According to a press release posted to the Philadelphia 76ers website at 4:52 am this morning, team owners Josh Harris and David Blitzer are partnering with local investment bigwig David Adelman to build a $1.3 billion arena in downtown Philly by the time the team’s current lease expires in 2031. According to the team’s new arena website, the building would be located on Market Street a few blocks east of City Hall, replacing part of the current Fashion District mall atop the Jefferson Station subway station, right next to the Reading Terminal Market and the Greyhound bus station and adjacent to the city’s Chinatown. And according to an ESPN interview with Sixers president Tad Brown — which clearly happened yesterday and was embargoed until this morning, unless Brown was awake at 5:56 am when ESPN posted its story — the arena will be built with no public funding:
“It’s all privately financed. So there’s nothing that we’re going to be asking from the state or the city that is going to go into this.
“[Asking for public subsidies] doesn’t play in Philly. … We wanted to take that question off the table, and we want to build the finest facility in the country with our own resources, so that we can give something to the city.”
Regular readers will recall that Harris and Blitzer were last seen two years ago seeking a $4 billion development project at Penn’s Landing that they vowed would not use “any direct appropriation of city or state taxpayer money” while seeking $700 million in city sales- and income-tax kickbacks. That plan collapsed almost immediately, at which point Harris almost immediately started talking about building a new arena elsewhere. Now we have the elsewhere, and another claim of no public money being needed.
Are Harris and Blitzer for real this time? We have only their own claims to go on — that arena website features a logo reading “Privately funded, no city subsidies,” but it doesn’t go anywhere when you click on it — so there are some questions we’ll want answered before applauding the Sixers owners for going where few sports team owners have gone before:
Really, “nothing” from the state or the city? There’s a long tradition in development circles of claiming that tax breaks aren’t really a public contribution, because it’s just asking for your own money back that would belong to the opera club anyway. There are lots of ways for team owners to demand subsidies under the table, and they typically like to use them all, so it would be nice to hear Sixers execs vow that they will be paying full property, sales, income, etc. taxes on this project.
Who’s paying for the land? In this day and age and on a site that’s bound to be complicated to build on — did I mention it’s on top of a busy subway station? — $1.3 billion isn’t outrageous as an arena construction cost only. The Fashion District mall’s owner, Tom O’Hern of the real estate investment trust Macerich, said in the Sixers press release that “we are committed to working collaboratively with 76 Devcorp to bring to life the vision of this iconic development that will ensure Philadelphia’s vibrancy for generations to come,” but that’s not exactly specific about who will pay what to whom, so that needs to be spelled out.
How do Harris and Blitzer plan to make this pay off? One reason there aren’t all that many privately financed sports arenas being built — the Golden State Warriors‘, Seattle Kraken‘s, and Los Angeles Clippers‘ come to mind for starters — is that it’s tough to get enough new revenues from a sports venue to repay a billion dollars or more in construction costs, let alone turn a profit. (It is at least easier for arenas than stadiums, if only because arenas can host lots of concerts to fill more dates.) Adelman noted that at the team’s current arena in the middle of parking lots in South Philly, “When you leave Wells Fargo Center, you can’t go have a drink, you can’t get something to eat,” which is true, but giving fans more bars across the street to go to doesn’t really boost the team’s bottom line. It’s possible that the Sixers owners think they can do better owning their own arena rather than being tenants of the Flyers, but then, unless they convince the Flyers owners to come be their tenants, they would end up having two arenas competing for concert business, which is never a good way to maximize profits.
If all of Harris and Blitzer’s promises turn out to be true, we could be looking at a case where capitalism is, sort of, working as its boosters claim it’s supposed to: Rich dudes sinking a bunch of their own money into building a competing arena, in the hopes of knocking the current private arena kings off their perch. (Whether the rich dudes have a solid business plan or a stupid one isn’t the public’s problem in this scenario, so long as they’re gambling their own money on it.) Or this could still be yet another “privately financed” project with a giant publicly funded asterisk yet to be revealed. More on this once Philadelphia’s journalists all wake up and start asking questions, I sincerely hope.
Philadelphia’s definitely a market I could see following a San Francisco/Seattle/Inglewood model. That said, downtown Philly has notorious parking issues. The subway station helps, but are the fans from the Main Line and South Jersey really going to take public transit? Maybe it doesn’t matter as DC and Newark aren’t exactly known for great parking either.
The proposed site is just a couple of blocks from the Vine Street Expressway, so it shouldn’t be too hard to drive to. Where everyone would park is another story entirely, and I expect will be one of the issues Chinatown leaders raise, since it was one of the things they objected to when the Phillies were thinking of building a stadium a couple of blocks north.
Is it possible to get SEPTA from the current sports complex to the new site? People could park in the lots that are there now. The Phillies and Eagles will still be there.
SEPTA doesn’t go to the current arena, does it? You’d have to take the Broad Street subway from there and change trains, or walk from City Hall.
There are probably some park-and-rides elsewhere on SEPTA that you could take the train from, but I’ve never used them, so will leave it to locals to say whether that’s a viable option or not.
First: Philadelphia does not have a “downtown” but a Center City.
Second: Jefferson Station is not a subway stop, it’s one of three commuter rail stations SEPTA has in Center City. It’s adjacent to the Convention Center where the Flower Show is usually held in the spring.
Third: The stadium district in South Philly is well placed for those who take mass transit. SEPTA runs express and game-day trains on the Broad Street Line, though the suggested connection point from commuter rail is City Hall station which is not handicapped-accessible.
“Downtown” is the generic term that non-Philadelphians would recognize. Philadelphia’s downtown is called Center City, much like New York’s downtown is called the Financial District.
And thanks for the clarification between the SEPTA underground commuter lines and the SEPTA underground trolley lines, and apologies for conflating the two — I can never keep straight which of those stop where along Market. (If I’m reading the online maps correctly, the trolley terminates a couple of blocks west at 13th Street, but the online maps are pretty terrible.)
As I recall the Flyers built/opened their arena in ’96… and as you say it is a multisport arena.
It’s entirely possible that the Sixers could make enough extra money at their own arena (and restaurant/bar/complex attached) to make this worthwhile. They could also optimise the fan experience for basketball only… something that is hard to do in a shared hockey arena.
Assuming they really are spending their own money, I say encore, encore….
If that happens, then hopefully the Flyers will adjust their arena to hockey only.
Hockey and concerts, I would assume, yes.