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Documents filed last week with the SEC by Atlantic Yards developer Forest City Ratner "warn that the non-arena portions of the plan could experience 'further delays' leading to most or all of the rest of the 22-acre, $4.9 million project being scrapped," according to Rich Calder of the N.Y. POST. Risks to investors cited in the SEC filings include the "potential of rising construction costs and financing rates, loss of arena sponsorships and inability to meet government-approved construction deadlines." The filings indicated Forest City Chair & CEO Bruce Ratner and the company could potentially lose $525M on the project, "excluding any potential write-offs for the arena" and "liquidated damages." Forest City "reported 'record' earnings the past year ending Jan. 31, in part fueled by selling Russian billionaire Mikhail Prokhorov a majority interest in the money-losing New Jersey Nets, who will move to the Barclays Center arena for the 2012-13 NBA season." The filings also revealed that the Prokhorov deal in May was a "greater financial windfall for Ratner than what was announced publicly." Prokhorov "paid Ratner $223 million for 80 percent of the Nets and 45 percent of the arena, and agreed to pay for $60 million in team losses and assume 80 percent of the Nets' $200 million debt." Both parties had claimed the deal was for $200M and other "funding commitments" (N.Y. POST, 4/4). The WALL STREET JOURNAL's Eliot Brown reports Forest City "has been struggling to raise money for the housing that will accompany" Barclays Center, which is "dwarfed by the nearly $4 billion in housing and retail space Forest City wants to construct there in future years" (WALL STREET JOURNAL, 4/4).
OPENING DATE SET: Nets CEO Brett Yormark indicated that Barclays Center will open Sept. 28, 2012, capping a "three-week run of soft openings tied to open houses and community events." SPORTSBUSINESS JOURNAL's Don Muret reports the opening event "should be announced in the next 30 days." Nets Sports & Entertainment as of last week "had 149 dates confirmed for Barclays Center's first year of operation" (SPORTSBUSINESS JOURNAL, 4/4 issue).
A panel of experts appointed by L.A. Mayor Antonio Villaraigosa said Friday that AEG's proposed NFL stadium in downtown L.A. "must include assurances that a 'financially sound entity' will stand behind the developer's pledge that the plan will impose no financial burden on the city," according to Rich Connell of the L.A. TIMES. That goal was "included in a series of items that a blue ribbon commission selected by ... Villaraigosa promised to focus on in the coming months as it evaluates the $1.4-billion plan for a stadium, new exhibit hall and parking on city-owned Los Angeles Convention Center land." Under AEG's initial proposal to the city, L.A. Event Center "would be the one committed to covering any shortfall in tax revenues needed to repay $350 million in city borrowing for the Convention Center work." First Deputy Mayor Austin Beutner, the blue ribbon panel's co-Chair, said, "We're looking to make sure the AEG vehicle that stands behind all of this is financially sound." In a statement, the panel said the stadium/event center "has the potential to transform Los Angeles," but it should only be approved "if we are certain it can be completed without taxpayer funds, traffic impacts are mitigated and the promised jobs go to Angelinos" (LATIMES.com, 4/1).
FACING OFF: In California, Scott Reid wrote AEG's "pursuit of an NFL franchise to play in a $1 billion downtown Los Angeles stadium has touched off a potentially multi-billion dollar arms race" with Majestic Realty Chair & CEO Ed Roski, who is "backing a stadium project in the City of Industry." It is a battle between "two of the region's richest and most influential men," AEG Chair Phil Anschutz and Roski, "billionaire business partners turned bitter rivals who share little common ground beyond a belief that the NFL is on its way back to the Los Angeles-Orange County market after a more than 15-year absence, possibly as early as the 2012 season." But NFL and stadium consultants, economists, sports business analysts, legislators, current and former government and NFL officials "who have studied both projects argue in a series of recent interviews that the NFL's return to Southern California is far from the certainty AEG and Roski's Majestic Realty group present it to be." Both groups face "significant political, financial, logistical and public relations obstacles." Perhaps the "biggest hurdle for both projects will be convincing the NFL to return to a region that has both fascinated and frustrated the league for parts of three decades" (ORANGE COUNTY REGISTER, 4/2).
VIKINGS STADIUM LACKS SUPPORT: In Minneapolis, Duchschere & Von Sternberg reported top city and Hennepin County officials "expressed skepticism Friday about the details of a long-awaited" Vikings stadium bill "emerging at the Legislature." Viewed as "two important potential local partners on a new Vikings stadium," officials in both the city and county said that the bill "wasn't structured in a way that would allow them to participate." Hennepin County Commissioner Peter McLaughlin said the bill is "badly timed" and "badly designed." McLaughlin: "I hope it comes to a bad end. I wouldn't even start talking to the Vikings until they bring half a billion dollars to the table" (Minneapolis STAR TRIBUNE, 4/2).
Rays Owner Stuart Sternberg said that "it's 'imperative' that talks on a new stadium progress because Major League Baseball will soon press the issue," according to Marc Topkin of ST. PETERSBURG TIMES. Sternberg, speaking before Friday's season opener against the Orioles, said that it "wouldn't be long, perhaps within months, before MLB and commissioner Bud Selig get involved." Sternberg: "The can has been kicked down the road and the road is not much longer." St. Petersburg Mayor Bill Foster said that the city "has no concerns about the team leaving and isn't too worried about increased threats." Foster: "The city is prepared for interference from Major League Baseball and all of the Selig tricks that have been used successfully elsewhere. We've studied it, we know it and we're prepared." Foster talked to Florida Gov. Rick Scott and indicated that it "was his impression there was 'no money' for a publicly financed stadium." Foster added that the "old model of the team, state and local governments each contributing one-third of the cost would no longer be feasible." He has agreed "only to talk about a new stadium in St. Petersburg or sites within Pinellas County, refusing to grant the Rays permission they've asked for to explore other potential sites in the Tampa Bay area." Foster did, however, "leave open the possibility that if there was no solution in Pinellas County, he could allow the Rays to look elsewhere" (ST. PETERSBURG TIMES, 4/2).
PAVING THEIR WAY: In West Palm Beach, Joe Capozzi noted the Marlins Community Foundation Paver Program gives Marlins fans a "chance to become a permanent part" of the team's new ballpark by purchasing engraved pavers. The pavers, which cost $250-400, "will be located in the ballpark’s East Plaza and seen by thousands of visitors throughout the year" (PALMBEACHPOST.com, 4/2).
Fulham “unveiled a statue of Michael Jackson outside its stadium on Sunday, with team chairman Mohamed Al Fayed telling fans to support another Premier League club if they don't like the idea,” according to the AP. Al Fayed, who was “close friends with Jackson,” unveiled the statue outside Craven Cottage stadium before Fulham's match against Blackpool. Al Fayed: "Why is it bizarre? Football fans love it. If some stupid fans don't understand and appreciate such a gift, they can go to hell. I don't want them to be fans. If they don't understand and don't believe in things I believe in, they can go to Chelsea, they can go to anywhere else." The statue had been “slated to be erected outside Harrods department store, but those plans were shelved when Al Fayed sold the business last year” (AP, 4/3). The WALL STREET JOURNAL’s MacDonald & Schaefer Munoz note the statue “has created a meeting of the minds between two camps of ... unlikely allies: wacko Jacko fans and rabid Fulham supporters.” Both groups “hate the idea and want the statue to beat it to some other venue.” Fulham fans “fear that Mr. Al Fayed's latest creation will become fodder for soccer rivals, known for mercilessly taunting opposition teams in often profane chants” (WALL STREET JOURNAL, 4/2).
When Tiger Woods’ golf course design business was founded five years ago, the hope was that it would “extend his brand, bring him untold more millions and leave his permanent imprint on the game,” but "none of the courses" he has started have been completed, according to a business section cover story by Paul Sullivan of the N.Y. TIMES. Woods’ Punta Brava course in Mexico has been under development for two and a half years, but “no dirt has been moved.” His two other designs, in Dubai and near Asheville, N.C., are “also troubled.” Sources said that the Dubai course “has been shelved permanently.” The Asheville project “is searching for new financing, and construction has halted until at least this summer.” The stalled development is "a trajectory that mirrors just about every element of Mr. Woods’ life these days." Punta Brava Developer Brian Tucker said that his group “had to redo" an environmental impact study, and groundbreaking “is set for later this year.” Sullivan wrote what “remains to be seen is how much the developers will use Mr. Woods’s image to sell the course.” Tucker indicated that Punta Brava “would be marketed mostly on its exotic locale.” Tucker: “This project is not about Tiger Woods.” Punta Brava’s location “allows it to play down Mr. Woods’s involvement, but the two other courses he designed do not have this luxury.” His “allure as one of the world’s great champions was a crucial pillar of the sales plan.” Tiger Woods Design President Bryon Bell said that the firm “would not be looking for new partners in Dubai.” Sullivan noted the “economic crisis” delayed development at Punta Brava as “credit dried up, and real estate prices plunged.” But the “tarnishing of Mr. Woods’s image has presumably hurt as well.” Its impact is “harder to quantify, though it probably has been more of a factor for” the course in Asheville, which “based its initial sales pitch as much on Mr. Woods’s personality and reputation as on his athletic accomplishments.” There have “not been any new projects announced” by TWD since the announcement of the Punta Brava course in October '08. Bell said, “We are evaluating opportunities from all over the world. We’re staying focused on our original mission of finding great sites, great partners, and creating spectacular designs. I’m very confident about our future” (N.Y. TIMES, 4/3).