DeKalb Commission approves soccer proposal, concerns remain

Posted by Dena Mellick August 4, 2015
CEO Lee May discusses the professional soccer proposal with DeKalb Commissioners. Photo from DeKalb County.

CEO Lee May discusses the professional soccer proposal with DeKalb Commissioners. Photo from DeKalb County.

By Dena Mellick, Associate editor

DeKalb County commissioners approved a proposal to partner with Atlanta United FC to build the soccer team’s $30 million practice complex and headquarters in the county.

The proposal, carried by Commissioners Mereda Davis Johnson and Stan Watson, would place practice fields, an outdoor stadium, and corporate headquarters for Atlanta’s first major league soccer team on property adjacent to Memorial Drive and Kensington Road. The county would provide 41 acres of land, paying for the cost of clearing the land and pay Arthur Blank, team owner, $7 million for the county’s use of 5,000 square feet of office space.

But during a commission meeting Tuesday morning, several commissioners expressed concern that DeKalb County was getting a raw deal and that more research and negotiation was needed before the memo of understanding was approved.

“I characterized this as a David and Goliath scenario, and it was,” Commissioner Jeff Rader said. “What makes the Scripture so compelling is that we all know that David should have won. And in this case, I’m afraid that Goliath did win. Without a clear measure of the project’s objective worth and sitting across the table from a trusted advisor, influential with politicians in DeKalb, DeKalb buckled. We squibbed the shot.”

Rader was referring to the fact that lawyers who have previously worked for DeKalb County represented Atlanta United at the negotiating table. He said between that and an overwhelming desire by CEO Lee May’s staff to get a deal, things moved forward too quickly.

“The interim CEO’s staff agreed to a deal that was six times more generous than Marietta offered on the land and $7 million cash on top,” said Rader, who called for a renegotiation on the proposal that would be in the public’s best interest.

Commissioner Nancy Jester said she would not be voting in favor of the proposal, telling the public, “I think you should have the right to speak. I have heard you loud and clear.”

Commissioners were concerned that the public had not had opportunity to comment on the proposal. Rader moved to allow public comment, but the motion was denied.

Commissioner Kathie Gannon called it a “behind-closed-doors deal” that should be “slowed down.”

She told the commission, “I deal with facts and analysis, not emotional votes.”

The crowd was vocal, applauding loudly when Commissioner Jester apologized to the public that they would not be getting to comment on the issue. At the beginning of the discussion, a woman walked up to the podium, stating, “I believe public should have the right to make a statement here.”

Commissioner Stan Watson asked CEO May to talk about the Memorandum of Understanding with Atlanta United and the effects it would have.

May was met with some heckling as he addressed the push to get the proposal through.

“I also apologize for the timing of this,” May said. “This is all about the timing. This is no attempt to pressure you all to do anything, to shove anything down your throats.”

May paused as a heckler yelled out about lack of respect, and said, “I’m trying to be as respectful as I can as people are shouting behind me. I don’t know how respectful that is.”

The CEO said the county itself just got word it was on the short list.

“Soccer season starts January 2017, so that’s not a lot of time,” May said. “I make no bones about it, we were very aggressive about seeking to land this deal in DeKalb County. We want to make sure we put our best foot forward.”

May said the memo of understanding the commissioners were looking at was laying out broad terms, but that lawyers would be hammering out the details of the agreement which includes a 3,500 seat stadium and three additional soccer fields.

May said the agreement would also provide office space for DeKalb County Parks and Recreation Department.

DeKalb County released a video featuring May, advertising a special announcement Tuesday at 4 p.m. related to the Atlanta United FC.

About Dena Mellick

Dena Mellick is the Associate Editor of

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  • Loren

    Note that that YouTube video celebrating the outcome of today’s vote was uploaded to YouTube *two days ago*.

    It should be no surprise, then, that a majority of the Commission didn’t feel like opening the floor to public comment. They were already so certain of the outcome they weren’t afraid to publicly advertise it days in advance.

    • CMR

      Good eye Loren. This was a stacked deck from the beginning. Mereda Davis Johnson, who co sponsored the “legislation”, has only been in office for one week. Yet this deal has been in the works for months. Shady players, shady deal.

  • CMR

    Fuzzy Math in Dekalb Soccer Complex From Lee May and One Dekalb :

    Let us take a closer look at these numbers and overall investment:

    Per Mr. May’s Statement, Total Investment in DeKalb:
    $30+ million in investment from Arthur Blank/Atlanta United FC
    150% Return on the County’s $12 million investment

    -Not exactly Mr. May.
    If I follow YOUR MATH, you calculate that “OUR” $12 million dollar investment today, will result in a $30 million dollar return in the form of an asset reverting to Dekalb County in 30 years, or a 150% return over the course of 30 years.

    First, let’s see what 30 years looks like for other sports venues in the Atlanta area over the last few decades:
    -Fulton County Stadium built in 1966, was 30 years old when it was finally demolished following the 96 Summer Games in Atlanta.
    -The Georgia Dome built in 1991, a state of the art facility at the time, is slated for demolition by 2016, a 25 year life span.
    -Turner Field, constructed for the 1996 Olympics, will be vacated by the Atlanta Braves after only 20 years. One major concern is the estimated cost to maintain. “Turner Field requires $150 million in renovation costs merely for structural upkeep”.

    Secondly, lets understand how this really works in favor of Arthur Blank/Atlanta United FC: The land is “prepared”, demolition, water, sewer, power, basic infrastructure at zero cost to the “operator”. You approximate on “the high side” a cost of $5 million, funded by the tax payer for said preparation. (Please pay careful attention to who gets this contract and the actual final cost). The land, now improved, is leased to Arthur Blank/Atlanta United FC (the operator) for 30 years at zero cost. The operator pays zero property tax for the duration. So far you have $5 million in the deal, you still following me?

    Next, Arthur Blank/Atlanta United FC build a $30 million practice facility with corporate headquarters on said 41 acres of improved property. (I assume he would have to build it somewhere.)
    Here is where it gets even better for his organization: He has already acquired a tenant (Dekalb County Parks and Rec.) to rent out 6000 square feet of office space for $7 million dollars up front (paid in the first 3 years). For that kind of rent, it must be some pretty swanky office space.
    In addition, Dekalb County will be required to fund/ pay for any maintenance or capital improvements to this space for 30 years. So you now have $12 million in the deal, 5 million in actual property improvements, and 7 million dollars in rent, plus maintenance costs. For the record, rent is actually an expense, not an asset.

    At the end of the 30 year land lease the ownership of the asset (complex) reverts to Dekalb County. However until then, and this is the real beauty, Arthur Blank’s Club will get to capture the full depreciation on the structure he built. In 30 years, on paper the complex will be worth pennies on the dollar and in need of significant updating, a potential liability.

    Finally, let’s look at return on investment, using just the numbers you provided above.

    If Dekalb County instead invested $12 million into a well diversified index fund for 30 years, compounded at an annual rate of 7%, it would be worth $96 million dollars, or a return of 800% over that same period.

    If Arthur Blank/Atlanta United FC, collects the $7 million rent they receive after three years, and then invests it at the same rate for the remaining 27 years of the lease, it will be worth $43.5 million. No wonder they are referred to Blank and Company as “the operator” in the MOU.

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