ROCK HILL, S.C. — Construction has been put on hold at the $800 million state-of-the-art Carolina Panthers headquarters in Rock Hill, Tepper Sports & Entertainment said. Earlier in March, Tepper Sports said the city of Rock Hill didn’t pay its initial payment due in March 2021 for the massive project. It was set to open in 2023.
On March 7, Tepper Sports & Entertainment released the following statement:
“We are committed to bettering the Carolinas community that supports our team and players. To that end, while GT Real Estate Holdings, LLC has invested more than $170 million into the development in Rock Hill, our partners have been unable to contribute the agreed upon investment to fund the construction of the public infrastructure. Given the economic realities, the difficult but prudent decision has been made to pause the project. The ongoing work will continue with our partners to find an economically acceptable solution for all parties to continue this project in Rock Hill.”
On March 9, Rock Hill released the following statement in response to the matter:
“The City has met all obligations required under the agreement, and is not aware of any March 2021 payment obligation. The City intends to continue honoring our agreement with the Panthers and fully supports the project.
“The bonds haven’t been issued to date. The agreement requires the City to utilize best efforts to issue bonds. We specifically did not agree to use any City funds or assets for this purpose beyond the tax revenues generated from the site. The City remains willing to issue any marketable bonds fully supported by the developer, whose support remains integral for the success of this public/private partnership.”
Then on Monday, Rock Hill city leaders gave more information explaining their side of the sudden pause in construction. They said the city’s plan was to offer bonds in different series, and not as Tepper Sports detailed.
“It’s a complicated project. It’s got many challenges and there’s always a risk of failure in this type of large undertaking,” said Rock Hill Mayor John Gettys. “This city council does everything in its best efforts to bring the bonds to market short of risking the credit of the city.”
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What is a bond?
Mark Hart, the Panthers chief operating officer, sent a letter in May 2021 to York County manager David Hudspeth asking for help after the city of Rock Hill failed to secure infrastructure bonds.
“Until we have a path to the $225,000,000 in bonds proceeds there is a high risk necessary infrastructure objectives will not be met,” Hart wrote at the time.
But what are bonds?
According to the U.S. Securities and Exchange Commission, a bond is a debt security that’s similar to an IOU. Borrowers issue bonds to raise money from investors who are willing to lend them money for a certain amount of time.
The May 2021 letter said the bonds involved in the construction of the Panthers facility were infrastructure bonds.
The SEC said when you buy a bond, you are lending to the issuer, which may be a government, municipality or corporation. In return, the issuer promises to pay you a specified interest rate during the life of the bond and to repay the principal, also known as face value or par value of the bond, when it “matures,” or comes due after a set period of time.
Per the letter, the bonds were to be issued Oct. 31, 2020, but the deadline was later pushed back to Feb. 26, 2021. However, more than a year later, the city of Rock Hill confirmed the bonds still have not been secured.
A spokesperson for Rock Hill said the city specifically did not agree to use any city funds or assets for this purpose beyond the tax revenues generated from the site. The city said it is still willing to issue any marketable bonds that the developer fully backs, whose support is necessary for the success of this public-private partnership.
What are the next steps?
York County councilmember William Roddey said he’s hoping leaders can work together to get the project back on track.
Mayor Gettys also proposed the city, county and the Panthers go back to the drawing board and work out a new agreement, taking things like inflation into account.
On Tuesday, the Panthers and York County had no additional comments. Channel 9 is working to learn more details.
The Associated Press contributed to this report.
(WATCH BELOW: As Panthers’ new HQ remains on hold, Rock Hill leaders say they’ve done their best)
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