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Friday, Apr 12, 2024

OC Soccer’s Reboot

James Keston will cap a whirlwind first year of sports ownership under the bright lights by moving his club into Orange County’s newest stadium.

His Orange County Soccer Club, an Irvine-based team that plays in the second division of the country’s hierarchy of the sport, the United Soccer League, is setting up shop at new facilities at the Orange County Great Park next month.

It will play at the new Great Park Championship Soccer Stadium, an amenity-rich facility that can hold more than 5,000 people. The stadium is the centerpiece of the first phase of the 175-acre sports park that’s been built at the former El Toro Marine Base site.

FivePoint Communities Inc., the Aliso Viejo-based developer that handled construction of the park for the city and is selling homes at the adjacent Great Park Neighborhoods, is taking the wraps off its work early next month.

The costs of construction for the entire sports park is estimated to be $250 million, with the soccer stadium—which can host other sports and events—the priciest individual facility built so far, likely in the $10 million to $15 million range.

The soccer team—also known as Orange County SC—plays its first match at the stadium on Aug. 15. Its second match, at night on Aug. 18, is planned as an even bigger event, and is scheduled to be televised by ESPN on one of its networks.

The step up in stature comes nearly a year after Keston, who heads Encino-based LARO Properties LP, bought the club.

The team played its first home matches this season at a temporary facility at Great Park after previously playing at Anteater Stadium at the University of California-Irvine.

The move to new digs is the clearest sign yet of the team’s commitment to the area and to being a notable presence in the sports scene, according to Keston.

“We’re focused on soccer in Orange County and on being a local team,” Keston said.

Real Estate Ties

Keston has a long resume of business experience; privately held LARO has a number of real estate and private equity investments, most of which are run under KFG Investment Co.

Recent projects the company’s been associated with include some larger residential developments in the Ventura County city of Camarillo. KFG’s website says it owns about 2 million square feet of industrial income properties in California and Texas, and 250 apartment units in Southern California.

LARO has invested in some Irvine-area firms, but a bulk of the company’s holdings are outside OC, Keston said.

Prior to LARO, he worked for Larwin Co., an Encino-based homebuilder that was long run by his father, Mike Keston, who is also part of KFG.

James Keston bought a majority stake in the soccer team in September from local businessman Ali Mansouri on undisclosed terms.

The price he paid was reported by the Los Angeles Times to be in excess of $5 million, a figure now said to be the going rate for a USL franchise.

At the time, the team was known as the Orange County Blues. It was known as the L.A. Blues when it played in Fullerton a few seasons ago.

A new OC-centric name, logo and uniform were among the many changes that Keston’s made since taking over.

He’s also brought in a new coach in longtime Chicago Fire midfielder Logan Pause, beefed up back-office staffing, and along with general manager Oliver Wyss, overseen a number of roster changes, with an emphasis on younger players looking to make a name for themselves and move on to bigger leagues.

He describes his club’s operational style as a combination of “organization and attitude.”

The first year has “been an adventure,” said Keston, a Venice resident who thought he’d be making the trek from Los Angeles to Irvine a couple of days a week at the outset of his involvement with the team. It’s been a lot more time-intensive than expected, he said.

The club’s making good on one key area: sponsorships. In June it landed Hoag Memorial Hospital Presbyterian in Irvine as “exclusive health care provider” to the club. Hoag’s logo is now on the club’s shirt.

In addition to other sponsorships, Keston said he’s working on potential TV deals to get the club’s matches televised locally. He’s also looking to add additional investors over coming years.

Keston said he’s aiming to turn a profit on the team in a couple of years. Estimates for the annual costs of running a USL team vary wildly but typically are listed on soccer websites as $1 million to $3 million.

Next up for the Orange County SC, hopefully, is a move up the standings. The team stood in 11th place in the 15-team Western Division of USL as of last week, after playing 12 matches.

It played four or five games less than most in the USL; its schedule is back-loaded, allowing the team to play more home games at the new stadium, which holds twice the number of fans as its current facility.

‘Intimate Feel’

The average attendance at USL matches is around 5,000, roughly the same number of seats as Orange County SC’s new home, although that is skewed a bit by a few franchises—like those in Sacramento and Cincinnati—that can draw crowds approaching 20,000.

“This is the right size for us,” Keston said of the new facility. “It’s a state-of the-art stadium, but it will have an intimate feel.”

USL sits behind Major League Soccer—home to LA Galaxy, and the new Los Angeles Football Club franchise that will begin playing next year—in the pecking order of the country’s soccer leagues.

By team count, though, USL is already big-time. The 30 teams that make it up give the league stature as the world’s largest second-division soccer league.

Its members have varied operating strategies, however.

Nearly a quarter are reserve teams of various MLS franchises—similar in some respects to a Triple-A affiliate of a Major League Baseball team—which allows the MLS teams to develop younger players by having them play in a competitive league.

Most other USL teams have less formal partnerships with MLS teams in order to loan out players; Orange County SC is teaming with the new franchise in L.A., for example.

Some USL club owners with deeper pockets, such as those who own the franchise in Phoenix, have their eyes on being chosen for expansion by MLS in the near future. That’s a costly proposition; MLS franchise fees are now reportedly in the $100 million range.

Those teams are more likely to spend heavily on famous but older players to make a name for themselves. Striker Didier Drogba, a longtime goal-scoring force with Chelsea FC in England’s Premier League, now plies his trade for the USL’s Phoenix Rising FC, for example.

Clubs like Orange County SC, which plan to be in the USL for the long term, are looking to build a sustainable, profitable franchise that will be part of the community, Keston said.

Right now, “we’re trying to build a base.”

That means signing fewer players on the downside of their careers, although never say never on a big-name signing, Keston said.

Japanese midfielder Keisuke Honda, previously with Italy’s AC Milan, trained with the club a few days this month—and drew a number of Japanese visitors to the team’s practices—before signing with a team in Mexico.

New Beginning

Orange County SC is Keston’s second stab at owning a soccer team.

In 2006 and 2007 he held the rights for an expansion MLS franchise in the Seattle or Portland areas, but couldn’t finalize a deal during the real estate downturn that claimed Larwin Co. and numerous other homebuilders as casualties.

Both Pacific Northwest cities now have thriving MLS teams, with the Seattle Sounders routinely drawing crowds in excess of 40,000—one of the largest fan bases in the world of soccer, let alone MLS.

Keston said he thinks about what might have been “every day,” but tries not to dwell too much on the past.

“I knew that when the time presented itself, I’d be able to get back (into soccer ownership),” Keston said.

His love for soccer started around the time of the 1994 World Cup, which was held in the U.S. He was able to attend matches, including the final in Pasadena’s Rose Bowl, and later gained an appreciation for the sport in his travels overseas.

The opening of the new Great Park facility marks, in a way, a new beginning for both the soccer club and the former Marine base, whose amenities have been slower to roll out than first planned, he said.

“The Great Park faces some of the same challenges as us. People have kind of heard about us, but they weren’t (too sure) about where they were,” Keston said.

With the sports park’s official opening in August, that’s about to change, according to Keston.

“We’re here now, and we’re open for business.”

The developer of the city’s new soccer stadium concurs.

“Our work is not done. But I believe it is now clear that we are building a series of venues, including the soccer stadium, that will enrich this community and deliver benefits for generations to come,” said Emile Haddad, chairman and chief executive of FivePoint.

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Mark Mueller
Mark Mueller
Mark is the Editor-in-Chief of the Orange County Business Journal, one of the premier regional business newspapers in the country. He’s the fifth person to hold the editor’s position in the paper’s long history. He oversees a staff of about 15 people. The OCBJ is considered a must-read for area business executives. The print edition of the paper is the primary source of local news for most of the Business Journal’s subscribers, which includes most of OC’s major corporate and community players. Mark’s been with the paper since 2005, and long served as the real estate reporter for the paper, breaking hundreds of commercial and residential real estate stories. He took on the editor’s position in 2018.

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