Worcester Business Journal

wbjournal.com | February 4, 2019 | Worcester Business Journal 13 B A N K I N G & F I N A N C E F O C U S Whatever your business goals may be, People's United Bank can help you go even further. We're a full-service bank with the resources of a large bank and the personalized service of a local bank. ©2019 People's United Bank, N.A. | Member FDIC We are the bank with the resources to help your business grow. Let's discuss your business needs. James T. Curran 508-890-5122 james.curran@peoples.com WooSox stadium must bring outside developments to be successful Worcester has borrowed $101 million to build a stadium for the Pawtucket Red Sox and to anchor a $240-million public-private redevelopment . Worcester officials say the development will generate enough tax and rental revenue to cover the taxpayers' cost and create an extra $3 million into the city's coffers. When polled online, the plurality of WBJ readers said the stadium plans must realize these development goals in order to be considered a success. F L AS H P O L L What would make the Worcester Red Sox stadium development successful? Regardless of the cost, the city's invest- ment has already been a success by attracting the team to move. 19% If the planned hotel and apartment complexes inside the stadium development come to fruition. If the city breaks even on its financial investment. 26% • "This is a big waste of money, and they should be paying taxes like the rest of us." • "It's a huge win for the city and very exciting. We can only hope the city reaches its $3-million surplus projection. The possibilities for the city are endless!" COMMENTS: Continued on next page If the city reaches its $3-million surplus projection and new developments pop up outside the stadium plans. 47% 8% economics professor at the University of Connecticut in Hartford. "And there was no possible way in which the stadium was going to generate anything like the revenue that was going to pay off the bond issue," he said. In a slower-growing region like Hartford's, any new growth around the ballpark is likely to simply take develop- ment from elsewhere in the area – not add to it, Carstensen said. An amenity for residents shouldn't be mistaken for a driver of new economic activity, even with any related construction. "It's not going to be an economic development project in its own right," he said. Success stories Allentown, a former manufacturing city just over an hour northwest of Philadelphia, brought a new team to the area in a similar way to Worcester. In Allentown's case, it used $17 million in state funds for a new stadium. Coca-Cola Park opened in 2008 to host the Lehigh Valley IronPigs, who play in the same league as the Pawtucket Red Sox. Roland Kushner, a business professor at Allentown's Muhlenberg College, called the stadium a good cata- lyst for new development in the region, if not necessarily on the park's doorstep. "I am a skeptic of public financing of sports facilities," Kushner said. "Howev- er, it worked here." Coca-Cola Park was built in a largely industrial area not too accessible from any nearby homes or restaurants. But attracting the team, and the IronPigs' popularity, Kushner said, brought the region a brand identity and helped bring other new attractions, including a minor league hockey team that moved to new arena in downtown Allentown in 2014. In the adjacent city of Bethlehem, a casino and hotel complex opened a year aer the ballpark and a performing arts center two years aer that. Even if planning had already been underway, Kushner attributed both projects in part to Coca-Cola Park. "ere's a feeling in the community that the success of the IronPigs and Co- ca-Cola Park made this area a better bet for such large scale entertainment and sports investments," Kushner said. In Charlotte, BB&T Ballpark opened in downtown in 2014, bringing the Charlotte Knights back to the city from a suburb to the south. e city committed $7.25 million in funds from hotel occu- pancy taxes and $750,000 from munic- ipal service district taxes. Mecklenburg County pitched in $8 million. In one sense, the ballpark has certainly worked: e neighborhood around the park has sprouted new apartments and shops. Gauging the ballpark's role however is less clear, said Craig Depken, an economics professor at the University of North Carolina Charlotte. A general consensus, Depken said, is much of the growth would have taken place anyway. Charlotte has been a boom city for years, its population growing by 123,000 people from 2010 to 2017. "It's very difficult to tease out the sta- dium's impact compared to the general Charlotte development," Depken said. "e impacts seem to be rather fleeting, or pretty minimal." Cautionary tales Stockton, Calif., a city an hour east of Oakland, paid for a new stadium opened in 2005 at the edge of Stockton's down- town on a contaminated site. e waterfront is improved by the ballpark and an adjacent arena opened the same year, said Jeffrey Michael, the director of the Center for Business and Policy Research at the University of the Pacific in Stockton. But there's no evidence, he said, the facilities have brought people to live in the neighborhood or spend more money there. e park is surrounded by a few parking lots and industrial parcels. "In fact," Michael said, "I don't think there is a single restaurant within several blocks." Worse, the ballpark was cited as one reason for Stockton's 2012 bankruptcy filing, one of the largest municipal bank-

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