EDA OKs lease, development agreements with Flying Squirrels for new Diamond District ballpark

A recent rendering of the new stadium. (BizSense file images)

One of the final pieces needed for construction to start on Richmond’s Diamond District was put in place Wednesday, as the city’s Economic Development Authority approved development and lease agreements with the Richmond Flying Squirrels for the project’s anchor baseball stadium.

The EDA, which will own the new ballpark that will replace The Diamond, authorized the signing of its side of those agreements in a specially called meeting that was held virtually. The result of months of negotiations, the agreements set the terms of the ballclub’s lease for the stadium and the venue’s development by an entity tied to the Flying Squirrels’ parent company, Navigators Baseball.

Under the agreements, which the parties are expected to formally sign in coming weeks, the ballclub is to pay $3.2 million in annual rent to the EDA for each of the first 10 years of the 30-year lease. The rent will then drop to $1.34 million for the 11th year and rise 3% each year thereafter.

The overall rent payment over the 30-year lease would total $66 million, city officials have said.

A separate lease between the EDA and Virginia Commonwealth University for its baseball team to use the new stadium remains under negotiation, according to the Flying Squirrels’ agreement.

The rents will be used to pay off $40 million in lease revenue bonds the city has secured to finance infrastructure improvements for the first phase of the mixed-use development. The stadium is to be financed using $130 million in general obligation bonds, which are to be paid back using tax revenue generated by the overall Diamond District development. The city locked in those bonds last month.

The development agreement puts the stadium’s construction cost at $117.2 million, with the actual stadium costing $110 million and the additional funds covering environmental and infrastructure site work.

The overall stadium development cost is projected to total $130.4 million, with the difference above the construction cost covering survey work, public art, architect and engineering design fees, and other eligible “soft costs.” In addition to the general obligation bonds, the overall development cost is to be covered by EDA matching funds and other revenue from the Navigators and VCU.

A rendering of the stadium’s outfield was shown during Wednesday’s meeting. (Screenshot)

Navigators Baseball and consultant Machete Group are leading the 10,000-seat stadium’s design and development through an arrangement with the city and Diamond District Partners, the group led by Thalhimer Realty Partners and Loop Capital that’s developing a 30-acre first phase of the 67-acre, $2.4 billion Diamond District project.

The stadium will fill 10 acres at 2929 N. Arthur Ashe Blvd., in the Diamond District’s southwest corner at the boulevard and the train tracks. Initial site work for the stadium started in recent weeks, and the stadium is targeted for completion in spring 2026, in time for that year’s baseball season.

In a news conference earlier in the day Wednesday, Richmond Mayor Levar Stoney noted the EDA meeting to approve the agreements, which he described as “a key milestone” for construction to get started. Stoney noted that a groundbreaking ceremony had been scheduled for last week but was postponed because of the threat of inclement weather from Tropical Storm Debby.

Stoney said the groundbreaking, which is expected to include a ceremonial lease-signing, will be held “very soon.” At the EDA meeting later in the day, Deputy Chief Administrative Officer Sharon Ebert said the groundbreaking is targeted for the first week of September.

Stoney also thanked the Flying Squirrels for their patience and commitment to staying in Richmond.

Levar Stoney

“This is a promise that Richmond made to the Squirrels over a decade ago,” Stoney said. “A number of options were presented, but nothing ever got off the ground. Today in 2024, we are prepared to begin work that will allow for Richmonders to enjoy a new stadium in the spring of 2026.”

Stoney added: “The Squirrels have been such an incredible partner for over the last decade. Many Richmonders – new Richmonders, longtime Richmonders – have expressed this is something they wanted to see. I am grateful for their willingness and their patience to wait as long as they have and continue to stay right here in Richmond.”

According to a project schedule included in the stadium development agreement, construction documents and initial building permits are targeted for September, while vertical construction would start in January 2025. Final inspections and a temporary certificate of occupancy are targeted for February 2026. Ebert said the city has hired local firm Timmons Group to assist with expediting plan reviews and permitting.

The development agreement lays out other details, including several perks worked into it for the EDA, such as a permanent sign in the stadium, a designated suite for hosting economic development prospects and other civic uses, 500 tickets to three games per season, and the right for the EDA or city to hold up to 10 events at the stadium per year.

The agreement says the Flying Squirrels will have a goal of hosting 160 events annually at the stadium by its third year of operation, a number that includes events the ballclub plans to host beyond season games. The ballclub also is to provide a limited number of “affordable” tickets to the community per game.

Also covered are naming rights for the stadium that the Flying Squirrels would sell and retain revenue from. The name of the new stadium has not been announced and is not specified in the agreement. Officials said the name would be announced at the groundbreaking event.

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