Ballpark: Financing Set For Hotel; Preliminary Construction Continues
Though the future of the Padres ballpark remains clouded by litigation and an ongoing criminal investigation, the baseball club’s development arm continues working on the $1 billion project as if everything is coming up roses.
Last week, JMI Realty announced it purchased eight blocks needed for the ballpark and private development around it from San Diego Gas & Electric Co. for $24.3 million. Of course this was a deal the club had already arranged two years ago when the ballpark site at the East Village section of Downtown was selected.
Perhaps more telling was JMI’s announcement earlier this month that the value of proposed private commercial development around the ballpark exceeds $600 million, about double the original estimate.
Dennis Cruzan, JMI’s managing director, said the increased private investment is the result of an expansion of several components of the overall project, as well as increased investor interest.
“Outside investor and tenant interest in the ballpark has been very strong,” Cruzan said.
Among the brightest signals that things are looking good is news that JMI tentatively has lined up the financing for the 512-room Westin Hotel and groundbreaking should take place shortly after Labor Day, Cruzan said. He declined to reveal the name of the lender, saying the deal is not final.
JMI is developing two other hotels in the 26-block ballpark district, a 238-room boutique hotel and a 203-room AmeriSuites Hotel. The total room count on three hotels is 100 more than the 850 rooms promised in the development agreement between the city and Padres, which was ratified by voters in November 1998.
In addition to more rooms, the revised development plan calls a higher amounts of office and retail development. It also includes the creation of 638 residential units where none were promised in the agreement.
Part of the reason for expanding the size of the buildings’ footprints is that the sites could accommodate it, but it’s also a desire by JMI to create greater densities for the area, Cruzan said.
The concept is to build retail and commercial spaces that will convert the ballpark district into an area that’s busy 365 days a year, not just the 180 days the Padres are actively competing, he said.
“It’s important for a project like this to have a critical mass so it becomes a destination for visitors,” he said.
As for the ballpark itself, all the property has been secured and some of the construction work is already completed. Earlier this month, the last of the 1,237 pre-cast steel piles were driven into the ground as a precursor to building the seating bowl. Concrete work on the stadium’s seating and walls is also under way.
The Padres and JMI continue to say the 46,000-seat ballpark will be completed by July 2002, yet much depends on whether the city can issue up to $299 million in tax-free bonds to finance the bulk of the now estimated $450 million price tag.
The city, its redevelopment agency and the San Diego Unified Port District is responsible for $296 million of that cost, with the Padres paying the rest, including any construction cost overruns.
To keep the project moving ahead, the city and Padres approved a $30 million interim financing package last month, but that money should last until the fall. After that, the project will require another infusion of cash.
The city’s hands are tied from issuing bonds because of about a dozen lawsuits and an ongoing criminal investigation into the conduct of San Diego City Councilwoman Valerie Stallings involving her purchase, and sale of stock in a company chaired by Padres owner John Moores and her subsequent voting on the Padres ballpark.