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Diamond District redevelopment cost set at $2.4 billion

City leaders, Flying Squirrels staff and others gathered outside the Diamond to announce the selection of a development team for the Diamond District project. (Jonathan Spiers photos)

With a development team selected for Richmond’s Diamond District project, city leaders on Tuesday celebrated the start of what is expected to be a 15-year effort with an investment totaling $2.4 billion.

At an event in The Diamond parking lot, speakers from the city, VCU and the Richmond Flying Squirrels hailed the selection of development team RVA Diamond Partners, with whom the city plans to work to replace the aging stadium and redevelop the surrounding 67-acre area. .

Among those who spoke were Flying Squirrels President Lou DiBella and COO Todd “Parney” Parnell, both of whom expressed emotion as they arrived at this point after more than a decade of promise of a new playing field.

“If you had told me when we moved here that 13 years later we would still be playing in this wonderful fun monstrosity, I would have told you you were crazy,” DiBella told the crowd.

“We’ve never felt anything but love for this city,” said Flying Squirrels President Lou DiBella.

“I’m not going to tell you that I had no doubts that we arrived here, but they left with time, because we never felt anything but love for this city.”

Choking, DiBella added, “We weren’t willing to go anywhere else.”

“It’s an emotional day for us. We’ve been dreaming of this moment for a long time,” Parnell added. “Thank you all for being here for what I feel is a truly historic day. We are incredibly grateful to everyone.

The event officially kicked off work on the first phase of the project, which is centered on replacing the 37-year-old Diamond with a new 10,000-seater stadium by the start of the 2025 season. the deadline set by Major League Baseball for all professional baseball facilities – major and minor leagues – to meet the new facility standards, which The Diamond does not.

“There’s nothing minor about any of this,” Richmond Mayor Levar Stoney told the crowd.

While the Flying Squirrels are the Double-A affiliate of MLB’s San Francisco Giants, Richmond Mayor Levar Stoney said at the event, “There’s nothing minor about this. This is a major investment in the league for the people of Richmond.

Other speakers included representatives from RVA Diamond Partners, Jason Guillot of Richmond-based Thalhimer Realty Partners and Rufus Williams of Chicago-based investment bank Loop Capital.

They lead the team with DC-based Republic Properties Corp., whose mixed-use projects include the Port of Washington on the Georgetown waterfront. Republic’s Jordan Kramer also attended but did not comment.

“We look forward to a partnership with the city, the Flying Squirrels and VCU,” Guillot said. “The city of Richmond is literally booming, and the opportunity to create a new 67-acre neighborhood where people can live, work and play, with the beloved Flying Squirrels as the anchor tenant, is a once in a lifetime experience. opportunity.”

Jason Guillot of Thalhimer Realty Partners is among those leading the RVA Diamond Partners team.

Williams added: “Richmond is a great place to raise a family, a great place to start a business, a great place to live. For us, it’s also a great place to invest in a multi-billion dollar mixed-use development.

Tuesday’s event took place less than 24 hours after the city announced the team selection over fellow finalists Richmond Community Development Partners, led by Houston-based Machete Group, San Francisco-based JMA Ventures, and New York-based Tryline Capital.

In a statement, David Carlock of Machete Group expressed the team’s appreciation for being considered.

“We want to thank the City of Richmond for including us in a well-managed and efficient process,” Carlock said. “Our team has enjoyed working closely with the city and engaging with the community over the past few months. We would also like to congratulate the RVA Diamond Partners team and wish them the best of luck in bringing the project to life in the years to come.

Detailed project phases

A site plan for the first phase of the project shows the new stadium in the southwest corner of the Diamond District. (Images courtesy of City Records)

The announcement of the selection was officially made through an introduction of ordinances that the city council could vote on at its September 26 meeting. The ordinances include a term sheet resulting from the city’s negotiations with RVA Diamond Partners that is expected to be approved later this year.

The term sheet sets out the proposed minimum commercial terms agreed between the parties. It also shows how the first phase of the project is expected to unfold, including the construction of the new stadium, which could accommodate 8,000 people with space for 2,000 standing spectators.

RVA Diamond Partners would pay the city $16 million for the phase one property, consisting of 21.8 acres at 2728 Hermitage Road and 2907 N. Arthur Ashe Blvd.

About 6 acres of the latter property would be leased by the Richmond Economic Development Authority, which would enter into lease agreements with the Flying Squirrels and VCU for the use of the new stadium. The stadium would rise in the southwest corner of the neighborhood at Arthur Ashe Boulevard and the train tracks.

The first phase would also include at least 1,134 residential units, 20% of which would be low-income with 184 units rented at 60% of the area’s median income, 39 units at 30% AMI and 20 units reserved for social housing residents with vouchers project based.

Ninety-two residential units for sale would also be built, including 20% ​​for low-income households, including 18 units at an AMI of between 60 and 70%.

The phase would also include 58,000 square feet of retail space, approximately 1,700 structured and 50 surface parking spaces, and a 180-room hotel totaling approximately 109,000 square feet. Talks between the parties indicated that the hotel brand, which must be approved by the city, would be modeled after a Curio by Hilton boutique hotel.

To complete the phase, a public park is modeled after the crescent-shaped park envisioned in the city’s Richmond 300 master plan.

A rendering of the Diamond District development as it would appear along Arthur Ashe Boulevard.

The minimum investment in the first phase is projected at $627.6 million, contributing to a total project development cost for the entire Diamond District area of ​​$2.4 billion.

The project would involve the creation of a Community Development Authority (CDA), a form of tax increment financing that local governments can use to help fund a project using tax revenue generated over time. This revenue – from real estate, entrance fees and BPOL taxes, as well as portions of meal tax and state sales tax – would be limited to those produced only in the 67 acres. that make up the project area.

According to the condition sheet: “The redevelopment of the Diamond District site is intended to be financially self-sustaining, which means that the new development in the Diamond District will generate sufficient tax revenue to pay the Development Authority’s debt service. community (“CDA”) bond financing and additional municipal services that may be required to support new development.

After repayment of CDA’s bond debt, the project is expected to generate $156.2 million in phase one general fund revenue over a 30-year period. The rents from the stadium leases and other revenue generated from the stadiums would be used to pay debt service on the bond financing.

The term sheet states that the bond financing “shall be without recourse to the City; therefore, requiring no moral or financial obligation on the part of the City. The funding would have a special appraisal requirement which, according to the document, “obligates the developer and other future landowners in the district to pay all debt service payment shortfalls in the event that revenue generated in the CDA district would not be enough to pay the debt service payments.

RVA Diamond Partners would purchase approximately $20 million of the first series of bonds for funding.

The document also lists purchase prices for three subsequent phases. Phase 2, consisting of 7.3 acres, would be purchased for $7.3 million and close in the fourth quarter of 2027. Phase 3 (12.9 acres) would be sold to RVA Diamond Partners for $16.4 million. dollars in 2030, and phase 4 (11.9 acres) would be purchased for $28.7 million in 2033.

A public meeting about the project and the selection process is scheduled for 6 p.m. tonight at the Bon Secours Training Center at 2401 W. Leigh St. The meeting will be broadcast live. A telephone town hall is also scheduled for Tuesday, September 20 at 6:30 p.m. Instructions for participation and more information are available on the project website.

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