Bringing Major League Soccer to Middle Tennessee is a good thing. There is a wide support for a team, especially from those in Williamson County, long the beating heart of the sport, even before it was cool.
But before soccer took root, Williamson County was a strong supporter of the state fairgrounds’ traditional events: auto racing, the flea market and, of course, the state fair.
The current plan for a soccer stadium puts all three in jeopardy.
The owners of the MLS team include John Ingram, whose family has been one of the greatest collections of philanthropists in the history of Nashville. The family has a reported net worth of more than $5 billion. Their partners include the Wilf brothers, who share that level of net worth and are also lead owners of the NFL’s Minnesota Vikings. The Wilfs’ hands, however, are not as publicly clean as the Ingrams’ hands, as the Wilfs have had real issues in Minnesota over stadium construction, etc.
The Nashville stadium deal was pushed by a disgraced former mayor and her chief operating officer, who, over the course of at least three decades, never denied his desire to “redevelop” (read: destroy) the fairgrounds.
Talk was that the MLS was demanding a soccer-only stadium before granting a team despite — before and since — having awarded franchises without such a requirement.
While the ownership group has guaranteed covering $9 million of the annual costs for the bonds required to build (under original estimates) the stadium, the annual cost to Metro will be $13 million. Not only is that an annual shortfall (read: tax increase), but it also increases Metro’s debt load, which is twice — you read that right, double — the debt of the state of Tennessee.
Additionally, there is the matter of the Metro charter and a specific amendment that requires the historic uses (state fair, flea market, auto racing) to continue on the property. Work that has already been done on the site, including the removal of thousands of parking spaces, makes it difficult for each of those uses.
And then there is Parcel 8C.
Parcel 8C is included in a 10-acre section that was “given” to the new owners for mixed use: 900 apartments, a hotel, retail, restaurants, etc. It’s a sweetener, if you will, that at the end of a 99-year lease might come out to millions of dollars for the city.
But what a sweet deal for the team owners.
Consider 900 apartments times 95% occupancy. Multiply that by $1,500 a month. That’s almost $15.4 million per year. Multiply that by 20 years and it becomes more than $307 million
If the units run $100,000 each financed over 20 years at 5%, the cost would be $90 million and the total payback over 20 years would be a little more than $142 million. Add a flat 15% to the original cost ($13.5 million) for maintenance, etc., and it’s a roughly $152 million profit over 20 years or about $7.6 million profit per year. And this does not take into consideration rising rents over the term, which would push the profit numbers higher.
This is just the apartments. Consider the other uses (hotel, etc.) that are planned.
In the spirit of transparency, my roots run four decades deep at the Nashville Fairgrounds Speedway, from fan to operator to announcing and everything in between. But this isn’t about soccer versus racing. It is a real estate deal designed to give away public land to help the rich get richer.
Nashville is the right city for MLS soccer, but the fairgrounds is the wrong place for a new stadium.