Real now wishing on iStar — as its investor
By Amelia Nielson-Stowell and Lisa Riley Roche
Deseret Morning News
After keeping the name of their new investor under wraps for almost a week, Real Salt Lake officials said Thursday that iStar Financial will invest in the Major League Soccer team and stadium.
The firm is stepping in to replace Goldman Sachs, which pulled out as an investor last week after stadium negotiations — still not completed — dragged on for months.
The terms of the deal with iStar are the same as those of the proposed deal with Goldman Sachs, said team spokesman Eric Gelfand. New-York based iStar will own a 50 percent share of the team with Real owner Dave Checketts' company, Sports Capital Partners.
In addition, iStar will invest $24 million in the stadium project, as well as $24 million in other Real business ventures. iStar also will secure a $33 million construction loan for the stadium.
Although not as lucrative a name as Goldman Sachs, Sandy Mayor Tom Dolan said he is confident in iStar.
"They're a multibillion-dollar firm, and they may offer some more flexibility to the project," Dolan said.
Sandy and state officials requested that Real disclose the name as soon as possible, said Randy Sant, Sandy's economic development director. iStar, however, asked Real to keep it confidential.
Real's Gelfand said various companies expressed interest in partnering with Real, but iStar was at the forefront. iStar has been involved in a variety of big projects in the sports and entertainment industry. The firm's portfolio is worth $10.9 billion, including $6.9 billion of loan assets, such as the Real deal.
Andy Backman, iStar's Vice President of Investor Relations, said iStar doesn't talk publicly about investment deals, but he complimented the Real stadium.
"We liked the project scope, and we liked the involvement of Dave Checketts, who is well respected in the sports industry," Backman said.
iStar Financial will help finance the first phase of the stadium project, which includes the 42-acre stadium. Phase two would be a 136-acre mega-development with retail, office space and a hotel and broadcast studio. Goldman Sachs is still interested in investing in that second phase, Real officials said.
Gov. Jon Huntsman Jr. said before the team's announcement that he had discussed the new investor with Real owner Dave Checketts within the past two weeks or so. Asked during the taping of his monthly televised press conference on KUED Channel 7 if the name of the company should be made public, Huntsman said that was up to Real.
"They're taking the business risk and the stadium, and they have to decide if their level of financial support, financial investment, makes it worthwhile," the governor said.
He said the taxpayer funds involved in the project — $35 million collected from transient room taxes paid in Salt Lake County — are coming from people staying in hotels and will be used to pay for land and parking. The project is much larger than that for the private investors, Huntsman said.
"The state's involvement in this has always been limited to securing the land where the privately funded stadium will be built, as well as the construction of a parking facility that will also greatly benefit visitors to the South Towne Expo Center," Huntsman's spokesman, Mike Mower, said after the announcement.
Meanwhile, a Salt Lake resident is wrapping up his statewide tour to collect signatures for a referendum that would allow voters to decide whether public money should be spent on the project. Brad Swedlund, 50, filed the request earlier this month and has been visiting various counties to find registered voters who will sign the petition.
State law requires Swedlund to collect nearly 92,000 signatures of voters who participated in the last gubernatorial election. Those signatures must be collected from at least 15 of Utah's 29 counties by April 9. Swedlund reported on his Web site,
www.getrealutah.org, this week that 35,000 signatures have already been collected.
Meanwhile, Sandy's planning commission Thursday night voted unanimously for a code amendment that, if passed by the City Council next Tuesday, allows for off-site parking at temporary events, such as Real soccer games. Per the state's $35 million funding package, $20 million must be used for 1,000 new parking stalls within a five- to 15-minute walking radius of the stadium.
Sandy's commission voted last week to hold off on issuing $10 million from Sandy's Redevelopment Agency for Real until the parking plan meets its conditions set forth by the commission.
Prev
Linear Mode
