Business & Real Estate

Sacramento Republic FC releases plans for soccer stadium in downtown railyard

By Ryan Lillis and Dale Kasler - rlillis@sacbee.com

September 17, 2014 04:48 PM

Sacramento Republic FC, the city’s popular minor-league soccer club, announced Wednesday it has reached an agreement to acquire land in the downtown railyard for a new 20,000-seat soccer stadium that could host a Major League Soccer franchise.

The announcement came on the eve of a scheduled visit by top executives with MLS. Those officials will arrive in town Thursday afternoon to begin an intense two-day assessment of Sacramento’s viability as an expansion market for the nation’s premier professional soccer league.

Republic FC said it was purchasing land in the northeast corner of the downtown railyard for its stadium. Larry Kelley, the local developer who is acquiring the 240-acre railyard, will join Republic FC’s investor group, contingent upon the team landing a spot in MLS. The team’s purchase of land in the railyard for a stadium also hinges upon whether the city is granted an MLS expansion team.

“The railyard is a once-in-a-lifetime project that will transform our city and region,” said Kevin Nagle, the lead investor in Republic FC’s expansion bid. “The soccer stadium will serve as a catalyst of this development and be a key attraction for recruiting a vibrant workforce to live, work and play in our city.”

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Drawings of the stadium released by Republic FC show that the facility would be situated east of Seventh Street where it runs through the planned railyard development. Railyards Boulevard, the main east-west thoroughfare in the railyard, is just to the south of the stadium site.

A map of the stadium site shows a light-rail station one block away from the facility, on Seventh Street. A grassy hill would sit on the northern edge of the stadium, giving fans a view of the field and the downtown skyline. Republic FC’s practice facility would be located a block away.

Nagle said the facility could be used for events besides soccer, including other sports and concerts.

Questions remain over how the stadium will be financed. Mayor Kevin Johnson has said no city money will be used to help build the facility. Nagle has said the Republic FC investor group will have the capacity to pay for the stadium, plus a league expansion fee of at least $70 million.

“We feel very comfortable with where we are,” Nagle said. “When we talk to MLS over the next couple of days, I think we’ll have a very strong story to tell and will be able to provide them information and the pathway to deliver a privately financed stadium.”

Sacramento is in a tight race with Minneapolis for the 24th spot in MLS. Las Vegas and San Antonio are also considered contenders as the league plans to add one more team by 2020.

MLS Deputy Commissioner Mark Abbott and other top executives plan to visit the railyard while in Sacramento. They will also attend a fan rally Thursday in midtown and visit Downtown Plaza, where a new Kings arena is under construction a mile from the soccer stadium site.

League officials also plan to visit Elk Grove, where city officials and a group led by former Assembly Speaker Fabian Núñez are making their own bid for an expansion franchise. The City Council in Elk Grove has agreed to buy land for a stadium near Highway 99.

The Sacramento contingent has said it has the edge. Abbott and other MLS officials have expressed the league’s desire to have teams located in urban areas.

Republic FC also has what it says is the kind of deep-pocketed ownership group that meets MLS standards. That group is lead by Nagle, the co-founder and vice chairman of Envision Pharmaceutical Holdings, a drug-distribution company that does $3.5 billion in business annually. He is also a major investor in El Dorado Town Center, a shopping and office district.

Envision was sold last year to an investor group for $935 million. Nagle would not discuss his share of that transaction, but told The Sacramento Bee last week he is worth “hundreds of millions of dollars.”

Nagle and Kelley are also both investors in the group that purchased a controlling interest of the Sacramento Kings last year, blocking the team’s proposed move to Seattle. Nagle said additional local investors in Republic FC would be announced, perhaps as early as this week.

Kelley built the Stanford Ranch development in Rocklin and transformed McClellan Air Force Base into a private industrial park. He expects to close this fall on the deal to buy the downtown railyard from Inland American Real Estate Trust, an Illinois firm that acquired the site after the previous developer defaulted on its debt.

Kelley is planning to develop the railyard into a mix of housing, entertainment, retail, office space, theaters, parks and hotels. The site is said to be the largest plot of undeveloped land in the downtown of any major American city. Millions of dollars have already been spent cleaning up the site and building infrastructure, including roads and bridges.

“We couldn’t have a better partner in Republic FC for what will be this region’s most important real estate project in 100 years,” Kelley said. “Sporting and culture events add to our civic amenities, quality of life and attract people to our region; both to live and invest. In addition to building a stadium with the club, I am also honored to be a part of their bid for MLS expansion and join its ownership group.”

Kelley said a handful of sites in the railyard were examined for a soccer stadium, but that the northeast corner became the only logical choice because of the size of the stadium’s footprint and the limitations imposed by streets and other infrastructure. The stadium would sit on a 10-acre parcel and would have a north-south orientation to avoid problems with early-evening sun, Kelley said.

Kelley said he declined an invitation by Republic FC President Warren Smith to invest in the team when the franchise was getting off the ground. “It wasn’t major-league sports,” he said.

But as Republic FC began zeroing in on the railyard as a stadium site, Kelley said jumping in as a potential investor became a natural.

“I just have that much confidence in (Nagle) and Warren,” he said. “If you look at what Warren has accomplished with the Republic, it’s amazing.”