Tuesday, November 20, 2018
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Roof drives lofty cost of Rays’ proposed Ybor City ballpark

TAMPA — Nobody pretends that $892 million to build a baseball stadium is pocket change, not even the guy who owns the team.

"That’s a large number, and it’s a shocking number when you see it," Tampa Bay Rays principal owner Stuart Sternberg says of the projected cost, which the team revealed this week along with a design for an Ybor City ballpark that’s meant to be comfortable and intimate.

But, Sternberg adds, with the cost of a new football stadium and related development for the Los Angeles Rams topping $4 billion, and $1 billion going into a new San Francisco basketball arena for the Golden State Warriors, "this is what’s going on out there."

In Major League Baseball, the Rays’ estimated project cost — which does not include the cost of buying the land or moving an electrical substation — would put the team into one of the league’s most expensive ballparks, behind Yankee Stadium, which cost $2.7 billion in 2018 inflation-adjusted dollars, Citi Field ($1 billion-plus) and Nationals Park ($908 million).

"With these ballparks, people get a little sticker shock, but 10 years ago, we were talking about something in the $450 million to $500 million range," Sternberg said, referring to the waterfront stadium with a sail-like cover that the Rays had proposed unsuccessfully in St. Petersburg.

"And when you take that and grow it at 4, 5, 6 percent a year," he said, "you get to where we are now."

COMPLETE COVERAGE: Rays unveil their plans for an Ybor City ballpark

Along with time, Rays executives say other factors figure into their budget. One is labor. With construction booming, it is increasingly scarce — and expensive. And, they acknowledge, the Trump administration’s tariffs on steel will make materials more expensive.

But an especially big driver of the cost, they say, is the roof.

The cost of ‘game certainty’

At nearly $245 million, the roof would account for about 30 percent of the construction budget for the proposed Ybor ballpark.

That is close to the difference between the Rays’ proposal and the Atlanta Braves’ no-roof SunTrust Park, which opened last year after construction that, adjusted for inflation, cost more than $642 million.

Given the bay area’s near-daily summer thunderstorms, a roof was essential for fan comfort and what the Rays call "game certainty," or the assurance that if you buy a ticket, the game won’t get rained out. In surveys of and focus groups with fans during two years of planning, those two priorities were the biggest demands the Rays heard from their customers.

THE RAYS’ VISION: A ballpark with windows that open, a translucent roof, spaces to play — and a $892 million price tag

A stadium without a roof could cost closer to $600 million, Sternberg said, but "it won’t be air-conditioned. It won’t be comfortable. People won’t show up that often."

The Rays considered a roof they could open, but designers said the site isn’t big enough to accommodate one, plus it wouldn’t be used that often and would be even more expensive to operate and maintain that what they did propose: a translucent roof made from a synthetic fluoropolymer known as polytetrafluoroethylene, or PTFE. (The team looked at using other transparent materials to let more sunlight through as well as the use of grow lamps in the hope of having a grass playing surface. But even in the best case, they would have had to replace the turf at least four times a season.)

Still, the cost of the roof surprised even Hillsborough County Commissioner Ken Hagan, who has been the elected official most involved in the effort to bring the Rays to Tampa.

"I was under the impression that by having a fixed roof the number would be much, much lower," he said "I was always told that by not having a retractable roof we would save $100 million to $150 million."

Architects with Populous, the company that designed the ballpark, say there’s more that goes into the roof, even one that doesn’t move, than just the PTFE fabric covering.

There’s also the structural steel to hold it up, the cost of erecting that structure, special deep foundations and columns to support the roof that are separate from the ballpark itself, plus a winged-shaped hard canopy that will shade the seats, the costs of air-conditioning the building (because it wouldn’t be air-conditioned without the roof), and $2.1 million in solar cells that will be part of the roof.

And there’s the cost of the large glass sections between the ballpark structure and the roof. Those will be able to be opened, allowing a breeze in on nice days, but they wouldn’t be part of the project at all if it didn’t have the roof.

Moreover, adding air conditioning to the building requires an electrical system with more capacity, and adds expense related to handling rain that falls on the structure.

"There’s a lot of other ballpark elements that are in this cost," Populous project manager Pat Tangen said. "It’s not just the roof that you see."

‘It doesn’t have any money’

The roof raises the estimated cost of the ballpark itself to $809 million.

But there’s more — specifically, about $83 million in infrastructure costs that could include:

• road improvements, storm drainage pipes and other utilities around the stadium;

• environmental cleanup of the site;

• an elevated walkway over Adamo Drive;

• and a 1,000-space parking garage on the west side of Channelside Drive, a former industrial plot of land known, in a quirk of local spelling, as the Gas Worx property.

These are the kinds of costs often paid for by local property tax revenues generated by community redevelopment areas, or CRAs. In a CRA, tax revenue generated by new development is earmarked for public improvements aimed at fostering even more redevelopment.

In downtown Tampa, for example, the city and Hillsborough County have committed up to $100 million to reimburse the Jeff Vinik-Cascade Investment partnership for roads and other public improvements associated with Water Street Tampa.

PREVIOUS COVERAGE: Vinik-Cascade partnership floats idea of more tax money for bigger project

But in Ybor City, there is a good news/bad news difference.

The good news: The Gas Worx property, where the Rays envision the new garage, is in the downtown CRA.

The bad news: Most everything else is in an Ybor City CRA (or no redevelopment area at all).

"We have a CRA in place," Tampa Mayor Bob Buckhorn says. "It doesn’t have any money in it."

The downtown CRA is much older and has been seen much longer-term growth in its property values. So it has a budget of nearly $11 million this year. In contrast, the Ybor City CRA, which includes part of the stadium site, has a budget of less than $316,000.

What that means, Buckhorn said, is that someone else — maybe the Rays, maybe private real estate investors — could have to provide a bridge loan to pay for the work on the front end "and then get paid back when the development occurs."

‘The only thing I know for certain’

You might assume that a budget of $892 million would include everything that will go into developing the ballpark the Rays have proposed.

You would be wrong.

The Rays’ estimate does not include two costs, at least one of which has seven-figure implications:

• Moving a Tampa Electric substation.

• Buying the land.

Both issues are unresolved. Hagan said county officials have talked to Tampa Electric about the substation and hope the utility will "absorb most if not all" of the cost of moving the substation, which is at 1401 E Fourth Ave.

Tampa Electric had no previous plans to move the substation, company spokeswoman Cherie Jacobs said in an email to the Tampa Bay Times.

"The Rays need to find a new location for the substation, and then we can determine cost and funding arrangements," Jacobs said. "We are in negotiations."

Meanwhile, the 14 acres that the Rays have proposed for the ballpark are north of Adamo Drive and east of Channelside Drive. For tax purposes, they have an estimated value of $6.5 million.

Currently, the land is owned by investors who include BluePearl Veterinary Service CEO Darryl Shaw, but a nonprofit corporation formed by attorney Ron Christaldi and Sykes Enterprises CEO Charles Sykes has an option to buy the land.

BACKGROUND: Meet the middlemen helping to bring the Tampa Bay Rays to Ybor City

Their goal is to make sure that speculators don’t grab the land and drive up the costs further.

"The only thing I know for certain is that Chuck (Sykes) and I are not buying the land ourselves," Christaldi said.

But who will buy it has not been resolved.

"There’s a couple of different options and variations that will be studied at great length," Hagan said.

One is for a public entity such as the county or the Tampa Sports Authority to acquire and own the property. That’s the model used for Amalie Arena, for example.

The problem is that if the ballpark is publicly owned, then it is taken off the property tax rolls and generates no CRA revenues that can be used to help cover project costs.

Another possibility is for private investors to buy the land. Hagan said it’s too soon to say which option local officials could pursue. This week, he wouldn’t even say generally when a financing plan might be put forward.

"We have made significant progress," he said. "However there’s still plenty of work to be done. I will say it is certainly not imminent."

Hagan did speak more plainly about another topic: the $150 million-plus that Sternberg says will be the Rays’ share of the project cost.

STUART STERNBERG: Tampa Bay Rays’ share of Ybor ballpark will be more than $150 million

It’s not nearly enough, Hagan said.

"The team has been repeatedly told that for this project to have a chance of succeeding in Hillsborough County the team will need to be at the table with at least half the cost," he said.

MORE: Go here for more Business News

Times senior news researcher John Martin contributed to this report. Contact >Richard Danielson> at [email protected] or (813) 226-3403. Follow @Danielson_Times

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