UC Riverside Looks to Foreign Investor for New Arena
Guest author: Tyler Jamieson (BusinessofCollegeSports.com Intern)
You’re the University of California, Riverside. You made the leap to Division 1 just over a decade ago. You’ve got a pretty cool mascot named “Scotty the Bear”. You’ve tasted varying levels of success in men’s golf and baseball, and women’s basketball and soccer. You had a pretty decent football team until 1975 when the program was discontinued due to low attendance and Title IX compliance. You’re 60 miles away from the glitz and glam of L.A. and your basketball and volleyball teams play in the luxurious… Student Recreation Center. In an age of iPads and high speed internet you’re rockin’ a Commodore 64. So if you’re A.D. Brian Wickstrom how do you go about getting funding for a long over-due multi-purpose arena? Apparently you go to China.
Allan Steele at The Press-Enterprise has an interesting look at how Wickstom had to “think outside the box” when coming up with a way to get funding for a badly needed arena. Wickstrom knew there was no way in today’s financial climate he was going to get funding for an arena through more traditional ways, so at the advice from an architect he looked into the controversial federal program EB-5. EB-5 is an employment based immigration program that allows potential would be immigrants the opportunity to obtain a green card for investing $500K or $1 million in a U.S. enterprise that creates or funds at least 10 jobs.
The goal of the program is to find new ways to pump money into businesses and areas that aren’t able to get loans, funding, etc. with investors being rewarded with a green card. However, opponents of the fund say the foreign money coming in isn’t providing enough of an impact to call the fund useful and that in effect the U.S. is just selling what should be far more valuable green cards.
It sounds like Wickstrom is ready to test the merits of the program as his visit to China and several presentations at a conference designed to introduce American’s to potential investors there have him staring down the barrel of a potential $20-$30 million in committed funds. Even if UC Riverside can get potentially $20-$30 million in EB-5 funds Wickstrom says there are still several hurdles to getting a new arena built, however they could use the money to get the arena started and get people excited about donating.
As an alumni or fan of a University what are your thoughts on schools securing foreign money for University projects? Is this a case where Wickstrom came up with a potentially clever way to get funding for a smaller school that is having trouble funding the cost of a new arena, or would larger schools with bigger endowment programs and larger revenue streams consider using this method as well in order to keep costs down for donors?