Tim Burgess, Council’s Arena Negotiator, Says an NHL-Only or NHL-First Arena Unlikely

 Finance, MOU, Security  Comments Off on Tim Burgess, Council’s Arena Negotiator, Says an NHL-Only or NHL-First Arena Unlikely
May 082015

Tonight, we have a few words from Tim Burgess which clarify that the NHL was not considered a stable investment of the public’s money as far back as the 2012 negotiations.  When combined with the reported tensions between Hansen’s NHL guy, Coleman, it sounds like Chris has been backed into a corner that would cost hundreds of millions of dollars that only Ballmer was willing to burn.

“We specifically wrote the idea of a hockey-only or hockey-first arena out of the agreement three years ago,” Burgess said. “We did that because it’s very weak financially. It’s just too risky for the city.”
The reason is that a typical pro hockey team generates about a third less revenue than an NBA team. So city analysts concluded a hockey arena might not be able to cover the city’s bond payments.
“If we’re going to do hockey, there would have to be a substantial lowering, if not elimination, of the public investment,” Burgess said.

That alone could be a fatal blow. But the arena also now has a triple whammy of political problems.
-One is that Hansen got in trouble down in California for making an illegal, undisclosed campaign contribution.
“That caused a few of my colleagues to be very concerned about his methods and style,” Burgess said.
-Two is that the big money behind the project, Microsoft’s Steve Ballmer, bolted when he bought the Los Angeles Clippers for $2 billion. It didn’t escape notice at City Hall that $2 billion could have built the Sodo arena four times over. Yet they needed public help?
-And the capper: News hit last month that a different group has proposed building an arena in Tukwila. They said it would be 100 percent privately financed.
You can’t compete with free. Burgess suggested it would be next to impossible now to convince Seattle citizens to help pay for an arena when another group is willing to do one without public money “only 15 minutes away.”

SoDo Arena Final Environmental Impact Study Released – Murray Reminds Everyone NHL First Requires Money

 Finance, Security  Comments Off on SoDo Arena Final Environmental Impact Study Released – Murray Reminds Everyone NHL First Requires Money
May 082015

People have been working themselves up into a tizzy about alternate arena proposals related to the NHL in Tukwilla and Bellevue.  Are they real, privately funded plans or just distractions prior to the SoDo arena FEIS being released ?  Nobody really knows as NHL team owners tend to do very little without public subsidy.

The FEIS is a huge document I’ll browse through later.  It’s being said that the document did not uncover huge roadblocks but did take a rather low-end view on traffic impacts and estimated a negative impact to the Port of Seattle of $-115,584 a year or so.

I also have noticed that the whole City of Seattle collection of arena documents for the city has gone dark with a 404 error.  (I think I found the re-designed collection for the County)  Hopefully, that’s a temporary issue.

NHL-First Means Sweeten the Private Money Pot

Ed Murray’s comments to the Seattle Times suggest the NHL first proposal will have to put in even more private money towards an arena than the NBA-only one.  I guess Ed realizes that NHL-associated taxes and benefits are likely to be far fewer than that of a NBA team.

While hailing Thursday’s release of a final Environmental Impact Statement (EIS) as “another major milestone” reached, Murray said he’s prepared to look elsewhere if entrepreneur Chris Hansen and his hockey partner can’t produce an “NHL first” funding proposal by fall. Murray told The Seattle Times he needs a “much, much better” public funding package to present to the Seattle City Council than the current Memorandum of Understanding (MOU) between Hansen, the city and King County.

That deal calls for up to $200 million in bonds toward a $490 million arena if an NBA team is acquired. But Murray believes there’s no chance of that now, meaning a new proposal with more private money for a riskier “NHL-first” scenario is needed.

“Folks have got to come up with a plan that’s viable for us to finalize this process,’’ said Murray, who needs less public funding to help him sell the council on a request to close a street that’s part of the 627-page EIS. “The timeline you see for decisions on the arena are the timelines for when we either go forward, or we pull the plug.’’

As a refresher of how much public financing (aka, the money the public would be getting to support public functions if this were an entirely private arena) is involved, from way back in September 13, 2012’s meeting we had this chart.  Does Hansen and his NHL partner have a way to sink $400+ million into just the arena and still have things pencil out ?

The range of public money that would be going to the arena project under NBA-only and NBA+NHL scenarios.

The range of public money that would be going to the arena project under NBA-only and NBA+NHL scenarios.

Reality of “no team owner $$ and no arena = no NHL” hits Geoff Baker

 Finance  Comments Off on Reality of “no team owner $$ and no arena = no NHL” hits Geoff Baker
Apr 242015

Geoff Baker of the Seattle Times has many, many pieces where he pines for the NHL to grace Seattle.  He stirs up passions with stories of the NHL leaders meeting with rich guys who drop hints of Seattle, Bellevue, or Tukwilla sites for an arena.  Eventually, reality comes crashing in, as in today’s piece from a AP Sports Editors meeting.  Nobody with as deep pockets as Ballmer is rumored for the NHL in Seattle, and without an NBA team committing both city and private money to an arena, any NHL team would need to throw in big money.

NHL commissioner Gary Bettman made it clear Friday that Seattle needs an arena plan and financing in place before the league even considers expanding there.

“From a distance, it won’t warrant — if it does at all — serious consideration until there’s a realistic expectation that there’s going to be an arena there,’’ Bettman said. “You’ve got your approvals, you’ve got your financing — you’re ready to go. You’re basically saying, ‘Listen, if we get a team, we’re committed to and are ready to break ground, because this building can be a reality.’ ’’

Why, yes, for a league with many teams on shaky financials, it probably doesn’t make sense to expand to Seattle until a gift arena suddenly appears.  Would you like to look at the KeyArena, because the city council would love to show you around and could cut a nice deal ?

Sports Reporters Find Arena Review Process Confusing, Unclear

 Finance, MOU  Comments Off on Sports Reporters Find Arena Review Process Confusing, Unclear
Jan 192015

If you were thinking that the Hansen Team’s secretive “what has been submitted, what is the city waiting on, what is Hansen delaying on” approach to getting an arena approved for building is not transparent, you’re not alone.

Geoff Baker of the Seattle Times has to make a lot of calls to city workers and still can’t figure out what to write about, so “we need transparency” it is!

On Friday, the city’s department of planning and development revealed the proposed arena’s final environmental impact statement (EIS) had been delayed three more months because of the complexity of issues involved. That realistically pushes well into 2016 the time frame for issuing any permits for the project proposed by entrepreneur Chris Hansen.

And it prompted an unusual news release from Murray’s office — on Saturday morning, no less — saying he wants more transparency from the planning department his office oversees.

Translated into plain English: Murray is taking heat over the latest delay (ed: or he hates getting phone calls from sports reporters on Friday afternoon).

“There’s some frustration out there on both sides of this,’’ (Murray) said in a phone interview. “People on both sides are struggling to understand the process.’’

Murray is not exactly a huge sports fan, but does perform ceremonial functions (waves to the crowd) at playoff games.  Mayor Murray really has not been involved in any of the arena approval steps (they were before he took office) and, aside from Geoff getting him on the phone to talk about sports, I’m not sure what he’s supposed to be “ushering along” to please sports fans currently distracted by OT wins by a team playing the worst game of the season (until the last minutes of the 4th quarter).  But, transparency!

Frankly, this arena saga could use greater transparency from all sides.


Hansen also could be more transparent. Much of this now yearlong EIS delay stemmed from him not submitting requested paperwork until late September.


It’s also worth noting the city isn’t compiling the EIS. That falls to consultant Katy Chaney of URS Corp.

But we don’t know exactly why she needs more time. Neither does the mayor, from what he told me.

And that’s problematic. It’s OK in a democracy to request that anyone wanting public money be put through rigorous screening. What isn’t OK is dragging things out indefinitely for reasons few understand.

There’s no evidence that’s being done here. But when the public remains in the dark about a process — even if via ignorance — it can lead to abuse.

Murray needs to spread the word about how this process will unfold. Some sports fans might not like the result, but they’ll at least see it coming.

If only someone in the driver’s seat on EIS submissions, the state of the ownership group, if the Bucks are for sale, and very familiar with where things stand had a website they could put that on…..   but then what would Geoff do to keep busy?

Economic Impact Analysis Documents from 2013

 Finance, Property  Comments Off on Economic Impact Analysis Documents from 2013
Jan 182015

Economic Impact Analysis

If you’re wondering about what Pro Forma Advisors writes about the economic impact of an arena, they think it’s pretty swell with $30-34 million a year in net operating income a year. Amazingly, this is based on 82 annual events that aren’t NBA and NHL. The Pro Forma presentation is here and a topsheet is here.

Ed Murray on Ask the Mayor says MOU stands, no NHL-first-ies

 Finance, MOU, Security  Comments Off on Ed Murray on Ask the Mayor says MOU stands, no NHL-first-ies
Nov 132014

A great deal of hand-wringing from McGinn’s ousting has revolved around Murray’s lukewarm support of any NBA ambitions.  The NHL continues to explore the Seattle arena proposal, but nobody is committed to being Hansen’s deep-pocketed partner in making their mostly revenue-neutral* arena deal work.  Nobody in a power position is itching to re-open the MOU to renegotiation and Mayor Ed Murray made a NHL dream-shattering statement that an arena without an NBA team just wasn’t going to pencil out for the city, the NHL is not stable enough a partner to proceed with.  For video confirmation, watch the response at 55:50.

(* neutral to the city funds because we assume that the public is too math-illiterate to realize they’re paying higher property taxes due to the arena and, because those higher taxes pay arena bonds rather than tax stuff, we also assume the arena would not require any of the city/county services the taxes it generates would usually pay for)

Dow Constantine on NBA Arena

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Oct 052014

In this clip from the Seattle Channel’s Civic Cocktail program October 1st, Dow Constantine was asked about the NBA arena.


Dow is still thinking Hansen will bring basketball to Seattle, even without Steve Ballmer.  Then again, Dow and the county benefit greatly from a “free rider” position in the NBA arena if only one team, the NBA, is signed on by the time the building is completed.

Hansen’s Arena EIS Documents Finally Submitted, Sports Reporters/Cheerleaders Stir

 MOU, PR Campaign, Property  Comments Off on Hansen’s Arena EIS Documents Finally Submitted, Sports Reporters/Cheerleaders Stir
Oct 022014

After months of delay and meandering careful collection of detailed analysis and predictions, Hansen’s team has submitted all requested info to the Seattle Department of Planning and Development.  As you can see by hours billed, work has been sparse, on the city’s side, for many months.

King5’s Chris Daniels continues to beat the arena drum, including dropping old details into his stories and not reporting the more negative finding that other outlets have (the leaders did not want to open the MOU to NHL first at this time).

The NHL is widely believed to be anxious to bring a team to the Seattle market. There was no formal presentation about the market during a league meeting on Tuesday. An NHL spokesman also said there were no formal talks about expansion during the owners meetings in New York City.

The league’s commissioner Gary Bettman and Deputy Commissioner Bill Daly both flew to Seattle earlier this year, along with potential owner Victor Coleman. They all met with Seattle Mayor Ed Murray and King County Executive Dow Constantine. Bettman later said the meeting was to get an update on the status of the arena. Murray says the league leaders also asked the city about the possibility of changing the Memorandum of Understanding on the arena, to allow for an NHL team to prompt construction.


Paul Allen Wants to Put NHL in Portland

Humorously, one ex-Microsoftee who actually lives in Seattle is speaking publicly about their desire to put an NHL team into the underutilized arena his LLC owns. Once you own the building, it really helps to have as many events in it as possible (and it’s best if the potential team owner is interested in doing that to minimize their sunk arena costs, or else you end up with Ackerley).