Bondholders who funded the construction of AutoZone Park and the operations of the Memphis Redbirds (Class AAA; Pacific Coast League) have been warned that the nonprofit ownership could make only a partial payment on the bonds this year.
U.S. National Bank warned that the Memphis Redbirds Baseball Foundation is slipping behind on its $5 million in annual bond repayments and will be making a partial payment. The foundation floated $50 million in tax-free municipal bonds to build the ballpark and launch operations.
Last year the foundation cleaned house and brought in an outside management firm to run operations. Since then the foundation has been negotiating with several potential buyers over the terms of a sale, which we expect to hear more about in coming months. The sale will also likely mean bondholders will receive less on the bond returns in the future.
It’s an ignoble end to what was a grand experiment in baseball. True, there are nonprofits and community groups owning baseball teams, but none with the ambitious plans listed by the Memphis Redbirds Baseball Foundation, which included a minor-league baseball museum and efforts to bring baseball to the inner city.
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