Rebekah L. Sanders, and Craig Harris

The Republic | azcentral.com

The Maricopa County Board of Supervisors is contemplating selling Chase Field in downtown Phoenix to private, out-of-state investors, and will meet Wednesday to vote on initiating negotiations.

The starting point for the proposed deal, made public Tuesday, is a $60 million sales price. It would include keeping the Arizona Diamondbacks at the stadium through 2028 — the remainder of the team’s contract with the county — and potentially longer. A draft contract showed the county would retain a handful of perks like a stadium suite and premium parking, despite no longer owning the building.

READ: Investor letter to county | Investor proposal | Access agreement | County letter to team

The county's vote comes amid tension between the county and the team over who is responsible for as much as $187 million in repairs to the 18-year-old baseball stadium. Opened in 1998, it is owned entirely by the county despite a team investment of more than $200 million in construction and enhancements. County taxpayers provided roughly $250 million to build it.

The county board in recent weeks has discussed stadium issues behind closed doors, fueling speculation about new developments. Wednesday's board vote, scheduled for 1:30 p.m. in the 10th floor conference room, 301 W. Jefferson St., Phoenix, will be the first since the dispute with the team exploded publicly this spring.

The terms of the team's contract with the county and the terms of the proposed deal stipulate that the Diamondbacks would have to approve any private sale. Team attorney Leo R. Beus said in a written statement that he had reached out to lawyers representing the investor group to find out more. He would not comment further.

However, a Diamondbacks source said the team is unlikely to approve a deal so favorable to the county and offering few concessions to the team.

The agreement would allow the county to choose an appraiser and the potential buyer to inspect the property.

The East Coast investors, identified as Stadium Real Estate Partners II LLC, want to create "a sports and entertainment district surrounding the facility ... that would further complement and enhance the downtown area and increase tax revenues within such sports and entertainment district," according to a letter from the investors.

The idea for a revamped sports and entertainment district in downtown Phoenix was floated by the Diamondbacks earlier this year, but in a different context. Team President Derrick Hall proposed that the city of Phoenix replace Maricopa County as Chase Field's landlord, opening up the opportunity to renovate the ballpark or build a new facility and expand CityScape, a high-rise, mixed-used development. Diamondbacks majority owner Ken Kendrick is a major investor in CityScape.

Because the Maricopa County Stadium District, an arm of county government that operates the stadium, no longer has the ability to raise taxes to help the team or contribute to the project, partnering with Phoenix was proposed as a way to take advantage of the city's municipal bonding authority.

The Diamondbacks were unaware of the county's sale plan until Friday, when County Board Chairman Clint Hickman sent a brief letter to Hall notifying him of interest from a private buyer and offering to answer questions. The investors contacted Kendrick, who referred the call to the team's attorney.

"We believe this transaction has the potential to benefit taxpayers by removing the need for public funding while fulfilling your desire to enhance the stadium," Hickman wrote. "... I can be reached on my cell phone. I am currently in Boston and will be at Fenway (Park) tonight to root on the Diamondbacks if you wish to meet in person."

The proposal includes provisions that may not please the Diamondbacks:

It does not state how much money the buyer would be required to put into stadium repairs. The proposal states that the investors intend to "commit whatever capital is necessary ... to improve the facility in a one year, but not to exceed a two year, plan" that meets the requirements of the original lease and new agreements with the county and team. The county's plan for stadium upgrades stretched over 12 years.

The county would receive the balance of a reserve account, roughly $16 million, for repairs that had been funded by team rent. To replace it, the buyer would be required to set up a new reserve account for repairs with $15 million. County spokesman Fields Moseley said the reserve account can't legally be transferred to the buyer or team.

The county would keep its ballpark suite, which county officials provide to non-profit community groups. Team officials have said the county's desire to have a suite and reserved parking was a sticking point of negotiations. The county also would keep an office and two premium parking spots. County Supervisor Andy Kunasek has bristled at the suggestion that county officials insisted on luxury accommodations, calling it slander. Moseley said the suite and parking would remain because the buyer would honor the original lease terms.

The Maricopa County Stadium District, an extension of county government that had been in charge of overseeing repairs and running non-baseball events at the facility, will continue to exist in a smaller role. District staff would serve as a "watchdog" to ensure the stadium is well-maintained by the investors, which is why an office at the stadium is necessary, Moseley said.

The county provided little detail about Stadium Real Estate Partners II LLC, listed in county documents as the buyer in conjunction with Integral Group, an Atlanta-based real-estate firm run by Egbert Perry, board chairman of Fannie Mae, the Federal National Mortgage Association. The investment group has no connection to the Diamondbacks or any of the team's investors, according to a letter the buyers sent to the county.

Sorina Givelichian, an investment banker with offices in Toronto and New York, is leading the purchase with assistance from Integral Group. Givelichian and Perry did not respond to calls and e-mails seeking comment. Calls to Martin Greenberg, a Milwaukee-based attorney representing the investors, also were not returned.

David Carter, director of the Sports Business Institute at the University of Southern California, said it is not typical for a private investment company to own a sports facility without having ownership in the professional franchise playing there. Typically, a government owns a stadium or arena and leases it to a team, or the team owns its own facility.

Carter, an expert on professional stadium issues, said the investment group may be looking for an opportunity to improve a distressed asset, then "flip it in the marketplace."

"If you are to acquire a building, it is beholden on those who acquire it to have a strong working relationship with the core tenant and the core revenue producer," Carter said.

If the deal goes through, he added, the Diamondbacks will have to spend time educating the new partner about the business of baseball.

"There will be some tutoring and mentoring to make it work," Carter said.

Communication between the team and the county had deteriorated in recent months, putting negotiations over the future of the stadium largely on hold.

The Diamondbacks hired a high-powered law firm and threatened to sue the county, offending county leaders. Team officials suggested they might try to leave the stadium before the team's current contract with the county ends in 2028.

Kunasek, the county supervisor, accused team officials of selling a "false narrative" to the public, slandering county board members and damaging taxpayer trust in government. In a profanity-laced storm, he called on Kendrick to "take your stupid baseball team and get out" and go back to "f--king West Virginia."

However, Board of Supervisors members have told The Republic they remain committed to finding a resolution that will keep the team playing at the stadium.

The conflict flared again in late June and July, when Diamondbacks officials submitted two letters to the county requesting funding for repairs.

One sought reimbursement for about $650,000 in improvements the team made to suites, the dugout, concession areas, locker rooms, and heating and cooling systems. County officials denied some items and said others might be approved with additional documentation.

The second letter outlined about $64 million in proposed repairs over five years, from replacing scoreboards to renovating party lounges. County officials agreed to continue funding structural issues such as repairs to concrete and steel. But they denied other expenses as superficial, inviting further negotiation.

Columnist Paola Boivin contributed to this article.