Royals Move Downtown Is Not About Baseball
John Sherman, the billionaire owner of the Kansas City Royals, wants a new stadium in downtown Kansas City, funded with a new sales tax. He doesn’t need public money to do this and it won’t drive economic development. It’s a cash grab, pure and simple.
Royals-loving Jackson County voters might think this is about baseball; it is not. It’s about Sherman enriching himself and his investors, leveraging our love of the Royals so he can drive up the value of the team. A recent CNN report pointed out:
Teams are now real estate plays for billionaire owners, stadiums increasingly serve as anchors for mixed-use shopping and entertainment districts, and development rights around stadiums for owners have become a key component of public financing for these projects.
Sound familiar? That same CNN story points out that the trend of moving stadiums downtown is relatively new. Prior to that, in the 1960s and ‘70s, new stadium construction moved to the suburbs—just as the Chiefs moved from Municipal Stadium to Arrowhead in 1972 at public expense. (Kansas City leaders are nothing if not suckers for developers’ slick sales pitches.)
The trend to move stadiums back downtown started in 1992, when the Baltimore Orioles opened Camden Yards. The deal struck by the Orioles owner, Peter Angelos, is a cautionary tale for Kansas City.
Neil deMause, freelance journalist and editor of the website Field of Schemes, has covered the Orioles for years. In 2019, he noted rumors of a possible Orioles move to Nashville. Orioles CEO John Angelos, son of the elderly owner, then inked a lease keeping the Orioles in place for 30 years.
Well, not exactly. According to deMause:
. . . the new lease gives Orioles owner John Angelos, or whoever buys the team from him, an out clause where he can leave early if he can’t come to an agreement with the state on a development deal for the area around Camden Yards by the end of 2027.
Maryland Governor Wes Moore extolled the agreement as protecting taxpayers, but it didn’t. In fact, the governor weakened his negotiating position because of that 2027 deadline—he either caves to Angelos on area development or risks triggering that out clause. Or, as Sherman has done in Kansas City, the owners could seek to renegotiate a subsidy package years before the lease expires.
The Angelos family recently announced they are selling the Orioles to billionaire David Rubenstein for over $1.72 billion.
Here’s the point: In 2019, when the rumors started that the team may relocate, the Orioles were valued at $1.3 billion. After renegotiating leases, additional subsidies, and an area development agreement, the team sold for over $1.72 billion. That’s a 33% increase in value driven not by playing baseball, but by negotiating deals—deals taxpayers paid for with subsidies.
Beyond the cost, deals like this allow developers to influence who sits on the other side of the negotiating table by backing sympathetic (or simply malleable) politicians. Here in Kansas City, Burns & McDonnell was one of the largest contributors to local political candidates, including Mayor Sly James, the year it applied for and received millions of dollars in taxpayer-funded subsidies. Incidentally, Sly James is now on Sherman’s stadium tax campaign payroll.
Whether you’re on the diamond or in city hall, it pays to play ball.
But nothing about this is about baseball. It’s about money and contracts.
If voters agree to the new stadium tax, elected leaders will have less leverage to strike a good deal on community benefits agreements, leases, and more. If the measure is defeated, Sherman and the county, in a stronger position, will go back to the negotiating table—hopefully cutting a better deal for taxpayers.
Sherman and his partners want to make as much money as they can, and that is fine. Voters need to be just as clear eyed about the costs and benefits of this proposal.
