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Thursday, Apr 19, 2018
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Tampa Bay Rays

Financing Details For New Stadium Still Up In The Air

Artist Renderings | What Do You Think? | Video: Rays New Park ST. PETERSBURG - The Tampa Bay Rays tried to garner support for a new waterfront stadium Wednesday by unveiling picturesque renderings at the proposed site of the ballpark as first baseman Carlos Pena hit balls into the Bay. Left out, however, were specific details about how the team would pay for the stadium and redevelop Tropicana Field, where the team now plays. The Rays owners said the value of both projects could surpass $1 billion. Among the new financing details released for the new $450 million ballpark:
•Rays principal owner Stuart Sternberg pledged the new stadium and Tropicana Field redevelopment won't cost St. Petersburg residents more in taxes. •The team's proposed $150 million contribution will come in the form of stadium rent, likely increasing from the current $1 million yearly lease payment to $10 million. The team's revenue-sharing agreement with Major League Baseball makes the arrangement most advantageous for the team, Rays executives said. •The Rays will ask the state for up to $60 million in sales tax rebates to help pay for the stadium, but it's not a deal breaker if Florida lawmakers reject the request, said Michael Kalt, the team's senior vice president of development and business affairs. •Team owners hope to pay the remainder of the roughly $270 million through the sale and development of the 85 acres at Tropicana Field, which is owned by Pinellas County. The team likely would get at least part of the money from extra property tax revenue collected on the redeveloped property, a subsidy known as tax-increment financing. "This is not a final product," said Matt Silverman, team president. "But our momentum and progress are clear." The Rays want to build a 34,000-seat, waterfront ballpark in downtown St. Petersburg at Progress Energy Park, Home of Al Lang Field. The stadium has served as the Rays' spring training facility since the team's inception in 1998. The team is moving spring training to a renovated facility in Charlotte County in 2009. Fate Of Plan, Tropicana Site Linked The biggest and potentially riskiest part of the equation is the fate of the Tropicana Field site. The land would give a developer one of the last large undeveloped lots in Pinellas County, and its redevelopment could energize a generally lethargic corner of St. Petersburg's downtown. If that component of the plan fails, so does the stadium proposal, the team said. Developers aren't sure the Tropicana Field property is worth what the team says it would need to make the deal work. Veteran land broker Bruce Erhardt, an executive director for Cushman & Wakefield in Tampa, pegged the property's value at about $100 million. Greg Grice, a broker with Marcus & Millichap Real Estate Investment Services' National Land Group in Tampa, said he thought the property would sell for more than $100 million. All of the land brokers said the price tag for the Tropicana Field site will be dictated by what's built there. The Rays hired a Houston-based real estate investment and development firm, Hines Interests, to produce a site development plan to help convince developers, taxpayers and government officials that the Tropicana Field site can be redeveloped successfully. Hines envisions a massive residential and retail complex, complete with 10 acres of parks and green space. Success Stories The formula has worked before. In other parts of the country, communities have successfully supplanted vacant, unwanted buildings with new developments that incorporate housing, shops, entertainment and employment centers. In Denver, the former Stapleton airport is being replaced with urban neighborhoods, businesses, stores and restaurants. Closer to the Tampa Bay area, the former Orlando Naval Training Center, decommissioned in 1999, is being transformed into a neighborhood and retail center called Baldwin Park. Kalt said team owners are weighing whether to have a separate, financial interest in the redevelopment of the Tropicana Field site. Rays owners and executives said they saved crucial space and more than $100 million by not proposing a more traditional retractable roof stadium. Instead, the stadium will use huge fabric sails that can be deployed in minutes when searing temperatures make games unbearable or if foul weather blows in. Team officials are working to find the best way to pay off the $94 million debt at Tropicana Field, which the city built to lure a baseball team to St. Petersburg. One solution is to continue to use city, county and state tax money to pay off the bonds, likely until about 2025, Kalt said. Mayor Remains Noncommittal St. Petersburg Mayor Rick Baker is among those the team must convince. He's worried about the uncertainty of the financing, despite the pledge for no new city taxes. As part of the Rays' $150 million contribution, the city likely would be required to sell bonds to come up with the money for construction and then use the rent to pay the debt. Baker said he turned down an offer to speak at Wednesday's news conference to unveil the stadium, opting instead to sit among journalists and community leaders. "I am not committed to it, but I am not against it," Baker said afterward, noting that he liked the proposed design. Gov. Charlie Crist, a St. Petersburg native, attended the event to show his support. He said the project could be a significant economic development initiative worthy of state taxpayer dollars, even in tough fiscal times. Florida's sports industry has doubled since 1999, generating $32 billion in economic effects and employing more than 400,000 people, according to the Governor's Office of Tourism, Trade and Economic Development. Perhaps the Rays will fare better than the Florida Marlins, who have tried for years to persuade lawmakers to give the team $60 million in sales-tax rebates to build a new stadium. Kalt said the team had a few cursory discussions with the Marlins about their requests for state money. "We support them and they support us," he said. Marlins officials could not be reached for comment late Wednesday. When asked what he thought about the Marlins' effort to get the tax break, Crist said: "I don't object to it." Also unknown is whether the ballpark will be called Tropicana Field. Tropicana Products Inc. pays the Rays about $1.5 million a year for stadium naming-rights through 2026, according to ESPN.com. "We think that a new stadium would be a great development for the Rays," said Pete Brace, a company spokesman. "While this is a very promising and exciting development, it would be premature to speculate about our future involvement with the Tampa Bay Rays as they begin to explore options for a new stadium."

Reporter Baird Helgeson can be reached at (813) 259-7668 or bhelgeson @tampatrib.com. Reporter Dave Simanoff can be reached at (813) 259-7762 or [email protected]

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