Privately funded MGM-AEG arena in Vegas actually breaking ground in May

It looks like one of Las Vegas’s umpteen proposed sports venues is actually going to get built, as AEG and MGM have announced a May 1 groundbreaking for their $350 million 20,000-seat arena on the Strip. The Las Vegas Review-Journal reports that the building wil be built to “NBA and NHL specifications” but will at least at the beginning rely on “programming such as concerts, MMA fight shows, sports events, award shows and boxing matches.”

The AEG-MGM arena is also being built entirely with private money — so far as I can tell, the developers never even tried to get public subsidies — which just goes to show that 1) in certain circumstances, privately funded arenas can work, and 2) those certain circumstances are largely “be in Las Vegas.” Trying to pay off arena construction entirely with revenues from concerts and the like is usually impossible unless you can guarantee 200 or so nights a year of activity — but apparently AEG and MGM think that’s doable in the bizarro world that is the Vegas tourist economy. Either that, or MGM so desperately wants to beat all its competitors to the punch to get a new arena built, it’s willing to treat it as a loss leader for the rest of its casino/hotel/murder mystery business.

Either way, Vegas will now have a new arena to dangle in front of the NBA and NHL for a new team, though we’ve seen how well that’s worked for Kansas City. In the short to medium term, expect this to mostly be a snazzier place to watch Cher, Billy Joel, and Justin Timberlake. Man, tell me why people like to go to Vegas again?

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8 comments on “Privately funded MGM-AEG arena in Vegas actually breaking ground in May

  1. Biggest UFC fights and boxing matches are booked there. That’s the only reason I go.

    Any new stadium carries some risk, but I think this is a necessary one for MGM. If someone else built an arena and grabbed the Bucks and/or an NHL team, then it’d be tough for UFC & the big boxing promoters to keep booking the shabby MGM Grand Garden Arena. Plus it gives the MGM hotel a chance to re-develop the space that the current arena takes up so that those Signature condos might finally sell.

  2. My only reaction is: “Your move Seattle”

    Obviously, Seattle is the NBA favorite and Vegas has 0 chance at entering the NBA without Seattle, but Seattle’s been talking about their new SODO arena for a long time now & at some point they’ve got to be on the clock. Their in this self-imposed conundrum where Seattle wants an NBA franchise first, except no one wants anything to do with the kingdome because that’s the one of the reasons they lost the Sonics in the first place!

    So hopefully Seattle will be more proactive & break ground soon so they can both be expanded into the maxed out 32 team association simultaneously.

  3. I think he meant the KeyArena.

    Vegas has zero chance of getting an NBA (or really any professional franchise). The issue isn’t gambling though that’s part of it, but the fact there is so much other entertainment there any major sporting event would get completely crowded out.

  4. ahahaha good catch Dan, total brain fart on my part! I did mean KeyArena. I literally can’t believe I typed that, but your reaction cracked me up because that’s how I would’ve reacted.

    Obviously its either going to be relocation or expansion for Seattle, and if the Bucks are stuck in Milwaukee then expansion may be the only way, so it would be baffling if the NBA only expanded 1 team to make for an odd 31 teams. Vegas, in my opinion, is the next best option (even with KC’s Sprint Center just sitting there) so it could be a joint venture if they do ultimately go the expansion route. Its easy to count Vegas out for a multitude of reasons, but they might just end up having the best arena out there when its all said and done… who knows? but the new MGM arena will without a doubt be a more attractive option than KC. I can’t wait to see how it pans out over the next few years…

  5. “Obviously, Seattle is the NBA favorite and Vegas has 0 chance at entering the NBA without Seattle, but Seattle’s been talking about their new SODO arena for a long time now & at some point they’ve got to be on the clock.”

    Seattle has pretty much became NBA equivalent of LA in football, they have pushed the cities with teams that needed a new stadium to pay for one (sounds like some that were only border line are too), they also have pushed local ownership groups to pay far more (though somewhat aided by the league’s recent revenue sharing and virtual assurance the new TV deal is going to be much more lucrative). The chance of purchasing a team to relocate is worse than it has been in decades.

  6. @Lance I see your point, in the sense that both LA and Seattle will eventually get teams. Roger Goodelll said it would take 2 teams to satisfy the LA market, which is why the Rams and the Raiders will more than likely be playing in LA within the next 10 years. In the NBA’s case, you’re right that relocating a team is getting increasingly more difficult which is why Milwaukee may have been the last ticket for that option. All the more reason why expanding 2 new franchises seems like the direction they’re heading.

  7. I continue to think that Kansas City is a better option. I believe that Seattle wants an NBA team more than the NHL and that another Missouri franchise would fit nicely in the Central division. A Seattle/Vegas expansion would force Vegas to play their road games in another time zone. @Danblackdiamond

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