Devils, Housing Authority Disagree Over Arena Rent Terms
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Devils Say They Do Not Plan To Pay
First Year's Rent At Prudential Center |
The Devils "do not plan to pay the first year's rent" on the $375M Prudential Center, and instead said that the Newark Housing Authority (NHA) "owes them nearly $800,000 due to delays in completing the arena," according to Maura McDermott in a front-page piece for the Newark STAR-LEDGER. The NHA, which owns the arena, "gave the team until Monday to make what was expected to be a multimillion-dollar rent payment, granting the team's requests for two extensions" on the September 30 deadline. NHA Exec Dir Keith Kinard said that the agency "plans to declare the team in default." The NHA and the team "will have 30 days to resolve the rent conflict or go into arbitration." Devils owners Tuesday "delivered 12 pages of letters and calculations to the authority stating their lease allowed them to deduct nearly $2.2[M] from the rent owed, due to delays in building the year-old arena and completing construction on the land around it." Devils Exec VP/Administration Gordon Lavalette in a letter indicated that as a result of the delays, the NHA "owes the team $791,530." Devils Owner Jeff Vanderbeek said that the team is "merely abiding by the terms of the 30-year lease." Vanderbeek: "We have fulfilled our responsibilities under the contract and we will continue to do so. This isn't a charity, this isn't a philanthropy, this is a business, so we're going about our business." However, Kinard said that construction delays "did not interfere with the arena's operations and should not result in a discounted rent."
RENT CHECK: The Devils indicated that the NHA "owes $902,778 or $34,722 per day -- for the 26-day delay in getting the arena ready for the team's home opener" on October 27, 2007. The team also "cited a January 2006 agreement between the authority and the Devils promising all work on Lafayette Street would be complete by May 1, 2006," but said that the work "wasn't done until March 27, 2007, and the authority owes $20,000 a day 'up to a ceiling of $2[M]' for the delay." Kinard said, "None of these things were ever brought to our attention in countless meetings, in countless correspondence going back and forth with them. Frankly, I'm shocked" (Newark STAR-LEDGER, 10/30).
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