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Ram's stadium tops $4 billion, Kroenke's big bet gets even bigger

Discussion in 'American Football' started by RaiderRay, May 16, 2018.

  1. RaiderRay

    RaiderRay RIP SD Chargers..Go Raiders, Go Irish Staff Member Administrator Podcaster

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    https://www.sportsbusinessdaily.com/Journal/Issues/2018/05/14/Facilities/Rams.aspx

    Los Angeles Rams owner Stan Kroenke and his wife, Ann Walton Kroenke, are investing $1.6 billion in the team’s new Inglewood stadium, a project that now costs in excess of $4 billion. The information was provided by finance sources after banks met earlier this month to arrange a $2.25 billion loan for the construction.

    The Kroenkes’ $1.6 billion investment is higher than the final price of the last NFL team to sell, the Buffalo Bills, which were bought by Terry and Kim Pegula for $1.4 billion in 2014. That underscores the allure of the L.A. market as well as the surging price of building the yet-to-be-named stadium.

    [​IMG]
    Stan Kroenke’s investment in the new stadium tops previous NFL team sales.

    Photo: getty images

    “It is unprecedented,” one banker said of the investment. By comparison, after debt, the top equity infusions into stadiums from NFL team owners, such as the Cowboys’ Jerry Jones and Falcons’ Arthur Blank, have topped out at a few hundred million dollars. Kroenke also has agreed to a completion guarantee, the finance sources said, meaning he covers cost overruns and is responsible for the debt if the project does not open on time.

    The $4.25 billion cost for the 298-acre site just four miles from LAX airport more than doubles the most expensive stadium ever built in the U.S., the $1.7 billion spent on MetLife Stadium in New Jersey. The cost also includes the value of a 6,000-seat amphitheater but not the planned retail and commercial development, as well as the building of a new NFL Network home that is expected to drive the total cost of the project close to $5 billion if not more, the finance sources said.

    The price tag has skyrocketed since NFL owners first approved the stadium in January 2016, when Stan Kroenke estimated a price tag of $2.3 billion. It soon rose to $2.6 billion, and then in March got cited in media reports as $3 billion. Part of the soaring cost is due to ensuring that the venue can withstand an earthquake, and the new projected figure includes what are known as soft costs, which cover items such as access roads and utilities and by themselves are budgeted at $850 million, the sources said.

    Rams/Chargers stadium cost sources
    Amount Source
    $2.25 billion Banks

    $1.6 billion

    Stan and Ann Kroenke

    $400 million

    NFL stadium financing

    Total: $4.25 billion


    Source: SportsBusiness Journal research
    The Rams declined to comment.

    The sources asked for anonymity because the bank meeting on May 4 in L.A. was confidential. Kroenke met with the bankers at a reception after the meeting and a tour of the construction site.

    JPMorgan Chase is leading the bank group, which includes Bank of America, Citigroup, US Bank, Citizens Bank, Sumitomo, GSP Capital, MUFG Bank and Fifth Third Bank. The minimum a bank is lending is $50 million and the maximum is $300 million, the sources said. The deal should close this spring.

    JPMorgan declined to comment.

    In a loan like this, the lead bank arranges for other lenders to buy into the debt as a way to spread the risk. That process is called syndication.

    The stadium, scheduled to open in 2020, will house both the Rams and Chargers. The Rams are the primary equity partner in the stadium operating company, though the Chargers have a piece, too, and so will pay off a portion of the debt costs.

    [​IMG]
    The Inglewood, Calif., facility will now cost $4.25 billion to build.

    Photo: courtesy of the los angeles rams

    The loan’s pricing is 200 interest points over the floating rate index, the London Interbank Offered Rate. Last week, the three-month LIBOR was 2.35 percent, so if for example the Rams were paying interest last week, the rate would have been 4.35 percent. The Rams are not borrowing the full $2.25 billion right away (they tap the credit as construction moves on) and that total amount will be reduced after personal seat license fees are used to pay down the debt. Nevertheless, interest alone could be well north of $50 million annually.

    The deal includes a $183 million interest reserve, so the Rams can pay interest in coming years before all the revenue starts flowing, one of the finance sources said.

    Of course, the stadium is expected to be a revenue-gushing machine. The loan requires pledges of revenue that is 1.75 times debt, the finance sources said. Including PSL sales, that suggests stadium revenue of close to $4 billion.

    The stadium is to host not just the Chargers and Rams but concerts, other sports and events for the 2028 Summer Olympics. The 2022 Super Bowl also is scheduled for the stadium.
     
  2. Fender57

    Fender57 BoltTalker

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    Wow, the value add the Spenis family will contribute is akin to taking a piss into the Pacific Ocean.
     
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  3. Gill Man

    Gill Man Inaugural San Diego Charger Fan Since 1962 FUDEAN Staff Member Moderator

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    He's merely along for the ride......just like he's always been his whole life. FUDEAN. And EFF U NFL for letting the guy get away with it. :rolleyes:
     
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  4. Harryo the K

    Harryo the K Well-Known Member

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    They are gonna bleed you Dolt fans dry the first three years. Everything , from napkins to programs to Keenan Allen crossed arms TD t-Shirts. It's an odd situation, you can't get a sellout unless your sell SSL for every seat. I'll wager they'll “allow” themselves to sell ”a certain” portion of non SSL seats......will it be 'worth it' to buy a SSL and season tickets in 2020 simply to to 'able' buy SB tickets in 2022? I think not but that debt is so large, Kroenke might sell the Chargers without Spanni to make ends meet.
     
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  5. FiftyFive

    FiftyFive Dean Spanos is a traitor!

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    Let's not kid ourselves here. The Spanii aren't adding any value. If anything, their mere involvement diminishes the value.
     
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  6. Pointyearedog

    Pointyearedog I only put idiots on ignore...

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    Dean just broke open one of his private accounts and is donating $12.85 to Stan's palace.

    pig bank.jpg
     
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  7. Harryo the K

    Harryo the K Well-Known Member

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    It's a loan. Not a gift. And it was tough, he has to watch out for his family, too.
     
  8. Old School SD Fan

    Old School SD Fan View from the King's balcony!

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    Hey, I had that suit!!!

    In 1970.
     
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  9. Gill Man

    Gill Man Inaugural San Diego Charger Fan Since 1962 FUDEAN Staff Member Moderator

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    He and his wife are Walmart shoppers;)
     
  10. Quetzalcoatl

    Quetzalcoatl BoltTalker

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    **** Kroenke. I hope that ******* loses a lot of money on this, and the Rams move back to St. Louis without him. The gobs of money these owners horde is ******* ridiculous. I guess it's good Kroenke is spending billions on something that will provide jobs, but I don't like that he has that kind of money in the first place. Plus, only a sadistic son of a bitch moves a team away from its fans. Yea, I get the Rams were from L.A. once, but it's been a while - they had a new fanbase, and this bitch stuck it to the fans of St. Louis. **** him. **** the NFL.
     
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  11. Harryo the K

    Harryo the K Well-Known Member

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    Let's figure...

    The 500 "All-Access" seats will be in one section 20 rows up and between the 45-yard lines on each side of the stadium. The tickets come with premium parking, food and drinks, access to the stadium's most exclusive club space and guaranteed opportunities to purchase tickets for events such as the Super Bowl.

    Licenses for the "VIP" section will cost $80,000 for Rams games and $50,000 for Chargers games. The approximate 2,500 VIP tickets also will include parking, and food and drinks, but no guarantee of Super Bowl tickets. VIP seats will be between the 30-yard lines on the first and second levels of the stadium.

    The 10,000 "Club" licenses will range between $15,000-$35,000 for Rams games and $10,000-$25,000 for Chargers games. The licenses come with club access but won't include parking, food or drinks.

    Imagine buying a seat at the ChargerDome for $25,000, and a season ticket ror $350 per game or $3,500......and you don't get parking or a Ritz peanut butter ******* and Dr.Pepper combo.

    Imagine what the endzone upper deck fans will enjoy. I hope this fails miserably.
     
    Last edited: May 17, 2018
  12. wrbanwal

    wrbanwal Well-Known Member

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    new headquarters for nfl network?
    NFL Media moving to Inglewood entertainment complex in 2021

    NFL Media will be moving from its Culver City location to a new facility at the L.A. Stadium and Entertainment District in Inglewood.


    The move is expected to happen in 2021.

    The NFL will develop a 200,000-square-foot facility for the The NFL Network, NFL.com, the NFL app and NFL RedZone. There will also be an outdoor studio and space to host studio audiences.

    The Inglewood complex is the former home of the Hollywood Park racetrack.

    It will have as its centerpiece a 70,000-seat stadium, which will be the new home for the Rams and Chargers.

    The complex will also have 3,000 residential units, a 300-room hotel, and 400,000 square feet of retail space.
     
  13. Harryo the K

    Harryo the K Well-Known Member

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    That was known desire. But so far, I think the $4 billion debt is only for the physical stadium.

    Or as we call them nowadays NFL Casinos.
     
    Last edited: May 19, 2018
  14. Concudan

    Concudan Still Chargin Staff Member Administrator

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    I wonder if the los vegas stadium is going to have slot machines on the back of the stadium steats and Keno girls coming around....
     
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  15. Pointyearedog

    Pointyearedog I only put idiots on ignore...

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    Wow, if the costs keep piling up like this, poor man Deano and company won't even be able to afford to move in as a renter.
     
  16. Quetzalcoatl

    Quetzalcoatl BoltTalker

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    Instead of passing through entrance gates, you walk through a gauntlet of people pushing fliers for escort services and titty bars.
     
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  17. Harryo the K

    Harryo the K Well-Known Member

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    Definitely will be on site, area for off track and sport betting. Going to be a money drain train, till maybe the State or Federal Govt wants a cut.
     

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