Those hoping to see the NBA return to Seattle received some great news Tuesday. Chris Hansen, the billionaire behind a failed effort to relocate the Sacramento Kings in 2013, has offered to fund a new arena entirely with private money, according to KING 5 News reporter Chris Daniels.
In a letter to Seattle mayor Ed Murray, the King County executive and city council members, Hansen said his investment group is willing to construct the arena “at no cost to the City or the County." This is a change from a previous request for the city to contribute $200 million for construction.
“The goal of this partnership was to build the arena and bring an NBA team to Seattle. Public financing was simply a mechanism that made that possible at the time,” the letter states. “We have concluded that a changed economic climate makes possible the private financing of the arena.”
What held this up before?
In 2012, Hansen’s group signed a five-year Memorandum of Understanding with the city to work together to make a new arena possible. But last May, the city voted 5-4 against a proposal that would have allowed Hansen to purchase and vacate a section of Occidental Avenue, a street south of the Mariners’ Safeco Field. That put the project on hold.
Seattle City Council member Sally Bagshaw, a previous supporter of the arena project that voted against the street proposal, suggested it was too risky to allow Hansen to purchase the land when it’s not clear the NBA even wants to expand:
“There’s no legal obligation for the city to give up a street under this proposal at this time, and we are putting a lot at risk for an NBA team that doesn’t even exist. We’re hoping for fairy dust,” she wrote in an April, 2016 blog post. “The Council and the Mayor should consider benefits for our city and region, not just what’s best for one man and a hoped-for basketball team.”
Hansen called the vote “disappointing,” but acknowledged that “we don’t believe it is the end of the road in our quest to bring the NBA and NHL back to Seattle.”
What changed Hansen’s mind?
It’s tough to say, but while NBA expansion seemed a ways off in May, there are increasing signs that the league would consider it in the near future.
Earlier this month, SB Nation’s Sonics Rising cited multiple sources suggesting the league would put expansion back on the table after completing a new CBA. Seattle is one of a few cities that could be in the picture, along with Louisville, Las Vegas and several others.
But expansion to Seattle is unlikely without any plans for a new arena, putting the ball back in Hansen’s court. By offering to privately finance the arena, Hansen is putting the impetus back on the city to approve the Occidental Avenue proposal.
The upcoming Memorandum of Understanding deadline likely played a role as well. The agreement expires next year, so without any movement on the financing of the arena project, the arrangement would have needed to be renegotiated.
What must the city decide now?
Hansen’s financing plan had one condition: the city must agree to vacate the stretch of Occidental Avenue that they refused to vacate last May. One of the five city council members who voted against that proposal must decide if Hansen’s pledge to forego the $200 million in public funds originally promised is enough to change their vote. The city must also waive an admissions tax, as it has for Safeco Field and CenturyLink Field.
If that happens, Hansen’s group will cover a $27 million gap to help the city pay for a bridge on Lander Street. This will help ease congestion and is a concession to those worried about the city focusing on an arena for a team that doesn’t yet exist instead of other public works projects.
What happens after that?
Should the city change its mind on the Occidental Avenue proposal, Seattle immediately becomes a top candidate for NBA expansion. The other 30 league owners would have to approve splitting the revenue pie another way, but with so much TV money entering the league and the potential to add the 14th-biggest media market on the table, perhaps that’s an option they’d entertain.
In April, NBA commissioner Adam Silver said the league “may consider” putting expansion on the table once the new CBA was complete, which could happen in the next few weeks, according to Yahoo! Sports’ Adrian Wojnarowski.
While Silver said in April that a roadmap to a new arena won’t “hasten” the NBA’s decision, it will likely be necessary for Seattle to even be under consideration. Key Arena, which the Sonics left in 2007 to move to Oklahoma City and the WNBA’s Storm currently play, is barely a viable facility.
Would the NBA consider expansion more closely if Hansen’s group actually broke ground on a new arena? Or is Hansen’s group willing to fund a new arena privately because the NBA is considering expansion more closely? It’s a chicken-or-egg scenario that is inching closer to a resolution, much to the relief of those who want to see the NBA back in Seattle.