NBC 7’s Derek Togerson takes a look at the potential for San Diego to add more professional sports teams in this commentary
Downtown San Diego is suddenly home to some of the most prime real estate on the planet. The San Diego Unified Port District has informed Terramar Retail Centers that it will not renew their lease on historic Seaport Village and opened it up to ideas for redevelopment.
That means as of September, 2018, the Port District can completely reshape that land, something they’ve thought for a long time about doing. So why is the sports guy interested in this?
Because one of the six ideas the Port District will consider includes an 18,000 seat sports and entertainment venue. Basically that means it’s a new Sports Arena and if that is the proposal that is eventually chosen it opens up a whole new world of possibilities.
There are other things included in the proposal by real estate company OliverMcMillan, including three hotels, several restaurants, office space, new performance space for the San Diego Symphony and even tide pools for the Scripps Institution of Oceanography (of the 70 acres the Port District is making available, 30 are submerged).
But the anchor would be that new arena, and that just begs the question … Why would someone build a new sports arena if there’s no team to play in it?
The most obvious answer is to hold concerts, special events and smaller conventions like Kansas City’s Sprint Center does. Even though there is no major professional sports franchise committed to playing there it hosts a myriad of different events. In July alone it will have performances from such diverse acts as Louis C.K., Drake and Dolly Parton. Sprint Center has hosted 540 events in a little more than five years.
Now, that might be enough for a new facility downtown but what really sticks out to me is the fact AEG Worldwide is on board with OliverMcMillan to design and run the proposed new facility. Having that sports and entertainment entity in the mix is like having Vegas lights going off when someone hits the jackpot.
Speaking of Vegas, it’s AEG Worldwide who helped with the new facility in Las Vegas that attracted an NHL expansion team. That arena was privately financed. In fact, here is just a partial list of the facilities AEG helped find private financing for:
T-Mobile Arena (Las Vegas)
Staples Center (Los Angeles)
American Airlines Arena (Miami)
StubHub Center (Carson, CA)
Citizens Bank Arena (Ontario, CA home of the AHL Ontario Reign)
That is a key component here. The development plan set forth by OliverMcMillan and AEG is estimated at about $1.4 billion and they say they can do the whole thing with private money. No tax increases. No cash from the general fund.
Do I have your attention yet?
Part of the reason they can do it is the Port District would offer a long-term land lease on the 70 acres on the Embarcadero. The developers would operate as a private entity and pay rent based on either a fixed rate or a percentage of profits (the Port District will make this offer to any of the six plans they are considering).
This way they don’t have to worry about the costly and often contentious “land acquisition” portion of a real estate deal. But, back to the big question of who gets to call the new arena home.
First thought would be the San Diego Gulls. The new hockey franchise had a wildly successful inaugural season in the American Hockey League playing at Valley View Casino Center, which is also operated by AEG. People I’ve spoken to with the Gulls say they would move to a new facility on the Embarcadero “in a heartbeat.”
The Gulls have a lease at the VVCC that runs for another four years, which would potentially line up nicely with when the proposed new facility Downtown could be set to open. Plus, with AEG as the manager of both facilities it would be easy to move to a brand new spot.
The Samueli family that owns the Gulls and NHL’s Anaheim Ducks loved their first experience with San Diego hockey fans and would be willing to move their team down I-5 to a new facility if it makes good business sense. However there is little likelihood they would bring the Ducks down to American’s Finest City full-time.
As for another NHL expansion team? The league will have to look at the possibility now that they have an odd number of teams but putting three franchises in Southern California, plus one in Las Vegas, would be a hard sell.
So how about the National Basketball Association? I know, we’ve had the NBA come and go (twice) but that was a different era of professional sports. Plus there was never a billionaire San Diego family that wanted to own a team here and keep it around for a while. Now there is.
The Jacobs family really likes basketball. They also run Qualcomm Incorporated and have more than enough cash to own an NBA franchise, something they have long wanted to do. A trio of brothers … Paul, Jeff and Hal Jacobs … even helped buy in to the Sacramento Kings to help keep the team in California’s capital city.
The number one reason the Jacobs boys have not brought a pro hoops team back home is the cost associated with building a new arena. If that part is already taken care of, the road has been cleared for them to make their longtime dream come true.
In March NBA Commissioner Adam Silver spoke about the possibility of the league expanding and said he doesn’t see it happening in the next couple of years but offered this caveat:
"Organizations all grow over time, and on an optimistic note," Silver said. "I don't think the there is any doubt that at some point we will turn back to looking at whether we should grow the league.”
A brand new arena with a wealthy and committed ownership would certainly grab Silver’s attention. If expansion is not in the cards there is always to possibility of a team relocating. Silver admitted that not all 30 current franchises are performing at the level he would like.
“At the moment we are not in the position, putting even aside profitability, where all 30 teams are must-see experiences,” said Silver. “That's not a secret."
But even putting all that aside a Downtown sports arena could be just the first domino to fall. First off it opens up the Sports Arena land where Valley View Casino Center now sits. The City of San Diego has identified that parcel as an underperforming asset and would very likely jump at the chance to have it redeveloped, which brings us to the San Diego Chargers.
The Bolts’ citizens’ initiative (CI) is 100% separate from any development that would happen on the Port District land. So if the Chargers get their plan on the November ballot and have it approved and City Hall does not throw up 2,000 road blocks to try and keep it from happening then BOTH the new convadium and the new sports arena could go up a few blocks from one another.
But in the event the Chargers don’t get what they want Downtown, they could then attempt another CI and go after the 100 or so acres at the Sports Arena. I asked Chargers Special Counsel Mark Fabiani if that is a spot the team would be interested in.
“No,” said Fabiani in an email.
But that’s OK! We still have lots of possibilities because AEG is now fishing in our waters and AEG, traditionally, does not get skunked.
If another development plan is chosen to redevelop the Embarcadero then AEG could still very well look to the City and offer the same kind of a setup. Legally they could do the same kind of land lease the Port District is offering its new tenant, tear down the Sports Arena, and start fresh with a L.A. Live kind of experience closer to Point Loma. Where the Gulls would play during that time is an issue that would have to be looked in to.
That would give San Diego TWO brand new redeveloped areas and start pulling us in to the 21st Century. Plus don’t forget something is eventually going to happen with Mission Valley. Either the Chargers will leave to go Downtown; leave to go to Los Angeles; or have a change of heart and commit to building a new stadium at the Qualcomm Stadium site.
If they go then we have the JMI Realty proposal to expand San Diego State University and build a 35,000 seat stadium for the Aztecs that could also hold a professional soccer team. Regardless of which new stadium is potentially constructed, Major League Soccer will strongly consider putting an expansion team in San Diego.
So, to recap, what if we go from the doorstep of losing our NFL team because it plays in an ancient stadium to having an NFL, MLS, and NBA team playing in a pair (perhaps trio?) of brand new, state-of-the-art facilities, all because somebody decided it was time to change Seaport Village?
It’s amazing to consider what might happen when someone engages in some forward thinking, isn’t it?