Three key points for Paris to successfully host the Olympics

Athletes train for years, even decades, in preparation for the Olympics—and so do the host cities. Hosting 329 medal events in 32 different sports, some 10,000 or more athletes, and welcoming millions of visitors at the same time is no mean feat.

The stakes are high in the Paris case because it is the first time the event has been held in 100 years. It wants to do things differently and become the “greenest” Olympics yet, turning to renewable energy, plant-based foods and rental sports equipment.

Paris’ investment in the Olympics doesn’t stop there. The French capital has pledged to clean up the Seine to use it for open water swimming competitions – but the move is not going as planned. It has also built a new train line to help improve connectivity to Olympic venues.

While Paris has taken a novel approach in some areas, it faces the same baggage that host cities inevitably face: cost overruns.

S&P Global Ratings estimates that the cost of the 2024 Olympics is estimated at nearly $10 billion, exceeding the planned budget by 25%. While not as cost-intensive as the Sochi Olympics (2014) or Rio (2016), it still reflects the tricky trade-offs cities must make when accepting the daunting task of hosting the Games.

“We do see greater overspending on infrastructure, but it’s not without pressure on the operational side,” said Alexander Budzier, a fellow in management practice at Oxford University’s Saïd Business School who has studied the legacy of Olympic overspending.

In some ways, the Paris Olympics are on the cusp of rethinking the future of events of this magnitude: Should they stay the same, or are they in dire need of change?

Paris’ struggle

In preparation for the Olympics, Paris decided to limit the number of new venues to control costs and carbon emissions. This is indeed the case. But along the way, the city engaged in what some called a “social cleansing” as it displaced hundreds of people who lived near the Île Saint-Denis, where the Olympic Village is located, and elsewhere. The government denies the move has anything to do with the Olympics.

The event seemed to get off to a rocky start, with the opening ceremony marred by heavy rain, out-of-sync filming and some controversial behavior that some saw as a parody of the Last Supper painting.

There’s also the question of whether the Seine is ready to host an event of this magnitude. The river remained polluted until dangerously close to the opening of the Olympics. Then athletes began to fall ill after swimming in the river (although it has not been determined whether the Seine was the culprit).

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Ken Hanscom, who worked on the U.S. Olympic team and serves as chief operating officer of ticketing platform TicketManager, said some of these issues were expected but difficult to plan for.
“There’s going to be some bumps along the way. But I think there’s been a lot of bumps here [in Paris] Very, very small,” Hanscom told wealth.

Olympic “Hangover”

Historically, cities have been in a state of “hangover” after hosting the Olympics. The 2004 Athens Olympics, while significant, were so costly that they are believed to have triggered Greece’s financial crisis.

Meanwhile, the Rio Olympics eight years ago left abandoned facilities in the Brazilian capital in its wake. In Tokyo, corruption scandals have followed as the city struggles to host the event and gain attention during the COVID-19 pandemic.

Is Paris immune to these effects? Maybe not, but it does progress from the mistakes made by some of its predecessors.

For example, although the French capital has switched to cardboard beds and fewer new venues, concerns about costs still linger.

The paper co-authored by Budzier found that actual prices in Paris were actually 115% higher than initial estimates. Those costs could have been spent on public services — a problem Budapest residents recognized and signed a petition that led Hungary to abandon its bid for the 2024 Olympics seven years ago. For the same reason, the Paris Olympics also received considerable criticism, even though the events went ahead as planned.

Since the International Olympic Committee launched Agenda 2020 to change the way future Olympics are held, cities including Paris have had to think more about how to make the event sustainable. This has brought progress, but it will take time to become sustainable.

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“The estimated cost of this will go down. At the same time, cost overruns will still exist,” Bazil said. “At the moment, it appears that Paris does not benefit financially from this. [the Olympics]so the benefits will come later.

The legacy of the Olympics has also been a huge success. For example, when Los Angeles hosted the Olympics in 1984, it generated $223 million in profits for the city. London 2012 is seen as an example of how the Olympics can promote urban regeneration and build infrastructure that benefits local communities.

Three characteristics of Olympic success

So, what does it take for the Olympics to be successful? Hanscom, who has participated in four iterations so far, mentioned three things in addition to basics like safety.

First, getting your budget right is a win. The Paris Olympics didn’t really achieve that, but it helped limit some big infrastructure and operating expenses. This is also part of an ongoing, evolving digital effort to reconcile. Paris officials have justified the costs because they plan to repurpose units in the Olympic Village into housing after the games, with returns that may be difficult to quantify.

Secondly, strong local participation means everyone directly affected in the host country or city is immersed in a grand sporting experience. In Paris, a large number of the audience is expected to be French – a trend Hanscom has also observed.

With fewer international visitors coming to the city ahead of the Olympics (which hurt Air France-KLM’s revenue), there were rumors of unsold tickets and unbooked hotel rooms. But hey, at least the French made it through.

Finally, Hanscom emphasized that the Olympics brought a great show to live audiences and television viewers. Ratings for the Olympics have declined in recent years, and there is an urgent desire to reverse this situation. But this year, the opening ceremony became the most watched event on French television. Data shows that viewership is rising even globally.

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So, overall, Paris is likely to succeed, Hanscom said.

“I think there’s progress being made on how they continue to improve and grow because right now, when you look at Los Angeles, I don’t believe there’s not a new facility being built,” he said. “It can always get better.”

Basil pointed out that the attention of hosting the Olympics can create a positive “leverage effect”.

“Hosting the Olympics allows you to do things that you might otherwise need decades of public debate and piecemeal intervention in a city to do,” he said.

Take the cleanup of the Seine, for example. Past French leaders have promised to reopen, but deadlines kept getting pushed back – until Paris committed to hosting the Olympics. The city spent $1.5 billion to reduce pollution in the river. Of course, the Seine isn’t in the best shape, but there has been more cleanup work over the past few years than there was a few decades ago.

The world is eagerly watching how Los Angeles 2028 will achieve better results through the event and its legacy. At present, it is optimistic enough that the idea of ​​a successful Olympic iteration is slowly but surely developing.