The developer behind the $124 million soccer stadium project in Pawtucket may have secured the $14.5 million needed to close its financing gap, but there's still a lot of work and potential snags ahead before the riverfront arena will be ready in 2025.
Mike Raia, spokesman for developer Fortuitous Partners LLC and the soccer team Rhode Island FC, says small groups of workers are returning to the construction site, which has been quiet for weeks since the initial private funding ran out and the city of Pawtucket put public borrowing for the project on hold.
Work crews are preparing for a "more complete reactivation," Raia said. "We expect our general contractor to have a full ramp-up on site in the near future."
Still, there are many pieces for the financing for the 10,000-seat stadium – part of a planned mixed-used development called Tidewater Landing – that still need to fall into place.
With the $14.5 million recently secured, Fortuitous Partners now says it has raised the full $50 million it promised in private equity as part of the stadium deal with the state and the city of Pawtucket.
Fortuitous is waiting for Pawtucket to issue $27 million in bonds through the Pawtucket Redevelopment Agency to help pay for the project.
In fact, Fortuitous informed the Pawtucket City Council in a letter on Aug. 7 that the private equity is in escrow and will be available to spend "upon finance and bond closing."
City and state officials have said they're ready to move ahead with the bond issue but still have to market the bond to potential bondholders and secure financing commitments.
The office of Pawtucket Mayor Donald R. Grebien did not immediately answer questions from Providence Business News about Tidewater Landing, its financing and its future.
Beyond the bond issue, the project is set to receive government backing in other ways. To date, the project has secured $10 million in Rebuild RI tax credits and $10 million from the city of Pawtucket, in addition to the $27 million in bonds.
Fortuitous has refused to disclose the private investors for the stadium. They are “a group composed of individuals from inside Rhode Island and beyond … that shares Fortuitous’s vision for the project and professional soccer," Raia said.
In response to questions, Raia said that in addition to the private equity, there is also roughly $40 million in private debt “which will be backed by the developer through cash flows from the operations of the stadium activities.”
Meanwhile, Rhode Island FC, the United Soccer League expansion team that is expected to play at Tidewater Landing, is moving ahead with plans to field a team in 2024.
In an Aug. 7 letter, Fortuitous Director of Development Daniel J. Kroeber told the City Council that the team has 19 full-time staff members and planned to hire another 10 before January.
At the same time, General Manager Khano Smith, who is also head coach, has been traveling across North America and Europe scouting players. Rhode Island FC expects to make the first player announcements in the fall.
The team, which plans to open its first season next spring at Bryant University and has executed a minimum 30-year agreement to play in the USL, is leasing office space in downtown Pawtucket and plans to open a team store there, too.
Fortuitous is also looking beyond the stadium at the next phases of Tidewater development. In his letter to the City Council, Kroeber said the developer is working with the city to submit brownfield redevelopment grants from the R.I. Department of Environmental Management that could be used to remedy soil contamination problems on nearby parcels eyed for development.
Kroeber said Fortuitous is also working with city staff members to issue a request for proposals to design infrastructure such as a pedestrian bridge, riverwalk, park and buildings.
When it comes to the soccer arena, the developer is confident the major hurdles are behind them.
“We don't anticipate additional obstacles and look forward to a 2025 stadium opening on the waterfront in Pawtucket,” Raia said.
However, Steven Griffin, a former CPA who has been an outspoken critic of the stadium, anticipates obstacles.
He says he has scrutinized the investor documents and has concluded that Tidewater Landing is not financially feasible. Minor-league soccer teams are rarely profitable, and the financing includes far too much debt, he says.
Griffin, who cofounded Point Judith Capital with former Gov. Gina M. Raimondo and is the author of two books on the sports business, thinks Fortuitous is in over its head.
“I know the industry," he said. "The financial model doesn’t make any sense."
Steve Griffin is RIght!