Five years ago today, on September 11, 2012, the media assembled in city hall to announce an agreement that I, and just about everybody else involved, thought would result in the return of the NBA to a new arena in Sodo. I cannot express the pride in victory I felt that day or the personal appreciation I felt for Chris Hansen who was at the time and remains a personal hero of mine.
It's hard to believe that five years later, having failed to acquire the Sacramento Kings, finalize the project permit, or place a bid for an NHL expansion franchise, this MOU is coming to an end and another appears to have taken clear control of the situation.
After months of negotiations, the Office of Economic Development (OED) will be sending a copy of their draft MOU with the Oak View Group (OVG) to City Council for review with an anticipated signature to occur on December 4, just one day after Chris Hansen's current MOU expires.
Many will remember the intense renegotiation that took place in 2012 when then-mayor Mike McGinn passed his MOU agreement off to council. During the 7 months that followed City Council did everything possible to "put their fingerprint" on the document negotiated by McGinn, who had a very contentious relationship with Council.
This process is expected to differ substantially from that one as both the OED and OVG have engaged with council and community for input at a much earlier stage. Reports of a lack of community involvement are completely and totally fabricated. Whereas Hansen's team announced a deal negotiated in secrecy and then had to work under the public spotlight to negotiate last minute concessions with a number of local stakeholders, the OVG proposal has largely been signed off on by groups such as the Seattle Storm, Seattle Center, and Uptown Alliance. They have broad support from groups like Youthcare, having negotiated a benefit agreement that will yield $20 million in support for youth homelessness and activities.
One detail of significance, originally identified by KJR's Dave Mahler via twitter, is that OED notified the NBA and NHL of their plans via scheduled phone conferences today. These calls, which have been confirmed by Sonics Rising are believed to have been positive in nature and continue a pattern of frequent and open communication between the city, OVG and the sports leagues that I believe bodes well for the leagues return to our market.
If there is apprehension about this deal, from either sports league, about KeyArena I would expect them to make it known in short order. Perhaps not via an official statement but certainly by alerting people involved in the process or members of the national media that Seattle is preparing to make an unrecoverable mistake. Indications I have are that both leagues are extremely supportive of Leiweke and receptive to his plan, but I will still be vigilant watching for any and all messages to the contrary. If Chris Hansen has support within the league, now is the time for him to bring them to the table with some type of indirect statement of support. The league could change the course of things with a simple off-the-record phone call to any number of supportive elected officials (Dow Constantine?).
In addition to the MOU itself OED will be providing council with a "statement of values" agreed upon by a coalition of stakeholders including sports fans, union labor, social justice advocates and representatives of all impacted neighborhood associations. This "statement of values" is essentially intended to act as instructions and priorities for our council members when reviewing the MOU.
As a member of committee on civic arenas, I would like to thank my fellow committee members. Having witnessed stadium and arena battles both here and in other markets I can tell you that the neighborhoods virtually always oppose the construction of large stadiums due to concerns on traffic, housing, and impact. I anticipated intense opposition from residents of Uptown (formerly referred to as "Lower Queen Anne") but instead have been amazed by the strong support put forward by the Uptown, Belltown, and South Lake Union Neighborhoods. They have a strong shared vision for a dynamic neighborhood.
My contribution to this value statement was the insertion of language directly targeting the concerns of Sonics Rising readers. The document states:
"It will be suitable, both in terms of physical design and business model, to attract a National Hockey League franchise and facilitate the return of the Seattle Supersonics. The project will affirm the unique social role that professional and amateur sports, as well as music and the arts, play to inspire youth and bring together diverse communities across our region.”
I appreciate my committee peers and Brian Surratt of OED being amenable to adding specific instructions that the council vet both the physical design and business model of the facility to ensure that they are suitable for the NBA and NHL. At today's committee meeting, I informed both Surratt and the Oak View Group representatives of my intentions to follow up on these instructions and request specific details about the financing model in order to re-assure nervous fans. In addition, it is my intention to make myself available to any representative of the Sodo group if they would like to provide specific and quantifiable examples of how their proposal provides a financial model that is more likely to lure the league to their site. The economic model of the building is a provable formula and I encourage everybody to step up and show the fans how they intend to make this happen.
Tomorrow will be a big day with MOU details expected to be released to the public in the early morning and I assume reviewed in minute detail in the days and weeks to follow. I will provide a hint to say that many concerns that have been brought up on this board are likely to be addressed in the actual document. Like the last one, this is a good deal for the taxpayers.
Comments
Process
I understand where the process is right now. OVG has gone about getting the deal done in a much better way than Hansen’s group and it’s paying off big time.
That said, there had better be some EXTREME vetting of the traffic and parking issues that are going to plague the area if they add potentially 100 dates (regular season NBA and NHL plus playoffs) to the lower Queen Anne area. I have seen ZERO plans that make me think there are long term plans in place to take care of these issues. Don’t give me the monorail, don’t give me drones. People simply are not going to utilize these in any significant way.
Also, I can’t help but worry about renovating a 55-year old facility for a SECOND time when, after the first time, it was essentially designated as obsolete by the NBA. I have serious reservations that OVG can convert Key into a facility that competes with rinks (yes, I’m mainly here for the NHL) like PPG Paints in Pittsburgh, XCEL Energy Center in St. Paul, Staples Center, etc. Having been in those buildings, I can’t see how simply lowering the floor is suddenly going to make a new arena. My fear is in 15 years, any team that does come here will say it can’t compete while playing in that building. Of course, that assumes that teams will come here. I’m not exactly convinced that teams are Leiweke’s ultimate goal, despite what he said at the press conference a few months back.
It’s unfortunate that this process has brought us to this point. Yes, Ed Murray is ramming this through simply to save his political legacy (such that it is) and to make nice with the Port of Seattle. But, Chris Hansen and his group have to share the load of the failure to get this done. They haven’t done nearly enough (or done it in the right way) to get SoDo completed. On paper, it’s not even close, yet here we are.
By AJ55 on 09.11.17 6:10pm
They aren't just lowering the floor
They are completely gutting that building. When the mayor says it’s a new building under the old roof, that’s the truth.
By Paul Rogers on 09.11.17 6:33pm
Of course he’ll say that. What else would he say? But hey, if that’s actually the case then great. I’m definitely taking a "believe it when I see it" approach. The traffic issues still remain and no amount of spin is going to change that.
That said, I’ll still end up going. I’ve been waiting for a NHL team in Seattle for 30 years and if it comes to Key, great. I just think between the two options, it’s the wrong location.
By AJ55 on 09.11.17 6:39pm
The drawings bear that out
Location wise, I agree with you.
By Paul Rogers on 09.11.17 6:47pm
Not to turn it into a complete back and forth, but I’m sure the remodel from the Coliseum to Key Arena looked great in drawings as well. I know there are camps on both sides of this issue and probably will be until it’s actually done. Again, I hope it comes through with flying colors and I will gladly eat crow when I see it. (After waiting in Mercer traffic for 90 minutes. )
By AJ55 on 09.11.17 6:54pm
"I understand where the process is right now. OVG has gone about getting the deal done in a much better way than Hansen’s group and it’s paying off big time."
Hansen was operating with an MOU set before OVG was even brought into the game.
OVG danced to Ed Murray’s fiddle, and the people of Seattle are the ones getting screwed for it.
By harkening on 09.12.17 10:04am
Agreed.
By AJ55 on 09.12.17 8:15pm
Rebuild
This is not a renovation. This is an entire redesign and build. The arena under the roof will not resemble the current Key in any way.
By Mekong70 on 09.12.17 6:42pm
I will gladly eat crow if I’m wrong, but I don’t see how having the constraint of the roof allows for an arena that is built from the ground up. Xcel Energy Center was built on the site of the St. Paul Civic Center, but the old building was completely torn down. If that was the case here, I’d be less worried.
Still doesn’t put the building closer to the freeway.
By AJ55 on 09.12.17 6:52pm
Thank you Brian, and congratulations for the progress you have helped to enable after all of these years
I especially appreciate your heads up to the Sodo group, and I will continue to hope that this enables them to become involved in a constructive manner. While the OVG may be a good deal for the public, I believe that the Sodo project and update to Key Arena has even greater, and more positive, impacts for the people of our region, and visitors to the City of Seattle.
All will be made right if the Sonics return.
By cortone on 09.11.17 6:12pm
And I appreciate your reasoned response
By Paul Rogers on 09.11.17 6:34pm
Cheers Paul
Although to be honest, I think the majority of my posts are reasoned (heh, YMMV). This wasn’t a grab-by-the-lapels-and-shake kind of post, so I’m glad it came across properly.
By cortone on 09.12.17 11:33am
I recognize that the likely outcome distresses many fans
And I understand the concerns, even though I don’t share them.
That said, I fully believe we will eventually get both leagues into that building if it’s built.
By Paul Rogers on 09.11.17 6:32pm
If someone
could point to any example of a modern day expansion team owner & league that chose to come to city where it will be the 3rd tenant after concerts, after NHL I would feel more confident about the NBA returning. Add in $1bil expansion fee and I don’t see how the NBA awards Seattle a team vs another city that will give it a dedicated home. Prove me wrong, but I’ve yet to find a modern day example. ** The clippers are looking to move into a new place.
By dawgfan4life on 09.11.17 8:03pm
That assumes
that the NBA owner would be neither a partner in the arena or in the NHL team.
By Taylor Bartle on 09.11.17 8:12pm
I will bet anyone on this board $1
That the NBA owner has an equity share in the building before it is all done.
By Brian Robinson on 09.11.17 8:20pm
I am just
identifying my concerns as a Queen Anne resident who has been following this as close as a common citizen can for the last 10 years. And I think that is a very fair concern to have at this time with the info and quotes provided to date.
By dawgfan4life on 09.11.17 8:25pm
"before it is all done"
Is that implying that a possible NBA owner will join the group before the MOU is finalized in December, or is the "all done" referring to an eventual NBA owner?
I love to make bets but I’m not one to bet against someone who might have inside knowledge
By ksmith1984 on 09.11.17 8:29pm
This is just speculation
This doesn’t really answer the question that was asked.
Why do you believe an NBA owner will have an equity share before it is all done?
What does "all done" even mean? Completion of the new MOU? Or when/if the NBA expands?
By sidenote on 09.12.17 4:41am
Shares will be set aside
Bonderman will be an owner and he owns shares
Leiweke will be an owner and he owns shares
Additional shares in the facility will be set aside or otherwise available to future prospective team owners.
Just a hunch
By Brian Robinson on 09.12.17 7:51am
Plus... you know...
Leiweke said it…
By Taylor Bartle on 09.12.17 9:10am
So the 33% split is down to 25% if you're a team owner?
Two teams, splitting 50%, and then splitting that with OVG.
What does the city get for handing over control of a public park besides a renovated building?
By cortone on 09.12.17 9:16am
Look at Dallas
The AAC is owned by the city of Dallas and operated by Center Operating Company, L.P. (a joint venture between the Dallas Mavericks and Dallas Stars). I would expect something similar to be the case here. Something like Seattle Center Arena Group, L.P., a joint venture consisting of OVG, the Seattle Supersonics, and the Seattle Anything-but-Kraken.
By Taylor Bartle on 09.12.17 9:20am
Rec'ed for everything but
the dig at Kraken.
Kraken.
By Chris Meirose on 09.12.17 5:48pm
Without looking at the specific financing, there are a couple of significant differences that I see.
First and foremost, Victory Park is a "planned" development from top to bottom, executed by the younger Perot, and still in development it would appear, almost 20 years after the arena was built. AAC is a cornerstone of the development, which was built around it. It is not now, nor was, a public park, and public lands were not exchanged for the right to develop it, as far as I can tell.
Secondly, there was a tourist tax excised to fund a significant portion of the arena (a couple hundred million). That is a huge impact on the private funding required to get a reasonable ROI from the team ownership groups. The effect on the revenue-splitting requirements would be massive, and completely non-existent for OVG and its partners.
It also appears the the Mavericks would like to exit, although I wasn’t willing to work to get past the log in requirements to find out, and sort out whether it was a report or an opinion piece. The headline was to the effect that Cuban would like out and the city leaders are/should be okay with that.
By cortone on 09.13.17 11:38am