“The city’s brand has changed,” Butts said with a broad smile in a recent interview. “We’ve gone from being known for high crime, poverty and failing infrastructure to the next big thing.”
The development of a new stadium comes at a fortuitous time for the NFL as it seeks to reclaim a foothold in the country’s second-largest media market after a 22-year absence. That goal only will be buoyed by the emergence of the high-scoring Rams, who play the New England Patriots in the Super Bowl on Feb. 3, as one of the league’s most dynamic young teams in just the third season since their return to Los Angeles.
Moreover, after decades in which taxpayers shouldered much of the cost of new sports arenas, the privately funded stadium is being closely watched as a potential new model for first-rate NFL venues built without public subsidies. To succeed, the development’s proponents say, the stadiums of tomorrow can’t exist as stand-alone buildings used for just 10 or 20 NFL home games a year; they must be flexible, multipurpose facilities embedded in complex commercial developments that attract customers and events year-round.
“If you’re going to build a stadium in a city, it has to play a larger role than the NFL. It has to bring people together in a meaningful way — both on Sunday and on every other day of the week, both in the fall and every other season. That’s the driver,” said Kevin Demoff, the Rams’ chief operating officer. “If you’re looking at a stadium project, everybody now is trying to figure out how you make it the epicenter of day-to-day life. Hopefully, this project will serve as a great model for that.”
At a cost estimated at more than $5 billion, the development — its formal name is the LA Stadium & Entertainment District at Hollywood Park — includes a 70,240-seat stadium and 6,000-seat performance center under one roof that will anchor a 298-acre complex of office buildings, shops, restaurants, residential units, hotels and parks. It’s 3 1/2 times the size of Disneyland and twice as big as Vatican City. It is the vision of Rams owner E. Stanley Kroenke, a Missouri-born billionaire developer and sports mogul, who took to heart NFL Commissioner Roger Goodell’s insistence that any new stadium built for pro football’s return to Los Angeles must be iconic and serve as home to two teams. In addition to the Rams, who moved back from St. Louis in 2016, the city is also the new home of the Chargers, who used to play in San Diego.
But even in a copycat league such as the NFL, it’s far from clear that Kroenke’s new-era model can be replicated. Its staggering expense is the primary barrier.
NFL's most expensive stadium
Though the Kroenke organization won’t confirm the cost or provide details of its privately funded financing plan, NFL owners in March agreed to raise their debt waiver to accommodate the Los Angeles project. That will help cover the cost of the stadium and essential infrastructure such as utilities, parking lots and roads, according to a person familiar with the multiyear plan.
The surrounding multiuse development, which includes a 250,000-square-foot West Coast headquarters for NFL Media and the NFL Network, will be constructed in stages and drive the total project’s cost well over $5 billion.
Beyond the loan, Kroenke is investing $1.6 billion of personal equity — an unprecedented investment among NFL owners, who have a rich tradition of building stadiums with other people’s money. (Even among fellow NFL owners, Kroenke’s wealth is notable, valued at $8.5 billion by Forbes magazine. His wife, Walmart heiress Ann Walton Kroenke, has her own fortune, valued at $6.6 billion, although it is his money that’s backing the Los Angeles development.)
The sale of seat licenses, which has become a significant source of NFL stadium funding over the past 20 years, will also defray construction costs. Both the Rams and Chargers require the purchase of stadium seat licenses, or SSLs, in addition to the regular ticket price. The Rams’ SSL prices are slightly more than the Chargers’, ranging from $1,000 to $15,000 per seat, depending on location and amenities. SSLs for club seats, which come with additional privileges, run $15,000 to $100,000. In a first, however, both teams will refund the full price of the SSLs after 50 years.
Pricing the seat licenses is challenging, Demoff acknowledged, but necessary in the calculus of financing a multibillion-dollar stadium that isn’t built on the backs of taxpayers or on the backs of fans.
“In a market like Los Angeles, people will always pay for the Lakers’ sideline seat or behind-the-dugout seats at Dodger games. There’s always going to be those people who will pay a great amount for the best in a market like this,” he said. “But for those fans who have been with us for three or four decades, we need to make sure their voice is heard, too. And priced into the building, as well.”
Additional funding will come from stadium naming rights and sponsorships of other facets of the project, such as a futuristic, suspended, dual-sided video board called the “Oculus” that will span the length of the field.
The NFL, as it does with every new stadium in the league, will extend its standard loan — in this case $200 million per team — toward the new venue’s construction costs.
Stanford University economist Roger Noll, who has written extensively about publicly subsidized sports venues, gives Los Angeles’s NFL project high marks for its reliance on private financing, in-town location, surrounding mixed-use development and ready access to four major freeways.
“This is a really good deal [from a public-policy standpoint] compared to virtually any football stadium that has been built in the last 30 years,” Noll said, adding a caveat about potential lost revenue from developments that might otherwise have been constructed on the 298-acre site.
But until Kroenke joined forces in 2015 with Stockbridge Capital, which owned most of the Hollywood Park land, the site had sat fallow, with the economic downturn in 2008 stalling previous development plans. According to Butts, who in 2014 had negotiated a major renovation of the Forum, the community embraced the idea of anchoring the site with an NFL stadium and entertainment complex, as well as the skilled jobs and apprenticeships it has created (30 percent are dedicated to local residents).
When completed, it will more than double the cost of the next-most expensive NFL stadium — the $1.8 billion Las Vegas stadium being built for the relocating Oakland Raiders and also due to open in 2020. Noll characterizes its heavily subsidized funding as one of the worst deals in sports history, with Las Vegas and Clark County handing the Raiders a $750 million subsidy and the state of Nevada committing $200 million to upgrade freeways to reach the site.
Just behind the Las Vegas stadium in terms of cost are New York’s MetLife, home of the Giants and Jets — it was privately funded but built on land owned by the state of New Jersey — and Atlanta’s Mercedes-Benz Stadium, host of this year’s Super Bowl. Each cost $1.6 billion. The Falcons’ home is owned by the state of Georgia and was constructed with help from roughly $600 million in public funds.
Just a decade ago, it seemed the Dallas Cowboys had set a spending mark that wouldn’t be topped when they opened AT&T Stadium at a cost of $1.3 billion, with the city of Arlington helping team owner Jerry Jones finance the project with tax hikes and bonds.
If the Los Angeles stadium indeed represents a new model, it may not be replicable. It’s doubtful a project so grand would work in markets outside New York or Los Angeles. In addition to hosting the 2022 Super Bowl, the stadium, whose capacity can be stretched to 100,000 for mega-events, will host the 2023 College Football Playoff championship and the 2028 Olympics’ Opening and Closing ceremonies and is vying to hold 2026 World Cup matches.
Moreover, the project is uniquely tied to Kroenke’s vision of where global sports and entertainment are heading and his zeal to be at the forefront. In addition to the Rams, Kroenke is the primary owner of London’s Arsenal soccer club. He owned the NBA’s Denver Nuggets and NHL’s Colorado Avalanche before placing them in a family trust.
“This project is really a confluence of Mr. Kroenke’s core competencies in [real estate] business, sports and entertainment,” said Jason Gannon, managing director of the LA Stadium & Entertainment District.
DNA of Southern California
The stadium is roughly 60 percent complete, and on a recent day 3,500 workers were busy despite a rare bout of rain in Southern California.
Inside the complex of trailers that serve as the nerve center, a large countdown clock ticked down the remaining days, hours and minutes until completion. Architects, engineers, carpenters and land-use managers were at computer terminals, reflective vests and hard hats nearby, coordinating workflow on the 17,000 line-item tasks that remain.
Inside one of the large conference rooms, surrounded by full-color renderings and detailed elevations of the stadium, Demoff and Gannon discussed the vision behind the project.
“We started with, ‘How do we do something that has never been done?’ ” Demoff said. “ ‘How do we do something that’s completely unique within Southern California, that would change people’s view of sports and entertainment districts?’ ”
The Rams wanted a roof, yet they didn’t want a dome or a structure that retracted. They also weren’t wild about walls, instead envisioning fans sitting outside, feeling the ocean breeze as they watched football.
This posed a design challenge for the architect, Dallas-based HKS. The solution was an NFL stadium tailored to the Southern Californian lifestyle like a bespoke suit: the first indoor-outdoor stadium.
“If you go to a home, a business, a hotel or restaurant in Southern California, that indoor-outdoor feeling is embedded in the experience. It’s done in a beautiful way; there is never a hard edge,” said Mark Williams, who heads the sports and entertainment division at HKS. “That’s in the DNA of every Southern Californian, but nobody had ever done that on a large scale, let alone an NFL stadium.”
The landscaping will reflect that, bleeding from the outdoor to the indoor. And the canopy-style roof was treated like a piece of sculpture as much as utilitarian structure. Its tapered, sloping shape was modeled and refined over multiple iterations, in concert with data on wind flow and the sun’s movement. From Kroenke’s perspective, the roof needed to serve as the stadium’s “fifth dimension” — immediately identifiable and impressive from the airplane windows of the 40 million travelers who land at LAX each year.
To comply with Federal Aviation Administration height limits, given its proximity to the airport, the stadium had to be sunken in the ground — 100 feet down. That means its sixth tier of the seating bowl (of eight total) will sit at ground level, so most fans will walk down to their seats, as if to a sunken living room. The remaining aboveground portion of the stadium, then, feels almost organic — not like a massive concrete and steel structure imposed on the landscape.
“If you were going to try to bring football back to the Los Angeles area after being gone 20 years, you couldn’t just count on there being a lot of fans who wanted NFL football. They could watch on TV on Sunday, play fantasy football or go to local bars,” Demoff said. “It had to be a game-changer in terms not only of the NFL fan experience but, truly, the Los Angeles lifestyle experience.”