Posts Tagged ‘FS Investors’

Since early October, 2017 a month’s worth of information has accumulated, thus I must respond.

Certainly, San Diego State University’s decision to become a competitor of FS Investors (Soccer City) changes the San Diego community view and prompts the choosing of sides, which is not unfortunate, rather necessary.  Are you a supporter of a university educating 30,000+ students or do you pine for retail and office space?

Once SDSU decided to employ Populous to develop and present the site design, any hint of amateurism or lack of commitment on SDSU’s behalf disappeared.  Any CSU campus committing $100,000 for stadium/site renderings is rare air.  Populous also brings familiarity given their development of Petco Park, to say nothing of several other football and soccer stadiums worldwide.

Populous hinting at the inclusion of soccer stadium design elements is strictly fodder for San Diego soccer fans, who are uncomfortable with FS Investors soccer/retail vision, to support SDSU West in hope of one day attending an MLS game.  I doubt SDSU will chase any MLS opportunity given the dicey financial nature of most MLS franchises.  The funding challenges facing SDSU are significant.  Adding a tenant who may (implying may not) make the lease payments on time is risky and unnecessary.  Inviting the Chargers, Rams and another NFL team to play August exhibition games is a guaranteed full stadium and tidy rental fee with no long-term commitment or presence of a tenant.

After partnering with Populous, the university hired PCI Consultants to launch and secure a signature drive to place SDSU West either on a ballot (6/18 or 11/18) or in front of the San Diego City Council for approval.  What could have been an unorganized gaggle of SDSU alumni and students sprinkled throughout the city and county without any signature gathering experience is now a well-coordinated army of signature gatherers stationed in front of mega-shopping centers, grocery stores and malls as of October 21, 2017 through the next ten weeks (ending just prior to January 1, 2018).  Oh, yes, do include the Aztec home games during that time frame.  To say nothing of campus.  Tens of thousands of Aztec alumni and students is the ultimate captive audience.  The required 71,646 signatures for the ballot initiative will be easily eclipsed by 25,000 to 30,000 at the end of the year.  I find intriguing the City Council option of approving SDSU West without the necessity of a ballot measure (this possibility was implied in Roger Showley’s UT article dated 10/19/17).  Why have a messy election if we can receive a stamp of approval instead?

Speaking of the San Diego City Council, council member Chris Cate’s illegal delivery of city documents pertaining to Soccer City to FS Investors will develop into a festering wound that drains away some public support for Soccer City.  I do not propose that Mr. Cate’s entry into UPS/Fed Ex competition makes for a complete collapse of Soccer City, but his foolish action and unapologetic response will irk San Diego citizens who have no patience for politics as usual.  If Mr. Cate’s illegal activity blossoms into charges filed by the Attorney General of California, Soccer City will find itself unwittingly, but deservingly, attached to Mr. Cates legal woes.  Expect SDSU supporters to emphasize that connection without mercy.

The San Diego City Council and Mayor Faulconer must acknowledge that SDSU West provides something more than a retail opportunity (stressed by FS Investors) and the associated minimum wage/low paying jobs.  Does San Diego want or need another Fashion Valley?  SDSU West is an investment in not only SDSU’s ability to absorb a student population increase of 50% by 2030, but also employment opportunity for professors, researchers, university administration and support as well as the continued education of what becomes a legion of California taxpayers.  Nothing beats a solid base of taxpayers in maintaining not only a city or region, but also the financial vitality of a state.  Would San Diego citizens rather enjoy the benefit of university based jobs paying between $40,000 to $125,000+ annually or the thrill of minimum wage moans of young adults stuck in the vortex of low paying jobs?  Kevin Acee’s 11/3/17 UT article sums the choice nicely:  “My sole desire is to see whatever is done on the property be the best for San Diego’s economic and cultural advancement . . .”  Indeed.

As for the money to develop the area and football stadium, SDSU currently sits on $150 million, an amount of money that needs to increase.  The university recently completed a ten-year fund-raising effort that resulted in $815 million for all things Aztecs.  SDSU administration and alumni have substantial fund raising skills.  The school can issue construction bonds to cover some costs.  Stadium and field (always separate the two) naming rights will generate significant sums of money for the school to payoff said bonds.  In addition to generous current and, no doubt, future donors, SDSU can use funds from the Campanile Foundation to assist in developing SDSU West.  Too many San Diego citizens forget that SDSU continues to undergo impressive physical change on campus.  Money is found for priority campus projects.  Money will be found for SDSU West.

The next time you drive past SDCCU (I prefer the Murph), would you rather see a university or a retail outlet in its place?

 

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The San Diego Union Tribune has published seven articles on the relationship between FS Investors and SDSU during the month of March (or as of this writing 3/26/17).  Much has been reported and debated in the articles written by Kevin Acee, Mark Zeigler, Roger Showley and Tom Krasovic.  Less, Acee’s 3/24 piece, the reporting has been fair and balanced.

As an Aztec alumnus (oh, alliteration!), I begin and end my decision making with “What works best for SDSU?” as applies to all things Soccer City.  Soccer City and FS Investors is plan B for the university.  I want to discuss plan A.

Plan A is the idea proposed by the university via athletic director, John David Wicker, and Campanile Foundation chair, Jack McGrory, that centers on SDSU buying or leasing approximately 47 acres of the Qualcomm site to build SDSU West and a football stadium.

The seven point plan presented by the university is admittedly thin on particulars, especially financial considerations, but at the very least the general idea of what SDSU wants to do with the acreage is easy to understand.  12 of the 47 acres (that’s 25% of the total land purchase/lease) is devoted to the long treasured Aztec football stadium.  The other 75% of the land is dedicated to SDSU West.  I find fair to assume that SDSU will develop the 35 acres along the model of current College Avenue campus expansion meaning the inclusion of retail space accompanying lab and classroom construction.

Mr. McGrory stated that SDSU’s student population will grow from the current figure of 35,000 to 50,000 within three decades.  That is an eye-popping increase of 43%.  An additional 15,000 students (to say nothing of the bevy of university employees to teach the newcomers) will not fit along the border of Montezuma Avenue, College Avenue and the multitude of two lane streets to the west, east and south of the school.  Physical expansion of the campus is required if residents of San Diego do not wish to see Friday night death fights between local homeowners and students.  Said physical expansion cannot happen within the current confines of the university.  Building in ravines is unwise.  Thus, the solution found in 47 acres of mostly ugly, cracked parking lot.

Mayor Faulconer and the city council will enjoy the benefit of pointing to present and future job creation by approving this land purchase as SDSU continues to educate and graduate thousands of students who will earn above average salaries and pay above average taxes that will fund the city and county of San Diego now and in the future.  This is the purest form of non-polluting job creation imaginable.  Mayor Faulconer is an Aztec alumnus.  Pushing hard for his school is expected.  He is believed to hold desire for higher political office.  About 300,000 of his fellow alums live in the city and county of San Diego.  I believe most vote.  That’s a sizable base for future campaign efforts.

Mr. Wicker and Mr. McGrory state that the university can finance $150 million towards the football stadium.  The quote from the 3/22 article from Mr. Wicker, “We’re comfortable that we can go out and build that stadium and finance it.” indicates confidence that public assistance is not to be considered.  Rightfully so.

To State’s advantage, the city has agreed to a lease extension of the Q through 2018.  Ron Fowler and the Padres have offered Petco Park as insurance for the 2019 and 2020 seasons if necessary.  Mr. Fowler stated “We’re not going to let division one football disappear.”  A firm declaration supported by his kind offer of Petco Park.

The usual headache of infrastructure development is a non-issue given east and west entrance to the Q from Friars Road and from the north via Mission Village Drive as well as the trolley stop to the south of the stadium.  No other piece of property in the city or county comes with ready and functional infrastructure, thus the cost savings is dramatic.

Finally, Mr. McGrory is a former San Diego city manager.  Mr. McGrory’s political acumen will guide the university through the political ritual of approval for SDSU West.  He knows when to turn right or left, avoid a dead-end and hammer home the message of campus expansion.

Regarding plan B featuring SDSU as a partner more so than a public sympathy character, works to a limited degree on behalf of the school.  MLS does not approve of stadiums in excess of 30,000 seats.  Granted, SDSU football crowds are generally in the vicinity of 25,000, but what would be lost is the annual crowd of 45,000 seated for the KGB fireworks show in September.  Perhaps some would protest by pointing to the initial seating capacity of 35,000 of the SDSU football-only stadium, but that’s 5,000 more tickets than will be seen at the MLS facility.  Additionally, with Mr. Wicker securing contracts with PAC-12 schools for non-conference games, crowds of 40,000 (last year’s Cal game at the Q) would be non-existent.  The lost revenue for the school would be substantial.

FS Investors is a business.  They want profit as they well should.  I do not anticipate the question of “Does this work for SDSU?” to be at the forefront of decisions, alterations and reconsideration as Soccer City moves forward.  This reality creates a disadvantage for the university.  Disadvantage should not be near SDSU West.  FS Investors can easily work with SDSU as both developments move forward.  This is the best form of partnership for SDSU.