United Sold; New Focus on Stadium
Saturday, January 6, 2007
A San Francisco real estate developer has partnered with former Duke basketball star Brian Davis and at least two other investors to purchase D.C. United's operating rights, build the team's stadium in Anacostia and develop the land around it, sources said yesterday.
Victor MacFarlane, who heads the largest minority-owned real estate management firm in the country, will lead the group. He will be joined by Davis, a Bladensburg High graduate, and Discovery Communications founder John Hendricks. The group will pay Anschutz Entertainment Group, the MLS team's operator the past five years, an estimated $33 million.
The group is more interested in a proposed 27,000-seat soccer stadium at Poplar Point in Southeast and the mixed-use development that would surround it than it is in the team, said the sources, who refused to be identified because they did not want to upstage the official announcement at a news conference scheduled for Monday.
District Mayor Adrian M. Fenty, Del. Eleanor Holmes Norton (D-D.C.) and two of Fenty's top deputies, City Administrator Dan Tangherlini and Neil O. Albert, deputy mayor for economic development, are scheduled to attend the news conference.
Fenty's team is increasingly leaning toward supporting the new stadium as a way to kick-start development in that area along the Anacostia River, a high-level D.C. government source said.
A further announcement related to the stadium development could come from Fenty in as soon as two weeks, after he has time to work out the specifics of how the project would be financed, the source said. Fenty wants to ensure that a significant amount of private money will be used to build the stadium.
A city planning agency has developed two financing options, one with United controlling the development and paying for the stadium, and one with the city using tax money generated from the site to fund the stadium, but Fenty's aides say they are examining all options.
The soccer facility would be built across the Anacostia from the Washington Nationals' new, publicly funded baseball stadium, scheduled to open in 2008.
United President Kevin Payne, who oversaw the formation of the group and will continue to run the club's front office, said he had no comment on the sale. MacFarlane's spokesman, Doug Holm, did not respond to telephone and e-mail messages.
MLS Commissioner Don Garber, who will also attend Monday's news conference, said through a spokesman that he deferred comment to United officials.
AEG, which also runs MLS teams in Chicago, Los Angeles and Houston, has had United's operating rights on the market for several years. In the summer of 2005, AEG announced a $26 million deal with a group headed by local real estate investors Willi Lauterbach and Tim Kissler, only to see the agreement collapse a few months later amid questions about the new group's financial resources.
Unlike other U.S. professional sports franchises, MLS teams are owned by the league, which awards operating rights to individual groups. AEG, founded by Colorado billionaire Philip Anschutz, took over United's operations five years ago following the disintegration of the club's original investment team, Washington Soccer LP.
MacFarlane, 55, owns 25 percent of the Southeast Federal Center project near the new Nationals stadium. He was involved in a failed attempt by a group of developers to build a mix of condominiums, shops and restaurants, along with parking garages, next to the new baseball stadium. Under that proposal, MacFarlane and local developer Herbert S. Miller had pledged to invest money from the California Public Employees' Retirement System to build the mixed-use development. However, the deal fell through when MacFarlane and Miller failed to reach agreement with District government officials. Miller is not a partner in the soccer deal.
MacFarlane Partners, founded in 1987 in San Francisco, specializes in urban development projects and, as of last year, was managing $2.2 billion in investor equity and $8 billion in properties. MacFarlane, sources said, is the primary financier in the United deal, with Davis, Hendricks and at least one other unidentified investor serving smaller roles.
Davis, 36, graduated from Bladensburg High in 1988 and won NCAA championships in 1991 and '92 at Duke. He and former teammate Christian Laettner are partners in Blue Devil Ventures, a real estate development firm based in Durham, N.C. They have been unsuccessful in attempts to purchase the NBA's Memphis Grizzlies.
Unlike MacFarlane and Davis, Hendricks has a soccer background. In 2001, he founded the Women's United Soccer Association, which folded in 2003. With a new women's league planning to launch within two years, Hendricks could end up overseeing a local team that would share a stadium with United.
Hendricks also helped create the Maryland Soccer Foundation, which runs the Maryland SoccerPlex in Montgomery County.
The deal was brokered by Michael Sears, a local financial advisor and investment manager. Sears is advising the parties on the sale and on developing Poplar Point.
Staff writer Thomas Heath contributed to this report.