ARLINGTON HEIGHTS, Ill. (AP) — With the galloping horses long gone, the Chicago Bears see 326 acres of opportunity at the shuttered Arlington International Racecourse. The Buffalo Bills also are making plans for a new home. Same for the Tennessee Titans and baseball’s Kansas City Royals, and on and on it goes. When it comes to construction for sports, today’s economic uncertainty is nothing compared to the promise of tomorrow. Interest rates, inflation and supply chain issues factor into the plans, according to construction and financing experts, but they haven’t been standing in the way.
The hulking grandstand at the shuttered Arlington International Racecourse casts an eerie shadow as the sun sets on a weekday evening. It sits dormant on a tract of land that could be transformed in a major way.
With the galloping horses long gone, the Chicago Bears see 326 acres of opportunity. The Buffalo Bills also are making plans for a new home. Same for the Tennessee Titans and baseball’s Kansas City Royals. Major League Soccer’s Inter Miami is working on its new place, and on and on it goes.
When it comes to construction for sports, today’s economic uncertainty is nothing compared to the lucrative promise of tomorrow. Interest rates, inflation and supply chain issues factor into the plans, according to construction and financing experts, but they haven’t been standing in the way.
“The best time to build is now, not two years from now,” said Dan Wacker, director of pre-construction for Mortenson’s sports and entertainment division, which counts Minneapolis’ U.S. Bank Stadium and Las Vegas’ Allegiant Stadium among its recent major projects. “If you can make that happen.”
The key to any development is understanding what the market can bear when it comes to spending, which already factors in inflation — “a manageable risk factor,” according to Scott Zolke, a lawyer with an extensive sports background who represents the Bills in stadium talks.
“One of the things that we exhausted in our analysis of Buffalo was ‘What if?’” he said.
“What about inflation? What if we go into a recession? What if … the supply chain is completely flipped upside down?” Zolke added. “You look at the best, worst, middle-case scenarios, do your comparisons … and then you say, is it worth it?”
Teams continue to say yes during what looks like an imposing time for massive construction projects. Even amid a tentative easing of inflation in October, the Federal Reserve likely will continue raising interest rates to cool the economy.
While teams are taking the current economic climate into consideration, it hasn’t been a deal breaker.
“I have not yet seen decisions change on whether to do a project or not do a project because of the cost,” said Bill Mulvihill, managing director and head of the Sports Finance Group at U.S. Bank, which helped finance the Los Angeles Rams’ SoFi Stadium. “It’s just more changing how are we going to fund this, how much is it going to cost rather than changing are we going to do this or not?”
The Bears want to turn the Arlington Heights site, once a jewel of thoroughbred racing, into a different kind of gem, anchored by an enclosed stadium and bursting with year-round activity — assuming a deal with Churchill Downs Inc. to buy the land goes through.
They envision restaurants, retail and more on the plot of land some 30 miles northwest of their longtime home at Soldier Field — all for about $5 billion, with some taxpayer help.
They’re not the only team with their eyes on new digs. The Bills are finalizing a deal with state and county governments to build a $1.4 billion stadium, and the Titans recently lined up the last financing for an estimated $2.1 billion domed home.
In Buffalo, it took years of prodding, fears of relocation, numerous studies, a change in ownership and delays caused by the COVID-19 pandemic to finally reach the conclusion the Bills needed a new facility to replace the stadium they’ve called home since 1973.
For the most part, when it comes to new stadiums and ballparks, owners are playing the long game, knowing they figure to profit even if prices are a bit haywire at the moment.
