Credit Crunch Delays Development of Arlington's Glorypark

DALLAS — The credit crunch has claimed another victim: Arlington’s Glorypark.

Construction on the much-anticipated entertainment, retail, and residential complex to be located between Rangers Ballpark and the new Cowboys stadium “will not begin this spring as planned,” according to Hicks Holdings LLC.

The idea for the 1.2 million-square-foot, mixed-use development has been bounced around for years and construction is being spearheaded by Texas Rangers owners Tom Hicks and Steiner + Associates, a Columbus, Ohio, developer.

Officials said “the nation’s economic markets have made it impossible to come to terms with lenders” for the half-billion dollar project. And the developer also wasn’t able “to secure a firm and final commitment from an anchor department store,” according to Hicks Holding.

In addition to the credit problems facing the Glorypark development, rapidly increasing prices for gas and steel are also hampering major construction projects worldwide.

“We have put an enormous amount of time and money into Glorypark,” Hicks said in a press release. “In the end, the dream can’t become reality without the right financial package. We will pursue alternative funding options and examine our reprogramming options.”

Last summer, the Arlington City Council approved the city’s share of the development with a financing plan that included $135 million of bonds for parking garages and infrastructure upgrades around the baseball stadium.

The developers no longer plan to exercise an option to extend a letter of commitment to underwrite the bonds for the road improvements and garages, according to Hicks Holdings.

The city had planned to sell the bonds through its Entertainment Area Tax Increment Financing Reinvestment Zone No. 5. Arlington owns the land Glorypark will be built on and any new property taxes collected through the development would help provide debt service on the bonds. Debt issued in TIF districts usually is secured by the ad valorem tax revenue pledge from the captured appraised value of the zone.

“These events are in no way related to the city of Arlington,” Hicks said. “The city did absolutely everything possible to facilitate negotiations while, at the same time, protect the taxpayers’ interests. We all must take the long view for this important piece of real estate between two great sports teams.”

City officials and the developers hoped to have much of Glorypark completed and open early in 2009. The stadium currently under construction for the Dallas Cowboys is scheduled to be open in time for the 2009 National Football League season.

“When my family purchased the Rangers, we pledged to invest in a development around the Ballpark,” said Hicks, who also owns the Dallas Stars of the National Hockey League and half of the Liverpool Football Club of England’s Premier League. “We are still committed to doing that, but we may have to reexamine what should be built and what actually can be built if the market conditions continue.”

The NFL awarded Super Bowl XLV to Arlington to be played in the yet-to-be-named stadium. Team and city officials estimate the 2011 game may generate $93 million in ticket sales and be a boon to Arlington and North Texas in general.

The city has sold about $301 million of taxable and tax-exempt bonds over the past few years to finance the public portion of the stadium.

Arlington officials have said Glorypark could generate as much as $4.3 million in annual revenue and create nearly 4,500 jobs, as well as more than 3,300 one-time construction jobs.

Development of a 310-room Westin Hotel and condominiums also being built by Hicks Holdings across the street from the new football stadium will continue as planned, the company said.

The city’s current population of more than 376,000 is up 13% from the 2000 Census tally of 332,969.

Arlington’s general obligation debt is rated AA by Standard & Poor’s and Fitch Ratings, and Aa2 by Moody’s Investors Service.

 

 

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