If a new home is to be built for the Toronto Blue Jays downtown, it would mean getting a lease on the Rogers Center that doesn’t expire until 2088.
This lease with Canada Lands Company (CLC), a crown company that controls most of the land on which the stadium was built, was originally signed in 1989 and provided for a rent of at least $ 330,000 per year. Rogers Communications, who now owns the team and the stadium, is likely to pay more today, according to industry data.
While building a new stadium on land they don’t own if there is a long-term lease in place, it seems like a long way to go, real estate and sports professionals say CLC, Rogers, and development partners have plenty of motivation to close a deal.
For the Blue Jays and Rogers, demolishing the stadium built in 1989 at an estimated cost of $ 570 million could mean replacing it with a smaller, more modern stadium with more lucrative corporate suites. It could also mean the team and company are getting new revenue streams from a multi-purpose development built on the site with condos, office space, retail and some parking space.
This is money that would not go to Major League Baseball’s revenue-sharing program to be shared with other teams. David Carter, executive director of the Sports Business Institute at the University of Southern California, also stressed that this would not count towards baseball-related revenue, which would mean increasing team salary caps.
“A team doesn’t have to share that kind of income with the league or the players. It’s her own. It can make a big difference to a team’s income and add to their franchise value, ”said Carter, who discovered a similar project just a few miles from Rogers Center: the Maple Leaf Sports and Entertainment development of Maple Leaf Square, Cadillac Fairview and Lanterra developments.
The Blue Jays are valued at $ 1.625 billion, according to the latest Forbes magazine estimate.
While the SkyDome, as it was called when it opened in 1989, was initially a modern marvel, it quickly became clear almost from the start that it was out of date, said Richard Peddie, who ran the stadium for its early years. The contrast between the concrete-heavy Toronto Stadium and a retro-look single sports stadium built shortly thereafter in Baltimore couldn’t have been sharper.
“I went to Camden Yards for the first time and said, ‘oh, sh-‘. SkyDome was really the last of the large multi-purpose stadiums to be built, ”said Peddie. The stadium is already the seventh oldest ballpark in Major League Baseball. In 1994 the Ontario government paid off the stadium’s debts, which had increased to $ 400 million, and then sold it to a consortium that included Jays’ owner Labatt Breweries for $ 151 million. The stadium filed for bankruptcy protection in 1998 and was bought by another company called Stadco for $ 80 million. Eventually, Rogers bought it for $ 25 million in 2004.
Sources said Rogers has worked with Brookfield Asset Management on a plan to build a new, smaller stadium, as well as condominiums, office space, and parkland on the site. In contrast to the construction of the Rogers Center, the plan does not provide for public funding.
“Before the pandemic, we looked at options for the stadium. However, this year our main focus has been keeping our customers connected and protecting our employees. So there is currently no update to the Rogers Center that we could share,” said Rogers spokesman Andrew Garas.
Brookfield declined to comment on this article.
While some published articles had indicated that Rogers was considering the Quayside area as an alternative location, a spokesman for Waterfront Toronto, who owns the area, said the plan was new to them.
“The media reports were the first Waterfront Toronto to hear of interest in the Quayside site as a potential new home for the Blue Jays. Quayside spans two council-approved plan areas of the district: the East Bayfront Precinct and the Keating Channel Precinct. … Neither plan is for a multi-purpose stadium like the Rogers Center, ”said spokesman Andrew Tumilty.
A source familiar with Rogers’ plans, who has no authority to discuss them publicly, said Quayside was not an option to be considered.
The company has already reached out to both the federal government, which owns most of the land through CLC, and the city of Toronto, which owns a small plot of land and should see changes to the zones.
CLC confirmed in an email that it owns most of the land and that the Rogers Center has a lease that expires in 2088, but referred further questions to Rogers.
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Some of the people Rogers has met, according to the federal lobbyists’ register, include Local MP Adam Vaughan, PEI MP Steven MacKinnon, and Taras Zalusky, acting chief of staff, Public Services and Procurement Canada.
Vaughan, Liberal MP for Spadina-Fort York, where the stadium is located, admitted meeting Rogers last July and said he received a simple message for the communications giant after they shared details of their plan.
“The advice I gave Rogers was to get in touch with Canada Lands sooner rather than later,” Vaughan said.
There’s also plenty of motivation for CLC to play well with Rogers, said John Andrew, a real estate professor at Queen’s University’s Smith School of Business.
“The stadium stands in the way of major development. This lease definitely gives Rogers leverage as a sports stadium is nowhere near the most lucrative use of the property, ”said Andrew, who estimated it could be five years or more before a new stadium even begins construction.
Even if CLC doesn’t sell the land, renting a new development, including office towers, retail stores, and condominiums, would be worth millions of dollars annually to the crown company that gets it from a stadium lease, Andrew said.
CLC could decide to sell the land or swap it for stake in the development, said Andrew, who would not be surprised if the project eventually expanded to include a redevelopment of the nearby Metro Toronto Convention Center.
While the convention center is owned by a different developer, Oxford Properties, Andrew said that large developers often work together to spread the financial risk on mega-projects.
“A partnership between Brookfield and Oxford would be very easy. They worked on other deals together and these guys all know each other very well. It’s a small club. Retirement plans like to share the risk with others, so you often see business between two or three of them, even if one of them could afford to do it alone, “said Andrew.
While CLC and Rogers both have their motivations for wanting new development, Brookfield and any other developer who might join the project later have so too, Andrew said. Thanks to COVID-19, the office towers in the city center, which once enabled large developers to generate a steady flow of revenue, have become far less lucrative for a company, probably in the long run.
“I think when all is said and done, maybe 30 to 50 percent of people will work in these office towers again. Because of this, big developers are pushing more condos than office towers. It’s pretty easy, ”said Andrew.
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