November 06, 2009

City OK's plan to study downtown arena, entertainment district

Plans call for 18,000-seat arena, retail shops

Las Vegas took what could be a giant step today in getting a sports arena built in the city’s downtown — and luring an NBA or an NHL team to locate here.

The City Council voted 6-0 to enter into an exclusive agreement with the Cordish Co. of Baltimore, noted for its downtown development expertise around the country, to study the prospects of building an arena, a casino/hotel and an entertainment district on about 20 acres that includes the existing city hall.

Councilman Steve Ross, who said he supports the project, abstained. Ross said he has been advised by the city’s lawyers not to vote on projects involving the city hall, because of his efforts to negotiate for union jobs on a new city hall project in his job as secretary-treasurer of the Southern Nevada Building and Construction Trades Council.

Before the vote, Mayor Oscar Goodman called the agreement a “tipping point” and said the redevelopment project would “take us from a great city to a world-class city.”

The city’s “Exclusive Negotiation Agreement” with the Cordish Companies Inc. provides a two-year window for Cordish to study the feasibility of a sports arena, a casino/hotel and an entertainment district on about 20 acres split between two sites at Las Vegas Boulevard and Stewart Avenue.

“We think that’s tremendously important when you hear a little about the Cordish companies, their reputation and the accolades they’ve received, not just from their clients, but from groups such as the Urban Land Institute,” Bill Arent, director of the Las Vegas Office of Business Development, told the council. “We thought it was really important to get exclusivity with this company for studying this project,
mainly the arena, in downtown Las Vegas.”

Cordish will look into building a casino/hotel on the 7.75 acres that is now the site of City Hall and the Stewart Avenue Parking Garage.

On the site just east of city hall, the company will check into the feasibility of an arena with at least 18,000 seats and an entertainment district that would include retail shops, restaurants and bars.

The agreement calls for Cordish to determine the economic viability of an arena, including seeing if public financing is available. Cordish would look into recruiting an NBA or NHL team and an arena operator.

Cordish would also develop a strategy for getting tenants for what it calls a “Live District” and for the casino/hotel. It would set up business terms for acquiring and developing the two sites.

The company would work on a viable financing plan, using a combination of public and private funds for the Live District and hotel/casino.

The pact with the city also calls for Cordish to come up with a schedule and a scope from when the project would be designed through getting permits, beginning construction and completing the improvements on the two sites.

Under the agreement, Cordish will put up a $100,000 deposit, as an act of good faith, which it would get back at the end of the two-year period or if Cordish finds that the development isn’t feasible, Arent said.

The city would also reimburse Cordish for up to $150,000 toward the cost of third-party expenses in studying the plan. That money would come out of the city’s Industrial Development Revenue Fund.

Arent said Cordish was likely to spend much more than that on its research. But if the plans fall through and Cordish decides not to do the project, the city would be able to recover the studies and reports that the $150,000 generated.

“The arena itself is a challenging project. It’s an ambitious project,” Arent said. A 2006 study by the Convention Sports & Leisure group study showed that such an arena could cost about $500,000, he said. Cordish will look into a combination of private and public financing for an arena, he said.

Port Telles, Cordish’s development director, told the council the Live District would also include amenities such as comedy clubs, art walks and have open air areas that could be a community gathering place for events like high school pep rallies and be the start or finish of a community running event.

Asked to explain the “Live” concept a little more by Councilwoman Lois Tarkanian, Telles said the Live districts are pedestrian friendly. Cordish provides free entertainment acts, up to 200 per year in such Live districts, including big-name artists.

“They stay before the game and after the game,” he said. But the Live districts are self-sustaining and don’t actually require an adjacent sports arena,
he said.

The company, which has developed 26 urban redevelopment projects, just won a Urban Land Institute Award for Excellence this year for the Kansas City Power and Light District.

The Kansas City project transformed an area of urban blight into an $850 million entertainment district that includes 45 retail outlets, restaurants, bars and entertainment venues, linking the convention center in Kansas City, Mo., to its downtown sports arena.

Telles said Cordish has found, during the nearly 100 years the company has been in existence, that the smart developers and the smart cities are those who plan and position themselves for success during difficult times.

“We see an opportunity for us to get started with that process right now,” he said.
Cordish has also found that arenas and the venues around them have created steady economic growth for communities, Telles said.

Councilman Stavros Anthony asked if the sports arena could proceed if the city hall land was not in the mix.

Telles said if that did occur, it’s something that the company would analyze and try to make work.

“My preference is the National Hockey League, to bring the Detroit Red Wings out here,” Anthony said.

Mayor Pro-Tem Steve Wolfson asked if all the projects needed to be done as one large project, because their success of one would depend on the others.

“You want to take a holistic approach to it and look at the entire package,” Telles said. “That’s how you get, really, the bang for the buck in terms of what we can plan.”
Wolfson noted that a hotel-casino would be the first such facility to be built in the downtown in decades.

He also indicated, because the city does own the 20 acres in the project footprint, that city-owned land could be leveraged as the public’s part of the project, rather than having the city come up with funding or increase taxes.

Arent said it would be premature to speculate what incentives might be put on the table this early in the process, but the land does have a lot of value and is something that could be put into the public-private equation.

Councilman Gary Reese said he saw the project as a way for the community to come together in a common gathering place for entertainment downtown.

“I just hope I live long enough to be able to go to a basketball game here,” Reese said. “I’m not a hockey fan. I’d like to see the Detroit Pistons here.”

Goodman told Telles the council had been steadfast in trying to move Las Vegas into being a world class city. But the city has had to endure impacts of 9-11, which put everything on a standstill and now it is dealing with the worst recession in memory,
he said.

He asked Telles to tell Cordish that “a miracle” has occurred in Las Vegas with the building of the Lou Ruvo Brain Institute in the building designed by famed architect Frank Gehry in the downtown as part of the city council’s vision to bring a world-class medical facility here. The council has also pushed to improve cultural offerings in the city and the Smith Center for the Performing Arts in the downtown is evidence of that, he said.

“Today is one of the final pieces that we’re heading towards,” Goodman said. “For a city to be a great city, to be a world class city, it has to have a place with which the people who live in a community can identify.”

He said many people who relocated to Las Vegas started identifying more closely with the community as the result of rooting for the nationally ranked UNLV Rebels basketball team. Building an arena and an entertainment district would extend that sense of community, he said.

“We’re counting on you, because this is our dream,” Goodman told Telles, “to have this kind of venue in the heart and soul of the entire valley here


Join the Newsletter

Sign up to receive the latest updates and news from The Cordish Companies