mean by that is, as we were at the midway point of last year, so about this point in time in 2021, we were thinking about the different additions that we would need to make with the team, and we realized that we were over-delivering or ahead of budget with respect to ticket sales, corporate partnerships, et cetera. And it gave us a chance to tap in some of those -- that extra cash that we had and spend that on players. And so as the trade deadline approached, we worked with Alex Anthopoulos, our General Manager, and said, here's some cash that you can deploy. And with that, he made some unbelievable moves. The history is now talking about that as much as we all are, which is that we got the likes of Eddy Rosario and Jack Peterson, who's, by the way, added to that ring in a form of a pearl that's on one side of the ring. So and a couple of others. All of that said -- Jorge Solera, I should have mentioned him. All that said is that we had a better team coming out of the trade deadline that we had coming into it, and we had, as a result, after getting all those pieces, we had incredible results on the field. And then ultimately, won the World Series. So that's the story that you probably know, most of. So what happens when you win a World Series? What does that do to you as an organization? From a business perspective, it's obviously very good. That's the easiest way to say it. What that does though do for us is it allows us to go back into those relationships that we had and make sure that we're reinforcing those. So for instance, with season ticket holders, we had some of our highest renewal rates that we've had in the past 2 decades. We added a significant number of new season ticket holders year-over-year, and then we also increased our corporate partner relationships. So not just the number or quantity of corporate partners that we had, but also the depth of those relationships, expanded some of the relationships and things like that. The other thing that happened coming out of COVID that has continued to occur this year, with all the successes that I just mentioned, is that things like our per cap or net revenues have all increased and have stayed relatively steady. So last year coming out of COVID, one of the stories that was happening not just with us but with a lot was that you saw per caps in the form of merchandise or concessions, the things that people were going out and spending money on when they did go to events was increased compared to the way they were before COVID. We've seen those same rates in those same per caps at about the same levels as we did last year, which is nice and above what we were in the pre-COVID days. So attendance up, per caps are up in merchandise and in concessions and other event revenues, things like parking. And then we've also seen other indicators, fan engagement indicators. So the size of our fan base as a whole has also increased. So how do we measure things like that? First off, things like television ratings. Year-over-year, TV ratings are up as we sit here today, just slightly, but we also know that people are doing other things and ways to engage with us. So this authenticated streaming that they're doing on the Valley's regional networks because, of course, right now, we don't offer direct-to-consumer streaming. We do offer authenticated streaming. Those numbers are significant. We're also seeing social media engagement significantly increase. And so it's easy to relate all that, if you will, to the entirety of the fan base and make a statement that our fan base has grown in size by a pretty wide margin by winning the World Series. That might sound self-evident, but it's also important to point out and is a great indicator for the overall health of the business. And we're seeing lots of ways that we're able to exploit upon that during the course of this season. Fans are back this year in heavy numbers. I think we've tonight's game number, if I'm not mistaken, home game number 49. And as of last night, we've sold out 24 of those 49 games. So we're seeing extremely strong attendance. I would expect that tonight's game is going to be sold out as well. So we'll hit 25. And after the break, we're already seeing the advanced sales on all our tickets and the remaining 31-plus home games. Those are already strong and indicating very, very favorable. So what's ahead for us. ahead for us we think are a lot of things, not just leading into or the conclusion of this year but also into future years. One of the things that baseball has opened up is the opportunity to do a jersey patch. So that's something that we're currently out in the marketplace, exploring. We don't yet have a jersey patch to announce, but it is something that we are very active selling. I bring it up because it's a pretty significant piece of corporate part opportunity. You would equate it -- probably similar to like a naming [indiscernible] deal as far as size and enormity of that deal. So without giving what our expectations are specifically on it, it is obviously going to be a fairly large deal and has the chance to make what is already a strong, robust corporate partner sales effort for us even been bigger. Sports betting is something that we've been active in, in the state of Georgia. It's something that we've commented on a little bit previously. We've been active lobbying in Georgia for the past 3 years. We've done so in concert with the other professional sports teams in town, the Hawks and Falcons and Atlanta United primarily. We've seen some movement on that, I would say to you, there's still opportunity for that. Legalization has to occur here for sports betting to occur, of course. There's a couple of different pathways for that, and we're working on those things. I think there's something like 33, 35-plus states that currently have sports betting. And so we're able to see what sports betting does for professional sports teams. We think that helps with fan engagement and potentially even helps with some direct revenue opportunities associated with the team. So that's something that we're keeping our eye on. And then I know it's probably going to come up. So I'll talk a little about it is where we stand in the way of RSNs as well as the overall TV media landscape. So as you all know, we broadcast on the 2 Valleys sports regional networks that are in our territory. And we're having, as I mentioned, on the ratings perspective, we're having a good year with them. They've done a phenomenal job with respect to the production. We're keeping our eye out for what's happening with the Diamond Sports Holdings of all Valley's networks. And the good news for us is we know that in this part of the country with those regional networks, where they are very strong in the overall Diamond Sports Holdings portfolio. Our actual rights fees are contracted through the end of 2027. And those are strong competitive rights fees in the world of Major League Baseball. So I certainly see that there's going to be some changes in that world. But one way to look at that is by having an agreement that takes us through 2027. It takes us out of some of the issues that would otherwise be occurring if we're in a marketplace, renegotiating those rights fees today. So while a few years ago, 3, 4 years ago, you might have looked at those as being too long of rights fees. I think you could say today, having that contract in place for that period of time is actually probably a good thing for us. And it gives us a chance to look at what's happening in the landscape. That's something that we're obviously mindful of in working with Major League Baseball and have some eyes for that. And I think the evolution of direct-to-consumer and the combination of the legacy sports broadcasting will continue, and hopefully, we'll be active participants with that as a league and as a team. So with that, I think I'm going to turn it over to Mike, who will talk to you a little bit about the Battery.

Thank you, Derek. So thinking back what [indiscernible] had said a little earlier in 2018, we both thought it was 2019. But no, so that's 4 years ago. And I think one of the things when we start looking at some of the slides you saw that remind all of us that [indiscernible] in the trenches every day here is a little more than 8.5 years ago, this was Woods. And about a month or a year after that, it was a piece of dirt. And so we've been able to create and build and operate now 3 million square feet of mixed-use development and obviously, Truist Park. When you were here last time, we were just a little more 12 months into opening obviously Battery Atlanta in Truist Park. We were -- what we called Phase 1 was nearing an end. We were already starting to plan for Phase 2. And obviously, we've all went through a very tough time in 2020, 2021, Derek told you about the impact on the team and certainly what it did for our business there. But I think it speaks volumes for the fact that we were able to pivot very, very quickly. We're in the state of Georgia, never shut down. But our ownership and our ability to operate what we do from a team standpoint in the Battery is equaled by no one. And that's why this has been so successful because we were able to pivot so quickly. We kept everyone open. Jeremy Strife our EVP of the Braves Development Company, and I looked at each other when COVID hit and said, look, we don't want to hear the keys jingling at the end of the year. We're not going to lose anyone here. We have the ability to work with them, no one caused this to happen. And when it was all said and done, we lost one tenant they shut down all over the country. So -- that's -- that was really, again, just our strategy and our ability to do the things we needed to do to continue to operate. So very quickly now, if you look at the Battery notwithstanding the 1.1 million square feet of Truist Park. We're at 2.25 million square feet of mixed-use development today in this main 57-acre parcel. Phase 2 is now, is part of that. Phase 2 is that the [indiscernible] Papa John's headquarters, 2 more Fortune 500 companies have moved into a 300,000 square foot building. And you probably have now noticed the big 420-foot tower. That's the elevator test tower that TK operates exclusively. There's 18 different silos in there. People come from all over North America, South America. Test elevators, their technicians train in that building. And there's a 5-story conference center then at the bottom of that. And for us, we did a joint venture with them. There's 3 stories at the top of the building that we're using for special events space and getting a great deal of traction, think -- receptions, parties, weddings. We're operating that for them. They're in the elevator business, as Derek said, we're in a mass gathering business. So that is now fully open and we're almost fully leased with that entire building. Between Papa John's and TK, they take up 82% of it. So those are long-term leases, obviously, that -- with 2 great companies. And then the other part that we added on since you've been here was the Silverspot movie theater doing extremely well, even though the content has been slowly rolling out in the entertainment industry. We have the Aloft hotel that's been fully opened since July of 2021. And then we have another fully leased off, 2 stories of office building and some more retail under there. So that's our lineup. And as I said earlier, I mean, just continues to do extremely well. We're almost at the point by the end of this year that we will have no lease space left. We have long-term leases in play with a lot of our retail tenants, office tenants and proud to have all of them be part of the Battery. Okay. So I think we're just going to go right to that. The next 2 kind of new things for us call it, Phase 3 inside, but things to come. Truist Securities, we've worked on an arrangement with them, obviously, an incredibly long-term relationship and partnership with them. You're sitting in Truist Park. We do tons of things in the community with Truist. They've been a big contributor to the Henry Louis Aaron Fund that we started after our legend and the legacy of Hank after he passed away. Help us with field renovations, help us with our incredible feeding the families. We did 4.2 million pounds of food, 3.5 million meals during COVID that we used our facilities and at the health families in the Metro Atlanta area. So we have this long incredible relations to them. They're going to move out of their financial services center in Buckhead. We're going to build them a 0.25 million square foot, 9-story building. They're moving 1,000 employees here. They haven't decided other parts of the country of those employee bases that will eventually move here. But essentially, we're going to build this building for them starting this December. It will include a 42,000 square foot trading floor over the parking deck, which is very unique, obviously, highly amenitized space. Like many companies in this space, they know they need to create a lot of amenity in order to keep [ drawling ] their employees back to work. So Beth, do you want to move that slide. A lot of people say, well, where are you going to do that because we don't have a ton of space left, but we're pretty creative in our ownership and operation. So the ballpark is on the bottom of the page and just south of Battery avenue. This building is essentially 200 feet from home plate. It's right next to the Rock Sea. I think the next slide shows it a little bit better. Yes. So you'll see the ballpark on the left, there's a 9-story building, the 0.25 million square foot building on the left side. And then the parking deck with the 42,000 square foot trading floor will be on the top. It will take about 30 months to complete. We expect to turn this building over to them. sometime in 2020 -- end of 2024. And then they'll spend about 6 to 8 months on the interiors. Gives you a little bit of a feel for, again, what it looks like in Battery avenue. You can see again the ballpark -- Truist Park on the left side. So it's very tight, very close. Done all the engineering and we're able to put that into that space. I'll go back to 1 second there, Beth. There's about a 2,000 square foot tariffs on the top of the tower and the office building. You can see you won't be able to watch the game. This is not Riglyfield with apartments in the outfield, but you'll be able to be part of the energy, you'd see the activation going and feel like you're part of what's happening. And then there's another project we're doing is a joint venture with a company called Golden Rod out of Nebraska. They actually are the majority owner of the 2 big white buildings that are in the south side of Circle 75. This is called The Henry, again, paying tribute to Henry Earn. Right behind the Omni hotel where you're staying, you looked across the street. That's the location. We own the piece of property there. We can [indiscernible] into this arrangement with them. This is 504 very high-end apartments. This will start going vertical this December, and this is Phase 1. It will attach to the back of the plaza where -- between the Omni Hotel and Comcast or stairs coming up there, if you maybe you have seen those. This bridge will attach right into the back of their -- gets rid of all the vehicle/pedestrian conflict we have now during games, and we've got a lot of people crossing streets. And then there will be an elevated walkway attaching those new office building. This is Phase 1, Phase 2 on the drawing board today is another hotel and potentially a condominium-type project on top of it. And so that will be the next thing that we roll out with them. Gives you a little bit of a feel for, again, the orientation of it. And that's just showing you on the left side, the -- I'd say, the pink is Phase 1, right side Phase 2 with the hotel and the condos. This all in is about a $450 million project, okay? That's it. All right. So Again, lots of exciting things. Last year, we did 9 million people that came through the Battery. We have a great tracking system. We know where they come from, just like Derek said we know our season ticket holders and actually every fan that comes in Truist Park because of ZIP code and how they purchase their tickets. This year, we're tracking at 10.1 million, to rolling 12 million. We brought 7 new concepts on board in 2021. We have 8 new concepts coming on board in 2022. So again, we never missed a beat through COVID, continue to lease up space. And it's all to support our #1 objective, and that's winning the World Series. So we hope to do that again. Anyone a Metz fan in here? D***.

Okay. Thank you, Derek and Mike, we're now going to open up to questions. For those on the webcast, there were some slides that Mike was referencing again, those are posted to our website. So please take a look there, and you'll be able to follow with what he was pointing out. I will start with one question and then we'll open it up to the audience and the webcast as well.

So a question on the demographics of the baseball fan. What are some of the efforts that both you or maybe MLB are doing to reach younger audiences?

Well, first thing we're doing is actually studying our demographic very closely our fan base. There's been an initiative all across baseball, but that's been intensified here is to do a lot of research on fans and try to understand who's currently coming to the ballpark, who's currently watching our television broadcast, who currently engages with us in things like social media. So we have a significant effort underway. And one of the things that we can report on is actually that our fan base has a tendency to be slightly younger than Major League Baseball fans and more diverse. That's correlated probably closely with our market, right? Our market is a younger market, a more diverse market, and we're attracting people from this marketplace and throughout the Southeast. I think one of the things that helps us is an added benefit is that we have the Battery. That's part of the overall experience. So in addition to have a great ball team, we also have people -- the Battery where people become early, stay late, go to restaurants and bars, and there's clearly been an attraction for young people to do that. So regardless of how the team does, I think it insulates us in many ways because the overall experience is tied very much to this broader experience of the things that you can do in association with coming to a baseball game. Yes, anybody in the room want to ask a question?

It's Barton Crockett from Rosenblatt. I was wondering if you could talk a little bit about the -- how you see baseball trending through kind of the economic cycle? We're looking everyone's worried about recession impacts from the real estate side and also from the baseball fan attendance stand spending per match? What do you see?

Well, as I've mentioned, our indicators are all very strong. So thinking about it from a KPI perspective, I would say we're doing extraordinarily well. I know that's not necessarily the case in every single baseball market, and there are cycles that teams go through, many of them related to how team performance works. When a team is really down and they're not winning as much, you might see fans attendance and the amount of fans paying attention engaged go down. We're obviously on the different side of the cycle. But I also said that we -- I think we're a little bit insulated because of the broader fan engagement opportunities that we have, the ballpark and the association with Battery. I'm actually really bullish on baseball as a whole look. I mean if you think about it with respect to the entirety of the league, I think you're starting to see that baseball, while they've been saying for decades and decades, baseball is dying. It's a dying sport. You hear these prognosticators, maybe say those things. They've been saying that for 50, maybe even 100 years. And I tend to look at it the other way, which is I think baseball is doing extremely well. We're on front lines of innovation in many different areas. The way in which we bring our product to our fans has dramatically changed over the past 10, 20 years. The streaming opportunities that we have into the future are significant. How those get figured out are going to be challenging, of course, but I think when you think about having 162 games, we have a depth and quantity of content that really relates well into that. And so I think we're exceptionally well positioned if we can take advantage of that. Said a different way, if you add up all the fans that come to baseball game. It's significantly more than the fans that attend other sports leagues combined. So while on one side, you can look at this in a negative way, I'm actually quite bullish about the opportunities that exist not only in the short term but long term. And I'll let Mike -- do you want to comment on the real estate side?

Yes. I'd say along the lines of what Derek was saying is that we're a little bit -- I won't say, insulated, but we create a year around playground here. And I know it's an old adage that gets abused live, work, play, but that's -- we're the epitome of live, work, play. 10 million people, 3 million coming to games, but 7 million people coming here year round and why? It's because we activate over 400 different events a year here. We're constantly activating, creating energy, creating reasons for corporates and entertainment seekers and families to constantly come here. And that's why our hotels are doing well, our authentic lineup of restaurants. You're not going to find really any chains out here. There's a lot of creativity in the restaurant space. So we feel pretty good about the fact that we've created a very safe, accessible place that had a lot of entertainment, a lot of restaurants, a lot of different opportunities, and that's why we're going to continue to do well.

Are there any other questions from the room?

We have one here. What is the status of the Minor League team sales? Will that complete? Any impact to think about with team performance or talent acquisition?

Yes. So we've largely completed that transaction and the services agreement between them are largely completed as well. So in effect, we're untethering ourselves from the Minor League teams. From a business perspective, on the baseball side of things, nothing -- for all intents and purposes, nothing has changed. There's still our development center for all of our players. We have, as strong as ever, relationships with the players, the coaches, the player development side of the mix, and that's bearing fruit each and every day. So I see that well into the future. And Alex Anthopoulos runs that side of our business, the player development side and all that. And I think we're in really good shape there. We've got the draft coming up, and so more of that to come.

Mike McCarthy [indiscernible] Capital. I'm just curious what was the catalyst for separating Minor league from...

The original catalyst was really that Major League Baseball came in and created a change to the system. So there was less need to protect the geographies as a result of the way that Major League Baseball structured their new agreement with the Minor League teams and how that worked. And so we felt it was the right time. And for us, it was a good opportunity to sell the teams. We had a willing buyer and worked out, everything was smooth as far as the transaction goes. So I think it was a well-executed transaction at the right time.

And I guess kind of duck-tailing on that. Can you talk about the benefits of maybe staying under the Liberty umbrella versus [indiscernible] and kind of how you guys think about that?

Well, with a lot of Liberty people in the room, will probably answer that in the right way here. I'm only kidding. There's a lot that's been said about our ownership and how we do as an organization, particularly on the field with respect to Liberty Media. But I think this thing on my finger probably is a good example of how well being inside of the Liberty Media tent has worked. I think they'd be the first to tell you if they were standing in the microphone that they allow us to operate this business in the way that we need to. So we're structured in such a way where our control person is Terry McGuirk. He runs the relationship with the league, and speaks to the highest levels of Liberty Media. And for all intents and purposes, we're left then to just manage the business in the best way that we know how. So I like to look at this, and I tell my peers this, I think I can safely say this for Mike as well, I think we actually have one of the greatest corporate ownerships or ownerships period, in all sports. It gives us the flexibility and the financial freedom to do the things that we need to do to be successful, including what we've done with the Battery in the past.

I'd just add. So 8 years we've been doing this, obviously, this piece of dirt that we took over and the leadership of Liberty, all the way up to John Malone, not onetime has anyone ever said, wait holdup, put the brakes or something incredibly supportive they believe in it. They trust us. We've delivered. So they've been fantastic.

Mike, it's been great to see the Battery come together and build the energy out there. Would you be willing to put some either quantitative or qualitative metrics around the returns that you realized to date? And secondly, what you're targeting for Phase 3?

So I can talk about Phase 3. It's as far as what you saw numbers. That's the great thing about having Shane and Brian here. So I leave that all up to them. I know there's different intervals. We do that during the year. So -- but no, Phase 3 is, again, partnership on the big piece with Golden Rod that is across the street. And again, it goes back to the belief in what we're doing here. Truist, they had other opportunities to look at. TK at 6 other states that were obviously that were -- again, they were very engaged in discussions with them. Papa John's is in Louisville. All those companies continue -- they're here because they made a concentrated effort to bring their headquarters here because of what we've created here and what they think it is going to do for their workforce. So financially, again, I'm going to leave those discussions up to them, but it's working.

Another question from the webcast. How do you think about your pricing strategy as consumers cut spending potentially heading into recession?

I actually still think we've got a lot of room to grow as it relates to pricing. What I mean by that is we're still a very inexpensive ticket, not just in our marketplace with the other professional sports teams or entertainment options, but also if you look at us compared to the rest of the league. And that's not to say that we're going to increase prices, right, as an automatic. It just means I think we're well positioned right now as we go into some of these uncertain economic times ahead of us. Again, I'd like to look at the facts of what we've got already this year is a demonstration of that. We're seeing increased demand. We're not only -- as I mentioned earlier, not only are we doing exceptionally well with respect to our season ticket totals and the amount of season ticket holders that we have. It's been -- last time we had a season ticket [indiscernible] this high, it was over 20 years ago in a ballpark that was much bigger. But also our single-game ticket sales are extremely strong. And we're actually seeing that increase as the year goes. So certainly, part of that is the team has done better as the year has gone on. But we're -- we do some things here in the ticket world that include things like dynamic pricing. So it does allow us the chance to alter pricing change up or down based upon market dynamics. And we're constantly looking at that and have a team of people that are very well versed in looking at that every day. And it's one of the advancements of our organization, quite frankly, as a structure over the past 5, 10 years as we've built that capability in house. We have a business intelligence team, not only on the baseball side, that's doing all the analytics on the baseball, but we also have it on the business side. And those guys are doing exceptional work and really informing us on some great yield management, all kinds of other business intelligence-driven decision making.

Pardon. So you mentioned some of the streaming [indiscernible] it sounds like you're [indiscernible] your partner to put Valley -- [indiscernible] why not? What it would take to get you there or [indiscernible]

Sure. First of all, it's a complex scenario. And so I'll try to be brief and high level with respect to this. It's something, first off, I'll state, as I mentioned earlier, we as a team and as a league are studying this every day. It's one of the things that we are very, very active in with respect to our business. You are correct in saying that we are not currently allowing the Valley's regional sports networks in our territory to do a D2C offering. We think the best opportunity for that is to understand how that goes in some of the other markets and then look at what the league can do to support the best efforts and best practice with that. So we're studying it, looking at it and feel like -- one of the things that we also have to remember, right, is as you launch the D2C opportunities, it has the chance to disrupt some of the legacy distribution that's occurring with the traditional distribution mechanism. And so we've got to be mindful of that and understand that there's 2 levers there that need to be contemplated. And it's something that, again, we're spending a lot of time on, but have to look at others for what's happening.

A question for Mike. You previously monetized the residential part of the Battery. Are there other parts of the Battery you would look to sell? And if so, what goes into that consideration?

The great John Sheraton one said he'd trade every player in our team if we made us better. So we always had a little bit of hesitation when we would hear them say that. But no, right now, we're not looking at selling everything. Everything is just producing incredible numbers and margins, which -- we're selling out our hotels. Obviously, the restaurants are doing incredible numbers. We're in a good place right now where the real estate, the vision for this, the objective of it was to support winning the World Series. [indiscernible] the ability for Alex to go out and get the right players that can help us make that happen. And the real estate is doing an incredible job of that at this point. So there's no -- nothing on the drawing board that we're going to sell anything because it's how well it's all performing. And as you can see, we're building more.

Maybe a related follow-up. How do the per room rate at the hotels in the Battery compared to [indiscernible] Atlanta to downtown Atlanta?

So right now, when you look at our classification and how we match up with the other hotels in our categories and in our market, we're #1 across the board in every single category. As far as downtown hotels, we don't compare ourselves to them. I will just tell you that the numbers here, I would say, probably exceed what they'll do in downtown Atlanta on most nights, definitely in the nights we're playing games.

One more. The Atlanta Braves have been active in the Metaverse. Can you talk about some of those efforts?

Sure. So we did launch a digital version of Truist Park this year. It was an exciting opportunity for us to do some exploration into that space. I don't know exactly where that's going to go, but we wanted to be among the league leaders, leaders in all of sports in trying to understand how we can capitalize on the Metaverse. So you can go on today right now and investigate the digital Truist Park, navigate your way around. It's almost like a little bit of a video game, if you will. And I think there's all kinds of opportunities for that. We were talking about broadcasting a minute ago. It's not out of the realm of possibility, the future possibility, maybe even near future possibilities to have a game broadcast inside of the Metaverse, inside of the digital Truist Park and be able to watch it from home sitting side by -- in the [indiscernible] while your -- digital twin of yourself. So those things are things that we're exploring and also drawing some inspiration from around the world of entertainment and elsewhere for how we launch this. We were excited to be the league leaders in this. I think we were the first Major League team to do this. And I think there's ultimately a revenue component that goes associated with it today. I think a little bit of a marketing opportunity. And soon thereafter, we're going to try to figure out how to monetize it.

Last question. What are your thoughts on the value of sports rights for the Braves but also just broadly?

I think there was at first probably looking around, especially as some of the streaming companies have got in. And with COVID, the acceleration of streaming and all of the changes that took place, there's probably some wonderment about what happens with sports rights. And I think the thing that I'm excited about as reference to an earlier comment is Major League Baseball has the opportunity to do a lot of exploration in this space and figure out what works for them. So at the league-wide level, we're streaming games and utilizing different platforms to understand what types of new and different customers, fans that we can reach, whether it be on Peacock or Apple TV, et cetera. Those give us great insights into how we drive the business forward. I also think one of the things that you're starting to see happen is those same companies and more are realizing the value of local sports rights. And so while they've initially been looking at this on the national level with league rights, I think we're starting to get a lot more doors knocked on, on the local level. And so I think it's a good indication of how those companies value and view local rights and where that is for the future. So again, I'm extremely optimistic about it. And I think we're well positioned, particularly because we occupy as the baseball team in this part of the country, a big swath of the United States where there's no other Major League Baseball team here, and we have a significant fan base. So we're very well positioned with respect to market size, market dynamics, the strength of team, all the other things that we've been doing. So I think it's, again, a very optimistic outlook. All right. Well, I think that's it for the official version of this. For all those non-Metz fans, we're going to welcome you for tonight's game. And for those Metz fans, we're going to show you out the door right now. But in all seriousness, for those people that have been joining us online, we thank you very much for participating, and look forward to having a great game with all the rest of you that are here in person. Thank you.