Richmond baseball stadium agreement reached — with year delay

The city of Richmond has reached an agreement with developers RVA Diamond Partners on the $2.44 billion Diamond District development and a new baseball stadium expected to open in spring 2026 — a year later than Major League Baseball’s April 2025 deadline.

Now it’s up to MLB to decide whether to grant the city an extra year or move the Richmond Flying Squirrels Double-A team to another home, but Richmond officials are hoping the forward momentum will be enough to keep the Squirrels in place. A spokesman for Richmond Flying Squirrels said the team had no comment to make at this time.

According to city documents made public Tuesday, the stadium will cost $90 million instead of $80 million reported previously, and the new ballpark will have 9,000 capacity instead of 10,000.

Although the 38-year-old Diamond’s aging condition has been a persistent problem that led to the Triple-A Richmond Braves’ departure in 2008, a 2020 decision by Major League Baseball to require all Minor League Baseball teams’ host municipalities to bring their stadiums up to league standards by opening day 2025 or lose their teams, has created more urgency in Richmond.

Jason Guillot, principal of Thalhimer Realty Partners, one of the development team partners, noted that Richmond is far from alone among cities running behind on renovating or replacing their MiLB stadiums by MLB’s 2025 deadline.

“You’ve got COVID, you’ve got this run-up in interest rates,” Guillot said. “It’s not been easy for municipalities.” That said, “the hope is that MLB and the Squirrels will be able to work with us.” According to the city, the federal interest rate rose from 0.08% in October 2021, when the Diamond District request for proposals was announced, up to 4.83% currently.

Monday night’s announcement followed the Richmond City Council’s introduction of language to approve the city’s agreement with the joint venture that includes Richmond-based Thalhimer Realty Partners; Washington, D.C.-based Republic Properties Corp.; Chicago-based Loop Capital Holdings LLC; and San Diego venue developer JMI Sports.

City Council also will vote in coming weeks to convey nearly 61 acres of the 67-acre Diamond District footprint to the Richmond Economic Development Authority, and that land — which does not include the new stadium’s property, which will remain city-owned — will be sold to RVA Diamond Partners for $68.3 million, including $16 million for the first phase, according to a fiscal and economic impact study produced for the city by Davenport & Co. That’s a change from earlier plans, and the city also expects to create a larger incremental tax district beyond the 67 acres to pay for infrastructure improvements that will create better walkability for surrounding neighborhoods, Guillot said.

According to the Richmond City Council website, the two ordinances are scheduled to appear on the May 1 Organizational Development Standing Committee agenda — one to authorize Richmond’s chief administrative officer to execute the project development agreement, and a second to convey the 61 acres to the city EDA. If approved, the two measures could appear on City Council’s May 8 agenda. The second item will require a seven-vote majority to pass, since it involves the city’s transfer of property.

Also, the city will be responsible for the public infrastructure in phase one of the project, which includes construction of the stadium. “Funding will come from multiple sources, including cash from land sales, public utilities’ enterprise funds and general obligation bonds as capital improvement projects,” the city’s announcement said.

The Davenport report was made public Tuesday and includes the following financial details:

• Despite the higher cost of the stadium, the overall project is still expected to cost $2.44 billion, as anticipated last September.
• Phase 1 is expected to cost $627.6 million.
• Non-recourse CDA revenue bonds are expected to provide about $80 million of $110 million in funding for the stadium.
• The developer will still pay $20 million in non-recourse subordinate loans to fund the stadium’s construction, which will be repaid after the payment of the CDA bonds and meeting specific targets.
• The sale of the phase 1 land to the developer will provide the city about $10 million of equity for the stadium.

The Davenport report anticipates a net benefit ranging from $1.01 billion to $1.07 billion through fiscal year 2068, after the maturing of CDA revenue bonds for the fourth and final phase, and through 2035, the city can expect between $9.1 million to $16.4 million in economic benefits — although costs will likely supersede revenue in the second half of the decade. The difference in revenue depends on CDA bonds’ interest rates, the report says.

According to the city’s announcement Monday, the project will still include 2,800 residential units, 935,000 square feet of office space, 195,000 square feet of retail and community space, and two hotels.

Next, the city must rezone the 67-acre Diamond District and create the Stadium Signage Overlay District, create a Community Development Authority and design standards, and reach lease agreements with the Flying Squirrels and Virginia Commonwealth University. The developer must also submit the subdivision of the land to Richmond City Council to create the new Diamond District.

Earlier this month, Lou DiBella, president and managing partner of the Richmond Flying Squirrels, expressed concern over the delay of firm plans for the stadium and surrounding development.

“This is not about your Flying Squirrels wanting a new ballpark,” DiBella said in a statement April 11. “If there isn’t a stadium built that meets prescribed MLB guidelines, is suitable for professional baseball, and is worthy of the great city of Richmond, there will be no Opening Day 2026 in RVA.”