The Project’s Fatal Flaws
• Total Absence of Political Support: San Diego Mayor Jerry Sanders immediately announced his opposition to the project (1), and the would-be developer did not even attempt to involve the Councilwoman from the Qualcomm area, who will have tremendous influence over any potential project. (2)
• Complete Disconnection from the Realities of the Marketplace: The proposal comes at a time when condominium prices in the San Diego region have reached historic lows and office vacancies in nearby downtown San Diego are at historic highs.
• Extreme Density that is Unacceptable to the Community: The community has not taken the project seriously project because the developer has proposed to create an enormously dense project -- the equivalent of a second downtown San Diego – in Mission Valley, already one of the most congested areas of San Diego. The Mission Valley infrastructure, even if substantially improved, could simply not support the massively dense project that Mr. Dealy has proposed.
In 2003, for example, the Chargers proposed creating an urban village on the Qualcomm site with approximately 6,000 condos and 173,000 square feet of office space. Mr. Dealy proposes to build a similar number of condos and four million square feet of office space. (3) There is simply no way that the area’s infrastructure would support such a humongous development project.
In short, for reasons of excessive density alone, the project has been viewed as dead on arrival. (4)
• Unrealistic Funding Assumptions: The proposed project relies on the following unrealistic funding assumptions:
o $100 million from San Diego State University, at a time when the State of California is teetering on bankruptcy. Even in better economic times, the ability and willingness of the public university system in California to invest this amount in a professional football stadium is, at best, questionable.
o $200 million from the NFL, at a time when the G-3 program has been exhausted and when, even under the prior G-3 formula, San Diego would have been entitled to approximately$100 million in League loans.
o $350 million in taxpayer funding, which would:
- require the courts to designate Mission Valley as a “blighted area” under the law (5), and
- require the State of California and numerous other hard-hit government entities to give up their share of several hundred million dollars in property taxes so that the money could be spent on the stadium and the related infrastructure. (6)
• Initial Supporters Have Already Abandoned the Proposed Project: The developer’s press release listed prominent supporters, including former San Diego Padres executive Charles Black and local developer Gary London. At the press conference to announce the project, though, only the developer and his architect appeared; neither Mr. Black nor Mr. London appeared at the press conference, and both independently contacted the Chargers to indicate that they had withdrawn their support from the project.
• The Proposed Developer’s Lack of Serious Intent: No serious developer would announce a project such as this without having reached an accommodation with the area’s key elected official (San Diego Mayor Sanders) and the project’s main tenant (the San Diego Chargers). The fact that this would-be developer went ahead without this kind of support indicates that the developer lacks the seriousness of purpose (7) and the sophistication necessary to accomplish such a difficult project.
(1) “The mayor [was] not on board with the project. [Developer Perry] Dealy called on San Diego Mayor Jerry Sanders to create a task force to study this proposal and others that would retain the Chargers in the county. It was an idea that didn't go over well in the Mayor's Office.” San Diego Union Tribune, May 28, 2009.
(2) “Councilwoman Donna Frye, whose district includes Mission Valley, said that last concern is reason enough to question a proposal she has not even seen. ‘If the whole proposal turns around the area being declared a redevelopment area, you have to comply with state law,’ she said. ‘Mission Valley's not blighted.’’ San Diego Union Tribune, May 21, 2009.
(3)“What Dealy and his River Waterfront Development Team envision is a construction project of epic scale, one that resembles the Chargers' original proposal in much the same way King Kong compares to Curious George.” San Diego Union Tribune, May 20, 2009.
(4)“Two weeks after developer Perry Dealy privately showed Mayor Jerry Sanders blueprints for redeveloping San Diego's Qualcomm Stadium site, Sanders' office is raising concerns and other politicians sound skeptical or unenthused. Sanders declined to comment yesterday, but his spokesman Darren Pudgil said Dealy's idea “appears to be very dense for the site.” San Diego Union Tribune, May 21, 2009.
(5) Developer Perry Dealy “readily admitted that the basis for moving ahead with their plan is getting the site approved as a redevelopment zone, a tricky proposition both legally and politically.” San Diego Business Journal, May 28, 2009.
(6) “The Chargers first proposed the redevelopment idea when they offered their original stadium proposal back in 2003. Shortly thereafter, everyone pretty much agreed that it’d be near impossible to get that redevelopment designation, so the idea was scrapped.” Andrew Donohue, The Voice of San Diego, May 28, 2009.
(7)“’We'll stay if it looks like the mayor wants to keep it in the limelight, but we don't want to just go uphill with it,’ [developer Perry Dealy] said.” San Diego Union Tribune, May 28, 2009.
