AUSTIN (KXAN) - KXAN Austin News is first to learn businessman Billy Joe “Red” McCombs is theprincipal investor in the new Formula 1 track to be built inAustin. The newly announced project partner said he dove into thisendeavor, knowing its potential to make a huge economic impact onthe area and also in his own wallet.
The center is part of McCombs’ UT namesake, the McCombsSchool of Business. In addition to making Forbesmagazine’s top 400 richest Americans since 2005, he was alsoa former owner of the San AntonioSpurs, DenverNuggets, and the MinnesotaVikings. Forbes says he is worth $1.3 billion.
The founder of the Red McCombsAutomotive Groups and co-founder of ClearChannel Communications joined the man responsible for bringingthe track to Austin, Tavo Hellmund, and various Formula 1officials. Hellmund, a former racer and Austin native, said thecity is built for F1 success.
He cited its geographic location, its nightlife for theestimated 200,000 visiting fans, and Austin's willingness toembrace technology as reasons the city will be the first permanenthome to F1 in the U.S. in nearly three decades.
"Without a doubt, (this will) make this one of the true greatsporting events in the world on an annual basis," Hellmundsaid.
Hellmund's company, Full Throttle Productions, and McCombsPartners are two of a small handful of investors in the estimated$250 million project. Prophet Capital Management, an Austin-basedprivate investment company founded in 1995, is the third, alongwith the additional services of MotoGP World Champion KevinSchwantz.
So far, the private partners have not disclosed theirspecific stakes. Officials said they will not seek furtherinvestors, though McCombs said they still must raise "a lot" ofcapital. Texas Comptroller Susan Combs, who has been integral onthe state level for this project, told KXAN she is confident thegroup will secure the necessary funding.
"When you have the performers that these guys have, they'regoing to be able to raise the money," Combs said.
Officials also announced the track's exact location on about 900acres near Elroy in southeastern Travis County previously meant fora residential development called Wandering Creek.
Speculation surrounding the exact track site began shortly afterFormula 1's initial announcement two months ago. Many correctlythought the site to be in the general area just to the east of the
The Grand Prix event will be held in Austin between 2012 and2021. During that time, the event is expected to rake in anywherefrom 90,000 to 200,000 people each year.
That could mean an economic impact somewhere between $200million and 400 million. On the low end alone, that's about thesame amount brought in by the Austin CityLimits Festival and all the University of Texas football home games for anentire season.
Officials plan to begin construction in December and hope to becomplete in early 2012. They said the track will be used for otheroff-season events and for research into alternative fuels.
Formula 1 also launched a new Web site Tuesday, as well. It is formula1unitedstates.com.
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