LOS ANGELES — Baltimore-based developer The Cordish Companies has until June to submit a proposed financial agreement to the Las Vegas City Council to develop a $390 million arena and entertainment district.
The City Council voted 4-3 at their January 22 meeting to extend negotiations on a development agreement to June 1. The original deadline to reach an agreement was Jan. 27, according to Jace Radke, a senior public information officer for the city.
"Cordish had been in an exclusive negotiating agreement with the city for 30 months, since 2011; but the agreement was set to sunset on Jan. 27," Radke said.
The extension gives Cordish the time to present a final development agreement and get its financing in place.
If a development agreement is reached and approved by the City Council, the developer would move ahead on plans for an arena with at least 18,000 seats in Symphony Park. In addition to the arena, the plans also call for an entertainment district with retail and dining offerings similar to the 5.6 million square-foot L.A. Live in downtown Los Angeles, which is anchored by the Staples Center arena.
"The Cordish Companies is committing $150 million toward the development of a world class arena in downtown Las Vegas," Port Telles, the company's development director, said in an email response. "We are very proud of the progress made with the city and are confident the new arena will spur significant economic growth in the downtown and region."
The hope is that the arena can attract a National Basketball Association or National Hockey League team.
Neither the city, nor Cordish, would comment on whether the agreement would hinge on Cordish securing a team; or even on whether the developer has reached out to potential teams.
"When the NBA was here a few years back for the NBA All Star game, the message from the league was the ball is in Las Vegas' court," Radke said. "They would consider having a team here, but there would have to be a world class arena for them to play in."
Under the current proposal, the city would issue $187 million in bonds to be repaid by revenues from the arena and the entertainment district. Cordish would contribute $151 million in equity.
Repayment of the city's debt would be the highest priority under the proposed terms, Radke said.
The projected annual city bond payment is $13.3 million, while the total projected revenues from the arena and entertainment district are $25.5 million annually, he said.
The estimated economic impact from the arena development is more than $400 million, with 4,500 construction jobs, according to city officials. Estimated economic impact from arena operations is $700 million in total output spent annually, 10,300 new jobs and $30 million in new taxes collected.
A proposal that the remaining $52 million be repaid from a special assessment on an improvement district including casinos and other downtown businesses on Fremont Street was shot down in an amendment to the extension from the City Council. Part of the negotiations will be to decide whether the city or Cordish covers the remaining $52 million.
The arena proposal is part of a decade old plan dreamed up by former Mayor Oscar Goodman to revitalize downtown. The key elements were to focus on academic medicine, performing arts and professional sports. The first two have been realized with The Cleveland Clinic Lou Ruvo Center for Brain Health that was completed May 2010 and the Smith Center for Performing Arts that opened March 10, 2012.
Goodman was succeeded by his wife, Carolyn Goodman, in 2011.
"Over the 12 years of the former mayor's years in office, downtown redevelopment was a huge focus for the city," Radke said. "That has continued with the new mayor Goodman."
The arena was originally proposed for old city hall as the city developed a new one. Instead, Zappos ended up moving its 200 employees into a refurbished city hall building transformed into a headquarters building in September 2013.
