It appears that the Washington Capitals hockey team and Washington Wizards basketball team are going to move across the Potomac River to northern Virginia. Governor Glenn Youngkin announced, alongside owner Ted Leonsis, that the teams would be moving to a massive new sports complex and arena in Alexandria’s Potomac Yard neighborhood as soon as 2028.
As a sports fan, I have no strong opinions about where those teams choose to play, although I agree that this is a serious blow to a downtown Washington D.C. that has many stretches looking increasingly shabby, empty, and run-down these days.
But as a Virginia taxpayer, I sure as heck don’t want any state funding used to build these teams a new arena. Leonsis, the owner of the Capitals, Wizards, the WNBA’s Washington Mystics and Monumental Sports Network (basically a local version of ESPN) is worth an estimated $2.8 billion.
I’m less opposed to spending taxpayer money on infrastructure changes around a new stadium; all of those people have to be able to get to and from the stadium or arena, and it’s reasonable for a locality or state to pick up part of the tab because roads, highway interchanges, and public transportation like Metro stops are a government responsibility.
The good news is that it appears that the state won’t be directly paying for any arena construction, but that a new state-established entity will effectively be taking out loans by issuing bonds — but the plan is that state taxpayers won’t be the ones paying back the bonds, but fans parking their cars in future years.
The framework of the deal rests on approvals from the Virginia General Assembly and Alexandria City Council. The state legislature, which convenes Jan. 10, 2024, for its upcoming session, will be asked to approve the creation of a new Virginia Sports and Entertainment Authority that would own the land and buildings within the entertainment district. The $2 billion investment would be supported through bonds issued by the proposed authority, as well as a $403 million investment by Monumental.
The 9 million-square-foot district, to be developed by JBG Smith, would include the sports arena, as well as corporate headquarters for Monumental Sports & Entertainment, a media studio, a Wizards practice facility, a performing arts venue and an expanded e-sports facility, along with retail, restaurants, hotels and conference and community spaces.
The first phase, which includes the arena, could generate $12 billion in economic impact and create 30,000 jobs over the next several decades.
The bonds for the project would be repaid through annual rent paid by Monumental and arena parking revenues, naming rights and incremental taxes generated by the arena and development of the first phase, according to Youngkin. The City of Alexandria would contribute $56 million toward construction of the performing arts venue and $50 million toward underground parking development. The land and buildings would be owned by the authority, which would enter a 40-year lease with the company.
I would note that when giant new development projects like this get unveiled, the deal that gets announced and the deal that gets enacted sometimes are not much more than distant cousins. Projects have delays and cost overruns, lawsuits, environmental impact statements, inflation drives up the cost of materials and labor, and so on. The temptation to have Virginia taxpayers cover some of the costs will not go away, so conservatives in this state will have to watch this development project closely.
The Washington Capitals and Wizards Won’t Be in Washington for Much Longer
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13.12.2023
It appears that the Washington Capitals hockey team and Washington Wizards basketball team are going to move across the Potomac River to northern Virginia. Governor Glenn Youngkin announced, alongside owner Ted Leonsis, that the teams would be moving to a massive new sports complex and arena in Alexandria’s Potomac Yard neighborhood as soon as 2028.
As a sports fan, I have no strong opinions about where those teams choose to play, although I agree that this is a serious blow to a downtown Washington D.C. that has many stretches looking increasingly shabby, empty, and run-down these days.
But as a Virginia taxpayer, I sure as heck don’t want any state funding used to build these teams a new arena. Leonsis, the owner of the Capitals, Wizards, the WNBA’s Washington Mystics and Monumental Sports Network (basically a local version of ESPN) is worth an estimated $2.8........
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