Seattle mayor selects influential investor for KeyArena renovation

Updated:

SEATTLE - Seattle Mayor Ed Murray has chosen the influential investor group Oak View Group to renovate 55-year-old KeyArena.

With Mayor Ed Murray not running for re-election, it will be up to the next mayor to see the $564 million KeyArena renovation project through

Candidate Jessyn Farrell will look hard at transportation.

”The transportation improvements are going to need to be very, very significant and so I would like see more information on what the city intends on that,” Farrell said.

Oak View Group CEO Tim Leiweke promised, “We will deal with the neighborhood and the transportation issues. And we will do with it-- deal with it so that we are part of this $12 million a year campus and do it so that we have minimum disruption to the community.”

Candidate Mike McGinn is the former mayor who backed the SoDo option, presented by developer Chris Hansen.

McGinn thinks the council should keep the SODO option alive.

“I think they should grant the street vacation. It is conditional. They will not build an arena unless they have a team. And that give you an opportunity to fully vet the Oak View Group proposal and see what they have to say.”

KIRO-7 asked Murray if he thinks he should keep the SODO option alive.

“The SODO plan is still technically alive and the council, vacations are in the council's purview, not ours. Work could be done on doing it. If we were going to send it back down to the council though, I would want a very different process than was used the first time,” Murray said.

The City Council will hold its first meeting on the Key Arena Plan on July 10.


Key developments:

  • Seattle took a significant step forward in a long-running arena saga on Wednesday when the mayor chose investor Oak View Group’s proposal.
  • OVG has billed its plan as “New Arena at Seattle Center.” The group’s vison basically rebuilds the facility except for the roof. See photos here.
  • Murray said that he hopes to have a council-approved memorandum of understanding with OVG by the end of 2017.
  • The completion of an arena could be the ticket for getting an NHL team into the market first.
  • In OVG’s April proposal, the group said it hopes to have the arena renovated by October 2020 so it’s ready in time for the 2020-2021 NBA/NHL season.

Below is a questions-and-answers section with what we know now. See renderings and site plans from OVG here.

Who is the Oak View Group?

Los Angeles-based Oak View Group is led by industry leader Tim Leiweke, who has been in the sports and entertainment industry with over 30 years.

OVG is currently underway in the development of a new arena in New York State for the Islanders NHL franchise and a new MLS Stadium in Miami-Dade County for David Beckham’s expansion team.

What is their proposal in Seattle?

OVG's proposal called for a $564 million overhaul that would be financed through a mix of revenue streams. OVG also has financial backing from Madison Square Garden Entertainment. Watch the news conference where the proposal was discussed below.

OVG has billed its plan as “New Arena at Seattle Center.” The group’s vison basically rebuilds the facility except for the roof. See photos here.

OVG was originally looking at a $400 million project before realizing the cost was significantly higher to make the remodel work on a limited footprint. They also called for an ambitious schedule that could have had a new arena ready by 2020-21. That timeline is now in question after KeyArena was unexpectedly selected to host early-round games for the NCAA men's basketball tournament in March 2019.

Wasn’t there another proposal?

A competing bid from Seattle Partners — a group that included arena giant AEG — withdrew its proposal Sunday amid criticism of how the city handled the proposal process.

Seattle Partners proposed a $521 million remodel that required using $250 million of the city's bonding capacity to complete the financing, which was deemed a deal breaker after the city demanded the project be privately financed.

According to KIRO Radio, Murray made his decision late Friday, but that decision was apparently leaked, causing Seattle Partners to withdraw its proposal on Sunday.

What does OVG mean for a new Seattle sports team?

While Seattle's history is as a basketball town, the completion of an arena could be the ticket for getting an NHL team into the market first. The NHL has not hidden its interest in Seattle, the No. 14 media market in the country and the only market in the Top 25 nationally that does not have an NBA or NHL team.

But the NHL has also grown frustrated by the starts and stops of an arena process that's seen more roadblocks than successes.

Mayor Ed Murray announced that the city will begin negotiations with the Oak View Group on a proposal for a privately financed renovation of city-owned KeyArena. See renderings in this slideshow. (Images via Oak View Group)

In OVG’s April proposal, the group said it hopes to have the arena renovated by October 2020 so it’s ready in time for the 2020-2021 NBA/NHL season.

What happens next?

The decision to go with OVG is subject to both sides agreeing on details of the proposal and the finalized transaction must receive approval from the City Council.

That may prove tougher than it sounds, as numerous community groups have expressed concerns about KeyArena becoming a year-round destination venue in a neighborhood that has seen a building boom with transportation shortcomings.

There's also the question of how much influence Murray's decision will have since he is not running for re-election in November.

Murray said in a  news conference on Wednesday that he hopes to have a council-approved memorandum of understanding with OVG by the end of 2017. The city council's 9-member civic arena committee meets on July 10 to discuss the proposal.

What does this mean for the SODO arena plans?

Still waiting across town is investor Chris Hansen and his hopes of building a privately financed arena in an area near Safeco Field but also near the city's maritime businesses that have strongly objected to another sports venue joining the neighborhood. Hansen's proposal only requires city approval of a street closure to move forward, but he has said he will not start construction until a franchise is acquired.

The plans to renovate Key Arena have drawn criticism from those who prefer the SoDo arena proposal. During his interview on KIRO Radio, Murray pointed out that the Seattle City Council voted the SoDo plan down.

An investor involved with the Sonics Arena group says the SoDo plan isn’t dead.

“I haven’t heard that and I don’t believe that to be the case at all,” former NBA player and Sonics GM Wally Walker told KIRO Radio’s Dori Monson. “We own the land and we’ll see what happens as they try to negotiate a deal between [Oak view Group] and the city.

“We’ll just stand by. We’ve just said all along we just want a solution where an arena in this town gets built that attracts the NBA and NHL. If we’re on the path, that’s great.”

Murray’s comments Wednesday morning did make it seem as though SoDo was being phased out

What will this mean for traffic?

There are still concerns from neighbors of KeyArena who say there isn't a plan to get fans to the stadium besides by car. OVG pitched what it calls alternate traffic solutions in April.

OVG’s plan anticipates that automobile access as a mode of transportation will decrease from 82 percent to 69 percent by 2035 when a light rail station opens near the stadium. They are banking on the alternate modes of travel.

The solutions include shuttles, rideshares, and bicycling. Click here for an expanded list.

When was KeyArena last renovated?

KeyArena, which opened its doors in 1962, was last renovated in 1995.

It was the former home of the SuperSonics before the basketball team bolted for Oklahoma City in 2008.

It is currently home to WNBA's Seattle Storm and hosts dozens of concerts and other events. It had about 570,000 visitors last year.


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