Sports stadium construction: Worth the public controversy to put a 'city on the map'?
Whether it's a Sunday afternoon spent cheering on a football team or a night under the bright lights hoping for a ninth-inning homerun, a major league sports event is one of the quintessential American experiences. Bright lights, enthusiastic crowds — what's not to love? For some communities, teams and contractors, it's the process of building that arena — or stadium or ball field — that just might take the sheen off the experience.
Lately, there have been a few sports venue projects that, even before making it out of the ground — whether it's due to local resistance or financial battles — are high-profile pains in the neck.
For example, the NBA's Golden State Warriors, who are privately funding the construction of their new $1 billion arena in the Mission Bay area of San Francisco, have come up against local opposition from the Mission Bay Alliance, which represents a group of medical professionals and facilities — including a children's hospital — located across the street from the approved site.
The Alliance has filed lawsuits against the Warriors, claiming the location is inappropriate for a sports venue and could prevent access to life-saving emergency care. So far, the Alliance has succeeded in pushing back the Warriors' anticipated move into the new arena from 2018 to 2019 as the team prepares to fight the litigation.
Attorney Irwin Kishner of Herrick, Feinstein LLP who has been involved in such major venues as the new Yankee Stadium and Citi Field, said there’s almost always some form of pushback against large sports complexes, whether it's of an environmental or fiscal nature.
"It's a fairly hot issue," Kishner told Construction Dive. "Are you properly utilizing public resources in a manner that most benefits the community, or could the dollars being spent be better utilized towards putting up a school or hospital or community center? Everybody has their idea as to what's the best and highest use for a particular site, so there are always issues."
Kishner added, though, that there is usually a fairly rigorous zoning approval process for projects like the Warriors arena.
"While it sounds, emotionally, like a very compelling issue, you have to think that some very smart and involved people thought through a lot of that," he said.
Case Contracting in Tampa, FL, counts the 1998 Montreal Expos and St. Louis Cardinals joint spring training facility in Jupiter, FL, as one of its many professional baseball projects, but company president and COO Tim Walker said the company has never built one of these high-public-interest projects without experiencing some level of local resistance. Walker chalks it up to the diversity in opinions present in any group of people.
"There’s always somebody that's not going to like something," Walker told Construction Dive. "If I like vanilla ice cream, you’re going to like chocolate. That’s the way it is."
Public vs. private funds debate
One hot button issue that always arises with this type of construction is whether or not to use public money. The Warriors are financing their arena, but teams like the Milwaukee Bucks have seen heavy opposition to state and city financing.
Architect Stan Meradith of DLR Group said teams attempting to feed at the public trough are sometimes victims of their own success. Meradith, who counts the Pinnacle Bank Arena in Lincoln, NE, and University of Texas Disch-Falk Field in Austin among his and DLR's many major sports venue design projects, said the resentment on the part of the community that's being asked to fund the project can often be traced back to high player salaries.
"People in tough economic times really push back from that and object," he told Construction Dive. "They think if athletes can make that kind of money, what kind of money must the ownership be making, and, if that's true, then why are we, the taxpayers, building their facilities for them?"
Difficulties in Minnesota
The U.S. Bank stadium in Minneapolis, which will be home to the Minnesota Vikings NFL franchise when complete, has also been in the public eye lately. Ever since the owners revealed the stadium's design, bird safety activists have been vocal opponents of the 200,000 square feet of glass walls and roof they say will attract migratory birds from the nearby Mississippi River flyway, causing them to smash into the glass and die.
In addition, the Vikings and Mortenson Construction, the general contractor on the project, are currently in mediation because of a $15 million dispute over change orders. Despite the public perception that change orders on a project are the manifestation of bad planning, experts say that they're part of any large project, particularly one that must stay on a tight schedule in order to make the vital deadline of a team’s opening day.
"I think when the public hears 'change orders,' it's construed as someone messed up or made a mistake," Meradith said.
"To those of us who are in the industry, that has much less of that connotation," he added. "To get some venue ready for 2018, if it means that it has to be fast-tracked and actually has to start construction before all the documents are done, everybody understands the conditions and that there are going to be change orders. Sometimes in order to get it done earlier, the project has to start before all the drawings are done."
As complicated as mini-cities
Kishner compares major sports venues to little cities, which include infrastructure, security considerations and other public comfort aspects that make change orders virtually inevitable.
"In erecting a stadium, there is so much involved that change orders are an ordinary and normal part of the process," he said. "They’re typically put into the construction budget so, when you’re financing a stadium, there’s always a line for changes."
Walker agreed that on projects of such magnitude and when there is such a critical time element, everyone is aware of the likelihood of changes.
"Most of these things have been worked on by the GCs and the ownership group a year or two before the thing even goes into construction," he said, "so there's a lot of understanding."
Walker said there's also less room in the budget these days for built-in contingencies that at one time could have avoided the need to pursue extra payment for some changes.
"With the margins, you have to account for every nickel because there's no fluff left. None," Walker said.
No money in sports?
In November, CEO Ronald Tutor of Tutor Perini famously made the comment during the company’s 2015 fourth-quarter analyst conference call that there was "no money" in sports construction.
Kishner doesn't buy it.
"There's definitely money to be made in stadium construction, and there are a lot of people that make that money from the architects to the accountants to the workers," Kishner said. "It goes all the way through the food chain. There's a lot of money to be made in the construction for the people that are actually doing the day in-day out work. There really is."
But for Kishner, the debate over whether sports venues are moneymakers for contractors pales in comparison to the financial and psychological benefits for the community.
"I think there's two parts. One is you have the financial aspects. Putting in a stadium or an arena in a municipality is extremely helpful in generating jobs, in generating income, in bringing dollars," Kishner said. "Equally as important, though, is you have tremendous psychological benefits by having a team. Every major city wants to have a team. It's a source of civic pride. Look what happens when a team wins the World Series. It's a major rallying point. To a certain extent, it puts the city on the map."
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