The City of Seattle has signed off on the $700m (£533m/€595.1m) renovation plan for KeyArena, a move that is set to boost Oak View Group’s (OVG) bid to land an expansion franchise in the NHL ice hockey league.
The city council yesterday (Monday) approved final transactions documents by a vote of 8-0 to fully renovate the arena and formally approve OVG’s plan to privately finance.
Taken together, two ordinances which revise use of the admissions tax and constitute the development, lease and integration agreements that were recently transmitted represent the arrangement between the City of Seattle and ArenaCo to redevelop KeyArena into a first-class sports and entertainment facility.
The 56-year-old, publicly-owned arena will be renovated in its entirety using only private funds. Earlier this year, OVG announced it had an NHL investment group, Seattle Hockey Partners led by billionaire David Bonderman and film producer Jerry Bruckheimer, for a $650m bid for an expansion franchise that would begin play in a revamped KeyArena in 2020-21.
Seattle Hockey Partners is slated to give a presentation to the NHL’s executive committee next week. The city has included a clause not to allow demolition of the existing KeyArena until an NHL franchise is secured.
KeyArena currently serves as the home of Women’s National Basketball Association (WNBA) team the Seattle Storm, with a men’s NBA franchise also targeted by investors behind the redevelopment project.
“In many ways, today’s Full Council vote is the closing chapter of a story 14 years in the making,” Councilmember and co-chair of the Select Committee on Civic Arenas, Debora Juarez, said. “I am so proud of this moment and what it represents, including our history with both (former NBA team) the Sonics and our future with the world champion Seattle Storm, a proposal which could ultimately lead to over a billion dollars in private investment in Seattle Center.
“We have achieved a feat rarely seen in the construction of sports stadiums – a public-private partnership where the taxpaying public doesn’t pay for arena construction.”
OVG will commit to the Seattle Center site for 39 years and spend $40m on transportation mitigation. It has also committed $10m to Seattle organisation YouthCare, in addition to paying for the relocation of the businesses affected by the construction.
The Associated Press news agency noted that next week’s pitch to the NHL is expected to be straightforward. Seattle is the largest market in the United States currently without a winter professional sports team, while a season ticket campaign launched earlier this year was ended early after deposits hit the 33,000 mark.
“I don’t think we have to say much,” Tod Leiweke, president and chief executive of Seattle Hockey Partners, said. “I think it speaks for itself. An 8-0 vote, a process that concluded when many people said it just simply couldn’t be done. We said we were going to put our best forward and today the city helps us do that.”
KeyArena will stage its final event in its current guise on October 5 – an NBA exhibition game between the Golden State Warriors and Sacramento Kings. The arena will then be handed over to OVG. Leiweke added: “Now we really get to dream about the National Hockey League, we get to dream about a presentation next week, we get to dream about the return of the NBA. Let’s go.”
Commenting on the city council vote, Mayor Jenny Durkan said in a statement: “Throughout this process, the City has had two goals: get the best possible deal for Seattle and our taxpayers, and create a world-class sports and music facility for the next 50 years.
“This agreement ensures that the much-needed redevelopment of KeyArena will create good, family-wage jobs, make critical investments in transportation, and protect taxpayers by ensuring the City will not foot the bill for construction, including any potential cost overruns.”