top of page

No deal should be this bad for a city and its residents.

 Written by Alan Delisle, former St. Petersburg City Administrator




1. The deal was flawed when Mayor Welch and some Council members decided that all that mattered was keeping the Rays, at any cost. By doing so, the St Pete lost all negotiating leverage. The City leadership threw aside the well-being of the residents and taxpayers for political support from a Wall Street owner, campaign contributor and false advertising.


2. It was further flawed when Mayor Welch picked the Rays/Hines team without negotiating a Term Sheet before the selection announcement. The City then went into negotiations without any leverage at all. The Rays/Hines controlled all contentious issues because the City had nowhere else to go. The City had already rejected all other teams, including the Kriseman selected Midtown development proposal.


This lack of competition resulted in a weak, embarrassing, incomplete Term Sheet for the City, and produced one of the worst economic development/stadium Development Agreements (DA) for any city.


The St. Pete Chamber of Commerce falsely claimed that all the other proposals were not as good as Rays/Hines. Mayor Welch canceled a far better proposal for St. Pete when he cast aside the MIDTOWN proposal. MIDTOWN was a better deal for the City and would have created leverage in negotiating with the Rays. It was a shortsighted business decision to cancel Midtown.


Most other developers, including MIDTOWN, refused to submit under Welch's RFP because they knew it was a waste of time and that he was only going through another selection process to pick Rays/Hines. This approach meant Rays/Hines knew they held all the negotiating cards, and the final Development Agreement (DA) painfully reflects this fact.


3. The City’s approach to the D.A. was flawed from the start. The City surrendered to how the Rays wanted the deal framed, separating the stadium negotiations from the development of the entire Trop site, again conceding city leverage.


If the Rays wanted the stadium early (which, of course, they did), then the City should have demanded that the rest of the site be implemented within a similar timeframe as the stadium, and at the Developer's expense (like it was in Atlanta and San Diego), especially for the early non-stadium Development Phases of the project. Instead, the City got nothing concrete in return, another flawed business decision.


4. If the City had tied performance of the stadium to the performance of the supporting development, the argument that future property taxes would pay City costs would have been much more credible. The Chamber cites that the Economic Impact Study done for the Rays/Hines project was the strongest of all proposals. This claim is also false.


The City completed the Economic Impact Study on the Rays/Hines proposal assuming full build-out, not based on the project as reflected in the final D.A. that only requires weak, flimsy minimum development requirements. The City not explaining this timing is disingenuous. The Chamber ignoring this fact is a poor business practice. 


The project reflected in the final D.A. doesn't come anywhere close to these early misleading economic impact numbers based on a hypothetical build out. As described below, the non-stadium development aspect of this D.A. is incomprehensible, a slap in the face to any rational thinker, to any City Council and especially to the economic development profession.


The City could end up with little more than what exists today on site – a stadium and some parking -- based on the Developer performance flaws found in the D.A. (see below)


5. The non-stadium development is allowable by parcel vs. by phase. While the D.A. requires a city-funded infrastructure-phased approach, non-stadium development does not have the same requirement. The Developer has a complete "say" on when and how a parcel gets developed, even though the City must pay for the Infrastructure at upfront delineated, phased timelines. And what is even worse, Rays/Hines can delay development if it wants or they can pass along any parcel to another developer. So, the Stadium project is well planned, coordinated, financed, and managed by the Rays, but the non-stadium development is unplanned, uncoordinated, unfinanced, and mismanaged, leaving the St. Pete in the dark and at the whim of the Rays/Hines.


6. Hines is a reputable developer, but, in this case, they only serve as a curtain to the Rays’ full control. The only real goal in this project was for the Rays to get an incredible deal on a new stadium and to keep out all other lead developers so the Rays didn’t give up control. They will always do what is in the best interest of the team and business. The City of St. Pete will always be secondary.

It's hard to believe Mayor Welch and many Councilmembers played into this trap. Truth- to-power went silent, except for a few Council members.


7. We must remember that the Rays told St. Pete for years that it was Montreal or nothing, or Tampa or nothing. They also failed to respond to the Kriseman Trop RFP because they didn't want to compete with other developers. They knew Kriseman would keep the City's leverage to benefit the entire City and its residents and not give up the store; it had to be a win-win.


8. The Tampa Bay Times' position that this decision comes down to keeping the Rays is shortsighted at best and in direct contrast to its editorial responsibility to protect the community interest as it once did with St. Pete's precious waterfront. The final D.A. clearly reflects what the Times’ position results in, a full surrender of the City’s priorities. The questions that should determine a "yes or no" vote on this project, contrary to the Times, should be the following:


a. Did the City overpay for the stadium/development? Why did the Atlanta Braves and

San Diego Padres NOT receive a penny for development around the stadium? Why was it paid for by the Developer, yet in St. Pete, the City is giving away land and paying for all Infrastructure ($130 million) related to the development of the full site? This decision is unheard of in a development market as strong as St. Pete and a site adjacent to one of the strongest downtowns in the country. There should be no non-stadium development incentives.  Zero.


b. Did the City get a fair return on its investment in the stadium and development by grossly overpaying in the final DA? The City is paying for greenspace and parkland, of all things, by reducing the Developer's land cost. The City is paying for gap Affordable Housing by reducing Developer's land costs and committing to future City grants (see below). The City is paying for "ALL" Community Benefits by reducing the Developer's land cost. Small business participation percentages are not guaranteed. They are all just "GOALS" and the goals are embarrassingly low.


After all Major Welch's rhetoric about inclusive development, it is hard to believe that the Developer has no "skin in the game" for Community Benefits and that the MWBE- Small Business participation percentage is a dismal 10%, and that's not even guaranteed. And the penalties are ridiculous since the goal is so low. Incredible. Unacceptable. Does this really make up for the past?


c. Does the City need to subsidize the non-stadium aspect of the project in any way? NO. Cobb County and San Diego gave NO incentives to the Developer for non-stadium development. St. Pete is giving approximately $304 million for this purpose in land value reduction and Infrastructure in the final DA, if applying the two-year-old land appraisal. The giveaway number is even higher if the City uses a more current and accurate appraisal. The Atlanta Braves and San Diego Padres’ developer paid the total cost for land and Infrastructure for its non-stadium development, unlike the Rays.


d. Why is the ancillary, non-stadium economic development not guaranteed like the stadium? Why is the minimum development requirement so weak knowing that the City spends approximately $1.29 billion on the total project, most of it upfront? Why do truck-size loopholes, meaningless penalties, and bizarre timeframes exist for non-stadium development compared with those for the stadium? The Rays get what they want, and the City does not?


e.  Why is "open space/parkland" so minimal – 10 acres? The Council once was adamant about 20-30 acres of parkland on site. So was the Chamber leadership. Why are they so quiet now?


f.  Why isn't Rays/Hines held responsible for all development on the site since they get all the benefits? Why are Parcel Developers allowed without any Rays/Hines' responsibility? What will the financial transaction be between the Rays/Hines and the Parcel Developers? Talk about uncoordinated.


g. What happens when the current owner sells the Rays? Does the City get paid back for its investment, or does ownership obtain all the increased financial value caused by the stadium when a sale occurs? Or will the City share in non-stadium real estate revenue since they are paying $130 million in Infrastructure costs and giving up approximately $174 million or more in land value? Has the City seen the non-stadium financial proforma for the non-stadium development. Will this be shared with the public? If not, why not? When do cities make a blind investment like this?


h. Why are developer default provisions so lenient or meaningless? Why are minimum development extensions allowed when Rays/Hines already receives 10 years to develop only 33% of the minimum development, 20 years to develop only 66% of the minimum development and 30 years to deliver 100% (maybe) of minimum development? Why are Excusable Development Delays permitted? Why is property purchased per parcel? Why are development timelines and deliverables meaningless or non-existent, except for absurdly lengthy 10, 20, and 30-year deadlines for proportional minimum development?


9.  Mayor Welch's statement from the beginning that this will correct the mistakes of the past is not obtained with this final DA. We now know the Community Benefits and Affordable Housing are being paid for by the St. Pete taxpayers, not the Developer. This

is the definition of “Smoke and Mirrors.” Why is the City paying for what is always primarily a Developer expense? The premise behind Community Benefits is that the Developer pays extra for them, not for the City to make the Developer look good by paying for them. Just like the Miami stadium deal, they will be writing about how bad this deal is years.                                                                                                                                        

10.  In addition to the City reducing the price of the land to pay for the Community Benefits and Affordable Housing and having to pay for all the Infrastructure Costs ($130 million), the final D.A. requires that the City "provide reasonable and necessary subsidies for the construction of stand-alone rent-restricted units in an amount similar to other affordable housing deals with similar funding strategies." You have got to be kidding! How much more can the City give? How unfair is this?


11.  The business community should be up-in-arms over this financial mess. Any company conducting business in this manner would be closing shop within a year. Worse yet, business support for this deal is like running up a credit card for future St. Pete businesses. The Chamber of Commerce's letter of support is superficial at best. To suggest that the site would sit and go undeveloped if this project doesn't move forward is preposterous. Every major Developer in the country would be doing somersaults to participate in the Trop development if the Rays were not micro-managing the development, and these Developers would develop the site with little city assistance, like Atlanta, San Diego, and Midtown. Why is the Chamber taking such a non-sensical position? Is the Chamber looking at the best interest of the City or just its organization?


B.     WHY IS THE FINAL Development Agreement (D.A.) SO BAD FOR ST. PETERSBURG:


 1.  The Target Development Plan is meaningless in the D.A. and Minimum Development Requirements are insufficient and easily manipulated by the Developer.


2.   Schedule III, Minimum Development Requirements:  Minimum is the exact word. It calls for 3,800 market-rate residential units over 30 years, which is like asking nothing since market-rate housing will be a huge money-maker for the Developer. We discuss Affordable Housing below. The minimum requirements also require one million square feet of office, arts, recreation, entertainment, education, public administration, healthcare, and institutional space over 30 years, of which 500,000 sq.ft. must be Class A office/medical/medical office space and at least 50,000 sq.ft. civic, museum space. This  represents 16,000 sq.ft. a year over 30 years in Class A office/medical/medical office. In a city that is land-locked like St. Petersburg and strains every day to locate commercial  land, it is a shame that the city did not put a premium on office development of all types – A, B, and C and at a much more meaningful level.


The City needs Class B and C office space as well. What is Entertainment? Why isn't Moffett addressed like we have been told repeatedly would happen? Two hotels with 400 keys, a small 50,000-square-foot conference center, and open space of a measly 10 acres, which the City is paying for (see below), round out the minimum development requirements that must be delivered over 30 years. Can you imagine that after the City provides huge funding early for the stadium, the land, the Infrastructure, and all the other incentives, the Developer gets to take 30 years to deliver an ill-defined non-stadium minimum development agenda? There is no mention of Grow Smarter Industries. There is no mention of the Innovation District. There is no mention of local small business office requirements. There is no mention of the Arts District or Deuces Live. There is no mention of targeted industries unique to St. Pete. Misses all.


MIDTOWN was pledging $5 million in grants for minority and BIPOC-owned small businesses for space in the Phase I development. Midtown was also providing $10 million for the Local Retail Storefront Program, $5 million in Phase 1 and another $5 million in Phase 3.


3. Even worse is that Schedule III defines a 33% and 66% Interim Minimum Development Requirement 10 and 20 years into the D.A. term, a weak attempt to make the 30-year window look better. Perhaps a 2-year window for all minimum development would make a difference, but 10 and 20 years is almost as laughable as 30 years at that scale. So, the Developer gets everything upfront, but the City may wait 10, 20, and 30 years to see any non-stadium MINIMUM development. Incredible. Unfair. Sad. And it gets worse. The above requirements are subject to further delays per “Excusable Development Delays (see #4 below).”


4. Article 1, Definitions, D.A. “Excusable Development Delays” is defined. This pathetic language means that the Minimum Development Requirements are worthless. Simply read this language and it is understood that the Developer has every out to delay this development, including stadium construction delays. Who controls that?


 5. Section 4.1.5: It is hard to believe that the city has taken all this time and still has not completed the Oakland Cemetery report. The preliminary report was concluded during the Kriseman administration. This report should have been completed prior to the Development Agreement being finalized. The public should demand results now prior to this deal being approved. Families need to know.                                                                                                                                                   

6. Section 4.2.1: The language in this section results in the Developer being able to reject almost any parcel for development that it wants, showing again how weak the development requirements are and how unpredictable property tax revenue from the project will be, making the economic impact analysis worthless. The Developer can reject any parcel for archaeological, environmental, geotechnical, soils, subsurface conditions, or lack of access or materially impaired access to a parcel (can you believe it). The Developer gets to update its due diligence process priors to closing on any parcel instead of doing it upfront like with the stadium. Another out for the Developer?


Any Developer will be able to drive a truck through this language. So, what does the City do with this rejected land? The Developer should have a set due diligence period for all

of the land, comparable to the stadium land, with no "outs" after that. For some reason, Rays/Hines can quickly conduct all “due diligence” on the stadium site but not on the non-stadium development site. The City should not start the stadium project until Phases 1 and 2 of the Target Development Plan are committed to and under construction.

Divorcing the stadium from non-stadium development was a huge mistake.


7. Section 4.2.2: The purchase price is further adjusted downward if the Developer rejects any land, which is a simple process under the final D.A. AND the Minimum Development Requirements are adjusted downward if the Developer rejects at least 20% of the net non-stadium development acres. The DA does not explain how the City will calculate these reductions. But you can be assured that reaching this 20% threshold would be easy for any Developer based on the D.A.'s loose criterion. The real point here is that creating an incentive to reduce the minimums is extremely bad policy. Since the minimums are so inconsequential and have so many outs to them, no additional reduction should be contemplated. And remember (see above), the City gave a farcical 10 and 20 years to deliver on 33% and 66% of the Minimum Development Requirements. This D.A. language is hard to believe.


The Developer will have 10 years to do nothing if they want. They will have 10 years to manipulate the individual Parcel rejection process. They will have 10 years to manipulate the all-inclusive “Excusable Development Delay” language. They will have 10 years to sit and look at the costly, taxpayer-funded stadium. They will act, they will say, but the D.A. does not require it. Why not? How does the City, any City, give away all this money without requiring a payback or comparable activity from the Developer? Can you imagine spending $130 million on Infrastructure without a strong "commitment" back on non-stadium development? Of course, it is a shame that the Developer will not spend a dime on infrastructure but will make millions of dollars off it. 


8. Section 4.7.1:  This section allows Parcel Developer "exceptions" as well. This easy-out language will create a huge mess. Again, the D.A. is badly flawed in allowing this parcel-by-parcel acquisition approach instead of Phased development. The City should have required Phase development led by one Developer, similar to what happens when building a stadium.


9. Section 5.1.1:  For the money that the City is putting into the development equation, paying for Infrastructure, which is absurd in a market like St. Pete, and free land, not to mention all the other developer incentives, the return on Affordable Housing is deplorable.


Five hundred units at 120% of AMI is just about the Market Rate for the Trop area, and another 100 units of senior living shouldn't even be counted. Proportionately to the number of acres on site, this is much worse than the Moffitt project that Mayor Welch canceled. Four hundred units at a lower AMI will most likely be built off-site.

MIDTOWN was required to build all Affordable Housing on site (1,800 units), the AMI was lower, and the number of units was more (550 more units than Rays/Hines) without all the City incentives found in the Rays/Hines deal. MIDTOWN was investing $5 million into gap financing for the development of Affordable Housing, which is in direct contrast to the Rays/Hines deal (see Section 13 below).


10. Section 5.1.2: It is interesting that the DA says at least 600 of 1200 housing Affordable units must be built on-site "or as may be mutually agreed by Developer and City." Another huge loophole. Does this mean it may be less than 600 units on the Trop site?


11.  Section 5.1.7: To make matters worse, instead of integrating the income-restricted housing with the rest of the development, the Developer selects four properties where this housing will be isolated, and instead of buying the land, the City will ground lease the land for 99 years. Is the goal to keep the restricted-income renters separated from market-rate renters? MIDTOWN pledged integration.


12.  Section 5.2: This is where the City guarantees "grant" money to these four Affordable Housing sites and “for off-site stand-alone units within St. Petersburg,” in addition to paying for Infrastructure and giving free land. This guarantee just means other City 

developers of Affordable Housing will lose out, and the Rays/Hines will be able to triple dip. (See section 9 above). Unlike the Rays/Hines, MIDTOWN was investing its own

money in making Affordable Housing "gap" financing happen. Mayor Welch is using public money. The Developer has no risk.


13.  Section 5.3:  These penalties for failing to build Affordable Housing are worthless because the City has made it impossible for the Developers not to reach these numbers with all the financial giveaways. Parcel Developers get the same benefits. These penalties are window dressing. Free land, free infrastructure, free grant money. Who could fail?


14.  Section 5.4: All Affordable Units should be rent-restricted forever based on the subsidy provided by the City, whether ground leased or not. Thirty years of rent restriction is ridiculous based on the enormous City incentives provided.


15.  Article 6: A 10% goal for using Minority-owned Businesses, Small Businesses, and Women-owned businesses is an embarrassment. This goal is applied to the entire project. Remember that the City entirely pays for the Community Benefits under the Community Benefits Agreement by reducing the price of land. 10% is such an absurdly low goal that the penalty language is this section is meaningless. Is this, in any way, making up for the past? The reference to a 30% goal is worthless in this Article.


MIDTOWN, in comparison, was pledging 20% of all construction jobs would be filled by South St. Pete CRA residents, a 20% SBE/MWBE participation rate in all phases of the development, a 20% of total labor hours on major construction elements with values of $1 million or greater would be performed by apprentices, and 10% of the direct hard costs of the project will be dedicated to City located contractors or businesses. AND THESE COMMITMENTS WERE NOT GOALS; THEY WERE REQUIREMENTS.


16.  Article 7:  Infrastructure work includes open spaces/parks, remediation, roads, and bike paths, which, in the St. Pete market, should be the Developer's responsibility. The Developer will substantially benefit from these amenities. The City paying for all these infrastructure expenses guarantees a much higher revenue stream in rent back to the Developer. And, the Developer has complete control over what the work entails and change orders. The Infrastructure Budget is projected at $181 million, which means property owners on the redeveloped Trop site will be assessed to pay the difference between the City’s $130 million contribution and $181 million. This results in a $51 million charge against affordability on site (See #17 below). 




17.  Section 7.8.5:  The Developer's share of the Infrastructure is incomprehensible. Crediting the Developer with Infrastructure financial participation in the Term Sheet is disingenuous.


This section allows for a special assessment of all new property owners on the Trop site to pay into a fund to pay the Developer's share of any Infrastructure cost. This method of funding means that the Developer pays nothing for Infrastructure on top of free land and all the other development loopholes. But the worst is that the property owners on site must pay an extra fee on top of property taxes. What do you think this does to the affordability of rents? It pushes rents higher, hurting affordability. It's ominous how this special assessment district only benefits the Developer.


18.  Section 7.10:  The Developer has complete control over the timing and the order of Infrastructure work, and since some of the Minimum Development Requirements do not need to be completed for 10, 20 and 30 years, you can bet that the Infrastructure over the first 10 years will almost exclusively be for the stadium, which makes this City giveaway even worse.


19.  Section 8.1.3:  The Developer and Parcel Developers must pay a minimum of $50.4 million for property on site over the first 12 years of the term of the agreement (about half the discounted land). This requirement is in conjunction with the 33% Minimum Development that must be completed by year 10 of the agreement. (see above). These provisions mean the City pays out a minimum of $80 million in Infrastructure during this time, not to mention about $287.5 million for the stadium upfront (over four years approximately) and $176 million in land value, and the Developer doesn't have to pay anything other than $15 million in the first three years of the Agreement on property. Even after paying for this land, there is no development requirement until year 10, and it's only for 33% of the Minimum. This unfairness to the City is simply hard to comprehend.


20.  Section 8.19:  In the event of an uncured Material Event Default by the Developer, the only penalty is that "the Developer shall no longer have any rights to acquire any Parcels pursuant to this Agreement not already acquired by Developer and/or Parcel Developers, except for Parcels located in Phases for which Developer has Commenced Construction of the Infrastructure Work applicable to such Phase." You might as well say that the Developer can do whatever they want. Because the Minimum Development Requirements are at 10, 20, and 30 years with outs and the City is paying for all infrstructure work upfront, the Developer, in effect, has no real penalties for lack of  performance. In fact, performance criteria are almost non-existent.




The Rays/Hines D.A. reads in section 16.9.5, "In no event shall the City have the right to terminate this agreement notwithstanding any Default by the Developer under this agreement or by any Parcel Developer . . ." Section 16.9.6 and 16.9.7 are even worse for the City. Devastating.


21.  Section 9.3: 10 acres of required Open Space must be a mistake. It says that the Developer will try to expand it to 14 acres, but there is no commitment.


MIDTOWN WAS COMMITTED TO 24.7 ACRES OF OPEN SPACE. There was a time when the Council wanted 20-30 acres of Open Space, and the Chamber strongly agreed. Please tell me that 10 acres is a mistake in the D.A. Please.


22.  Section 16.1.1 (5): Creates a process for the Developer to extend the Minimum Development Requirements deadline by three years if 80% of the goal is reached.              So, as if these deadlines were not ludicrous enough, they can be even longer and more ludicrous based on this section of the D.A.



This deal has been sold by the Music Man, a complete sales job to deflect from the stifling weaknesses of the final D.A. Some argue that this one-way deal is the only way to secure the Rays, and that is all that counts. That is not correct.


Great public-private partnerships benefit both the Developer and the residents of the City. Poor public-private partnerships that conceal and minimize city needs have a devastating impact on the health of cities over time.


The Rays have proven one thing over their tenure in St. Pete: They have no interest in Trop development. Some argue that is why Hines is involved. Hines will do what the Rays want.

Period. If the Rays cared about the City's interest, do you think the Trop site would have been vacant of development all these years? Where was Hines for the last three decades?


The fact that the final D.A. is one-sided in favor of the Rays and lacks fundamental development requirements proves the point. A city should never approve a deal based on hope, trust, and the spoken word. It must protect its interest, and the City must ensure Developer performance is clearly articulated in the D.A. with accountability. It currently is a far cry from this.


Throw away everything that has been said about the project to date and simply read and re-read the final D.A. It will tell you everything you need to know.  The fact that Council members  expressed their support for this project before the D.A. came out was another huge mistake.


St. Pete. You deserve so much better. I do not blame the staff for this poor D.A. I blame Mayor Welch and a few irresponsible Councilmembers who are consumed with only the Rays. I understand there is a big difference between being a Mayor and a County Legislator. Still, there is no excuse for these glaring mistakes in the D.A., the false marketing about the deal, and the harmful approach to such a critical project. Whenever the marketing is stronger than the deal, you know you have a problem.


I agree it would be nice if the Rays stay, but I can assure you that there is no other City that would come close to presenting the Rays with what is in this D.A. We already know what Tampa offered.


Everyone hoped the D.A. would reflect significant changes from the Term Sheet based on all the public input. These changes did not happen.


The question is, what is a “fair deal”? This D.A. is not fair to St. Pete. It is disgraceful and this document proves it.


St. Pete:  You did the right thing by the Waterfront. You did the right thing by the Pier. It’s time to do the right thing by the Trop site. 


And just so everyone is clear, I am a huge Rays’ fan.   


About Alan H. DeLisle:

  • 45 years of Economic Development Experience

  • International Certified Economic Developer

  • Former Assistant City Manager for Durham, NC, Executive Director of the Louisville Downtown Development Partnership, President of the Buffalo Economic Renaissance Corporation and St. Petersburg City Development Administrator and NYS Senate Legislative Director.




Subscribe to Our Newsletter

Thanks for subscribing!

bottom of page