AEG’s Farmers Field proposal calls for the development of 64,000-seat, retractable roof stadium, along with the US$275 million replacement of a wing of the Los Angeles Convention Center. The $1.2 billion stadium project, backed by a $700 million naming rights agreement with Farmers Insurance, is one of two proposals designed to lure an NFL team back to the Los Angeles area.
With a 4-0 vote, the council’s Ad Hoc Committee on the Downtown Stadium and Convention Center recommended approval of the agreement with AEG with a vote by the full council scheduled for Tuesday. The Los Angeles Times reports approval of the nonbinding agreement will herald another nine months of talks between the two sides. “This is the table setting, not the meal,” said Councilwoman Jan Perry, who voted for the plan and heads the stadium committee.
AEG has promised to finance the stadium on its own, but will require the city to issue $275 million in tax-exempt bonds to pay for demolition and relocation of the exhibition area. AEG’s proposal calls for the bonds to be repaid from new tax and lease income generated by the stadium and convention hall projects.
The Times reported the project did not receive universal approval with questions raised over financial returns from the stadium. Quentin Fleming, a Pacific Palisades-based management consultant, stated he believes AEG’s return will be more than triple the amount projected by the city’s economic consultants. “It would be beneficial if we could have an independent person, someone without a vested interest, perhaps even a city employee themselves, take a look at the numbers,” he said.
AEG’s proposal is competing against Majestic Realty Group’s 75,000-seat football specific stadium in the City of Industry, 22 miles east of downtown Los Angeles. The facility is considerably cheaper at $800 million, and would act as the centrepiece of a 600-acre entertainment district. In 1994, Los Angeles lost the Raiders and Rams franchises to Oakland and St. Louis respectively. The Raiders and Rams have both been linked with a return to the city, with the San Diego Chargers, Jacksonville Jaguars, Buffalo Bills and Minnesota Vikings have also been mentioned as possible targets.
