Site for Proposed Stadium in Limbo
Since Philip Anschutz let out that he may be planning to build a football stadium in downtown Los Angeles, the Colorado billionaire has created a buzz about where he might put such a massive project.
But many within the commercial real estate industry and in economic development agencies are skeptical that such a plan is financially or politically feasible, even if City Hall agrees to help.
Even if Anschutz and his partners, whose billions and past successes make it impossible to dismiss the idea, are serious about the stadium, the effort is very preliminary and the outcome is far from certain.
The initial outline of Anschutz’s plan would require a 55-acre complex, the equivalent of 10 city blocks. That would be among the largest and most disruptive single developments in downtown Los Angeles in many decades.
Commercial brokers could not think of a site that would remotely accommodate such a major development without major relocations of businesses and residents and the expenditure of several hundred million dollars.
“This one won’t be easy,” said real estate investment broker Carl Muhlstein of Cushman & Wakefield.
Nonetheless, business and city leaders are not dismissing the Anschutz initiative, given his roles in rejuvenating downtown Denver, and helping to develop Staples Center in downtown Los Angeles..
Anschutz has undertaken past projects with large degrees of stealth, so his actions so far regarding the proposed football stadium are part of his apparent operating style. He declined to discuss his activities with The Times.
Anschutz has been a growing force in the sports and entertainment industries, filing earlier this week to sell stock in his theater chain. The $345-million public offering would further consolidate his control of that industry.
Anschutz, worth an estimated $9.6 billion, built his fortune bartering railroad rights of way and creating a 16,000-mile fiber optic network that is now Qwest Communications. Recently, he has been building a sports empire with stakes in the Los Angeles Kings hockey team and the Colorado Rapids and Chicago Fire soccer teams. He currently is building a $120-million sports complex at Cal State Dominguez in Carson, eventually to house the Los Angeles Galaxy soccer team, which he owns.
The Los Angeles proposal comes after a recent slew of football stadiums have been constructed and approved for downtowns, ranging from Seattle to Baltimore. The locations are often well served by freeways and mass transit systems, and supporters say the stadiums have helped draw substantial numbers of visitors and new developments to struggling downtowns.
Staples Center--built in part by Anschutz and developer Ed Roski--is credited with triggering new retail and residential development on nearby blocks.
“Downtown is the only logical place for [the football stadium],” said Carol Schatz, president of the Central City Assn., downtown’s leading business advocacy group. The facility “would create a lot of positive synergy with what’s already here and with what’s happening.”
Efforts to build a football stadium in Southern California have included such sites as a gravel pit in Irwindale and industrial land in Carson. The Rose Bowl in Pasadena and the Los Angeles Memorial Coliseum have also been mentioned as possible homes for a National Football League team.
Despite enthusiasm for the new idea, Schatz and many others in downtown business and real estate circles had not heard about the plans until they surfaced in the media, leading many to say the effort must be in the very early conceptual stage.
“I don’t see anything at the moment,” said Michael Pfeiffer, executive director of the South Park Stakeholders Group, a coalition of property owners, businesses and institutions in the southern section of downtown. “It’s an intriguing idea. It’s an exciting idea. We will just have to see how it unfolds.”
The stadium backers--who include Anschutz, Roski and financier Ron Burkle, another billionaire and one with long political involvement in Los Angeles and nationally--have declined to say if they have identified a specific location downtown. Despite hundreds of acres devoted to parking lots and underused commercial properties, amassing the 55 acres the Anschutz group said it needs could cost at least $300 million, say real estate brokers.
“I don’t see where you are taking a bulldozer and scraping away 10 city blocks,” said one real estate broker who specializes in downtown land sales.
Some have speculated that a few large industrial and vacant parcels in the northeast and southeast portions of downtown could be combined to create a site large enough to accommodate a football stadium and be easily accessible by freeway and rail transportation. In addition, about 40 acres of vacant and underused land west of the Harbor Freeway near the Belmont Learning Complex and Downtown Center Studios could be a viable location.
However, most real estate observers agree that the ideal area also would prove to be the most expensive and problematic: South Park, which includes Staples Center. In addition to being a short walk from Staples--home to the Lakers and Clippers basketball teams and the Kings hockey franchise--a South Park stadium would be near a proposed entertainment and hotel district and commuter rail lines. An investment group failed to win support for a South Park stadium a few years ago during the last major effort to attract a professional football team to Los Angeles.
Despite many attractive features, or because of them, South Park is also an increasingly popular site for housing and other retail projects that have sent land prices soaring. Recent land sales in the area have approached $125 a square foot--far above what many say would make economic sense for a football stadium.
The city could use eminent domain to assemble land at cost, such as was done for Staples Center, and be helpful in other ways, such as streamlining the planning process and paying for traffic improvements.
But Mayor James K. Hahn has made it clear that the city will not subsidize a stadium project.
Real estate broker Steve Soboroff, who helped close the deal on Staples Center, said that project proved that a major sports arena could be built without public subsidies.
“At Staples, there were many different parcels owned by many different people that we wanted to acquire,” said Soboroff, who is now president of Playa Vista. “The city used its powers to basically take control of that land and purchase that land.”
One of the city’s leading businessmen said Friday that building a football stadium from scratch without the help of public subsidies or the guarantee of a team is a risky proposal.
“There’s no way you can invest $400 million to $500 million in the cost of a stadium, and have any revenues that make sense,” he said. “With Staples, you’ve got 280 events a year. With a football stadium, how many events can you have? Ten? Twenty?”
Anschutz, Roski and other partners are seeking city financial support to build a 27-acre hotel, entertainment and retail district on the blocks immediately north and east of Staples, at Figueroa and 11th streets.
The hotel and entertainment property could conceivably be combined with other nearby lots to include a football stadium, but that would unravel years of agreements and deals with the city and is viewed as highly unlikely.
“Assembling the site will be difficult if you want to be anywhere close to Staples,” said Jack Kyser, chief economist for the Los Angeles County Economic Development Corp. “This is going to be a challenge.”
Many in the 70-block South Park area say they are not aware of any effort to buy land for a stadium, but some say they would welcome such a project.
A few blocks east of Staples Center, Jeff Ingham, who handles leasing at the towering Transamerica Center, said a neighboring football stadium would make the area more attractive to visitors and workers alike.
“It would be very positive, because it would bring in a lot of amenities and more restaurants within walking distance,” he said. “It would only benefit us.”
