Pawtucket $400M Soccer Developers Says They Are Going to Baltimore, Cleveland and Other Cities

Fortuitous Partners Brett Johnson and Berke Bakay announced that they are looking to do developments in Baltimore, Cleveland, and other cities around the country.

The pronouncement was made during the taping of a business podcast with Mike Consol on "Shop Talk: Opportunity zone projects anchored by sports stadiums."

Johnson during the interview said that Fortuitous Partners is also looking at Baltimore, MD; Cleveland, OH; and other cities for their opportunity zone driven sports complex model.

He said that the firm is also looking at Buffalo, NY and Oklahoma City, OK.

Johnson told Consol that the costs of the developments would cost between $100 million and $1 billion.

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Fundraising in RI

Johnson told Consol that Fortiuitious was actively fundraising in across the country and in Rhode Island for the Pawtucket project.

On December 3, top Rhode Island officials announced the major development in Pawtucket to take advantage of President Donald Trump's "opportunity zone" program.

The federal program has been under criticism as it was sold as being intended to help the poor, but critics claim that the program is being manipulated and benefiting the wealthy investors. SEE COVERAGE HERE

Governor Gina Raimondo and Pawtucket Mayor Donald Grebien announced what they claim will be the largest economic development project in Pawtucket’s history — a project that requires as much as $90 million in direct RI taxpayer subsidies. The project is titled Tidewater Landing.

The estimated $400 million project will transform Pawtucket’s waterfront with hundreds of thousands of square feet of new development, including a new professional soccer team that will compete in the USL Championship – the second division of professional soccer in the United States, claim officials.

According to the press release — “The public investment is expected to be approximately 20% of project costs (in the range of $70 to $90M total, with an anticipated $60-$80M of that total to be derived from State revenue). Final public investment will be determined based on factors such as site conditions, parking needs, and other project-specific considerations.”

Further, the Raimondo administration states, “The finalized plan will incorporate strong taxpayer protections for both the state of Rhode Island and the city of Pawtucket. Provisions will ensure the public pays for performance according to agreed-upon project milestones, which will be determined in the coming months. All state investments will be made based upon completion of project phases and other project milestones.”

The Other Partner

Rhode Islanders have not met Johnson’s partner in Fortuitous -Bakay.

Bakay is inextricably tied to Johnson via their co-chairmanship roles in the phoenix soccer team — Phoenix Rising — and well as Fortuitous.

In a podcast recorded in April this year, Johnson outlined that Bakay is one of the original founders of Fortuitous. “I reached out to a couple of my core partners in Phoenix Rising in Berke Bakay, my co-chair of Phoenix Rising…”

And in a phone interview with GoLocal, Johnson confirmed that Bakay is a partner in Fortuitous.

Just prior to his role in Fortuitous, Bakay headed Kona Grill, the 45 restaurant chain that was publicly traded on NASDAQ. Bakay's tenure at Kona Grill is absent from his bio on LinkedIn.

The restaurant chain was marketed as "featuring a global menu of contemporary American favorites, award-winning sushi, and specialty cocktails in an upscale casual atmosphere."

By August of 2018 Kona Grill announced that its Board of Directors appointed Jim Kuhn to succeed Bakay as President and Chief Executive Officer. Bakay was appointed as Executive Chairman of the Board of Directors and would "remain with the Company in a strategic role.”

“Leading Kona Grill over the past six years has been a tremendous honor. We’ve doubled the number of restaurants, started franchising internationally and domestically and have positioned ourselves as a truly unique brand serving global cuisine in a contemporary ambiance,” said Bakay at the time of the leadership change.

Within months, the company was filing for bankruptcy and the company was purchased out of bankruptcy for pennies on the dollar. While the company was in distress, one business tracking database says that Bakay still collected nearly $500,000 in compensation in his last year at the top executive. Bakay has refused to reply to repeated press calls.

In Bakay’s final year as president and CEO the stock fells from a 12-month high of $13 per share to $2.50 — an 80 percent loss in stock value.

Brett Johnson defends Bakay’s performance at Kona. “Berke Bakay is not involved in the Pawtucket proposal. Berke does, however, have a lengthy record of business success. He also played a central role in the success of Phoenix Rising. As you know, Berke was neither President/ CEO nor on the board of directors when Kona filed for chapter 11 reorganization. In fact, between his end date as CEO and the chapter 11 filing no less than five people served as CEO,” said Johnson in an email to GoLocal.

“Berke’s tenure at the helm of a company in the very competitive restaurant business included multiple years where Kona was one of the best performers for both Same Store Sales growth and Stock performance. It is on this foundation, built by Berke, that Kona quickly and successfully emerged from bankruptcy this year. Any entrepreneur knows that businesses sometimes suffer setbacks. In Berke’s case, however, his many successes far outweigh any setbacks,” Johnson added.

This story was first published 1/6/20 11:38 AM

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