Capella proposes McKalla Place partnership with PSV or putting MLS stadium at F1 track
July 31, 2018 – Austin Business Journal. Austin-based Capella Capital Partners LLC said it submitted two development proposals
to City Hall for McKalla Place, the proposed Major League Soccer stadium site in North Austin.
Capella Managing Partner Neil Francois said Tuesday afternoon print copies of the plans had been submitted to the offices of City Manager Spencer Cronk, Mayor Steve Adler and all Austin City Council members. He said they would be digitally submitted to the city on Wednesday. One proposal would be a mixed-use development with apartments or condos, shops, a hotel and office space —with the suggestion to build the Major League Soccer stadium at Circuit of The Americas, the Formula 1 race track east of Austin. Capella tells city officials it has reached an agreement with COTA, where a United Soccer League team is supposed to kick off next season and potentially serve as a competitor to a PSV-led MLS team.
The second proposal calls for pairing PSV’s soccer stadium at McKalla with parking, an office tower, green space and mixed-use and residential development. That option raises the possibility that the out-of-state operator of an MLS team and local developers — long seen as competition to one another for the sought-after city land — could instead work
Precourt Sports Ventures wants to relocate the Columbus Crew SC from Ohio to the Texas capital with a permanent stadium at McKalla Place, a 24-acre former industrial site south of The Domain. After nearly a month of negotiations, PSV and the city have hammered out the initial terms of a deal for the stadium. Austin City Council will be briefed on the deal on Wednesday and consider it for a potential vote on Aug. 9.
But the city kept the door open to other options, such as mixed-use development, affordable housing, parks, open space and creative space. Affordable housing has been discussed often as the city struggles with rising land costs and property taxes.
Francois previously said they would still pursue McKalla Place. On a three-acre site adjacent to McKalla, Capella is also planning the $250 million North Gateway Plaza project, which would feature a 21-story tower and 285 apartments, 300,000 square feet of Class A office space and 20,000 square feet of retail space.
The first plan for McKalla Place, dubbed Option “A,” would purchase the land for $22.1 million or lease it for 80 years with an annual rent of $750,000.
According to documents obtained by ABJ, Capella would develop about 1,200 multifamily residential units, 120,000 square feet of mixed-use retail including a local grocery store and private day care, green space, a hotel with 150-300 rooms and 800,000 square feet of Class A office space. With no room for a soccer stadium, Capella suggests building it at Circuit of The
“Capella Capital Partners and Circuit Of The Americas (COTA) have reached a agreement for COTA to donate the required acreage to construct and house the MLS soccer stadium,” according to an offer document. “In addition, COTA will provide approximately 20,000 parking spaces immediately adjacent to the stadium.”
Capella said it would also construct eight youth soccer fields on city-owned property
and provide $250,000 toward youth soccer scholarships.
Representatives of COTA, Austin’s USL team and COTA chairman and USL majority owner Bobby Epstein did not immediately return requests for comment from the Austin Business Journal.
Francois said this option is the “perfect solution” to making the most use of McKalla Place and finding a MLS stadium site with enough parking.
“As of right now, we just have a verbal agreement with COTA,” he said by phone Tuesday evening. “But they have been adamant that they are in full support of donating the land to host a Major League Soccer stadium.”
The second option, dubbed Option “B,” suggests a partnership with PSV to keep thesoccer stadium at McKalla Place.
“Capella will co-develop the McKalla site with Precourt Sports Ventures (PSV) to build a state of the art ‘Live-Work-Play’ environment,” according to the second offer obtained by ABJ.
The remaining 14 acres not dedicated to the stadium would be purchased for $11 million or leased for 80 years at an annual rent of $400,000.
Capella would develop 1,150 multifamily residential units, 100,000 square feet of mixed-use retail including a grocery store and private day care, a hotel with 150-300 rooms, green space and 400,000 square feet of Class A office space.
When asked why Capella would propose an option featuring the stadium, Francois said Capella was in “complete support of Precourt’s soccer stadium coming to Austin.”
He added: “If the city feels the McKalla site is the best site [for an MLS team], we want to present an option that incorporates a ‘live, work, play’ environment that the community can benefit from [and] that shows additional mixed-use development.”
Basically, the company is positioning itself for a potential no-lose scenario. Francois said they’ve had talks with PSV about developing McKalla Place together. “They would be responsible for building their soccer stadium and we’d do all the mixed-use around it,” he said.
A PSV representative declined to comment when asked if a potential partnership has been discussed with Capella or if they were open to one. Publicly, PSV leaders have doggedly pursued locating their stadium in a dense, downtown-like setting. In fact, in January PSV brushed off the idea of building a stadium at the Travis County Exposition Center because it wasn’t close enough to the urban core. Circuit of The Americas is
actually farther out than the Expo Center.
But wait, there’s more
A development group consisting of John Chen, Marcus Whitfield and Vista Planning and Design have also said they plan to submit plans for McKalla Place. They want to convert McKalla Place into a mixed-use development with parking, office space, homes, a grocery store and studio space for artists and musicians. More on their proposal is in this recent report.
The deadline to submit alternative proposals to City Council is Aug. 3, according to the City of Austin’s website on McKalla Place.
Austin Business Journal