The wheels are turning for a new, self-funded NBA and NHL arena in Seattle in the city’s SoDo neighborhood, funded privately and publicly by tax revenue on the arena development and the professional teams that would call it home.
Seattle Mayor Mike McGinn announces a proposal for a new NBA/NHL arena in Seattle at City Hall, as King County Executive Dow Constantine looks on. (Joshua Trujillo/seattlepi.com)
The plan was spearheaded by Seattle-born investor Chris Hansen, who with his investment group is planning to purchase an NBA franchise and bring it to Seattle. He also is searching for a partner to bring an NHL team to Seattle.
Under the plan, which must still go through a newly appointed city and county panel, any teams at the new arena would be bound to stay in Seattle for 30 years. That means there could be no repeat of the Sonics fiasco for at least 30 years.
The proposed arena would take two years to construct and would be located south of the Safeco Field parking garage, where Hansen already owns a three-acre chunk of land. Several businesses would need to be relocated and several buildings would need to be demolished. The facility would be jointly owned by the city of Seattle and King County, and available for additional recreational and cultural events.
No public funds would be committed to the arena until NBA and NHL franchises have been secured for Seattle. Hansen also would not commit his money until he has secured a team. So, there will be no new arena until Seattle has a new team.
However, the proposal paves a clear route for the NBA’s return to the Emerald City. The Seattle Sonics left in 2008 after a controversial and divisive effort to fund a replacement for KeyArena, where the team had played for decades but was eventually deemed unsuitable by the NBA. A returning NBA team could temporarily play at KeyArena while a new venue is built in SoDo. A developer will study whether KeyArena could host hockey games.
Hansen is hoping to raise $290 million in private investment for the new venue. The entire cost of the facility would be between $450 million and $500 million. Public funding participation would be capped at $200 million, with revenue generated mainly by operation of the facility, and with rent paid by the teams and by the arena operator.
A new arena would be built south of Safeco Field in Seattle. (AP Photo/Elaine Thompson)
Under the proposed agreement, if those sources do not generate enough money, the teams would be on the hook to pay more in rent, said Dwight Dively, finance director for King County. He spoke with media at a briefing before Thursday’s news conference at City Hall.
“There will be no new taxes because of this,” said Fred Podesta, finance director for the city of Seattle. “There will be new revenues created by the arena.”
City and county representatives stressed that there would be little to no funding obligation by local taxpayers. The proposed agreement includes financial security provisions that would make Hansen’s investment group responsible for construction cost overruns and operation shortfalls, said Beth Goldberg, director of the city’s budget office.
For a basketball tenant, Hansen has his sights set on the Sacramento Kings, whose city — in a situation eerily similar to Seattle’s loss of the Sonics — is under intense pressure to build a new basketball facility. Sacramento must submit a financing plan by March 1 or risk losing the Kings, and city leaders are running out of time.
In not-so-great news for Seattle NBA fans, the Sacramento City Council voted Tuesday to allow city staff to enter into talks with 11 firms interested in leasing downtown parking in the city, The Sacramento Bee reported. Under the parking plan, the city could raise half of the nearly $400 million needed to build a new arena.
Sacramento Kings fans are feeling the same way Seattle Sonics fans did back in 2008. (AP Photo)
But now Seattle and Sacramento appear to be off on a foot race. With Thursday’s announcement, Seattle has a firm financing proposal for a state-of-the-art arena in a big sports market. Sacramento, it appears, does not.
Last season, the Kings very nearly relocated to Anaheim. This time, it could be Seattle.
NBA Commissioner David Stern has said Seattle is a “great” destination for the NBA, The Salt Lake Tribune reported last week. In fact, Stern had a conversation with Hansen about a year ago, the newspaper reported, though Stern said it was “just a general conversation.”
Meanwhile, the struggling Phoenix Coyotes professional hockey team may also be up for grabs. NHL Commissioner Gary Bettman has said the league is looking for a buyer to keep the Coyotes in Phoenix, but has strong interest in bringing a team to Seattle — as long as there’s a venue.
The Seattle Times, which originally broke the arena story two weeks ago, reported that Hansen met with three Seattle City Council members on Wednesday to discuss the arena proposal. He contacted Constantine’s office several weeks ago, and briefed the rest of the City Council on Thursday morning, the Times reported.
Hansen, a San Francisco hedge-fund manager, is a relatively unknown name in the realm of multimillionaires connected to Seattle. A graduate of Roosevelt High School, he’s not alone in wanting pro basketball back in the Emerald City. A potential site on the Eastside was being eyed by potential investors like Chicago businessman Donald Levin and Microsoft CEO Steve Ballmer. That was last summer — it’s unknown at this point whether Ballmer is interested in contributing to Hansen’s plan.
