Shop Talk: The Real Estate Agent Blog

FC Cincinnati's brand-new soccer stadium will be great for real estate. But what about the locals being kicked out?
June 27, 2019

Cincinnati Soccer is Kicking Real Estate Prices into the Sky

by The CE Shop Team

Cincinnati Joins The Soccer Craze, But at What Price?

With the emergence of soccer’s popularity over the past ten years, the expansion of the MLS into smaller cities comes as no surprise. Places like Austin, Orlando, Nashville, and Atlanta have embraced their new teams, leading to an entire new generation of fans ready to join the world in fandom of the biggest international sport. 

While this upsurgence in soccer has sparked economic growth, there is a real estate dark side. For a little background information, MLS league officials believe their most successful stadiums are ones built in the urban core. According to their research, when you locate a new franchise in poor areas, you immediately increase real estate values while stimulating the economy through new business development. Most new MLS cities have chosen this path, although officials agree this plan isn’t right for every city. This revitalization of the area allows for MLS teams to thrive while steadily developing and progressing the area. However, what officials do not consider is the immediate negative impact these projects can have on the area. 

Enter FC Cincinnati, one of the MLS’ newest teams. Like other cities, they’ve followed a gentrification strategy of building their new stadium in the impoverished West End neighborhood of Cincinnati. They are currently constructing a $250 million stadium that will seat over 26,000 fans. And yet, in exchange for this mastodon of a soccer pitch, local renters and owners have been forced out. The reason? Rent hikes and construction forcing landlords to kick out their tenants with little retribution. 

For homeowners, this isn’t a big issue. The West End annual home price rose 36 percent from $160,016 in 2017 to $217,170 in 2018. Compare that to the 7 percent hike that happened in the entire Cincinnati area over the same time, and we can conclude these fortunate owners are reaping the benefits, even if they are being “forced” to sell their homes above this value to make way for construction.

 

But for renters in the construction zone, not only are there over 1,400 people being displaced with little compensation, those who are not affected by construction are being stippled in rent hikes. 

FC Cincinnati paid $150,000 for a study to take a snapshot of how this new stadium would affect the area. The conclusion: everyone who rents property is endangered of losing their homes, even before construction starts. 

The residents of West End fought back. There is word going around that tenants were looking for a sum of $40,000 to pay for their moving and/or rent costs, a number FC Cincinnati President Jeff Berding claimed was just not possible. FC Cincinnati has already donated $100,000 for an emergency housing fund, and has created a team to help residents find new housing. They also offered $2,500 per household, and would cover all moving expenses, but tenants say it’s not enough.

The date to vacate was May 31st. According to WCPO, only seven residents remain, with two planning to leave by June 1st. For the other five, they have been given an extension up to October 31st, 2019. 

As for the remaining renters not affected by stadium construction or new businesses around the area, they will be dealing with constant rent hikes past the 2021 opening of the new stadium. While new business will help stimulate the surrounding area, how much of this stimulus will go to the ones hurt most is a grey area not being addressed. 

We will keep following this topic as it progresses.

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