Originally published July 3, 2017 8:00 AM PDT
UPDATED (8/4/2017): The city council updated Select Committee on Civic Arenas meeting times to discuss KeyArena redevelopment. Changes highlighted below.
After considering competing bids for a KeyArena renovation over the spring, the city of Seattle now has two proposals before it for a new state-of-the-art arena to support professional sports, concerts, and cultural events. One in the city’s Stadium District south of downtown and Pioneer Square; one at Seattle Center in the city’s Uptown neighborhood.
The anticipation is to decide on a single project this fall and move forward on a clear course of action for the future. So, what's next in the process?
The two options:
Location: 1st Ave S/S Massachusetts St/S Holgate St, SoDo
Estimated Cost*: $550 million
Estimated Size: 700,000 sq ft.
Seating Capacity: 18,500 (basketball), 17,500 (hockey), 19,000 (concerts), can expand up to 2,000 additional
Additional Feature: On-site training facility
Investor Chris Hansen's group - including former Sonics player and executive Wally Walker, retail empire magnates Erik and Pete Nordstrom, and Seattle Seahawks starting quarterback Russell Wilson - offered in October 2016 to fully finance the project privately in exchange for an exemption on admission taxes and a reduction of the business & occupation taxes charged on revenue made outside of Seattle.
The group seeks a two-block vacation of S Occidental Avenue that bisects the arena site. Their public benefits package for the vacation, given approval recommendation by the Seattle Design Commission in April, includes a public plaza, living machine water reclamation system, pedestrian/bike bridge over train tracks, a parking garage with potentially larger capacity than the Mariners' garage, financial contribution to freight mobility improvements, and an earmark for the money paid for Occidental Ave to go to the Lander Street overpass project.
Location: 305 Harrison Street, Lower Queen Anne/Uptown
Estimated Cost*: $564 million (possible ~$600 million with underground parking)
Estimated Size: 660,000 sq ft.
Seating Capacity: 18,350 (basketball), 17,100 (hockey), 19,100 (concerts)
Arena management and consultancy Oak View Group - created and headed by former NBA executive, former NHL executive, and former president of AEG Tim Leiweke, and music industry artist mogul Irving Azoff - has proposed a renovation of the existing KeyArena that would dig down 15 feet to expand the footprint of the arena and more than double the existing square footage. Anticipating landmark status, the project would retain the building's distinctive roof and the outer walls above ground. A new atrium would be added to the south end for entrance. A ramp going beneath Thomas Street will open to an expanded marshaling area with 8 loading docks.
An 850-spot parking garage concept adjoining the atrium was dropped following neighborhood feedback and concern over financial participation of a public entity, expected to be the Port of Seattle.
The group proposes a 35-year lease with the city for the land with five (5) 10-year extensions possible. The project would be built privately and OVG offers a $1 million annual lease rate with the potential to increase rent payments if annual revenue thresholds are hit. The potential to negotiate tax revenues to feed back into the operation and maintenance of the arena has been left open.
*Estimated cost is just for arena project. Environmental & traffic mitigation and public benefit cost not included.
What's next for SoDo
The SoDo proposal is in the hands of the Seattle Department of Transportation. After analyzing the project, they will draft a report and make a recommendation to the city council's Select Committee on Civic Arenas on whether to grant the proposed street vacation or not. As they have gone through this process with the arena before, it's likely most of their analysis can be reused.
SDOT does now have to take into consideration plans for S Occidental Avenue to be dead-ended at Lander Street for the overpass project. There is no deadline or timeline on when their analysis and recommendation will be done.
What's next for KeyArena
A 3-member executive review team, advised by a 10-member community panel, submitted its recommendation of the OVG proposal to Seattle mayor Ed Murray in the first week of June.
The proposal was selected by Murray over a competing proposal from Seattle Partners, a joint venture between arena developer AEG and real estate firm Hudson Pacific Properties. Seattle Partners withdrew their proposal prior to the expected selection, citing the lack of “a sufficiently thorough, objective and transparent process” on the city’s part. SP’s ask for up to $250 million in bond-backed public financing and its design proposal to cut 15% of the building’s roof to expand to the south are said to have taken them out of the running early on.
The city council recently announced it will hire an independent consultant to review the OVG proposal to aid in negotiations of a Memorandum of Understanding and a development and lease agreement.
Historic Landmark Status
The city has submitted applications to nominate KeyArena and six other buildings on the identified renovation project site for historical landmark status per State Environmental Protection Agency policy and city statutes. OVG plans to submit the building for federal historic preservation tax credits to offset development costs.
The Seattle Landmarks Preservation Board recently reviewed and approved a majority of the nominations, including KeyArena. They will review the nominations to see if they meet specific criteria for landmark designation. If the Board designates the arena and/or any of the buildings as landmarks, they will negotiate a Controls & Incentives Agreement with the city/Seattle Center. Per the city:
Controls define those features of the landmark to be preserved and outline the Certificate of Approval process for changes to those features. Incentives may include, but are not limited to, zoning variances, building code exceptions, and financial incentives.
After the agreement has been reached, the Board will forward ordinance legislation to the city council for the designation(s). The council will vote to approve or deny the ordinance.
7/8/2017: The city released a timeline of the KeyArena renovation proposal review. Added dates highlighted below.
A Timeline of What's Next
Here is a timeline of the next steps in the process. Some of this is in flux as analysis of the two projects could change when events take place.
Wednesday, June 7, 2017 - Mayor Murray announces his selection of the Oak View Group proposal for a potential KeyArena renovation Thursday, June 8, 2017 - City executive staff begins negotiations with OVG on Memorandum of Understanding Monday, July 10, 2017, ~10:30am - The city council’s Select Committee on Civic Arenas will meet to review Mayor Murray’s KeyArena recommendation for the first time. Wednesday, August 2, 2017, Time TBD - Seattle Landmarks Preservation Board will host a public meeting to discuss designating KeyArena, the NASA building, the Blue Spruce Apartments, and the Bressi Garage as historic landmarks following successful nominations. (Board approved landmark designations for KeyArena and Bressi garage; NASA building and Blue Spruce apartments denied.)
**Monday, August 14, 2017, ~10:30am - Select Committee on Civic Arenas meeting: KeyArena redevelopment update (Rescheduled from August 7, 2017)
Up to Wednesday, August 16, 2017 - Seattle Landmarks Preservation Board must release a report on designation approval to city within 14 days. Then, controls & incentives agreement negotiations can begin.
TBD - Seattle Department of Transportation will submit report and recommendation on SoDo project street vacation petition to Select Committee on Civic Arenas.
TBD - A public hearing on the SoDo project street vacation petition will be set by the Select Committee on Civic Arenas. Like in March 2016, this will likely occur in council chambers at City Hall at 5:30pm to give plenty in the community time to voice their opinion. Each speaker will be allotted 2 minutes of time, but speakers will likely be able to pool their time and have one person speak for them longer.
TBD - City Council may submit and sponsor legislation on the SoDo project street vacation petition to send to the Select Committee on Civic Arenas.
TBD - Select Committee on Civic Arenas may discuss SoDo project street vacation legislation and make any amendments. They can then vote to move legislation to the full council for a vote.
TBD - If voted to move to the full council, the City Council will review and discuss the SoDo project street vacation legislation and vote on it.
Tuesday, September 12, 2017 - Current deadline set by city council to receive a proposed Memorandum of Understanding between the city and OVG to explore the KeyArena renovation project. This also appears to be the deadline for the negotiated development and lease agreement.
**Monday, September 18, 2017, ~10:30am - Select Committee on Civic Arenas meeting: KeyArena redevelopment update, transportation charrette, reviewing proposed KeyArena MOU. (Originally scheduled for September 14, 2017.)
Monday, September 25, 2017 - City council’s Budget Committee begins deliberations on 2018 city budget; KeyArena renovation will be discussed during deliberations to prepare for potential council action on a KeyArena MOU in December.
Up to Monday, October 30, 2017 - The Seattle Landmarks Preservation Board has up to 75 days from the issued designation report to negotiate with the city on setting controls & incentives related to any potential redevelopment of the designated buildings.
Tuesday, November 7, 2017 - Washington State General Elections, includes mayoral election for the City of Seattle and election for the two at-large, city-wide city council seats currently occupied by Tim Burgess (retiring) and Lorena Gonzalez.
Monday, November 20, 2017, 2pm - City council full meeting: Council plans to discuss and vote on adoption of 2018 city budget.
Monday, November 27, 2017, ~10:30am - Select Committee on Civic Arenas meeting: Central staff identifies issues and options with potential KeyArena MOU; discussion of potential amendments to MOU; Independent consultant will present findings on OVG proposal to committee.
Up to Thursday, November 30, 2017 - Last date for public meeting by Seattle Landmarks Preservation Board to review and approve controls & incentives agreement. This meeting must occur no later than 30 days after written agreement is signed by the property owner (in this case the city).
Sunday, December 3, 2017 - End date of the effective period of the Memorandum of Understanding signed between the City of Seattle, King County, and WSA Properties III, LLC (“ArenaCo”) in 2012.
Monday, December 4, 2017 - The earliest the city could vote to approve an MOU and development and lease agreement with OVG on KeyArena renovation.
TBD - After the controls & incentives agreement approval, the Seattle Landmarks Preservation Board will submit landmark designation ordinance legislation to the city council. Council will review, amend (if necessary), and vote to approve or deny landmark status.
By the end of 2017, we could have a decision on a single arena and path forward to bring back our Sonics and bring the NHL to Seattle.