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For $2.4 Billion, Marlins Better Draw Fans

The long and arduous struggle for the Florida Marlins to acquire attractive land and reasonable financing for a new stadium was finally "solved" earlier this year, when the team announced plans to build a brand new park in Miami-Dade County. Now that the plans have all been approved, the County Manager for Miami-Dade had to set out to figure out exactly how much the stadium is going to cost.

The final tally? Approximately $2.4 billion. That's billion with a "b." Seriously.

No, the stadium isn't going to cost $2.4 billion to build, but it's going to cost that much across 40 years to finance the bonds needed to raise the $450 million that will pay for most of the construction costs, according to this article from the Sun-Sentinel. The construction bonds were issued last week in New York, and while the bonds are set to be backed by tourist-tax dollars (hence those astronomical hotel tax numbers you get when you visit South Beach), it's entirely possible, likely even, that the county will also have to dip into funding from its general fund to completely finance the new retractable roof park.

All of these costs are being footed by the county because it eventually caved to team ownership, which insisted on a publicly funded stadium under the threat of moving the team. With the everpresent empty seats throughout Dolphins Stadium, one almost wonders why the county council didn't just let the team leave.

"It is very expensive money," said Miami-Dade County Commissioner Katy Sorenson, who voted against the deal. "Who knows what we could have gotten out of them if we had tougher negotiators."

Who knows indeed. And who really knows whether a shiny new park will draw any more fans. Miami-Dade County better hope so, or this may go down as one of the most costly public referendum results in Florida state history.

By Cameron Smith  |  July 13, 2009; 12:11 PM ET
Categories:  Marlins  | Tags: Marlins, Miami, stadiums  
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Comments

They had to offer over 8% (nearly junk-bond interest rates). When you're talking about a huge principle, the smallest difference in the interest rate can mean a lot in the final cost. It would have been even worse if the Marlins owner didn't complete the bond sale with a $6 million contribution.
In a few years, the county will refinance these bonds closer to their 1.8 to 2-billion dollar estimates. Also, that isn't $2 billion in today's dollars. This is backloaded financing deal that predicts tomorrow's dollars will cost less than today's.

Posted by: cprferry | July 13, 2009 11:02 AM | Report abuse

Buffalo's AAA team gets better attendance than the Marlins. Defies credulity that they couldn't pull a switcheroo and move the MLB team north and the AAA team south...

Posted by: Juan-John | July 13, 2009 11:06 AM | Report abuse

I think the term "present value" might be relevant here. It's not really $2.4 billion.

Posted by: orange2299 | July 13, 2009 11:34 AM | Report abuse

Cameron,

I think it should be brought to light that this park did not actually go before a public referendum. The county council decided to use hundreds of millions previously earmarked for park and recreation improvements and shift it over to the building of this stadium. Not only was this proposal not brought before a general vote, but every other time it had been, it was voted down.

Posted by: wm49rs | July 13, 2009 4:16 PM | Report abuse

It's not really $2.4 billion?
why?
http://www.nowgoal.com/30.shtml

Posted by: fetrew | July 14, 2009 6:54 AM | Report abuse

Simply not true.

Florida is drawing 18,117 per game this season.
Buffalo is drawing 6,972 per game this season.

Posted by: comish4lif | July 14, 2009 11:57 AM | Report abuse

The comments to this entry are closed.

 
 
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