Real estate investor and developer Victor MacFarlane is selling his majority ownership share of D.C. United, turning over full control of the Major League Soccer franchise to business partner Will Chang.
MacFarlane’s departure, announced Thursday, comes after more than two years of unsuccessful efforts to build a mixed-use development project in the D.C. area that would have included a new stadium for United. In a press release, MacFarlane said he planned to devote more of his attention to the billions of dollars in real estate holdings that serve as the core business of his company, San Francisco-based MacFarlane Partners.
“As I devote greater attention to MacFarlane Partners and my projects in multiple cities coast to coast, I will continue to track and root for D.C. United and assist my friend Will if and when needed,” MacFarlane said.
Chang and MacFarlane purchased the team from Anschutz Entertainment Group in 2007. Chang, the chairman of investment firm Westlake International Group, will assume full control of United, though team president Kevin Payne and other executives will remain.
Chang, who was not available for comment, is expected to continue United’s efforts to find a new stadium for the team, though Payne likely will play a leading role. In a statement, Chang acknowledged “challenges ahead” for the team and its stadium efforts.
With MacFarlane no longer involved, it appears the team likely will focus less on development around the stadium than the stadium itself. The team has had ongoing talks with several jurisdictions about a stadium, but none has been successful.
“I am confident we will emerge successful on both fronts - including bringing the club to a stronger international level,” Chang said. “We will only improve our strategy on and off the field.”
Team spokesman Doug Hicks said it will be “business as usual for D.C. United” despite the ownership change.
Financial terms of the transaction were not disclosed. Last year, Forbes magazine said D.C. United was worth $35 million, making it the sixth-most valuable franchise in MLS. The magazine said United had $13 million in revenue but that the team had failed to turn a profit.
D.C. United has been the most successful team in league history, winning four MLS Cups and several other domestic and international titles. Despite that success, team and league officials have long said aging RFK Stadium does not provide enough revenue to sustain the team in the long term.
When MacFarlane and Chang bought United, team officials were in negotiations with the District about building a new soccer-specific stadium at Poplar Point in Southeast as part of a broader real estate development plan. MacFarlane had been willing to foot the bill for much of the stadium in exchange for the rights to develop land in the surrounding area. Those plans were scuttled when Mayor Adrian Fenty chose to place the development of Poplar Point up for competitive bidding.
Last year, United sought support for a new stadium in Prince George’s County, but Maryland state legislators last month voted against a bill that would have allowed the team and county to explore a stadium proposal.
Meanwhile, the real estate market entered a severe downturn, and a lack of available credit made new construction nearly impossible. MacFarlane Partners was not immune. The company took a major hit last year with the bankruptcy of LandSource Communities Development, a $2.5 billion real estate project involving 15,000 acres of land near Los Angeles that had been heavily backed by MacFarlane and the California Public Employees’ Retirement System.
“He is refocusing his business, and he has to focus on his business as a real estate investment manager,” MacFarlane spokeswoman Julie Chase said. “When Victor purchased the team, it was a very different real estate and economic environment. That plays into it as far as his decision to refocus. There was an original stadium plan that involved a mixed-use project that was at the core of what Victor’s business is.”