The City of San Antonio has approved the purchase of Toyota Field with a unanimous vote on Thursday and as such the final step needed to complete the sale has been passed. What this means is now contracts can be signed by all four parties involved and announcements should start.
Thursday’s meeting helped not only pass that hurdle but it also provided a lot of clarification to what the deal is. Those details were outlined by Assistant City Manager Carlos Contreras who really expanded on all of the nitty gritty details of what the sale involves.
There was a conflict between the two appraisals of the stadium, with the city appraising it at $13.3 million, while Gordon Hartman appraised it at $28 million. This means that neither party really got what they wanted (the total sale price is $18 million) which is often a good sign of a successful negotiation.
One of the most significant parts of the sale that Contreras announced was exactly how the city will deal with this following the sale. The city will form a Public Facilities Corporation to oversee this new purchase, which will include both Toyota Field and the South Texas Area Regional soccer complex.
That PFC will be in charge of the upgrades to the stadium and the new organization set up by Spurs Sports and Entertainment, San Antonio Football Club LLC will have to go through that organization. The PFC will be tasked first of all with upgrading STAR and will be in charge of approving SAFC budgets, making sure lease obligations are upheld and will have a board of two members from the city and two from the county.
The terms of the lease to SAFC LLC were also clarified, expanding on what we already knew about a 20 year lease. SAFC will be paying the PFC $100k per year and will also be required to pay a fee of $1.25 per ticket sold, which will go to a PFC improvement fund. The $1.25 number is set to rise throughout the lease to maintain value to the PFC.
Getting a Major League Soccer team is the clearly stated goal in all of this and as a result that was clarified, with SAFC required to provide a detailed plan to the PFC. SAFC will also be obligated to supplying the MLS expansion fee, with the city only spending money on the facilities.
As has been stated Spurs Sports and Entertainment will be required to repay both the city and the county if they fail to get an MLS team. Those payments were fully outlined beginning in year six with $250k to both before upping to $500k in year nine, $750k in year 10 and years 11-13 $1 million.
The city is also not locked in to SAFC as the only organization to go to MLS, but there are some clauses connected to a third party coming in. The lease with SAFC has a 10 year exclusivity clause and if a new soccer team comes in to MLS within those 10 years they are required to reimburse SSE.
A big point of contention was where the city money will come from and that was also clarified by Contreras at the urging of Mayor Ivy Taylor. The money will come from a redemption and capital reserve fund that is generated from other facilities, like Alamodome rents, money which cannot be used for non-facility things (like roads). The city expects that over time the facility will become self-sufficient.
Finally there were a couple of things mentioned with the SSE representative hinting that due to the lateness of this deal there will be no real pre-season matches, something San Antonio fans have grown useful. While again it was stated that 100% of the sale goes to Morgan’s Wonderland, thus securing its financial future.