Investor Group Offers to Finance El Toro Stadium

A Los Angeles investment group that includes former USC football star Anthony Davis has promised to raise $500 million for a stadium at the El Toro Marine Corps Air Station, a longshot bid to bring professional football back to Orange County and perhaps block plans to develop an airport at the base.

Irvine would be a late entry in competing with other potential high-powered investors--including former Hollywood agent Michael Ovitz--who are also trying to lure a National Football League franchise to the region, and league officials have said they prefer the team to be located in Los Angeles.

The Southern California Sports Group proposes to build a privately financed stadium on 440 acres of El Toro base land, which is now owned by the federal government and would have to be conveyed to the city. In exchange for giving the group exclusive development rights for the stadium, the investors say they would raise $500 million for construction and assist in locating an NFL franchise.

But there are many hurdles, not the least of which is whether Irvine can line up a team owner in order to have the NFL take its bid seriously. Even if investors produced the $500 million for a stadium, nearly an identical amount would have to be raised to lure a team, recruit players and coaches and to cover other expenses. Irvine Mayor Christina L. Shea said she plans to approach several local multimillionaires, including Irvine Co. Chairman Donald L. Bren.

The stadium plan, if it came to fruition, would represent a boost for anti-airport forces, who are pushing it as part of an alternative to an airport that would include a museum, a university and other developments some consider unrealistic.

The investor group has been discussing the possibility of developing a stadium with Irvine city leaders for several months and outlined its proposal in a letter to Mayor Shea last week.

The city is now completing extensive background checks on the investors to determine whether they can raise the money and, if so, where the money would come from.

“Remember, $500 million is a lot of money. We have to make sure they are real,” said City Manager Paul Brady. “If they are, the council can move forward.”

The proposal came as a surprise to some sports-business insiders, many of whom said they are unfamiliar with the partnership.

The most recognizable partner is Davis, one of the most celebrated athletes in USC history. He earned All-America honors in football and baseball for the Trojans and scored four touchdowns in a game against Notre Dame to spark the greatest comeback in the school’s storied football history.

Donn Morey, the chief executive officer of the sports group, is a veteran Los Angeles land-use consultant who helped secure permits for the new Getty Museum and has worked on other sizable developments.

Morey and Davis could not be reached for comment. Walter Burrows, an Irvine real estate lender, another member of the investment team, declined to comment on specifics of the proposed financing.

“We are still negotiating, so it is premature to get into details,” Burrows said. “We just think it’s an outstanding site.”

In the letter, the group said it would raise $500 million if Irvine agrees to give it exclusive rights to develop the stadium on the city’s property. The letter does not indicate the sources of the money or how many investors would be involved.

Shea and Irvine City Councilman Dave Christensen said such an investment would be an excellent first step in building a stadium without taxpayer funds.

Still, some experts have questioned whether the investment group can actually finance and operate the stadium solely through private investment, luxury boxes, naming rights and corporate sponsorship without using public money.

Football teams usually want a cut of those corporate revenues, which is why so many new stadiums and arenas are financed at least in part with taxpayer dollars. With several Southern California cities vying for a football team, it is likely at least one will be willing to offer public subsidies, experts said.

The financing proposal comes a month after top NFL officials toured the stadium site, which is located on the far south end of the base near the Santa Ana Freeway.

“The NFL officials have told us that we have a beautiful site but they have also told us that we were running behind because we didn’t have financial backers,” Shea said. “But now we are moving forward aggressively to find an owner. We know that a team sinks or swims based on the ownership.”

The league is expected to award its next expansion franchise over the next year. Los Angeles, along with Houston and possibly Toronto, are considered leading candidates, but the new team probably won’t play until at least 2001.

Irvine officials have been talking about building a stadium on the base for years and consider it a key part of the non-airport development unveiled last month. The so-called Millennium Plan calls for commercial buildings, office towers, homes and a huge central park on the 4,700-acre base, which is scheduled to close next year.

The county, however, is moving forward with plans to convert the base into an international airport that by 2020 would handle 19 million to 28 million passengers per year. The airport would be surrounded by office buildings, trade centers, hotels and other commercial developments.

The stadium would sit on a portion of the base that the county would set aside for commercial development. So at least in theory, the stadium could still be built even if the airport plan goes through. Still, the two projects aren’t considered a compatible mix.

Irvine faces stiff competition in its effort to lure the NFL. Los Angeles city officials have been pushing for a new stadium on the site of the Coliseum. Other locations include land next to the new Staples Center under construction in downtown Los Angeles or next to Dodger Stadium. Inglewood wants to build a stadium near Hollywood Park, while entertainment mogul Ovitz is backing a site in Carson.

Los Angeles City Councilman Mark Ridley-Thomas, a supporter of the Coliseum site, said he did not view Irvine as competition.

“Many people will want to participate if they think they have the capacity,” said Ridley-Thomas. “The only thing I can tell you is if they can persuade the NFL to make a deal with them, more power to them. We think the L.A. Coliseum is the place to be.”

The NFL has focused the most attention on Los Angeles sites because of their central location to all of Southern California. Still, Shea said El Toro is also a strong location with access to the Santa Ana Freeway and the soon-to-be-completed Eastern Transportation Corridor.

Orange County hasn’t fielded a professional football team since 1993, when the Rams abandoned Anaheim for St. Louis, where the city helped pay for a new stadium.

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Times staff writers Bill Shaikin, T.J. Simers and Jean O. Pasco contributed to this report.