Resolution 60 and Resolution 130 both passed during Thrusday’s Austin City Council meeting, directing the Austin City Manger to receive offers for developing the McKalla Place site while also directing the City to negotiate on a stadium deal at McKalla Place with Precourt Sports Ventures. PSV will now compete for the use of the McKalla Place site with other developers who will submit bids before an Aug. 3 deadline for discussion at the Aug. 9 meeting of the Austin City Council.
Both proposals went through notable changes in the time between Tuesday’s work session and last night’s City Council meeting. Resolution 60 was amended to change the word “solicit” to “receive” while changes to Resolution 130 included a bullet point that focused on developing a stadium plan that has a comprehensive solution to parking and transportation.
More than 20 Austin residents spoke for and against the resolutions with much of their discussion focused on the positives and negatives of relocating Columbus Crew SC. Among these speakers was PSV lobbyist Richard Suttle and, surprisingly, Crew SC investor/operator Anthony Precourt. Precourt’s appearance and comments related to his commitment to Austin are yet another blow to the claim of parallel paths being investigated in Columbus and Austin.
The only real shock of the night came during a brief discussion of an amendment to the resolutions that would bump the discussion of McKalla Place’s future to the Aug. 23 City Council meeting. PSV’s lobbyist Richard Suttle responded to this amendment claiming that PSV had already passed at least one deadline (though it is unclear who imposed this deadline) and that pushing the decision past Aug. 9 would be “problematic.”
Multiple Austin City Council members, though generally favorable to a stadium at McKalla Place, stressed the current version of Precourt’s proposal is not good enough. The comments from the City Council members made it clear that the city of Austin will attempt to take the upper hand in these negotiations and will look for a deal that has a much improved benefits package over PSV’s current plan.
With both plans passed, PSV will now have to compete with other offers for the McKalla Place site. John Chen and Marcus Whitfield, Precourt’s chief competitors for the site, were on hand to voice their support for Resolution 60. Earlier this month, Chen and Whitfield offered to purchase McKalla Place for more than $22 million, or to rent the land for 80 years in a deal that would total more than $300 million. Chen and Whitfield also suggested that they would pay property taxes on the site in addition to purchasing or renting it, providing a stark contrast to Precourt’s request that he lease the land for $1 per year while paying $0 in property taxes. The Austin-based developers stressed that Precourt is an “out of state interest” and that they would build something on the space for the City.
Even in light of Suttle’s newly set deadline of Aug. 9, the City of Austin clearly has the upper hand in negotiations moving forward. They called PSV’s bluff on multiple deadlines (Jan. 1, March, June 28) and now have a tangible set of goals that will look for in a proposal. Specifically, the City of Austin wants a deal from PSV that includes a minimum payment for a rail station (about $13 million) and on-site affordable housing. With an open offer from Chen and Whitfield, it’s unclear where the Council falls on issues of rent (currently set at $1) and property taxes (PSV has asked for the land to be exempt) but it would not be surprising for them to expect some serious concessions from Precourt on one of those two points.
On top of all of this is the pending litigation in Ohio and a looming threat of litigation in Austin should a deal similar to PSV’s original proposal be approved. Moving forward, PSV will be forced to accept a deal on Austin’s terms or find another location. PSV has been notoriously absent from communications to the Austin City Council and now they have five weeks to make a deal with the City while competing with solid cash offers. Buckle up.