Even though she lived to the ripe old age of 102, Bears matriarch Virginia McCaskey did not live long enough to realize her family’s long-held dream of building a new stadium.
She left behind a succession plan (mandated, with annual updates, by the NFL) that not only is expected to lock in ownership of the Bears by the McCaskey family, but also could impact the stadium quest.
What happens if some of the nine surviving children of Ed and Virginia McCaskey (plus 21 grandchildren, 40 great-grandchildren and four great-great-grandchildren) decide they want to cash out?
Will that put pressure on the McCaskey family to sell pieces of the Bears to private equity funds? (As of last year, the NFL will allow up to 10% of a team to be held by such investors.) Or could that move deprive the family of the capital it needs to build the stadium?
Attorney Frank Hawkins spent 15 years as an NFL executive, part of it as senior vice-president for business affairs and principal counsel to the league’s Finance Committee.
He downplayed financial pressures posed by Virginia McCaskey’s death.
“A lot of the desire for liquidity is gonna get picked up by private equity buyers. … meaning that the team is gonna keep running pretty much as it is. It’s not gonna waste a lot of its borrowing capacity buying out individual members of the McCaskey family who might want liquidity now,” Hawkins said.
“The McCaskeys will be able to handle demands by kids for liquidity in a different way without wasting team borrowing capacity that would otherwise go to the stadium. … The fact that there’s this safety valve — I don’t think there’s gonna be the same need for the team to borrow money to redeem kids’ shares in the team that there might otherwise have been.”
Virginia McCaskey “lived long enough that the seeds of a solution for the family liquidity issues are now in place,” Hawkins said.
“It’s not the total earthquake that it could have been. … I’m not saying there won’t be issues. But it’s not gonna be dire in the way that it might have been before the rules on private equity got loosened up,” he said.
A ‘very solid estate plan’
Chicago-based sports marketing consultant Marc Ganis has advised numerous NFL teams on their stadium financing issues. He agreed Virginia McCaskey’s death is unlikely to fundamentally alter the Bears stadium odyssey. But things could get a little messy with “more heirs in the decision-making process,” he said.
“They have a very solid estate plan, from what I’m told. So I think those costs will be limited. But, limited doesn’t mean zero,” Ganis said.
Any requirement — legal or political — for a further infusion of team cash could impact the stadium quest.
Already, the Bears are asking state lawmakers for nearly a billion in future hotel tax revenues to help bankroll a new domed stadium just south of Soldier Field and $1.5 billion worth of infrastructure improvements (with $325 million of that up front).
The plan has gone nowhere in Springfield, even with Mayor Brandon Johnson as lead blocker. That has fueled suggestions from state lawmakers for the Bears to shift their focus to the Michael Reese hospital site purchased by the city for a 2016 Olympic Village that was never built.
The Bears are at least entertaining the Reese site. But they’ve also achieved the property tax certainty they demanded that could pave the way for the team to move to Arlington Heights on the 326-acre site of the old Arlington International Racecourse acquired by the team $197.2 million.
Hawkins did some work for the Bears and, therefore, knows something about the estate plan set up by the Bears’ legendary founder George Halas Sr.
It was a “generation-skipping trust” that gave shares to all of the grandchildren. Virginia McCaskey “ended up holding all of those shares and voting all of those shares in trust on behalf of the kids and that’s what gave her control of the team,” Hawkins said.
The Halas family trust is now likely to “dissolve” with each of the heirs “taking a piece” of the Bears, he said.
Whatever happens now, it’s almost certain to pale by comparison to the family drama of the late 1980’s that followed the sudden and unexpected death of Virginia McCaskey’s brother, George “Mugs” Halas Jr.
Mugs’ death triggered a feud between the McCaskey and Halas factions that rivaled the Hatfields and McCoys.
When Mugs’ children tried to sell their shares to Neil Bluhm and Judd Malkin, founders of JMB Realty, the McCaskeys used their right of first refusal to block the sale and sell 19.6% of the Bears to insurance magnate Patrick Ryan Sr. and the late Andrew McKenna.
New stadium could double team’s value
Fast forward to 2025.
Nearly two years after arriving from Minneapolis, where he delivered a new domed stadium for the Vikings, Bears President Kevin Warren is on the clock to deliver the domed stadium that has eluded the Bears since the much-maligned 2003 renovation of Soldier Field.
Warren is determined make progress on a Bears stadium somewhere during the Illinois General Assembly’s spring session.
The fact that Warren has come up empty so far is not necessarily a bad thing, Hawkins said.
“If they get a new stadium, the team doubles in value,” Hawkins said referring to the current $6.4 billion value of the Bears recently estimated by Forbes.
“Had they gotten the new stadium before Mrs. McCaskey died, the estate tax would have been payable on twice as big a value. And that would have created a fair amount of pressure that doesn’t exist right now.”