Three months ago, Mayor Lori Lightfoot cavalierly dismissed the Bears decision to put in a bid to buy the Arlington Heights International Racecourse property as the same old negotiating ploy.
But the agreement the Bears signed last week to purchase the 326-acre racecourse site for $197.2 million makes it abundantly clear that this time, on this site, the McCaskey family is playing for keeps.
“It’s gonna take a while, but this one is going to happen,” said veteran sportswriter Lester Munson. “This is not boy-who-cried-wolf. This is not posturing. This is not negotiation. This is going to be a transaction that will transform the family asset.”
Chicago-based sports marketing expert Marc Ganis has advised numerous NFL teams on their stadium financing. He has closely followed the Bears stadium saga for decades, including former President Michael McCaskey’s past flirtations with sites in Gary, Indiana, Hoffman Estates, Aurora, the Near West Side and the ill-fated McDome project near McCormick Place.
Ganis ticked off a laundry list of factors that make this time different.
Paving the way
There are now multiple examples of NFL teams that have bankrolled new stadiums either completely on their own or with only a “modest” public contribution: SoFi Stadium in Los Angeles ($5.5 billion); Allegiant Stadium in Las Vegas ($1.9 billion); New York’s MetLife Stadium ($1.7 billion) and AT&T Stadium in Dallas ($1.85 billion).
“The Bears are able to follow in the footsteps of those teams in what to build, how to build it, how to finance it, how to market it. They will also walk in their footsteps on the NFL’s contributions and participation. The NFL’s financing program for new stadiums was $50 million to $100 million. It’s now $350 million,” Ganis said.
“And the financing market against the revenue streams the Bears would apply to get a loan to build a stadium are now well known, well documented and accepted by the marketplace. What might have been $150 million or $200 million before is now $600 million. The Rams alone — not counting the Chargers [who also play at SoFi] — have sold over $600 million in seat licenses. You get more and you pay more.”
When Michael McCaskey was attempting to play the suburbs against the city 25 years ago, the family-owned business that is the Bears franchise was valued at hundreds of millions of dollars. Today, the Bears are worth well over $4 billion.
“It’s the kind of valuation that would make, even conservative as the McCaskeys are, more comfortable taking on the financial responsibilities of developing a new stadium,” Ganis said.
Ganis called the 326-acre site that houses the now-shuttered Arlington International Racecourse “the perfect site” for a new Bears stadium.
“There’s plenty of land to do real estate development to help offset some of the cost of the stadium in a friendly governmental jurisdiction … right on a highway used to accommodating tens of thousands of people in the heart of their fan base north and west of the city. And for those right in the city, you can take a train and be dropped off right outside the door,” Ganis said. “The Bears understood that and they actually went to the NFL before they even put in a bid on the land to make sure they had the available cash to pay for it. The NFL granted that.”
Had the Arlington site become available early on in the Bears’ lease at Soldier Field, a move to the suburbs may not have been possible. The early-out penalty might have been too high. But, the Bears’ contract with the Chicago Park District reduces that penalty over time. It’s now $86.9 million. The payment would be closer to $55 million if they stick around until 2029, or less than $12 million if they break the lease with a year to go.
Sports betting controversy
Tensions between the Bears and Park District are nothing new. The team and its landlord have been arguing over the sorry state of Soldier Field turf, for example, since the very beginning. But the most recent controversy over sports betting at Soldier Field was higher stakes.
“When the Illinois Legislature included the ability to have sportsbooks adjacent to sports facilities with the approval of the landlord, that should have been a win-win for everybody. But the Bears still couldn’t get the Park District to focus on it,” Ganis said.
“There’s a toxicity that is unprecedented. That certainly plays a role in, ‘Do we want to control our own destiny, or do we want to go ask the public sector and the leadership for their assistance?’ ”
Munson said the importance of the sports betting stalemate cannot be overstated.
“The Park District is gonna fight them on gambling. … Mayor Lightfoot said on the ‘Mully & Haugh Show’ that she had to protect the downtown casino at the expense of the Bears at Soldier Field and that she cannot do anything that would ‘cannibalize’ casino revenue,” Munson said. “The Bears have made their deal with the Des Plaines casino and, at Arlington Park, they can maximize the gambling revenue. The economics of the gambling have changed the entire economy of the NFL.”
Munson added yet another item to Ganis’ list: the “generational” change in the McCaskey family, whose matriarch is 98-year-old Virginia McCaskey.
She is the daughter of Bears founder George Halas Sr. and the mother of Bears President George McCaskey.
“This is it. The family is at a turning point. … They know that they can double the value of the family asset by building a stadium like SoFi or like Allegiant. The revenue streams that would be available from this are phenomenal. When they add gambling to it, it becomes almost incomprehensible the kind of money they will be able to put together,” Munson said.
“They cannot maximize their profits without controlling their own stadium. They can’t do anything at Soldier Field. It’s too small. They know it’s impossible on the lakefront. Maybe finally, under the leadership of George, they have figured out that this is the one course that they have that will give them value that, either they can keep when she dies, or divide up among the siblings or sell when she dies.”
When the Bears chose the path of least political resistance by signing the 30-year lease at a renovated Soldier Field, the McCaskey family was in a different place under Michael McCaskey’s very different leadership.
“I can recall Mayor Daley expressing his frustration on dealing with Michael. The deal that they put together was one out of desperation — not out of any sense of investment or planning for the family’s future,” Munson said. “And then, the fact that Arlington Park actually closed and is now available, they figured out they just cannot pass this up. Those acres up there are priceless. The acreage is perfect for a stadium and more.”
Who’s paying for it?
Both Munson and Ganis believe the Bears and their development and ownership partners can finance their own stadium. They expect government help to be confined to infrastructure, perhaps through tax increment financing and bonding capacity to reduce interest rates.
Insurance magnate Patrick Ryan Sr. and businessman Andrew McKenna purchased 19.6% of the Bears from the Halas children during a highly publicized family feud decades ago. Ryan and McKenna could not be reached for comment.
But the political appetite to throw more public dollars at the team — with taxpayers still on the hook for debt from the 2002 renovation that will amount to more than $600 million by the time it’s paid off a decade from now — has seemed lacking so far.
Both Gov. J.B. Pritzker and Arlington Heights Mayor Tom Hayes have been noncommittal on the issue, while a handful of state lawmakers have moved to block any public funding for a new stadium.
“The Bears certainly don’t want to put a lot of their own money into this,” said University of Chicago economics professor Allen Sanderson. “But people can make dumb decisions, and that’s the big unknown here.”
Contributing: Mitchell Armentrout