If there is any certainty about the uncertainty surrounding Angel Stadium’s real estate potential in Anaheim, it’s that change has been a common theme throughout the city-owned facility’s six decades.
Baseball fans are cheering the news that new ownership is coming to the Los Angeles Angels, the team that’s called Anaheim home since 1966. The unpopular owner, Arte Moreno, is selling the team to Stan Kroenke in a deal that still requires Major League Baseball’s approval.
Kroenke owns, among other things, football’s Los Angeles Rams. He spent $5 billion of his own money to build the Los Angeles Rams’ stunning SoFi Stadium in Inglewood.
I will let others debate the athletic issues the deal creates. We’re here to look at the real estate part of the puzzle: What does the city of Anaheim do with a seemingly hot property, a stadium that sits on 150 acres of prime Orange County real estate?
Why did Kroenke pay a premium price, reportedly a record $4 billion?
Not because the Angels are good at baseball. They’re not.
Not due to Angel Stadium, which needs unknown millions of dollars in repairs – plus much more if it’s to be brought up to modern entertainment standards.
Kroenke paid up because of the real estate potential of the space the Angels call home.
Let’s walk through some key questions about how the land might be brought into the 21st-century version of sports entertainment.
Will the team stay?
The No. 1 issue. The Angels have a stadium lease that can be extended to 2038.
That’s a strong obligation to stay in Anaheim, but not an ironclad one.
Kroenke’s initial statements after the deal was announced talked about the strength of the Anaheim market. Let’s note that despite being one of baseball’s worst teams, the Angels have the 13th-best attendance in baseball.
Plus, Kroenke reportedly told certain sources that he wants to build a $2 billion stadium on the site.
But sports history shows that until agreements are signed, nothing should be taken for granted.
And it takes two to tango. The city has long treated the team too kindly, business-wise. And a real estate opportunity offers Anaheim a graceful exit from the baseball business.
But politics is a very funny game. For example, the mayor and one council member face re-election battles this November. So, the city is a major wildcard for what’s next.
And if you think about the Rams, remember that Kroenke moved the team from St. Louis to Southern California.
St. Louis wasn’t happy. Eventually, the Rams and the National Football League paid the city $790 million to settle the relocation dispute.
Also, Kroenke and Inglewood are in a legal squabble over who’ll pay for $400 million in civic infrastructure built to support SoFi Stadium’s development.
What’s changed over the years?
The stadium was built just for baseball when it opened in 1966.
Then, in 1980, it underwent a massive expansion to add the Rams as a football tenant.
Next, after the Rams left and Walt Disney Co. bought the Angels, the stadium was remodeled again. By 1998, the football expansion was out, and Disney flair was in, with a fire-breathing mountain behind the centerfield wall.
Another evolution was underway in 2019. Those plans included Moreno buying the stadium and the land and creating a neighborhood surrounding the stadium with housing, shopping, hotels and office space.
Yet the stadium’s future was unclear: Would it require a renovation or a brand-new facility?
A political corruption scandal – and the deal’s poor structure – ended that dream.
What’s the property worth?
Nothing is trickier than valuing commercial real estate.
It’s not like a home with plenty of comparable sales to help make a calculated guess.
One challenge with the stadium property is the team’s lease. That control, good for possibly another 12 years, limits the value because any buyer would have to honor the baseball team’s terms.
So, the Angels have a massive say in what happens to the land. And the buyer pool would be limited – to largely team management.
The 2019 deal that flopped in 2022 called for Moreno to pay $325 million for the stadium and land. But numerous caveats considerably reduced the true value to the city.
So, if we’re making a 2026 guesstimate, a comparable sale might be the federal government’s recent sale of the Ziggurat property in Laguna Niguel to Hoag Hospital for $207 million.
That 89-acre site is roughly half the size of the Anaheim property, which includes a landmark, pyramid-shaped office building that will be demolished.
Is the Anaheim land worth roughly double the Ziggurat price?
Stadium wrecking ball?
One thing seems certain: the old ballpark is destined to be demolished.
Do you think the guy who built an over-the-top, state-of-the-art stadium in Inglewood would settle for a remodel in Anaheim?
Modern stadiums offer numerous conveniences that older ones cannot, particularly luxury amenities that help pay the bills. In addition, Angel Stadium’s physical location, in the middle of the 150 acres, no longer makes sense.
You might want a stadium that’s more walkable from the nearby Anaheim transportation depot if mass transit ever becomes a reality for fans.
Also, a stadium at that northern edge of the land would give Angel fans easy access to the OCVibe entertainment and dining complex under construction around the Honda Center. It’s being built by the Samueli family, owners of the main tenant of that city facility, the Anaheim Ducks.
What else on that land?
What might Kroenke do with the rest of the baseball property?
Well, look at his development plan for San Diego’s ancient hockey arena, whose top tenant is, curiously, the Ducks’ minor league club, also owned by the Samueli family.
Let’s suggest, at a minimum, that these two sports owners are familiar with each other.
San Diego’s Midway Rising project includes a 16,000-seat sports arena, 4,250 housing units, almost half of which are affordable, a good chunk of retail and restaurant space, and 15 acres of public parks.
Or look at Inglewood, where SoFi Stadium is part of the overhaul of the old site of the Hollywood Park horse-race track. This project will include shopping, office space, hotels – and up to 2,500 housing units.
Of course, Anaheim officials will have their own ideas. Whether those desires are built at the stadium – or elsewhere using proceeds from the sale – is another puzzle.
The city desperately needs housing, especially affordable homes. You can also bet they’ll insist on some new parkland.
And another hotel in this tourist-centric town always sells at City Hall.
Will anything happen quickly?
Even in places where property development is swift, commercial real estate planning remains a tedious, detail-oriented process.
Layer on top of that all the challenges and uncertainties brought by political and regulatory perspectives. Now, the state Legislature often gives special blessing to entertainment-related projects, so this plan could be breaking ground sooner than other sorts of major developments.
Still, the most obvious real estate result of the sale of the Angels is that nothing will happen to the stadium or the parking lot any time soon.
Jonathan Lansner is the business columnist for the Southern California News Group. He can be reached at jlansner@scng.com
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