ST. PETERSBURG -- City Council member Karl Nurse’s question seemed so simple: If the Tampa Bay Rays plan to move to Tampa, why should the team benefit if St. Petersburg starts redeveloping Tropicana Field?
Nurse says he never intended to scuttle a deal to let the Rays embark on a regional stadium search. But when Rays President Brian Auld gave a blunt response to the question this month, Nurse’s colleagues got their backs up and voted the deal down.
A prime spot for offices, stores and housing, the Trop’s 85 acres could sell for $65 million or more. It simply seemed wrong a team on its way out the door should lay claim to even a dime of that.
Development rights are anything but simple. The portion of the proceeds the Rays could claim probably is way less than what the council foresees.
And now, as city and team leaders talk of reopening negotiations on a search agreement, it looks like sharing a bit of the proceeds may be exactly what makes the deal work for both sides.
At the heart of the matter: It’s one thing to sell and develop empty land after the team has left. The city would have full control and wouldn’t have to share the proceeds.
It’s quite another to begin redevelopment while the team is still playing at the Trop.
The Rays would face disruption to their remaining games and could veto any plans. Once they start looking for new sites, four years could easily pass before it’s certain they actually would leave.
Seeking bids before the Trop site’s fate is clear would likely reduce its price. It would be like trying to sell a house with contingencies, an uncertain closing date and in a neighborhood that might change dramatically -- or not.
“The Trop is more valuable if sold as a whole, rather than incrementally,” said St. Petersburg developer Craig Sher. “If it’s next to a stadium, it’s a whole different kind of development than if the stadium isn’t there.”
A Trop sale might bring less than some council members think. Before they rejected the stadium search deal, they discussed sharing $75 million, a figure they thought one developer had offered for the acreage four years ago.
Nurse suggested one scenario where the team would pay a $13 million buyout fee for leaving early, but the city would have to share $37 million in development dollars.
“Effectively it means we could not sell or lease any of that land while they are still there, unless we split the money with them” Nurse said. “How do we move forward?”
But payments under that six-year-old deal were not intended to come all at once. They would have been parceled out in three installments as construction proceeded. Only $15 million -- not $75 million -- would have been due while the team still played at the Trop, and therefore eligible for sharing.
Here’s how the stadium search deal, negotiated by Mayor Rick Kriseman, would have worked, had the council approved it:The Rays would have three years to analyze stadium sites and financing in Pinellas and Hillsborough counties. If they found a new location, they would negotiate with Kriseman to amend their contract on Tropicana Field to address “wind-down issues,” including how to share any development income before they left. The current share is 50-50.
But consider this thorny scenario:The Rays ask to amend their contract, expecting to move to a Tampa ballpark in four years. The city asks developers to bid on the Trop acreage -- maybe even construct a few buildings while the Rays are still playing there.Meanwhile, the Rays’ proposed Hillsborough stadium requires approval from the Tampa City Council, the Hillsborough County Commission, the property owner, the Florida Legislature and a referendum, not to mention stable construction prices and a favorable bond market.
Somewhere in all that, snags develop, and after two years of frustration, the Rays decide to keep playing at the Trop through 2027 after all.
If so, plans for major Trop redevelopment die on the vine.
Any “wind-down” amendment to the Trop contract will have to include a fallback provision to cover the possibility that the Rays might actually stay. Any restrictions on sharing development dollars will probably hinge on the team’s certain departure.Until bonds are sold and dirt turns in Tampa, the team could decide to stay in St. Petersburg.
At that point, how much would a redevelopment bid likely bring? A lot, but not all at once.
In 2008, when the team proposed a new stadium on the waterfront, a developer bid $65 million for the entire Trop acreage, though some on the council remember a higher figure.
Payments were scheduled in installments. The developer could plan and design but not actually build much on the Trop while the team still played there.
The first payment -- $15 million -- would have coincided more or less with construction beginning on the waterfront stadium. The second payment -- $40 million -- was due after the Trop’s last season. The rest was due three years after that.Using that yardstick, the city would be at risk of sharing less than one-quarter of the Trop sale price, minus the cost of replacing the parking spaces that any construction would eliminate.
Being able to share part of the Trop price with the team could well be in the city’s best interest.Any construction while the Rays are still playing would disrupt operations with trucks, cranes and dust. Some parking spaces would move farther from the entrance. Losing, say, 200 fans a game for three seasons could cost the team something like $1.5 million in lost revenue.
Without some slice of development dollars, the Rays might choose to exercise their veto power over Trop development. That could jeopardize the very progress and momentum that the city hopes to encourage.