The development plan for Farmers Field calls for demolishing and rebuilding part of the Convention Center to make room for the football stadium.
Los Angeles Mayor Antonio Villaraigosa said Wednesday that AEG owner Phil Anschutz has assured him a buyer will be found for the company who will agree to the terms negotiated with the city for Farmers Field, the proposed football stadium downtown.
It was announced Tuesday that AEG — the Anschutz Entertainment Group — is on the market. The company owns venues and sports teams around the globe.
Here in Los Angeles, its properties include Staples Center and L.A. Live. The company also is part owner of the Los Angeles Lakers and Los Angeles Kings.
At a press conference Wednesday morning, the mayor said he has a commitment from Anschutz and AEG President/CEO Tim Leiweke that the company's sale "will not impact the effort to bring a football team to Los Angeles.”
AEG has pursued the stadium project as a precursor to convincing the NFL to relocate a team to L.A. The St. Louis Rams and San Diego Chargers have been named as possible candidates. AEG and the city have been trying to get a deal in place before a meeting of NFL team owners next March.
The mayor refused to say when he learned about a possible sale of AEG. Under persistent questioning by reporters, Villaraigosa would only say, “I’m the mayor. I knew. I’m the mayor, and I knew. Let me be clear about something — I’m the mayor and I knew.”
The city has expedited its approval process for Farmers Field, which calls for demolishing part of the convention center to make room for the stadium. The city Planning Commission approved the project last week and the City Council is scheduled to take a final vote on the stadium deal on Sept. 28.
L.A. City Councilman Paul Krekorian, who chairs the council's Budget and Finance Committee, is one of the few elected officials who has expressed concern about the speed with which the city has proceeded with AEG. On Wednesday, Krekorian said AEG's pending sale "validated my insistence that the city slow down the express train of stadium enthusiasm."
Whoever buys AEG may inherit a legal challenge. A group of community organizations known as the Play Fair Farmers Field Coalition has filed a lawsuit challenging the state law that expedites legal challenges against the stadium. SB 292 allows all environmental concerns filed against Farmers Field to be sent directly to the state Court of Appeals.
On Wednesday, coalition member Eric Ares said AEG's announcement is “a great opportunity for the council to slow things down.”
But he expressed worry that the mayor hadn't been open about AEG's intents.
“This is just another example of conversations being had that affect hundreds of thousands of people that are being held behind closed doors,” Ares said. “We are concerned who will be responsible down the road.”
Last week, an attorney for the Natural Resources Defense Council, which is not involved in the Fair Play lawsuit, told a City Council committee that the legal challenge could be the death of Farmers Field.
“In my view, if that litigation is successful, which it could be, that could take down this entire project," said David Pettit. "It could kill the entire project."
No hearing date has been set for the lawsuit. The Fair Play coalition also is seeking a $20-million trust fund to protect affordable housing in the neighborhood, and it also wants protections against the anticipated increase in traffic.
Whoever buys AEG would also have to agree to the Convention Center portion of the project. The West Hall would be torn down and replaced with a new wing. Last week, city officials learned that cost has risen to $314.6 million — up from the original estimate of $280 million.
Though the city will issue tax-exempt bonds to finance the project, AEG has agreed to back the bonds. That means if there aren’t enough funds, AEG will make up the difference. The remaining third will be paid for with special taxes generated from the development area.
Councilwoman Jan Perry, whose district includes L.A. Live and the proposed stadium site, said through a "transparent and thoughtful" process, the city has worked to ensure the projects will protect taxpayers while working to "bring world-class conventions, tourism dollars, and revenue to the city" — in addition to more than 20,000 new jobs.
"Anyone stepping in to lead AEG will be held to the same understanding that we have established,” Perry said.
The city's Chief Administrative Officer, Miguel Santana, said he met with AEG's Leiweke Wednesday morning, "and made it clear that regardless of who owns AEG, the deal stays intact. It is their responsibility to get an owner who’s going to agree with the framework that the city council and mayor have committed to.
“There is no deal if they change the framework.”
Los Angeles biotech billionaire Patrick Soon-Shiong, who bought Magic Johnson's interest in the Lakers, has expressed interest in purchasing AEG. Soon-Shiong has reportedly joined forces with Guggenheim Partners' executives Mark Walter and Todd Boehly, who formed Guggenheim Baseball Management earlier this year to buy the Dodgers for more than $2 billion.
AEG has hired the Blackstone Group to manage its sale. Blackstone also handled the sale of the Dodgers.
Also on SCPR.org: