Well, that sure escalated quickly: Just two days after a Virginia state legislative agency voted behind closed doors to endorse a new arena for the Washington Capitals and Wizards in Alexandria, team owner Ted Leonsis appeared this morning with Gov. Glenn Youngkin to announce an agreement — albeit a nonbinding one — to move the teams there. The Washington Post quotes Youngkin as saying, “Virginia will not only be the best place to watch hockey — to watch basketball, but it will be the best place to innovate and press the envelope in what we can do together,” so clearly this deal came together so quickly that the governor’s staff didn’t have time to write a coherent press statement.
As for what the deal, which would still need to be approved by the full Virginia legislature, includes, the Post includes a few peeks at the elephant:
- The arena would be part of a $2 billion “12-acre mixed-use development” across the Potomac from D.C. and adjacent to the new Potomac Yard metro station.
- Developer JBG Smith, which owns the property, would sell it to a Virginia stadium authority for a price that “a senior JBG Smith executive said he couldn’t disclose.” The state would then lease it to Leonsis for another price that nobody is saying.
- State Del. Marcus Simon, the deputy Democratic leader in the state house, echoed what was reported yesterday in writing on Twitter that “I’ve been told this deal will use no state $$ & no impact on debt capacity of the City of Alex or Virginia,” but added that “obviously this is a trust but verify situation.”
- State Sen. Mark J. Peake told the Post that he was “always skeptical of giving tax breaks to billionaires,” which implies either that there are tax breaks included in the deal or that he’s afraid there would be. (Peake isn’t on the commission that approved the arena plan in secret on Monday, so it’s not clear if he’s even seen the terms.) If nothing else, it seems likely Leonsis would get out of paying property taxes by having the state own the land.
- “Two people familiar with Virginia’s proposal said it includes about $200 million for transportation improvements to support the new arena,” reports the Post, without explaining whether that is counted in the “no state $$” vow.
- There’s even a rendering of sorts, though it’s marked “for illustrative purposes only,” in case anyone might mistakenly think it’s an actual building you could climb through your browser and walk around in:
Washington, D.C. mayor Muriel Bowser, meanwhile, immediately responded with her own offer of $500 million in “public financing” for renovations to the Caps and Wizards’ (privately owned, if that’s even a relevant distinction in a world where who gets the revenues is more important than whose name is on the deed) existing arena, after Leonsis had asked for $600 million. Bowser called this D.C.’s “best and final offer.”
So to recap: Virginia’s governor is offering to buy land for a new $2 billion arena complex for the Caps and Wizards, and Leonsis is rumored to be willing to repay it, somehow, maybe not including tax breaks and infrastructure costs, while D.C. is offering half a billion dollars in renovation money in response. There are way too many blanks remaining in either of these deals to evaluate what either of them would mean for Leonsis, let alone taxpayers, but suffice to say that the bidding war just turned hot, so heads up, grass, and hold onto your wallets.
I wonder if the smash-n-grab route is the way for team owners to go now. Make your deal in secret, then announce it when it’s completed, before any opposition get up and running. Like the Atlanta baseball team’s move to Cobb County. By the time the public gets wind of the give-away, you’re already in your new digs.
I think that’s how Robert Moses built the highways and parkways in and around NYC.
There are hurdles to clear for sure but I think the Wizards and Capitals are moving to VA. Don’t think it’s a good deal for VA taxpayers, who went from being able to take in game by only paying for a train ticket to now paying for a whole Billionaire Playground.
There were so many things are already in the chute to come to that area (Amazon HQ 2 and the Virginia Tech Innovation Campus). But this gives Monumental more subsidized land so why wouldn’t they want to move. What really irks me is DC gave over $50M 8 years ago to build the Wizards a practice facility and it seems as if Leonsis will be abandoning that after 10 years.
https://ggwash.org/view/41129/the-wizards-practice-facility-deal-should-be-more-transparent
Great. Just… great.
Plenty of team owners love to tout the economic boom their new arena will bring to an area, and arguably MCI/Verizon/Capital One was a prime example of it actually… working.
Now do we get to see how the virtual abandonment of that arena 30 years later signals a neighborhood’s death spiral? Time will tell.
Not sure what the 15K concert venue competition is in DC, but if they convert it for concerts, like the Forum in Englewood, it could work out OK. All the best dates at the new arena will be taken by the NHL and NBA.
If it’s abandoned by the Wizards and Caps- it becomes the premiere concert venue in the region. They probably end up making a lot more money then when all the dates were eaten up by sports BUT the side effect is Royal Farms Arena in Baltimore kind of gets pushed aside. Oak View group has rebranded that arena as the premier concert venue in the region- but an empty, mostly state of the art venue in DC will be much more desirable for major concerts
It’s not going to be FULLY abandoned as a sports facility, either. They will move the Mystics to the arena from the current rec center that the Capital City Go-Go play in in an attempt to try and take advantage of the current popularity the WNBA is having in places like Las Vegas, New York, and Phoenix as it’s impossible to do that when you’re capped at 4000 seats, although it’ll be a challenge if the Mystics suck and struggle (and we’ve seen that type of apathy in places like Indiana where they actually had below 2K average the year before they won their first #1 pick) and I assume they’ll probably attempt some kind of arena football or other minor league endeavor for it for the winter months when they don’t have concerts lined up.