SBD/September 12, 2017/Facilities

Oak View Group Plans $600M Renovation Of KeyArena For Future NBA, NHL Use

OVG will assume commitments for the Storm’s lease once KeyArena reopens
Oak View Group "plans to spend" $600M renovating KeyArena for NBA and NHL use and finish by October '20, according to a front-page piece by Geoff Baker of the SEATTLE TIMES. According to a new deal with the city of Seattle, OVG would commit $40M to "improve traffic, transportation and parking beyond any requirements stemming from a mandatory environmental impact review." The deal "guarantees Seattle the revenue it currently gets from KeyArena, and includes a plan for sharing new money generated by the 55-year-old facility after renovation." Both sides hope the draft memorandum of understanding is "approved by a City Council vote by Dec. 31." Beyond the construction and transportation outlays, OVG plans to put $20M "toward a community fund," with millions more spent to "relocate existing Seattle Center tenants." OVG will also assume financial commitments for the "duration of the WNBA Seattle Storm’s new 10-year lease at KeyArena once it reopens." Baker reports the new 39-year lease has a "pair of eight-year extension clauses triggered only if OVG spends" at least $168M in "ongoing KeyArena capital improvements and acquires NBA and NHL teams." Baker notes the completion timeline "could lead to an NHL franchise beginning play" in Seattle by the '20-21 season. OVG has "partnered with billionaire investment banker David Bonderman and Hollywood producer Jerry Bruckheimer to be Seattle owners of an NHL franchise." The project’s completion date "assumes construction beginning" in October '18. There is "no exclusivity clause in the MOU, but it does specify that competing Seattle arena projects must be all-private with no city subsidies for construction." That "leaves a door open to entrepreneur Chris Hansen and his proposed private arena project in the city’s Sodo District if it wishes to vie for an NBA team down the road" (SEATTLE TIMES, 9/12).
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