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Exclusive: With new five-year deal, COTA chairman says Formula 1 is far from 'F1 and done'

COTA announced it had inked a five-year deal with F1 in February 2022. (MSI Images/Twitter)

In a year packed with near-constant noise at Austin's purpose-built Formula 1 racetrack, the uncertainty around Circuit of the Americas' newest F1 deal may seem to be forgotten.


But for dedicated fans, the four months of uncertainty following COTA's expired 10-year deal was more than just a blip on the global racing radar.

The track, which is host to the U.S. Grand Prix, NASCAR races, and more, announced that it had secured at least five more years with F1 in February.

Here are the exclusive details on inking the deal from COTA chairman Bobby Epstein himself.

Why the wait?

Every year, Formula 1 receives roughly $25 million from Texas' Major Events Reimbursement Program, a taxpayer-funded initiative that helps bring big sporting events like 2017's Houston Super Bowl to the state.

According to Fort Worth Star-Telegram writer Mac Engel, however, the Major Events Reimbursements Program agrees to provide funding only "if Austin holds the only F1 race in the country."

And with a new Miami race debuting this year, past legal hiccups and the past ambiguous financial impact of the race, some COTA insiders worried that the global sport was 'F1 and Done' with the Austin track.

Epstein told Austonia that the state legislation was not involved in the latest agreement.

"There is no allocation from the state annual budget," Epstein said. "There is existing legislation in place that allows for tax dollars collected from out-of-state event attendees to be used to reimburse some event-related expenses. This legislation is not unique to F1 and is used to attract more than 100 events to our state each year."

Epstein said the delay was due to COVID delays rather than internal disputes.

"The timing was really a matter of 'papering' the agreement," Epstein said. " F1 management and legal teams were overwhelmed with COVID-related schedule shifting, earlier in the year."

Why is F1 committed to Austin?

Whether there were behind-the-curtains negotiations or not, Epstein said it's easy to see why F1 decided to ink the deal.

On multiple occasions, Epstein has asserted that the 2021 U.S. Grand Prix in October was the "largest sporting event in the world," and with an estimate of 400,000 people in attendance over the weekend, it was the biggest three-day race weekend in F1 history.

"The festive weekend has become a fan and competitors’ favorite destination event," Epstein told Austonia. "As the sport grows and tries new formats, they don’t want to lose what’s already working, and after last year, there was no way F1 could stop (nor did they want to stop) the momentum."

Epstein said the league would also hesitate to leave a track custom-built for them, complete with the necessary turns and elevation changes needed to highlight the prowess of F1's drivers and its signature open-wheeled vehicles.

And the event is a highlight for more than just its track, Epstein said.

"Austin is such a great host city, and an absolute highlight of the sport’s global tour," Epstein said. "With the campgrounds, the entertainment, and the themed villages, the grand prix at COTA takes on an unrivaled atmosphere. The COTA experience is much more like that of a historic, traditional Formula 1 track."

With past attractions, celebrity appearances and a carnival-like atmosphere—complete with the promise of luxury "car condos" and a rollercoaster-studded amusement park in the next few years—it seems like that atmosphere will be hard to beat for years to come.

The U.S. market: too crowded or a chance to grow?

There's a new track in town—for the first time in over 30 years, a casino-side race in Las Vegas will join Miami and Austin as the third U.S. track in 2023.

But despite enjoying America's sole F1 presence for several years, Epstein doesn't view the two new events as competition.

"With a night race down the glamorous Vegas strip or a cosmopolitan spring race around the Hard Rock Stadium, Formula One is creating a diverse array of offerings," Epstein said. "Each event complements the other and offers vastly different experiences."

While Austin provides a star-studded, yet more accessible Austin-esque festival experience, Miami and Las Vegas will showcase the luxury side of the sport. And thanks to the success of Netflix F1 documentary series "Drive to Survive," the once-foreign sport is growing exponentially—and for F1 higher-ups, the previously untapped market is hard to ignore.

For Austin, that means thousands more are expected to keep making the U.S. Grand Prix weekend one of the biggest travel weekends of the year for Austin-Bergstrom International Airport and local businesses alike.

"With the Formula One audience skyrocketing in the United States, three events per year certainly won’t meet the demand," Epstein said. "And the event in Austin will continue to bring hundreds of millions of tourist dollars to our hotels, restaurants and shops."

Popular

With deposition and trial looming, Elon Musk has offered $44B for Twitter, again
Shutterstock

Elon Musk has proposed once again to buy Twitter for $54.20 a share.

The news that Musk is offering to carry on with the $44 billion buyout was first reported by Bloomberg. Now, a filing with the Securities and Exchange Commission shows Musk made the proposal in a letter to the tech giant on Monday.

The New York Stock Exchange temporarily halted trading in Twitter stock twice Tuesday, first because of a big price move and the second time for a news event, presumably the announcement of Musk's renewed offer.

While the per share offer price on this latest proposal remains the same as the original offer, it’s unclear if Musk has made other term changes or if Twitter would reject it. According to other reports, a deal could be reached this week.

The stock closed at $52.00/share Tuesday, indicating market uncertainty around the $54.20 offer.

After Musk informed Twitter of plans to terminate the original agreement in July, Twitter sued. A trial has been expected in Delaware Chancery Court on Oct. 17.

With the proposition of a buyout on the table again, it revives the question of whether Musk might move Twitter from San Francisco to Central Texas.

He’s done so with some of his other companies. Tesla’s headquarters in southeast Travis County had its grand opening earlier this year and tunneling business The Boring Company moved to Pflugerville. At least two other Musk companies, SpaceX and Neuralink, have a Central Texas presence without being headquartered here.

Technology journalist Nilay Patel this afternoon voiced concerns that owning Twitter and Tesla together could be problematic for Musk, as his Tesla manufacturing facilities in Germany and China are both in countries that have disputes with Twitter over content moderation and censorship.

Telsa shares fell after the Twitter news became public, before rallying to close up, at $249.44.

Austin rents nearly double in a year and are now in the top 5 nationwide
Dwellsy

While searching for a place to live, Austin renters will face monthly rates of nearly $3,000, a recent guide from rental marketplace Dwellsy shows.

The median rent in August this year was $2,930, a more than 86% increase since August 2021. That’s $820 more than the nationwide median asking rent in August and puts Austin just below the Bay Area, Boston and New York for large cities with the most expensive asking rent.

“Within this group, Austin, TX stands out for the highest increases in asking rent, which has nearly doubled since this time last year,” the study notes.

Outside of those large cities, however, others are seeing even higher rent spikes. Metro areas that ranked above Austin in one-year increases include those like Kansas City, MO with a 112% change in rent since last August and Tucson, AZ with a 124% change.

The data reflects large apartment communities, single-family homes and 2-6 unit buildings.