The developer of a bond-financed baseball stadium in Cleveland is just a few million dollars away from reaching its goal of raising $20 million from long-term luxury suite leases by Jan. 15.
Last week, the Gateway Economic Development Corp., a private nonprofit organization set up by Cuyahoga County and Cleveland to plan, finance, and build a sports complex in the city, announced it had commitments for $16.4 million, including accrued projected interest. Those commitments for 10-year, prepaid leases on luxury suites at the yet-to-be-built ballpark came from 21 firms, according to a press release from the group.
Gateway officials have said raising the $20 million would be necessary for determining the financial feasibility of the project and for getting a long-term letter of credit to replace Fuji Bank's short-term one that is securing $31 million of bonds. Revenue from the suite leases, as well as rents from the stadium are needed to back the $31 million of bonds that were part of a $146.7 million tax-exempt revenue bond issue sold by Gateway last December. The rest of the bonds are backed by revenues from county-wide excise taxes on cigarettes and liquor.
Gateway, which started the marketing drive for the suite leases last month, also is facing another test of the project's financial viability. That is getting the Ohio Legislature to permanently cap the project's property taxes at the current level of $400,000 a year -- a measure that was defeated in the House last month. Without the cap, Gateway officials have said taxes on the developed property -- estimated at $4 million a year -- would be too high to continue with the project.
Lora Thompson, Gateway's public relations director, said the House is expected to reconsider its vote by Nov. 15. If the measure, which has laready passed the Senate, fails again, she said the proposal would be brought to a legislative conference committee for revisions.
Gateways plans to build a $160.7 million stadium to be used by the Cleveland Indians and a $120.9 million arena for the Cleveland Cavaliers basketball team by 1994. Only non-bond revenues will be used to build the arena.