Will Sacramento Kings come to Va. Beach? The latest.November 9th, 2012 at 12:17 am by Bruce Rader under News, Politics, Sports, Uncategorized
On Tuesday, the Virginia Beach City Council will be presented with the final consultant’s report regarding the feasibility of building a $350 million arena.
The clock is ticking, so where are we now?
Governor Bob McDonnell, Beach Mayor Will Sessoms and officials from Comcast-Spectacor met in Richmond last week along with Sacramento Kings owner George Maloof in regards to the Kings moving their team to Virginia Beach.
Most of my sources tell me today they don’t believe the arena can survive without the assurance that the Kings will sign a long term deal.
But it won’t be cheap. The Kings will have plenty of expenses, at least a $30 million dollar relocation fee to be paid to their fellow NBA owners, as well as $10 to $15 million in moving expenses. As much as the owners would like Virginia Beach to help them with their $67 million arena debt in Sacramento that will never happen.
The Kings would have to play their games at the Ted Constant Center at Old Dominion for two seasons while the arena is being built.
Thus the team would want to be compensated for lost revenue–the total cost, including relocation fees, moving expenses and lost revenue for two years would be somewhere around $100 million.
It may sound like a lot but that is not an outrageous assumption, and it can be paid over time.
Already one consultant report, given to state officials, concludes an arena with an NBA team could generate as much as $182 million in visitor spending each year, with the state alone taking in almost $11 million in tax dollars.
Throw in the publicity of having a major league sports team in Virginia and the governor, mayor, and local business folks think it’s a good idea.
If the numbers add up.
A big chunk of the money would have to come from the state, as much as $105 million dollars, which would be paid to George and Joe Maloof the owners of the team for relocation fees and lost revenue, with any money left over to be used to help the city with construction costs.
The state would also help with financing bonds needed to build the arena.
Comcast-Spectacor and Live Nation, who are putting the deal together, will also probably be asked to kick in as much as $35 million dollars in cash to help make this happen.
Another option is, if the Kings don’t get what they want, would it be viable to build a less expensive arena–that would host concerts, big college basketball tournaments, like the ACC, ultimate fighting, big religious conferences, and then someday go after another NBA team, or maybe an NHL team that could move right in. Thus no lost revenue to be paid out since the arena will already have been built. That would be a $100 million savings alone.
That would probably rule out any money from the state right now, which might be enough to kill the deal, unless the NBA would guarantee Virginia Beach an expansion franchise, which seems out of the question.
Again the City Council will receive their own consultants report on Tuesday, but will the Kings buy in?
Can the arena happen without the Kings?
A complicated situation that could come to a conclusion one way or another by the end of the year.