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October 28, 2021

Sports village gets boost: Ariz. financial authority says proposal will be good for Windsor Locks

Rendering | All Sports Village A rendering shows the proposed All Sports Village in Windsor Locks.
By Susan Danseyar, Journal Inquirer

The Industrial Development Authority for the city of Phoenix is enthusiastic about being part of the financing for All Sports Village — a 76-acre multi-million dollar sports complex proposed for Windsor Locks — saying the project is viable and will be good for the community.

Bryant Barber, a lawyer representing the Industrial Development Authority in the Arizona city, said Tuesday during a public hearing held via Zoom teleconferencing from Phoenix that after doing due diligence, All Sports Village appears to be a fantastic project.

“Our CEO checked in with local officials and we were told there’s local support (for the sports complex),” he said. “In fact, we’re now thinking of doing one ourselves.”

All Sports Village, as proposed by developer Andrew Borgia, involves indoor and outdoor venues, including eight outdoor turf fields, 20 basketball courts inside a 220,800-square-foot building, restaurants, retail shops, two 150-room hotels, a family entertainment center, and a medical/physical therapy unit. The complex would be located on property situated on Route 20 between Interstate 91 and Old County Road that Borgia expects to close on soon.

Last week, First Selectman J. Christopher Kervick explained during a public hearing held in conjunction with the Industrial Development Authority that Borgia will finance the project using up to $200 million in tax-exempt bonds.

The city of Phoenix’s Industrial Development Agency will issue a series of tax-exempt bonds, which Ziegler Investment Bank of Chicago will buy, Kervick said. The bank will then use proceeds of the bonds to lend to All Sports Village Inc., a Connecticut tax-exempt entity.

Tuesday’s public hearing, held by the Industrial Development Authority as required by the Internal Revenue Service, was a second chance for people to comment on the project. Barber said the investment bank and developer brought the project to the authority because it has expertise in issuing these kinds of revenue bonds.

The Industrial Development Authority used a well-known feasibility consultant to evaluate the credit worthiness of the developer and project, as well as analyzed the track record and operating assumptions of the project manager, New York-based JABS Sports Management, Barber said. The authority also performed due diligence, Barber said, through feasibility and market studies.

Now, he said, the investment banker and finance team are preparing all the documents that will go out to investors.

Kathleen Montemerlo, the only town resident to participate in Tuesday’s Zoom hearing, asked how a complex that will charge money for entry can be a nonprofit or tax-exempt entity.

Barber said there are different types of nonprofit entities under which an organization can receive recognition by the IRS as tax exempt and they don’t have to be charities. All Sports Village Inc. is such an entity because it consists of private activity, as opposed to public activity, he said.

The IRS has deemed that companies that “lessen the burden of government” — which means a municipality doesn’t pay for a complex such as All Sports Village — is allowed to finance such a project with tax exempt bonds, he said.

Montemerlo told Barber it was news to her that All Sports Village has tax-exempt status and she wanted to be sure there aren’t other changes to the project that will arise such as the complex holding concerts on the property.

She also asked if the developer could build the project and then sell it. Barber said the Industrial Development Authority cannot stop the sale of All Sports Village down the road but that lower interest rates are only good if the project is owned by a nonprofit and the authority will have that in writing.

He advised that Montemerlo give him her contact information and he will try to organize a Zoom meeting with Borgia to address her concerns that some details of the project may have changed.

On Monday, Barber told the Journal Inquirer that government can’t do everything and he loves that the private sector is doing a project such as All Sports Village.

The cost of construction material has been going through the roof since COVID-19, Barber said, so with a favorable tax rate it makes sense for a developer to cut borrowing costs and use more money to build the complex.

The Industrial Development Authority has invested in about five out-of-state projects in the last five to seven years, including All Sports Village, he said. The other projects involved hotels and student housing at universities.

The authority receives a fee for issuing bonds for these projects, and 100% of that money is re-invested through disbursement to nonprofits in the Phoenix community, he said.

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