X

Thank you for sharing!

Your article was successfully shared with the contacts you provided.

ORLANDO-How badly does Orlando want to keep its National Basketball Association team? That’s the crucial question city council members will face in a few weeks when they review an $80,000 consultant’s report.

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.

Want to continue reading?
Become a Free ALM Digital Reader.

Once you are an ALM digital member, you’ll receive:

  • Unlimited access to GlobeSt and other free ALM publications
  • Access to 15 years of GlobeSt archives
  • Your choice of GlobeSt digital newsletters and over 70 others from popular sister publications
  • 1 free article* every 30 days across the ALM subscription network
  • Exclusive discounts on ALM events and publications

*May exclude premium content
Already have an account?

 

GlobeSt

Join GlobeSt

Don't miss crucial news and insights you need to make informed commercial real estate decisions. Join GlobeSt.com now!

  • Free unlimited access to GlobeSt.com's trusted and independent team of experts who provide commercial real estate owners, investors, developers, brokers and finance professionals with comprehensive coverage, analysis and best practices necessary to innovate and build business.
  • Exclusive discounts on ALM and GlobeSt events.
  • Access to other award-winning ALM websites including ThinkAdvisor.com and Law.com.

Already have an account? Sign In Now
Join GlobeSt
Live Chat

Copyright © 2021 ALM Media Properties, LLC. All Rights Reserved.