After 30 years, what Bills’ breakup with Delaware North means for iconic Buffalo company

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After 30 years, what Bills’ breakup with Delaware North means for iconic Buffalo company

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Delaware North will be fine.

The hospitality corporation, founded here 108 years ago, owns or runs concessions at about 200 stadiums, airports, casinos, hotels and national parks worldwide. Four years ago, Delaware North set a record with $3.68 billion in revenues. Last year, after the COVID lull, it generated $3.96 billion.

Business is grand.

Yet while Jamie Obletz sat in the 11th-floor boardroom at Delaware North’s headquarters Wednesday afternoon and looked out onto a sun-drenched downtown and glistening Lake Erie, gloom consumed him.

“It’s a bit of a funeral around here today,” Obletz said, guessing he would give everybody “one more day to sulk.”

Obletz is president of Delaware North Sportservice, the division that oversees 50 arenas around the globe, Lambeau Field, MetLife Stadium and Wembley Stadium among them.

But he was notified Tuesday his company lost an account that means more on an emotional level than all the rest.

After 30 years together, the Buffalo Bills have decided to switch to Legends Hospitality when their new stadium is scheduled to open in 2026. Legends was founded by Dallas Cowboys owner Jerry Jones and late New York Yankees owner George Steinbrenner.

“This obviously stings,” Obletz said. “There are emotions that can’t be ignored.”

Rather than the glorious opportunity to work at a Bills palace built to accommodate today’s voracious concession demands, Delaware North merely must play out the final years of its contract at the NFL’s fourth-oldest stadium — built when hot dogs, peanuts and beer were exemplary cuisine.

 

A rendering of the Bills’ new stadium. (Buffalo Bills)

Bills executive vice president and COO Ron Raccuia informed Obletz over breakfast at Jake’s Café, a Delaware North restaurant named for the company’s founding family, the Jacobses. Raccuia didn’t respond to a text from The Athletic about this story.

Obletz took a deep breath before breaking the bad news to Charlie, Lou and Jerry Jacobs Jr., sons of chairman and proud Buffalonian Jeremy Jacobs. If the Jacobses weren’t having a rough enough few weeks — the family’s Boston Bruins amassed more points than any club in NHL history, but the last-seeded Florida Panthers eliminated them in the first round of the playoffs — then the Bills’ decision made sure of it.

“It was not an easy conversation to have,” Obletz said. “He’s emotionally invested like the rest of us in trying to do what’s best for our hometown. We want to impress and showcase right here where we go to bed every night.”

The switch in Orchard Park might not impact the area significantly from a jobs standpoint. Obletz said Delaware North has between 35-40 full-time employees at Highmark Stadium. Legends Hospitality president Dan Smith told The Buffalo News it expects to hire 30 full-time executives there by 2026.

Obletz cited cash leaving the area as a larger concern. Legends Hospitality LLC is headquartered in New York, but parent company Sixth Street Partners is based in San Francisco.

“You have a Western New York company that, over generations, has given tens and tens of millions to the tax rolls and has employed thousands of people,” Obletz said. “The actual impact will be largely around the profits that are generated and will not necessarily stay in Western New York.

“Dollars we make here largely stay here, get reinvested here, get donated back to the community in spades.”

Legends won a four-bid competition that also included Sodexo and Levy Restaurants. Terms have not been disclosed.

The decision strengthens an already robust Bills relationship that began two years ago, when Pegula Sports and Entertainment hired Legends to handle project management, naming rights, sponsorships and premium seating licenses for the proposed stadium. Legends overtook additional Bills business aspects such as merchandising and retail operations. Raccuia’s daughter is an associate in Legends’ global partnerships division.

“They clearly have shown the ability to understand our marketplace at a very high level,” Ron Raccuia told The Buffalo News about the winning bid. “Overall, we felt they offered us the best opportunity to deliver the type of food and beverage experience that we know our fans want in the new stadium.”

Those words don’t jibe with Delaware North’s opinion of what they can offer above and beyond anyone else.

Delaware North had almost 100 employees working full-time on the Bills bid, Obletz said. He noted its proposal emphasized local synergies on the estimated $1.54 billion stadium project, with New York State picking up $600 million and Erie County another $250 million.

“We wouldn’t just rest on this, but our theory — maybe we were more wrong than right — was the public-private nature of this stadium and having an operator with our level of connectivity and ability to dig deep into the community,” Obletz said.

“We donate millions of dollars here on an annual basis. Our training and vocational programs, our philanthropic and outreach programs are deep-rooted and long-tenured. We’ll continue to do these things because that’s what our company is about, but we thought we could help bring the community benefits agreement to life.”

A community benefits agreement essentially is a political tradeoff to allay animosity over so much public money going toward a ballpark. NFL revenues reportedly are around $19 billion. The Washington Commanders are being sold for a shade over $6 billion. Forbes estimates Terry Pegula is worth $6.7 billion and the Jacobs family $4 billion.

The Bills’ community benefits agreement outlines requirements to invest $3 million a year in local programs annually, to hire construction and maintenance workers from low-income and diverse backgrounds, to enhance public transit for the stadium and to make the venue available for civic events.

A Delaware North spokesman said the company donates about $6.5 million a year to Western New York causes.

No edict was given to hire a local company to run concessions. The competing bids aren’t subject to public disclosure.

“It’s easy for me to say that, as a requirement of accepting a dollar of public funding, everything has to stay local whenever possible,” Obletz said. “But we never pushed it. That’s not part of our DNA. Besides, you don’t want to presume anything to the point you compromise the fan experience.

“Our hope is that a fair and objective process was run, that the company that succeeded in winning this bid is the best suited to deliver for the community and the fans that will patronage that stadium starting in 2026. We still think that should be us. So we live and die by our reputation.”

Obletz added the concessions proposal incorporated a portfolio of Western New York brands both famous and obscure.

“The trend in this industry is to bring local, authentic cuisine from street-side into the venue,” he said. “We wanted to go out and find the absolute best brands and minority-owned businesses that needed a boost and find what really resonates with Bills Mafia.”

This is the second high-profile Buffalo sports partnership to fizzle with the Bills recently. New Era Cap pulled out of its stadium naming-rights deal three years ago amid COVID struggles.

Because of the hefty public subsidies, Delaware North’s ouster is politically convenient for Gov. Kathy Hochul and eliminates conflict-of-interest criticisms that swirled during stadium lease negotiations. Her husband, William Hochul, is Delaware North’s general counsel and a senior vice president.

That, however, is merely one employee out of roughly 2,000 in Western New York.

Back in Obletz’s office, he looked glumly at the framed No. 1 Bills jersey that bears his name. He’s an Amherst native and Park School grad. His three children, ages 3 to 6, probably are destined for Bills fandom too. The oldest, Keating, already loves them.

More deep breaths, though. Earth will keep spinning. Delaware North will remain a sports powerhouse with the Bills or without them.

About 100 miles east on the New York Thruway, for example, Delaware North is basking in the glow of another client’s prestigious event, the PGA Championship at Oak Hill Country Club. In TD Garden, the Boston Celtics are playing the Miami Heat for the Eastern Conference title. A third of Major League Baseball parks are clients. Two months ago, 217,500 fans filled the Melbourne Cricket Ground over back-to-back nights to see Ed Sheeran.

“We do it from Seattle to Florida to New York to London to Singapore to Melbourne,” Obletz said. “To not have the same opportunity to do it where we live and go to bed every night? That hurts.

“But we’ll get over it. We can’t let this define us. We have to keep pushing, and we’ll remain committed to our community no matter what.”