City, county leaders reach initial Seattle arena agreement with investor
May 15, 2012, 6:32 PM | Updated: May 16, 2012, 12:07 pm
 Investor Chris Hansen, King County Executive Dow Constantine, Seattle Mayor Mike McGinn (not pictured) announce the next step in securing a new arena in the SoDo neighborhood. (Seattle Channel) |
The NBA is one step closer to a return to Seattle after
city and King County leaders announced they’ve reached a
memorandum of understanding with the
investor leading the effort to build a new arena.
Mayor Mike McGinn and King County Executive Dow
Constantine made the announcement with hedge fund manager
Chris Hansen. The MOU is a legally binding document that
would essentially give Hansen the go-ahead to proceed on
the preliminary work for the arena he wants to build in
Seattle’s SoDo neighborhood.
That document will now be sent to the King County
and Seattle City councils for approval.
The deal is far from done. In a statement, Councilmember
Tim Burgess, Chair of the City Council’s Government
Performance and Finance Committee, said,
“The Council will thoroughly review the Mayor’s proposal
for a new sports arena. We will determine if municipal
bonds for this project are an appropriate and wise
commitment from the City. We will also explore any risks
to the City’s financial stability and whether this
investment provides sufficient public benefit.”
Under the terms of the agreement, Hansen and his unnamed
investors would pay the majority of costs for land,
construction and acquisition of both and NBA and NHL
franchise.
Taxpayers would ultimately contribute $200 million to help
finance the arena through bonds, which would be
repaid with revenues generated by the arena. The city
and county would own both the arena and the land.
But the public share would be would be limited to $120
million if just an NBA team is secured first. The
agreement calls for the remainder only when an NHL team is
secured by the investment group.
“This commitment of $800 million of private capital is one
of the largest commitments of private capital ever made
for a project like this. It means jobs, it means
investments, it means revitalization and that’s a good
deal,” McGinn said.
The MOU limits King County’s share at 40 percent, with
Seattle paying the rest. McGinn calls that more than fair
since the city enjoys the greatest benefit from the new
arena.
The Mariners, Port of Seattle and other
business groups have raised concerns
about the impact of the new arena on freight mobility in
the area. Hansen recently commissioned a traffic study
for the SoDo neighborhood, the results of which he says
will be released soon.
In a letter to their respective councils, Constantine and
McGinn write that “while there are challenges in the SoDo
neighborhood, including freight mobility issues, let us
not forget that it is the largest transportation hub in
the region. Link light rail, a Sounder train line, three
bus rapid transit lines, 21 Metro bus lines, nine Sound
Transit Express bus lines, four ferry routes, two
interstate freeways and a future deep bore tunnel converge
in this neighborhood. There is no other site in the region
that possesses the transportation assets that are unique
to this area, which is a major reason the existing sports
facilities are located there.”
Hanson says he wants to have a finalized agreement in
place before the NBA Board of Governors meets next month,
in hopes of possibly acquiring a new franchise.
Read all related documents on the Seattle arena proposal
here.
