United describe planned investment in stadium
Copyright © 2021 Albuquerque Journal
The professional football team set to occupy an Albuquerque stadium project have made public their plans to invest in what will be their new home.
New Mexico United would contribute $ 10 million to help build the city’s proposed multi-purpose football stadium and pay $ 800,000 per year in base rent to be the site’s primary tenant, under terms set out in a new “letter d. three-page ‘rental intent’.
The team would also have to pay the city an additional $ 100,000 per year, but if not, keep all income generated by the stadium outside of specific events organized by the city.
The letter is not a formal rental agreement, which has yet to be negotiated.
The document released Thursday provides new details ahead of the November 2 election which is expected to determine the fate of the proposed stadium.
The ballot will ask voters whether the city should issue up to $ 50 million in bonds to help fund an estimated $ 65-70 million venue. Voter approval is technically not required for this type of bond – backed by the city’s gross tax revenue – but Mayor Tim Keller’s office has said it will not sue the stadium if the bond fails.
If voters give the green light to public investment, officials say United’s initial $ 10 million pledge – combined with around $ 8 million in previous government credits – means the city should have enough money to actually build it.
The team’s projected annual rent and income payments, meanwhile, would cover around 30% of the city’s stadium bond debt payments.
The city is expected to be around $ 3 million a year for a term that is now expected to last 25 years. The city would use the recently released funds by paying off old debts so that the stadium bond does not increase taxes.
“Our goal here is to make it a good deal for the voters, a good deal for the city of Albuquerque,” Lawrence Rael, city operations manager, said at a press conference Thursday morning at Isotopes. Park, a facility United currently shares. with the baseball team of the same name.
United owner Peter Trevisani has touted the letter as a “promise” bigger than the numbers.
“It’s a commitment that we are here for the long term. And, and I think most importantly, is a commitment that we believe in in New Mexico. We believe deeply in our state, we believe deeply in our city, we are ready to put not only our capital, but all of our resources behind it, ”said Trevisani.
The letter, signed by Rael and Trevisani, is not a formal lease but provides the “main points of agreement” going into this process and is legally binding if the bond is accepted, Rael said.
The document provides for an exit for both parties, stating that either can terminate the letter of intent if the parties fail to reach terms on the stadium design, funding or final agreement of rental and development.
According to the letter, United will negotiate a lease of at least 25 years with the city for the site, enter into a “community benefits agreement” with the neighborhood where the stadium is being built, “endeavor” to use local suppliers. for stadium concessions and trying to bring in a professional women’s soccer team over the next three years.
The letter states that the city, which would own the site, will have exclusive use of it for 15 days per year and will not be responsible for day-to-day operating costs.
With the exception of city-hosted events, all stadium revenue – including potential naming rights sponsorships, other advertising, and parking – would be donated to United, but terms require the team to pay. at least $ 100,000 on top of the base rent.
Rael said the eventual rental agreement will outline what happens in the event of a breach of contract, but that he is confident the city will be protected in part because the property is local.
“I know where these guys live. You all know. They are New Mexicans, and I think that’s really, really important, ”he said. “We have New Mexicans investing in New Mexico. “
He also noted that the letter required United to have business interruption insurance “to support the team’s annual obligation to pay base rent to the city.”
He said the conditions outlined in the letter provide voters with additional details as they prepare to make a decision.
“This information that we are presenting today really… in my opinion is starting to put a certain structure and a certain commitment into the project,” said Raël.
Among the notable questions still surrounding the project is the location, which officials have said will determine if the bail passes.
A municipal consultant hired to assess the feasibility of a stadium examined four sites, identifying two as “preferred” locations – Second Street / Iron and Coal / Broadway.
The company recommended 10,000 to 12,000 seats, estimating the project would cost around $ 65 to $ 70 million depending on the sites preferred. Both sites currently include at least some private land, and the consultant’s estimates do not include property acquisition costs. The projected price also did not include parking beyond the spaces necessary for the staff.