Orlando Magic owner Rich DeVos plans to leave the 11-year-old TD Waterhouse Centre after the team's five-year lease with the city expires in 2004. A new arena could cost up to $500 million, based on the figures of a handful of new NBA arenas already opened or planning to open shortly.
Renovating the 17,000 sf Orlando arena might be in the $40 million range if land, road and utility improvements are factored into the pro forma.
Who is going to pay for a new arena and for a facelift on the old arena? That's another unanswered question the city faces.
So far, DeVos hasn't publicly announced how much he would be willing to invest, along with taxpayers' money, into a new court for his team, and to renovate the old arena. Mayor Glenda Hood is already on record as saying taxpayers are not going to foot the entire bill for either project.
She doesn't relish having a repeat of the 1989 financial fiasco when the arena opened at a final cost of $110 million. She was a council member then.
The project's initial budget was $45 million. Taxpayers covered the whole shebang. About $40 million in debt is being paid off annually.
Today's high-tech arenas are in the $160 million to $350 million range, based on industry numbers. For example, the American Airlines Arena in Miami opened this year at a cost of $213 million. The Pepsi Center in Denver opened in Denver in 1999 for $160 million; the Phillips Arena in Atlanta also opened last year for $214 million; and the SBC Center in San Antonio, TX will open in 2002 for $186 million.
The Magic's DeVos already has aligned himself with deep pockets developer/investor CNL Group Inc. of Orlando. The two sides are talking of building a new arena, with or without the city's assistance and taxpayers' money. Neither party will discuss the topic at this time, however.
Ideally, the new arena would be part of an estimated $1 billion Downtown rejuvenation enterprise that CNL is guiding. For now, however, most city council members are not wringing their hands over thoughts the Magic might forsake them and taxpayers for another venue.
Continue Reading for Free
Register and gain access to:
- Breaking commercial real estate news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical coverage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
