Sports arena site bidder Midway Rising strikes labor deal

In a move that levels the playing field, the final development team in the running to lease and remake San Diego’s sports arena real estate in the Midway District has reached an agreement with a powerful labor group.

Midway Rising, the Zephyr Partners-led group proposing to build a new arena and 4,000 residential units, announced Thursday a non-exclusive endorsement from the San Diego County Building and Construction Trades Council. The organization represents 22 local unions and 30,000 construction workers.

This story is for subscribers

We offer subscribers exclusive access to our best journalism.
Thank you for your support.

The labor accord means the development team will enter into a project labor agreement with the Building and Trades Council, if selected to redevelop the site, and pay construction workers prevailing wages.

“We are thrilled to endorse Midway Rising, a proposal that harnesses San Diego’s local talent and local workers to truly uplift the long-neglected Midway District,” Carol Kim, business manager for the Building and Trades Council, said in a statement. “While some would have San Diego settle for less, we applaud Midway Rising’s commitment to bringing thousands of new affordable homes and a brand new sports arena to the Midway District while putting San Diego’s skilled local workers first.”

The deal is a major win for Kim, who has now secured promises from each of the development teams to pay prevailing wages for construction work, including market-rate housing. The Building and Trades Council has signed agreements with Midway Rising, Neighborhood Next, HomeTownSD and Midway Village+, and has a tentative agreement in place with Discover Midway, Kim said.

Prevailing wages, set by the state, establish specific, minimum hourly rates, overtime rates and employer benefit contribution rates based on job type.

Midway Rising — a partnership between Encinitas-based developer Zephyr Partners, sports-and-entertainment venue operator Legends and affordable-housing builder Chelsea Investment Corp. — is also in the process of finalizing a labor agreement with multiple service-worker unions to cover arena and hotel operations, a spokeswoman for the team said.

“We know that uplifting a community like the Midway District goes hand in hand with uplifting economic opportunity for local workers and residents,” said Shervin Mirhashemi, who is the CEO of Legends. “Ensuring Midway Rising is union built and union operated will guarantee the best jobs for local workers, the best construction quality for San Diego and the best visitor experience for arena and hotel guests.”

The support comes as the city prepares to eliminate one or more of the development teams fighting for a long-term ground lease of the 48-acre property currently home to Pechanga Arena. Teams are proposing dense, master-planned communities with an arena, housing, retail, office, park space and, in some instances, additional sports facilities or hotels. Each must also set aside at least 25 percent of housing units for lower-income families, as required by a state law governing how municipalities offload surplus land.

The bidders are scheduled to pitch their plans to a City Council committee on April 21. The city’s Department of Real Estate and Airport Management will provide the committee with a recommended shortlist, although council members can choose to move forward with any of the teams

Midway Rising’s proposal calls for 4,000 housing units, with at least 1,200 units deed-restricted for low-income families. The plan also includes 20 acres of parks and public space, 250,000 square feet of shops and restaurants, a hotel and a privately financed arena.