Tidewater Landing’s funding was ‘absolutely’ ready to go. Until it wasn’t.

Since news first emerged about the delayed public bonds, answers about what’s gone wrong, how the problem will be solved, and the scale of the private financing gap have been hard to come by

The site of Tidewater Landing and the future home of Tidewater Stadium and Rhode Island FC, as seen this week from the Division Street Bridge.Matthew J. Lee/Globe Staff

PAWTUCKET — Developer Brett Johnson was full of optimism in August at the ceremonial groundbreaking for the Tidewater Landing soccer stadium on the banks of the Seekonk River.

The state Commerce Corporation had recently voted to bridge a financing gap in the stadium project with about $35 million in tax credits and bonds. And Johnson didn’t hesitate when asked if he had his own funding lined up and if he was ready to go.

“Absolutely,” he said.

Seven months later, work is underway at the site. But the finances for Tidewater Landing look a lot less absolute.

The city of Pawtucket recently acknowledged that the bonds that the state authorized to go toward the stadium itself — instead of later phases of the development, including housing — hadn’t yet been issued. Private debt also hadn’t made fiscal sense to close on, the city said. Mayor Don Grebien wore a Rhode Island FC pin in a WPRI interview this week during which he reiterated the city’s commitment to the project. But another city official said the financial impasse is “very disconcerting.”

Meanwhile Johnson himself has still been raising money for the $80 million private share of the $124 million stadium project, despite his sanguine assurances at the August groundbreaking. During a press call in July, Johnson said he expected to close out the balance of the private fundraising “shortly.”

In the week-plus since news first emerged about the delayed public bonds, detailed answers about what’s gone wrong, how the problem will be solved, and the scale of the private financing gap have been hard to come by. Johnson declined to be interviewed for this story. The Commerce Corporation has withheld from the public a number of documents related to the deal since last summer, which The Boston Globe is appealing to Attorney General Peter Neronha.

With that appeal pending, Commerce this week declined to immediately provide yet another document: a signed incentive agreement between Commerce and the developer, which would outline terms of the public support going to the project. Commerce said “the agreement is not public at this time.” And numerous other questions remain.

Johnson’s Fortuitous Partners remains buoyant, though, and points to the ongoing privately-funded construction as evidence.

“Work would not have started or advanced to this level if there were not complete confidence in the full capital stack — debt and equity — being raised,” spokesman Mike Raia said in an email. “The process remains on-going and there is a pathway for completion in the near future.”

In explaining the financial impasse, the city of Pawtucket blames rising interest rates, the pandemic, tighter market conditions, and the looming prospect of a banking crisis. Governor Dan McKee, whose tie-breaking vote at the Commerce Corporation allowed the stadium support to move forward, has taken particular aim at the Federal Reserve for hiking interest rates.

But that’s a red herring, some critics have said.

“This outcome was completely predictable,” Michael McNally, a Commerce board member who voted against the most recent Tidewater deal, said in an interview. “Hopefully they find the money and can get it done, but we shouldn’t have gone forward.”

McNally originally voted for the financing package for Tidewater Landing, which passed the Commerce Corporation in February 2021. At the time, the public’s support for the project was devoted to some of the work around the stadium, not the stadium itself. The overall project was supposed to include housing, retail, commercial, and other development (and still will, Johnson pledges).

Then inflation started to bite, sending the price of the stadium from $83 million to around $124 million. After months of debate, the Commerce Corporation in July narrowly voted to shift its support from the work around the stadium to the stadium itself.

The overall economic picture, though, including rising interest rates, was one of the factors that led some board members to vote no, McNally said. In fact, interest rates had been rising for months before the July vote, McNally noted.

The project’s financing is sensitive to interest rates, with much of the $124 million project funded with bonds and loans, according to internal projections. Borrowing money becomes more expensive in a time of rising rates.

The stadium deal depends on $27 million in bonds, which would be paid back with state tax revenues generated in certain parts of the city, including the area right around the stadium. That district is broader than just the immediate area around the stadium.

Another big chunk was a loan facilitated by the Rhode Island Infrastructure Bank of more than $30 million, according to financial records associated with the deal. (This sort of financing isn’t guaranteed, backstopped, or subsidized by taxpayers, the Infrastructure Bank says.) But officials say that neither the state-backed bonds nor the private debt has been able to close yet.

The developer was also supposed to raise $43 million in equity, or upfront funding from investors that doesn’t depend on borrowing. But in addition to not being able to close on private debt, Johnson is also short on raising equity, according to city of Pawtucket officials. Those two things are likely related: If you don’t have the down payment for the house, you can’t get the mortgage.

McNally, who has become a vocal critic of the Tidewater deal, said it didn’t make sense to move forward on construction without the bulk of the funding actually in place. (The city of Pawtucket disagrees on this score.)

“I’ve been in construction and real estate my whole career,” McNally said. “You don’t move forward on a major project like that without most (or) all of your debt lined up.”

The August groundbreaking was ceremonial, and like other groundbreakings in an election year, had only a tenuous connection to actual work going on at the site. But construction has indeed started there. The developer, the city, and the state all say that private funds are paying for the work there. No state or city funding has flowed to the project, and the developer has not asked for additional public support for it, according to the parties involved.

And that construction was continuing Friday. But the football club sent a strong signal that the stadium won’t be ready in time for the spring start of the 2024 USL Championship season, as was the most recent goal, when it said it was evaluating venue options.

That could in turn affect the team’s internal financial projections, which The Boston Globe has also reviewed. Those projections show the team expected to charge from $16 to $100 for seats, and even expand the stadium to 15,000 seats in 2027. In the first year, the team projected having a paid attendance of 7,600 for league games. The team projected $750,000 annually at first for a naming rights deal (Amica is paying about $900,000 annually for the Amica Mutual Pavilion in Providence) and $400,000 for a kit sponsorship.

Raia, the Fortuitous spokesman, said in an email Friday: “The club is in active discussions with potential sponsors and has not yet settled on ticket pricing for the 2024 season. We are not going to comment further on internal, confidential projections, business plans or negotiations with future sponsors.”

Rhode Island FC is slated to play next year in the second tier of men’s soccer in America, a league called the USL Championship.

Even with all this uncertainty, the team itself — the soccer team — has been making moves toward the pitch. That includes hiring a head coach, Khano Smith, and a club president, Brett Luy. Earlier in March, figures associated with the team founded a nonprofit, the Rhode Island FC Foundation, “to impact the growth of soccer and use it as a force to positively impact the lives of Rhode Island’s youth.”

The club also has an independent supporters’ group, called Defiance 1636, a nod to Roger Williams’ arrival here and other acts of Rhode Island defiance, like the burning of the Gaspee. They plan to unveil their own logo at a nearby bar, Craft Burgers & Beer, said Kevin Callahan, who lives in East Providence and is one of the group’s founding members.

Whatever else it is, it’ll be defiant.

“We want our team to be defiant on the pitch, to defy the odds,” Callahan said. “Look at what’s happening now. We’re still looking to defy odds. That’s what we plan to do — defy the odds, put a team on the pitch, and compete for silverware.”

Another supporter who is signaling optimism is Michael Sabitoni, the president of the Rhode Island Building Trades and an influential labor backer of the deal. He said in an interview that he, too, remains confident — but hopes the Federal Reserve will stop raising interest rates.

“It’s been a little bit of a nervous time, but we’ve had difficult times in the past and we’ve come through it,” Sabitoni said.