Thursday, February 16, 2012
Updated: February 17, 6:34 PM ET
Seattle unveils plans for new arena
SEATTLE -- Christopher Hansen is making a $290 million proposal to his hometown that could be the impetus for a new sports arena that could bring the NBA and NHL to Seattle.
All he needs to make it a reality is city and county approval equaling $200 million and the two franchises.
Hansen, a hedge-fund manager based in San Francisco and a Seattle native, submitted a proposal to the city Thursday that calls for $290 million in private investment toward the construction of a new arena that would cost between $450 million and $500 million.
Hansen and his investment group also would be responsible for the purchase of an NBA franchise and finding a partner interested in bringing an NHL franchise to Seattle as well.
The proposal represents the first significant step toward solving the arena problem that was at the root of the SuperSonics' move from Seattle to Oklahoma City following the 2007-08 NBA season, leaving behind 41 years of history.
The proposal will now go before a review board -- a group of community leaders that includes one-time SuperSonics player and coach Lenny Wilkens -- with King County executive Dow Constantine hoping the review can be completed within a month.
According to a letter submitted by the Hansen, the remaining construction and development costs would be financed by the city and King County using taxes and revenues generated by the new facility and rent charged to the teams playing in the arena -- money that will not exist if the arena isn't built.
City officials are adamant there will be no new public taxes needed for the building and the city's portion of the investment will be capped at $200 million with any additional cost overruns paid by the private investors.
From there, Hansen's proposal would need city and county approval. City Councilman Tim Burgess believes the council could complete its arena review as early as June. But even with ultimate approval, no shovels will be going into the land just south of Safeco Field until an anchor tenant is in hand with a 30-year lease agreement that includes a no-relocation clause.
City officials say their projections for how the financing plan would work are based off having both an NHL and NBA team.
"There will be no arena unless there is an agreement to get a team here to occupy that arena over a very long term," Constantine said at an afternoon news conference that was part pep rally.
The amount of liability Hansen and his investment group are taking on is somewhat staggering and appears to comply with a voter-passed initiative from 2006 that prohibits Seattle from supporting teams with taxes unless such investments yield a profit.
City officials say the $290 million in private investment would be the third-most among NBA or NHL arenas. The arena would be built on land Hansen already owns in Seattle's SoDo neighborhood, where the Seahawks and Mariners already play.
"I am confident this proposal will be looked on favorably by both leagues and sincerely believe that together we can accomplish the goal of securing NBA and NHL franchises for our community," Hansen wrote in his proposal.
Seattle is the only top-15 media market in the country not to have at least three franchises in the four major professional leagues, and Thursday's announcement would appear to ratchet up pressure on places such as Sacramento, New Orleans and Phoenix, where their franchises face uncertain futures.
Documents obtained through a public records request from the city of Seattle show Hansen is paying attention to what is happening in Sacramento, where a March 1 deadline looms for submitting plans to the NBA for funding a new arena.
The linchpin of Sacramento's arena plan -- a proposal to divert and privatize parking revenues to cover roughly $200 million of the arena's costs -- is tentatively scheduled for a full city council vote Feb. 28.
Think BIG Sacramento, a regional initiative for a new arena launched by Sacramento mayor Kevin Johnson, denounced Hansen's moves, calling them "publicity stunts aimed at derailing Sacramento's process to build an arena."
But the NHL's Coyotes in Phoenix and the NBA's Hornets in New Orleans are both currently owned by their respective leagues, although each league has strongly expressed its desire to find local ownership to keep those teams in those markets. A public records request by The Associated Press found that Seattle Mayor Mike McGinn's office has not had documented contact with either the NBA or NHL about a team coming to Seattle.