SBD/Issue 175/Facilities & Venues

Devils Owner Vanderbeek Joins Calls For Izod Center Closing

Vanderbeek Says New Jersey Could Sell
Izod Center Property As Real Estate Deal
Devils Owner Jeff Vanderbeek is "raising the volume on his argument for closing" Izod Center -- a move that would leave the Devils-run Prudential Center in Newark as New Jersey's "dominant sports and entertainment arena," according to John Brennan of the Bergen RECORD. Vanderbeek said Izod "needs to be torn down, and the state could sell the property as a real estate deal." Vanderbeek -- who previously has "left the most forceful 'close the Izod Center' rhetoric" to Newark Mayor Cory Booker and Essex County (NJ) Exec Joseph DiVincenzo -- "suggested that a convention center might be a better use for the site." But Vanderbeek also said that the state "should solicit a wide variety of potential suitors to see whether any entity would be willing to pay off" the arena's $77M debt. Vanderbeek claims that Izod is a "drain on taxpayers because it loses" at least $10M annually, though NJSEA, which operates the arena, claims Izod earns about a $1M annual profit. NJSEA President & CEO Dennis Robinson said, "We are disappointed that Mr. Vanderbeek has chosen to take this aggressive tack in his continuing efforts to close the Izod Center." NJSEA officials and Vanderbeek in recent months have held discussions about whether the authority "might take over management" of Prudential Center from AEG. However, Vanderbeek criticized NJSEA as "'patronage heaven' for politicians and cited two letters from fans imploring him not to use agency employees." Meanwhile, the Nets, who play at Izod, are awaiting construction of their new Barclays Center in Brooklyn, and Vanderbeek said he "would marginally rather see the Nets in Newark" than in Brooklyn. Vanderbeek: "I just want the Nets off the fence. The biggest problem for us is that the Nets are being used as a ping-pong ball (by the sports authority). For a while they wanted to throw them out, then they love them" (Bergen RECORD, 5/30).

NO SLEEP 'TIL BROOKLYN: In N.Y., Richard Sandomir noted Forest City Ratner (FCR), which is developing Barclays Center, "still faces legal and financial challenges -- but it contends they have eased enough to unequivocally predict the arena's opening" for the '11-12 NBA season. Nets CEO Brett Yormark said groundbreaking on the arena is "done, inevitable, it's imminent, it's going to happen this year." Yormark: "We're on schedule. There's more certainty than there's ever been." Goldman Sachs Managing Dir Gregory Carey, whose company is co-financing the project with Barclays Bank, said that the "improving economy and brightened financial outlook for municipal bonds pointed to an increasingly likely chance of financing the arena." Carey: "We're in tough times, but it's looking good." However, Sandomir noted FCR must break ground by December 31 to meet the IRS' deadline to "sell tax-exempt bonds," and "if the developer misses the deadline, financing costs will leap." But Yormark said he and FCR Chair & CEO and Nets Owner Bruce Ratner have "never talked about missing that deadline." The December 31 deadline also "appears to loom" for the 20-year, $400M naming-rights deal between the Nets and Barclays. The bank "extended the sponsorship beyond last year because of construction delays," but a company spokesperson "refused to say if it would do so again" (N.Y. TIMES, 5/31).

ALL OPPOSED? The Bergen RECORD's Brennan reported an "often-rowdy, overflow crowd of about 200 packed a Brooklyn auditorium" Saturday for a New York Senate hearing on the Atlantic Yards project, which includes Barclays Center. Construction workers "made up the bulk of the crowd" for the hearing, titled, "Atlantic Yards: Where are We Now, How Did We Get There, and Where is the Project Going?" Many in attendance "used their union-supplied whistles whenever a state official expressed support for the stalled, struggling project" (NORTHJERSEY.com, 5/30).

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