NHL Welcomes Expansion Application from Seattle

 Finance, MOU, Other Arenas  Comments Off on NHL Welcomes Expansion Application from Seattle
Dec 082017
 

After 5 long years of being a “tag along” on the SoDo arena plans, local NHL fans have something to rejoice over.  The NHL Board of Governors’ meeting was occurring this week and Seattle’s new MOU with OVG was an inevitable topic.  The board discussed Seattle’s new arena plans and welcomed an application, with a $650 million expansion fee.  Fortunately, OVG has some fairly deep pocketed friends who have been interested in owning a NHL team.

The local reaction was enthusiastic (even if old-school NHL gear was bright enough fans could still make out players through a dense fog and cataracts).

The NHL is so confident in the bid the group authorized a season ticket drive similar to what happened in Las Vegas. Unlike prior non-league-sanctioned ticket waiting lists concerning the NBA’s Kings, the Las Vegas NHL ticket drive involved a deposit.

All of this bodes well for locking in a good deal on a new arena in town and having a professional sport to occupy it soon.  The NBA is still elusive, but at least one team will reduce the number of people intent on public pillory of Leiweke.

OVG CEO Tim Leiweke going as far as asking Seattle to hold him accountable.

“If we don’t have a franchise a year from now, they should take me and put me on top of that arena and while they start tearing that arena down, they should let me dive into the middle of the rubble because I haven’t done my job,” said Leiweke this week.

Added below the break are roundtable interviews put out by Sonics Rising with John Barr, Chris Daniels, and Brian Robinson as well as a “mega fan meeting” with OVG’s Leiweke held after Mayor Durkan signed the MOU.  Continue reading »

Seattle Center Arena Replacement By Oak View Group In December 2017?

 Finance, MOU, Other Arenas, Property  Comments Off on Seattle Center Arena Replacement By Oak View Group In December 2017?
Dec 032017
 

After a long RFP process involving multiple bidders (although Seattle Partners/AEG withdrew when their proposal involving city $250 million in city bonds was not well received) and some additional negotiation, it appears that Seattle’s quest for a new arena suitable for the NHL and NBA is coming to a close on Monday. This has caused some gnashing of teeth among those devoted to Chris Hansen and his plans, which we’ll save for later.

Seattle Center Arena Has Needed Renovation and Waiting on ArenaCo Isn’t Forward Progress

The KeyArena at Seattle Center has been a looming white elephant for the city, thanks to demands of the prior NBA franchise ownership to refurbish the facility with a questionable configuration for hockey. Some reports have suggested that the prior ownership was happy to explore NHL teams and then scuttled that plan in a scorched-earth move, capped by the offset ice re-build. The AECOM report of KeyArena options that the city commissioned outlined multiple scenarios, all requiring 9 figure investments with a future profitability very uncertain, particularly if another large arena is built in the city. At the same time, the Seattle Center arena’s city ownership requires the city make some plans for major investments to keep up with amenity standards, even as a concert, WNBA, and college basketball venue.

AECOM’s report included rough estimates of project costs to repurpose KeyArena, all well into the hundreds of millions of dollars.

Projections for Key to be self-sustaining were widespread. A2 required no competing large arena in town and B2 required the NBA to play in the renovated KeyArena space

Additional details about the options from the AECOM study are also below.

Details on how the KeyArena would be reconfigured under the scenarios analyzed.

The basis of AECOM’s estimates included modest investment (A1+2), significant renovations preserving pro-sports capacity (B1+2), significant repurposing into multiple entertainment venues (C) and even “something else” (D).

Under both AECOM scenarios with an arena also built in SoDo (A1 and C), the Key projects loses money. Only the Key as the primary arena in town (A2) or with a NBA tenant (B2) would have projected profits. This doesn’t bode well for the future of the Key if the ArenaCo group converts it into a secondary venue. Even the configuration ArenaCo proposed in September as a secondary venue is different from Scenario C, lacking acoustically divided stages and with a lower maximum capacity, which could be even less profitable.

ArenaCo’s Composition and Faith In Their Ability to Complete Project Has Changed

While the SoDo group has done an admirable job of crafting a good deal for the city, re-authorizing the city’s partnership with the ArenaCo group without a plan to actually build an arena ahead of a sports franchise would be turning our collective backs on going forward with having a new arena in Seattle. ArenaCo’s named investors, with the loss of the $37B investor, no longer have the majority of the capital once advertised for the expensive project of building an arena with mostly-private funds and purchasing professional sports team(s).

Revisiting SoDo Land Purchases, Property Tax Bills

 Finance, Property  Comments Off on Revisiting SoDo Land Purchases, Property Tax Bills
Jun 072017
 

SoDo Land Purchases Locked Hansen In On Site, Created Street Vacation Requirement

One way that Hansen was able to focus his efforts in SoDo, on a tract of land that required a street vacation to construct an arena, was by buying the land for the arena and plenty of land from his neighbors.  My recent trip through the public records indicates WSA properties is paying about $786k in property tax bills each year on executed land purchases of approximately $122M in total.  Note:  This tally leaves out the Dream Girls establishment and the Mariner’s lot indicated in yellow in the picture from the King County Parcel Viewer.

SoDo land plats with Arena site circled and WSA properties/Hansen purchased land in blue, Mariner’s lot highlighted in yellow.

The current list of sites purchased by Hansen under various WSA Properties LLCs is below, proceeding counterclockwise from the highlighted Mariner’s lot.  The address and last 4 digits of the parcel number, Hansen/WSA’s purchase date, the purchase price (or currently assessed value if indicated with a ~), and the annual property tax bill for that property.

North of Arena block

1500 1st Ave S - 6430   not sold m  ~$4.3M      
1518 1st Ave S - 6440   10/2016      $25M      $82,540
1526 1st Ave S - 6445   10/2016      included  $14,490
1530 1st Ave S - 6450   not sold dg ~$3.9M
1534 1st Ave S - 6455   4/2012       $4.3M     $32,198
1548 1st Ave S - 6460   5/2012       $9.5M     $18,325
1556 1st Ave S - 6465   5/2012       included  $38,027

West Half of Arena

1700 1st Ave S - 6400   8/2012       $8M       $37,561
1714 1st Ave S - 6405   7/2012       $5.6M     $16,110
17XX 1st Ave S - 6410   7/2012       included  $32,188
1730 1st Ave S - 6415   9/2012       $1.7M     $16,110
1740 1st Ave S - 6417   4/2013       $9M       $20,132
1746 1st Ave S - 6420   4/2013       included  $20,123
1760 1st Ave S - 6425   4/2013       included  $40,242

West of 1st Ave

1757 1st Ave S - 7110   12/2012      $1.8M     $18,012
1915 1st Ave S - 7135   9/2012       $3.2M     $23,006

South of Arena (garage)

2228 Occidental - 6125  9/2016      $32M       $17,428
1900 Occidental - 6115  9/2016      included   $124,064

East Half of Arena

1750 Occidental - 6285  12/2011     $22M       $237,986

note: fixed links that were to .gov are now .com

KeyArena Rebuild RFPs Are In

 Other Arenas, Property  Comments Off on KeyArena Rebuild RFPs Are In
May 012017
 

KeyArena RFP Responses

The KeyArena RFP announced by Ed Murray back in October 2016 has had more detailed, although still annotated as “redacted for public,” responses.  The AEG/Seattle Partners response is a 6 page executive summary and a 690 page full proposal pdf that includes letters of support from other NBA team owners.  The Oak View Group has submitted a 3 page executive summary and a 108 page proposal.  This is going to take some time to comb through, so I’ll add more details when time permits.  I added the Key RFP page to the list of links above.

King5 has a story that summarizes some details of the proposals, which can give you some inspiration on what to look out for.

Hansen Seeks to Terminate MOU in SoDo, Build Privately and Scoops KeyArena Remodel RFP

 Finance, MOU, Other Arenas, PR Campaign  Comments Off on Hansen Seeks to Terminate MOU in SoDo, Build Privately and Scoops KeyArena Remodel RFP
Oct 312016
 

Chris Hansen and SoDo Arena

Chris Hansen re-emerged from the inky shadows and dropped a bit of a bombshell last week in a letter sent to the City Council, County Executive Constantine, and Mayor Ed Murray.  Hansen says his group no longer needs public bonds to assist with financing the arena (even though it wasn’t about the financing but a means to return tax money to the project) and is, instead, able to proceed with only future tax money being expressly abated.

We have concluded that a changed economic climate makes possible the private financing of the arena. For that reason, and to address concerns expressed by city council members, we would consider revising the street vacation petition to eliminate public financing of the arena. In such a case the MOU would be terminated and the rights and obligations of the parties under the MOU would end. The City and County would recoup the $200 million in debt capacity, and tax revenue streams generated by the arena would cease to be encumbered for arena debt service.

  • Approval of the street vacation
  • Granting of a waiver of the City’s admissions tax for the arena, just as similar waivers have been granted for the other sports venues
  • Adjustment of the City’s B&O tax rate for revenue generated out-of-town

The letter glosses over the fact that the admissions tax was the largest chunk of the money for the prior bond repayments and the other venues in town (Centurylink and SafeCo Field) did a tax-swap where the county collects admissions tax even though they’re venues within the city limits (and they only collect a fraction of the legally allowed 10% admissions tax).  Details may be coming, but a few days later the public learned why Hansen was grabbing headlines where he could.

KeyArena Remodel RFP On the Way

We learned a few days after Hansen’s announcement that senior analyst for Mayor Murray, Sara Belz, had been a point person for soliciting KeyArena renovation proposals with Irving Azoff and Tim Leiweke in one group and current KeyArena operator AEG in another.  Apparently the discussions have been off-and-on for a while, maybe being hinted at during the “did AEGCOM’s report get hidden by the council” story in April 2016.  The mayor was planning to make an announcement of the plan to issue the official RFP to renovate the KeyArena in January 2017 and Hansen may have rushed his announcement to refocus the public on his plan.  Details are even more unknown, since an RFP is mostly a framework for a project and bidders need to respond appropriately.

Still, as the NBA season kicks off, Seattle has a lot of arena news, but there are no NBA teams available, no plans to expand the league, and then there’s the great unknown of the NHL.

May 022016
 

Videos will be posted later and we can all enjoy hearing councilmembers parade their personality today (be that Bruce’s sports phrase usage, Gonzales’ groaning at said sports phrases, Juarez’s talk of dams, or Johnson’s suggestion that 30% of the city is used for roads, as if a city can function with only 10′ footpaths and bus lanes).

Short summary – O’Brien, Burgess, Harrell, and Johnson voted in favor of the street vacation and Sawant, Herbold, Gonzales, Juarez, and Bagshaw voted against the street vacation.  There were many amendments and clarifications stated (including that a privately financed arena could be built to the terms of the MOU, excluding all those bits about public financing).  Interestingly, the Sonics Rising council vote live thread had a poll predicting the “yes” votes from the council which, at the start of the council meeting, had a tie between 4 and 5 (failing and passing), suggesting many knew all too well that the knife was being readied (insert GIF of proud new pappa Roose Bolton behind shived by “bastard” Ramsey Bolton).

Screencap from shortly after the full council vote concluded.

Screencap from shortly after the full council vote concluded.

In any event, now Hansen has to consider applying again?, changing his preferred site, or how he’ll design a privately financed arena with a public right of way running through the middle of it.  The location in SoDo requiring a street vacation has been something Hansen was pretty well set on, to the point of acquiring properties long before the MOU was even approved.  The current function of Occidental is why Hansen’s group carved a new North-South access road to the East of the arena.  It’s also a part of why the EIS’s site selection was somewhat lacking, it didn’t really give much imagination to using street-vacation-required parcels.  In many respects, this is the city council’s procedural way to escape this roller-coaster they’ve been on for years, particularly with a Nov 2017 expiration date functioning not so much as a deadline but being a harbinger of MOU re-negotiations/extensions.

Of course, Hansen does still own (or have options on) a bunch of land in SoDo, so he could still build LA Live-like attractions or parking garages or new commercial spaces like TV studios, if they pencil out.

Edit:  Video from the Seattle Channel has been posted.  The council takes up the street vacation at 1:12:15.

Fourth Arena Hearing On 4/19 and Materials/Amendments Are Online

 Finance, PR Campaign, Property  Comments Off on Fourth Arena Hearing On 4/19 and Materials/Amendments Are Online
Apr 142016
 

The last (third or second, depending on how you count the evening comment period) meeting for the Occidental Street Vacation for the proposed arena had several amendments proposed, including reducing the street vacation’s timeframe to 5 years and adding language meant to emphasize arena-contingent conditional approval.

 

April 19th at 2PM is the next regularly scheduled committee meeting, where the street vacation could be forwarded to a full council.  Materials have been posted online for that presentation.

 

Edit:  Seattle Bike Blog is advocating for protected bike lanes on 1st avenue, instigated by the arena.

Sonics Rising is trying to muck-rake a comparison of Port aviation vs seaport operations and tries to stir public anger over the port pledging its taxing authority to contribute to the viaduct replacement, as if that contribution wasn’t a “business as usual” ask by the government to fund projects from local taxpayers without going through a public vote/levy.  In this case, the port’s contribution of “up to $300 million” was to help plug the gap left by the state lowering the toll threshold from $400 million to 200 million.

SoDo Arena’s Necessary Occidental Avenue S Street Vacation Resurfaces

 Lawsuit, PR Campaign, Property  Comments Off on SoDo Arena’s Necessary Occidental Avenue S Street Vacation Resurfaces
Feb 022016
 

Street Vacation Hearings in March

Chris Daniels reported that Mayor Ed Murray has thrown some weight around to push the Occidental Avenue South street vacation forward to a vote.  Councilmember O’Brien has scheduled the public meeting at the “afterhours” time of 5:30 PM March 15th (sure to be more pep rally than discussion of the public’s value of the street) with subsequent potential subcommittee meetings on April 5th and 19th and, based on the subcommittee’s recommendation, a full council vote following as early as the 25th.  The street currently runs through the middle of Hansen’s proposed arena and would need to be removed to allow construction of the arena.

I am still looking for application documents related to the street vacation, but right now I’m only seeing this document related to designating Occidental Avenue S a Green Street in front of Centurylink and next to SafeCo’s parking garage. (UPDATE – see edit at bottom for a map of this one block street vacation).

The hashed green outline marks the newer green street designation.

The hashed green outline marks the newer green street designation.

The Occidental Avenue S street vacation is expected to only be granted with the acquisition of an NBA team, construction of an arena, pedestrian walkways, and many other improvements.  The county and city councils would still have to vote to issue bonds used to pay Hansen for the arena land and portion of the arena, but if that vote must occur prior to construction activity is something I’ll have to review.  As it stands now, the 5 year deadline on Hansen’s MOU expires in October 2017.

Seattle’s SoDo Arena – No Need to Rush

I will remind you that in May 2013, nearly 3 years ago, comments were along the lines of

“We think we’ll get through the EIS process at the end of the year, and then we’ll probably pay some appeals and (there will) be some things we need to mitigate,” Hansen said. “And we think it will be shovel-ready by this time next year.”

While Sacramento’s arena was, locally, viewed as being further behind in early 2013, with full motivation the Sacramento arena has pushed forward to a very complete state (live cameras here) with opening expected by October 2016.

 

Edit 2/4 – Documents related to the street vacation are trickling in.  This has a map.

Vacated street is the blue portion inside the arena project site outlined in red.

Vacated street is the blue portion inside the arena project site outlined in red.