Brett Johnson is quickly becoming a household name in Pawtucket, thanks to his development company’s plans for a $400 million mixed-use project anchored by a soccer stadium along the Seekonk River.
But the Brown University graduate still has some sizable hurdles to clear in his bid to make Tidewater Landing a reality, starting with lining up investors who believe soccer can support the ancillary development.
The project, slated for three separate riverfront properties in Pawtucket, calls for a 7,500-seat soccer stadium, a 200-room hotel, an indoor sports center, retail, residential and infrastructure improvements. The stadium would be home to a professional United Soccer League Championship team.
The project is to be financed by private investment and about $70-$90 million in public funding through a tax-increment financing plan that uses revenue from the project to pay for public infrastructure.
R.I. Commerce Corp., which in conjunction with Pawtucket solicited proposals for reuse of McCoy Stadium and revitalization of the city’s downtown, estimates Tidewater Landing will create 2,500 direct and indirect construction jobs and more than 1,200 permanent jobs after completion. Since announcing that developer Fortuitous Partners was the winning proposal, the city has entered a 120-day, due-diligence period that ends at the end of March. During that time, project details and financing will be refined.
Johnson is a principal of Fortuitous Partners and co-chairman of the Phoenix Rising Football Club in the United Soccer League Championship.
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SOCCER SITE: Brett Johnson is the principal of development company Fortuitous Partners, which is planning a $400 million mixed-use development on the Pawtucket waterfront called Tidewater Landing. Tidewater will feature a 7,500-seat soccer stadium that will be home to a United Soccer League Championship team. The stadium will be located at the site behind Johnson, across the Seekonk River. / PBN PHOTO/MICHAEL SALERNO[/caption]
The central focus of your project is a 7,500-seat soccer stadium. Why do you see Rhode Island as a market for professional soccer? Is there enough interest to regularly fill the stadium and support the development around it? Will you conduct a market study? [Seven thousand five hundred seats] is the initial aspiration, and we’ll want to program it double at some point. In some respects, we’ve already done a study. As I’ve described it, Rhode Island has consistently been in the top 10 for media ratings for professional soccer. What that means is when there’s an English Premier League game on television, or when there’s a World Cup game – men or women – on television, Rhode Island [viewership] is consistently in the top 10. That tells me a lot of what I need to know, relative to support and interest for the sport. The demographic melting pot of Rhode Island is another great supporter of launching professional soccer – all the different countries that are represented in the demographic makeup of Rhode Island, they come from very strong soccer backgrounds. I am highly, highly optimistic – and it’s not just hope, it’s born out of some experience. I’ve been at this for over five years; I’ve seen how we’ve built up a fan base in Phoenix, and I’m confident that with the right partners … I’m going to bring in some great local partners who will roll up their sleeves and really help me make this endeavor successful.
What is the proposed budget and timeline for the project? How much of the money do you still need commitments for, and from whom? The overall development right now that is part of our [request for proposals] is a $400 million development. I’ve had an incredible response from investors who are interested, who have started to kick the tires on the project and who have indicated their intention and or interest to invest. From that conversation to money being wired to the bank, there’s obviously a lot of work that needs to be done.
I intend on building a broad and diverse investor syndicate. And I am absolutely earmarking investment dollars for those that are in state. … I want stakeholders and ownership to be filled throughout the broader Rhode Island community. That’s critical for me to make sure I carve out the ability for in-state investors and others that can be part of this project.
So, who do you have monetary commitments from? I’ve had a diverse coalition of investors who have come up and looked at the project and indicated they’re interested in investing. Right now, we’re working on translating those indications into investments: putting together the investor documents associated with it – we have to actually create an opportunity fund for them to invest in. … It’s a lot of moving parts between what I would describe as investor interest to dollars in the account.
We’re in the due-diligence part right now. We’ve won the RFP but now we enter into a 120-day due-diligence period where we finalize the financial pro forma, the asset mix, the staging, and it kind of goes from theoretical to actual.
Where else in the U.S. has a project of this size, with a soccer stadium and related development, been successful? There are countless, countless professional sports-anchored developments across the United States. I certainly don’t get credit for coming up with this concept. In my backyard where I live, Los Angeles, L.A. Live, which is the downtown development that’s anchored by the NBA and NHL teams. When I first moved here 15 years ago, people would go to downtown L.A., they’d watch a game and they’d immediately go home. Now because of all the assets that they’ve built in downtown L.A., it has transformed that part of the city and now people are selling their big homes and changing their lifestyle to take advantage of an urban core.
It’s almost becoming the exception to the rule. In the prior era, you would see a sports stadium in the middle of nowhere. People would go to a game, and other than when there were people playing in the stadium, it would be dark all the other nights of the year. No one is approaching sports like that anymore. How do you provide reasons to go shop, eat, sleep well beyond game night? I’m confident we’ll do that with Tidewater as well.
But what about similar developments built around a soccer stadium? Louisville already had an existing team and, due to its success, is expanding to include mixed-use development. It’s set to open this spring and has a TIF financing component for a comparison to the R.I. project. Colorado Springs [just broke ground] and Oklahoma were also just big news stories in the USL soccer world.
How do you see the other elements of the project – an indoor sports center, apartments, shops, restaurants, offices and riverfront parks – complementing the soccer stadium? One of the many reasons why I love Pawtucket is, this is riverfront property right off of I-95 and going to be very close to a transportation hub that will get you via train either to Providence or in the other direction to Boston. When we build apartments as part of this complex, and when we build office space, I think you’re going to find that there’s going to be a great deal of demand from people who want to look at working there and who want to look at living there. [We want to] really provide an ecosystem where, 365 days a year, there’s activity going on in the Tidewater complex.
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PRIVATELY OWNED: The site of the Apex building, which is privately owned, could be involved in developmental plans as part of a proposed $400 million mixed-use project along the Pawtucket waterfront by Fortuitous Partners, if the owners agree to sell.
PBN PHOTO/MICHAEL SALERNO[/caption]
The Apex site, where the sports center, hotel and conference center are slated to go, is privately owned and city officials have had trouble persuading the owner to sell. What happens to the project if you can’t acquire this property? We’re looking at moving the event center and making it part of the stadium complex. We’ve got our architect spending time on that right now. I feel very fortunate with what I would say is the line of sight on Division and Tidewater [properties] relative to being able to invest in the asset classes that we’re talking about: the stadium, the event center, hotel, retail, the whole mix.
I can’t speculate as to how it will ultimately play out with Apex; that’s ultimately in the court of the city and [Commerce RI] and they’ve got what I would characterize as a healthy dialogue on that front. I don’t want to turn to the state … and say, “Sorry, we didn’t get that piece. We couldn’t make it work.” I honestly feel a responsibility to everyone that we figure out how to make Tidewater and Division [properties] work and I’m confident we can do that. That being said, as with any development, there are a lot of moving parts and complexities, but I remain completely confident that’s enough land in a great-enough location that we will be able to deliver on the majority of our aspirations, if for whatever reason fate ends up deciding that’s all we can develop.
What do you anticipate to be the biggest obstacles to this project? At my core, I’m just an eternal optimist. We’ve worked close to a year, we’ve spent a lot of money to get to this point. Our motivation only increases exponentially since we’ve seen this incredible support from our announcement. I couldn’t be happier with what I would describe as the unbelievable political support throughout the state. When I look at the team we have that’s behind us to get this done, I have an incredible amount of confidence that whatever obstacles come up, we’re just going to continue to find a way to get through it.
But there must be a few potential obstacles? The critical element for me is to make sure I have demand from an investment perspective. If I can’t raise capital, then I don’t know how this project gets done. A critical part is for me to figure out how to source over $300 million of private investment into this area. I am confident based on our vision, based on the political support we have, based on the assets we’re programming, that we will get that piece done. And then it’s dotting i’s and crossing t’s with the city on the Division Street land. It’s working with our friends at National Grid relative to [the] Tidewater property. It’s going to take a lot of work. None of this is for the faint of heart. It’s overwhelmingly complex, especially when you’re dealing with public-private partnerships. If I saw anything that concerned or scared me, I probably would have stepped away from this thing. All signs have been green lights as far as I’m concerned.
Do you have any experience with similar projects? I’ve obviously raised a lot of money for the Phoenix Rising soccer franchise. And if you look at the arc of my career, [I have] a lot of real estate development experience. … But I think most importantly, I’ve got truly a world-class team that’s partnered with me. Steve Betts [senior adviser to PHX Rising and Fortuitous Fund] is a critical part of what I’m confident is the resources and team and experience that’s going to enable us to make sure we raise the requisite capital, we program the right assets and get the right partners to start to move dirt.
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DETERMINED DEVELOPER: Brett Johnson, principal for development company Fortuitous Partners, is confident he can attract enough investors for his Pawtucket project.
PBN PHOTO/MICHAEL SALERNO[/caption]
The tax-increment finance plan calls for a portion of revenue from the project to be diverted to support the cost of public infrastructure improvements. What happens if the project fails to bring in the necessary funds to finance this? We’re going to have to work that out from Commerce RI and … Pawtucket. From what I can gather, [Fortuitous] will be on the hook for it. We did a fairly substantial economic-impact analysis. Commerce did their own impact analysis, and the return on investment for public dollars is fantastic – well north of any hurdle that would concern us.
The event center drives 365 days of traffic a year. It drives a lot of hotel room nights that we have. The partner that we have standing up the event center has more experience than anyone in the country. There’s a lot of merit behind their conviction on the numbers, again, born out of experience.
The opportunity zone program, the second wave of it, is going to be companies – private equity, capital entrepreneurs – that want to take advantage of the incentives associated with basing a company in an opportunity zone. From that perspective, that office space will be in high demand.
I think we’re striking the right balance with Commerce RI and I think we’ll more than exceed any projections that we’ve looked at relative to how we get a return for everyone.
Nancy Lavin is a PBN staff writer. Contact her at Lavin@PBN.com.
