Business & Real Estate

He’s the Hollywood mogul helping lead Sacramento’s Major League Soccer bid in ‘crunch time’

Hollywood mogul tours Sac Republic stadium site in railyard

Hollywood film producer Matt Alvarez tours the planned site for a major league soccer stadium in the downtown railyard with Sacramento Republic President Ben Gumpert on Wednesday, March 13, 2019.
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Hollywood film producer Matt Alvarez tours the planned site for a major league soccer stadium in the downtown railyard with Sacramento Republic President Ben Gumpert on Wednesday, March 13, 2019.

After several years of coming up short, Sacramento has hit a make or break moment in its effort to become a Major League Soccer city.

MLS Commissioner Don Garber this week laid out the scenario: After a period of rapid expansion, the New York-based MLS has room for one more team this year. The league will then take a breather, with no immediate plans to expand more. Two cities head the pack, Sacramento and St. Louis. The league will discuss expansion at an April board of governors meeting in Los Angeles.

A league spokesman said the league doesn’t expect to make a final decision on expansion at the April meeting. But Sacramento’s group says it is treating the moment as its final audition – and it is rushing to tie up loose ends.

“The clock is ticking,” said Matt Alvarez, one of two wealthy Los Angeles businessmen who recently signed on to lead Sacramento’s effort. “This is crunch time. We’re wrapping up a lot of things right now.”

Alvarez, a Hollywood film producer, and his partner, Ron Burkle, a billionaire businessman, movie producer and owner of the Pittsburgh Penguins of the National Hockey League, represent the key new element to Sacramento’s bid. Sacramento Republic FC soccer officials and Mayor Darrell Steinberg recruited the pair two months ago after MLS officials indicated the local effort needed better financial backing.

Speaking to The Sacramento Bee in Sacramento during an exclusive interview on Wednesday, Alvarez said he and Burkle agreed to sign on as principle owners of Republic FC because they’ve been looking for a joint sport venture and view Sacramento as a city that has grown substantially.

Burkle and Alvarez have signed an agreement to take control of Republic FC and build a $300 million stadium, contingent on the MLS granting the city a franchise. The new ownership group, which will include current Republic FC owner Kevin Nagle and possibly other Sacramento investors, would pay MLS a franchise fee of at least $150 million.

On a visit to St. Louis Monday, Garber told officials there it’s between that city and Sacramento. He noted that the St. Louis group still has a few steps it needs to take.

Garber declined comment on Sacramento this week, but Alvarez said the Sacramento effort has been in almost daily contact with MLS officials in recent weeks, and believes it has done everything the league has asked. Burkle and Alvarez recently made a presentation to Garber in New York.

“We came out of that meeting feeling confident with where we sit,” he said. “We’re in a great position.”

The team has one notable item to add to its resume before the April 18 board meeting.

Alvarez was in town on Wednesday to negotiate a “term sheet” or business agreement with city officials. Under that agreement, the city would set up an infrastructure financing district for the 31-acre stadium site east of 7th Street in the downtown railyard. The financing district will allow the developers to bond against future tax revenue on the site.

The city also would waive some stadium development fees and allow the team to build several digital billboards. Steinberg, whose staff has been in talks with the soccer group, said he hopes to have a deal in hand to bring to the City Council for its approval before the MLS board of governors meets.

“We are very close and I intend to bring this to council on April 9 and recommend strong support,” Steinberg said on Wednesday. “Then it is a full pivot toward the league to not only make our case, but to say we have stepped up big time.”

Steinberg said the project will help kick-start development of the railyard into a major new section of downtown. “This is about soccer, but it is about so much more,” the mayor said. “Ron and his team are interested in Sacramento. That is a great thing as we continue to grow and build.”

Alvarez, a Bay Area native, attended UC Davis before going to Hollywood, where he produced numerous movies. Alvarez and rapper and actor Ice Cube co-founded Cube Vision, a film and television production company behind nearly 20 movies, including Are We There Yet?, Ride Along and Straight Outta Compton.

The Sacramento soccer effort is an extension of his entertainment business, Alvarez said.

“We got very excited about Sacramento very quickly,” he said. “This is an amazing city. It’s already over the cusp of being a very cultured, diverse, great city that has a lot to offer to a lot of different people.”

Burkle, a supermarket tycoon who seldom talks publicly, previously headed a group that planned to buy the Sacramento Kings when the Maloof family was threatening to move the team. Burkle dropped out of that effort. But, according to Steinberg, the businessman has maintained a strong interest in Sacramento. Burkle, described as a huge sports fan, has co-owned the Penguins hockey team for 20 years. He was seen on national TV enthusiastically cheering at the Super Bowl a month ago in a luxury box with Gisele Bundchen, the wife of New England Patriots quarterback Tom Brady.

A new MLS franchise would take the place of Republic FC, which has represented Sacramento since 2014 in the second-division United Soccer League, but would keep the Republic FC name.

Sacramento has vied for MLS status for several years, but has lost out to Cincinnati, Nashville and Austin. League officials indicated it passed Sacramento over previously because the ownership group – before the arrival of Burkle and Alvarez – did not have the financial wherewithal that league officials preferred.

The group plans to develop about 15 acres it will buy adjacent to the stadium. Alvarez said that way the team can control the land use around the stadium to make it compatible and symbiotic. “It’s a great way to drive traffic to our business,” Alvarez said. Those plans include a light rail station along 7th Street a block from the stadium.

If Sacramento were to win an MLS franchise, officials say they would plan to have a stadium completed by the 2021 season.

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