PawSox Stadium Vs Superman Building: The Battle Over Public Subsidies

Aug 27, 2015

The vacant Superman Building looms over downtown Providence,
Credit Ian Donnis / RIPR

A proposed ballpark for the PawSox in Providence and the vacant so-called Superman Building might seem to have little in common. Yet both raise questions involving economic development and the possible use of taxpayer subsidies. 

Here's a look at how the two projects stack up.

It used to be easy for cab drivers like Frank Espinal to find fares outside the Industrial National Bank Building in Kennedy Plaza. That’s the structure Rhode Islanders know as the Superman Building.

"The Superman Building has become a homeless building now," Espinal said. "That’s where all those people hang out right now, so it doesn’t look good for the city."

It looked better for the city when thousands of bank workers in the Superman Building shared their spending with downtown merchants. But Bank of America pulled its workforce out of the building more than two years ago. So the challenge for Providence is finding a future for a building built for a different era -- when big structures were created to house individual companies.

"I look at it all the time and I say to myself, ‘we have to have it filled,’ " said Providence Mayor Jorge Elorza, who can see the Superman Building through a window from his desk at City Hall. Elorza said he remains in touch with the building’s owner, High Rock Development of Massachusetts, about what can be done to revive the Superman Building. Yet progress remains elusive.

"You know, we certainly have every intention and the willingness to have it filled," Elorza said, "but the truth is that the numbers have to make sense for private investors and whether it be residential, whether it be commercial space, the numbers simply have to make sense for them."

When it comes to the numbers, High Rock Development bought the Superman Building for $33 million in 2008. Then in 2014, the property owner asked for nearly 40 million in taxpayer dollars to convert the building to include retail space and 280 apartments.

But in the aftermath of the state’s losing investment in 38 Studios, the idea of steering public dollars to a private developer failed to attract support in the General Assembly. In 2015, another project emerged seeking a public subsidy. The PawSox proposed building a new stadium on part of the land made available by the relocation of I-195.

House Speaker Nicholas Mattiello emerged as a leading booster for the proposed stadium in Providence.

"A Triple A ballpark is an attraction – it brings people into the city. It would bring 5 [thousand] to 10,000 people per game into the city, for 70 games," he said.

The late Jim Skeffington and Larry Lucchino touted the PawSox stadium proposal during an April meeting of the I-195 District Commission.
Credit Ian Donnis/File Photo / RIPR

Mattiello thinks the envisioned PawSox ballpark offers a better return on investment than the Superman Building: "That creates a community aspect to our city, it helps draw companies into the city, and I believe it could and would be a catalyst for growth and that’s the difference."

Yet University of San Francisco sports management professor Nola Agha said reviving a downtown skyscraper might have a bigger economic impact than a Triple A ballpark.

"A minor league ballpark is going to be used a lot less than a permanent structure that either has residences or office space," Agha said. "I would think that the revitalized building is going to have probably a bigger impact than the stadium."

Of course, making comparisons is difficult, in part since the terms for a renegotiated stadium agreement have not been made public. Some ballpark opponents also maintain that creating a park or attracting companies with good jobs would be a better use of the former highway land than a stadium.

When it comes to the Superman Building, the owner is reviewing newly created state incentives to see if they support residential or commercial redevelopment of the property. Bill Fischer is a spokesman for the building’s owner. "At this time, all options remain open and are on the table," Fischer said.

Fischer notes that historic tax credits and other public subsidies were used to jump-start the South Street Landing project in Providence -- where plans include a new nursing school, student housing, and office space -- as well as the conversion of the Masonic Temple near the Statehouse into a hotel.

Yet the PawSox initial request for $120 million in public subsidies over 30 years sparked a sharply negative public reaction. And critics like Progressive Democrats of Rhode Island head Sam Bell call public subsidies like those sought for the Superman Building part of a rigged game that distort the free market.

"Because other buildings have gotten extensive public subsidy, it makes business sense for the owners of the Superman Building to in fact sit on the building, leave it empty, not invest anything in it, until they can get the public subsidy," Bell said. "It’s probably a rational business decision. And creating this culture of subsidy means that we hold off on non-subsidy development until the subsidy comes along."

In a perfect world, a revived Superman Building might feature a mix of apartments, office space, and a market like Trader Joe’s. Some downtown boosters want Citizens Bank to consolidate its Rhode Island workforce within the building, although there’s no indication of movement on that concept, and a Citizens spokesman didn’t respond to a request for comment.

When it comes to a Providence ballpark, House Speaker Mattiello says he thinks the merits of a renegotiated deal will ultimately win over Rhode Islanders, although Governor Gina Raimondo’s office cautions there’s still a long way to go before the state considers making an agreement with the PawSox.