BY Art Thiel 04:02PM 04/21/2014

New plan for Warriors’ arena: All private funds

In the face of site opposition, Warriors owners picked a new spot — just south of the Giants ballpark — and picked up the entire tab for land and construction, eliminating taxpayer politics.

The plan to put an NBA arena on abandoned public piers in San Francisco was abandoned in favor of 12 acres south of the Giants ballpark. / Golden State Warriors

Joe Lacob and Peter Guber, owners of the Golden State Warriors who caused a stir two years ago when they announced a plan to build a new arena on a controversial site on piers on the San Francisco waterfront, abandoned the idea and now intend to build on land south of the Giants’ baseball park to house an 18,000-seat venue in time for the 2018-19 season.

According to SF Weekly and San Francisco Chronicle, which reported the story Monday, neither the 12-acre purchase of land nor the construction of the arena will require public funding, perhaps the first sports venue of its kind in the country that will use no taxpayer money or resources. The deal reportedly was closed Saturday night to purchase the site from salesforce.com, a San Francisco tech company.

The development is similar to Seattle native Chris Hansen’s plans for an 18,000-seat arena in SoDo. But Hansen, who owns the seven acres south of Safeco Field, has asked the city and county for up to $200 million from the city’s borrowing capacity, to be paid back over the presumed 30-year lease, to fund arena construction. No tax increases were sought to pay for the building.

The proposal, outlined in a 2012 memorandum of understanding between Hansen and the municipalities, does not require a public vote, but does require Hansen to have an NBA team in hand prior to funding. Hansen was denied by NBA owners a year ago a bid to relocate the Kings from Sacramento.

Besides the unprecedented commitment to all-private funding, the Warriors development illuminates another contrast: A willingness from the team owners to change location and plan in the face of opposition to both.

Critics in San Francisco complained that the proposed 120-foot high arena on piers 30-32 would increase traffic and parking problems, have serious environmental impacts during construction and would block views of the Bay Bridge.

In Seattle, opponents of the SoDo location next door to downtown and opposite a busy deepwater port, say the area is already congested and will only grow worse. Hansen has never wavered in his commitment to the SoDo site.

In the state-required environmental impact statement now being completed for the arena, two Seattle Center sites were used as comparables. But Hansen said he has no interest in the sites. No sites outside Seattle were considered because Hansen’s agreement is with the city.

The final EIS is not expected before September.

Since the MOU was signed, Hansen’s chief political ally, Mayor Mike McGinn, lost his bid for re-election, and the council, with the addition of socialist Kshama Sawant, has tilted even further left. A shift of the arena site away from the port to city-owned property, which would help revitalize Seattle Center, has been speculated to be helpful for Hansen in regaining lost political momentum.

The San Francisco site, on Mission Bay, has a light-rail site in front of it and two adjacent parking garages for more than 2,000 cars. The Hansen site contains no plan for additional public parking.

The Warriors continue to play in Oakland at the Oracle Arena, built in 1966 and remodeled in 1997.


YourThoughts

  • Matt

    Looks like you’re trying to make a point in this article, Art.

    • art thiel

      Just letting everyone know what’s happening with the next potential new-arena deal in the NBA, and comparing it to what’s happening in Seattle. One thing I would add is that the Bay Area is a much bigger market than Seattle, and has a chance for greater revenues, especially with the better location. Less risk.

  • Will

    Art, in several articles you’ve mentioned a “state-required environmental impact statement” … but is that actually a state requirement? Snohomish County has plans to build a tournament level sports complex in a residential area near Woodinville on Wellington Hills Park. The County has said “no” to an EIS, instead they’re only doing a SEPA checklist.

    Their plan has about the same size footprint of Safeco Field… They want parking for 700+ cars, four artificial turf fields with stadium lights and three grass athletic (soccer) fields. Also planned – an indoor mountain bike building of 60,000 sq. ft. and an indoor sports facility of 50,000 sq. ft. All in all, it’s a radical development proposal that hasn’t had an ounce of a real impact study.

    • Darren Rawie

      I believe Dodger Stadium was 100% private.

      • art thiel

        The stadium construction was indeed all private, but the city bought all the Chavez Ravine land in a condemnation action for the Dodgers that pushed out hundreds of Spanish-speaking residents. Long story, but the project did require public participation, one that voters in the1950s Ok’d.

        • 1coolguy

          The place (Chavez Ravine area) was a dump and I’m sure the residents were paid enough to find another place. LA in the 50′s was a much different (and affordable) place.

    • art thiel

      Yes, it is a state requirement for this project. You think I would make that up? Different projects are held to different standards, based on many criteria regarding community impacts. I’m not a land-use attorney, but those who are on both sides do not dispute the process. The outcome may be a different story.

  • soundersfan84

    There is a huge difference between building arena that is 100% privately funded while trying to acquire a team and building an arena that is 100% private funded when you already own the team.

    No way Sodo arena will be 100% privately funded and i have a hard time seeing any new arena being built in the Seattle metro area and have it be 100% privately funded.

    No way the new arena is going to be built in Seattle Center reign. That’s even a larger political battle than it is in the Sodo district. Nevermind the traffic issue is even a bigger larger mess.

    • soundersfan84

      Oh Art have you seen the study that came out recently on the Port of Seattle.

      Based on that recent study on the port of seattle, Sodo arena will have ZERO impact on port of Seattle. It sounds like to me they have a larger internal problem to deal with than what may or may not happen next door to them.

      • art thiel

        If you’re talking about the report citing the declining business at the port, I’m aware. That’s part of why the port CEO in January talked publicly about consolidation with the Port of Tacoma. Whether it happens, and whether it is soon enough to make a difference with the arena, isn’t knowable yet.

        • soundersfan84

          I think the study is more damaging to the ILWU and port of Seattle claims that the arena will cause massive issue to the port. Isn’t the terminal that the study says that its only 35% efficient near by to where the sodo arena is going to be built. I think Port of seattle needs some to focus on getting upgrades done than to worry about what impact the arena may or may not have on the port.

          Something needs to be done to improve the port and keep cargo ships going to that port regardless of the arena.

          • art thiel

            Not if Seattle’s port is going to consolidate with Tacoma.

    • art thiel

      You’ve hit on the dilemma facing Hansen. He wants some help in funding construction by borrowing at the cheaper rates given cities. But my belief is a big majority of Seattle voters don’t want any public participation in another sports arena, and will have conveyed that to the council — even if there is no increase in any tax.

      And he will encounter opposition at the Center, where he won’t own the ground. Making it more complicated is that the center is, for most intents, a public park, meaning every constituency will demand a say in the outcome.

      • soundersfan84

        The funding to repay the 120/200m debt or what ever it’ll be when when
        arena starts being built will be pay back by those that use the facility
        which will be mostly be NBA fans or both NBA and NHL fans Perhaps
        maybe just NHL fans. If majority of seattle voters don’t want to get
        involved in paying back the debt of the arena then they can decide to
        not go to any of the events in the arena.

        Yes i know current
        plan requires a NBA team but who knows what is going to happen in the
        next 2-3 years. Things could change to where there is a NHL group
        willing to pay the necessary amount to where Seattle city council says
        yes to a NHL first option.

        You and I can both agree that a NHL first plan would definately require more private funds and less public funds which then puts the issue between Hansen and the NHL group.

        Seattle
        voter said their say with I-91 and that doesn’t say Seattle can’t
        directly provide public funds. It’s just that they have to show a return
        on
        investment. Of course the issue is how is I-91 enforceable in regards to Hansen’s deal and that is a separate discussion

        Reality is that I-91 needs to be fixed to have any real effectiveness. The fact is everyone is trying to apply it based on the spirit of the law just shows how poorly written that law is.

        • art thiel

          I-91 is so poorly written that almost all aspects and subject to interpretation. Hansen interprets his offer as more than meeting I-91. Opponents say otherwise.

          The NHL could become more attractive, but a city official I talked to said it’s not a revenue disparity between NHL and NBA as much as the cheaper value to NHL team in event of bankruptcy. If an NHL team wants to leave via bankruptcy with large public debt remaining, there’s a greater chance the city won’t be made whole.

          • soundersfan84

            Couldn’t that be said the same in regards to the NBA team leaving via bankruptcy?

          • Playhouse

            That has to be one of the more compelling answers heard regarding the city’s reluctance to look at an NHL-first approach similar to the existing MOU.

      • Playhouse

        “Making it more complicated is that the center is, for most intents, a public park, meaning every constituency will demand a say in the outcome.”

        Oh, quite true.

      • 1coolguy

        I say SELL the Center Land that he needs, just like they sold the Space Needle property to those developers. Most people don’t know the Space Needle is on private land, so that precedent is in place.
        An arena in private hands at the Center would revitalize essentially a dormant jewel.

        • art thiel

          True about the Space Needle. But that was 1958. Not sure the city would be willing to sell center assets in 2014.

  • soundersfan84

    Another thing to consider is how do you improve freight mobility. We all can agree that something needs to be done to improve mobility
    of the port its always will come down to how do you fund it. Having the arena in the sodo district provides a starting port in funding with that 40m transportation fund and can get matching state and federal funds if possible. If arena goes else where the everyone is basically trying to figure out a long term plan with zero dollars.

    Is that 40m dollars and a starting point in improving transportation in that district more important to the city council or improving Seattle center?

    • art thiel

      $40M basically gets very little meaningful done in terms of traffic mitigation. The Lander St. overpass that the city proposed more than 10 years ago at $80M I’m told now would cost double that. Yes, there may be matching funds but I haven’t detected the political/civic momentum to fix freight mobility, especially the port now openly admits to considering consolidation with Tacoma.

      • soundersfan84

        Its better than starting with nothing which will be if the arena goes elsewhere

  • Playhouse

    Much as people don’t want to admit it because of the extensive history at the Center, Lower Queen Anne has even worse traffic and parking problems than SoDo would. They haven’t gotten any better in the 6 years since the Sonics were the primary tenant at the Key. The city owning the land is pretty much the main selling point of those considering the Center as still a viable option, but that blinds them to the fact that infrastructure improvements in and around the Center, if even possible, and the costs of razing the Key to build on top of the location will likely drive up the total project costs even more than what’s currently proposed. In addition, the extensive demo and construction necessary will seriously affect then-current Center operations, which could have a long-term impact. The Center is a “safe” answer because that’s the way it’s always been. It’s not really the best answer, though, even if it curries favor with long-term pols.

    • art thiel

      Good points, Playhouse. Even with the, ahem, Mercer St. upgrades, the Center is a headache when 17,000 show for any Key event. It may be even worse when all the new apts in Belltown, SLU and LQA fill up with Amazonians. And then there’s the Gates Foundation, which is opposed to an arena that blocks its views.

      • Playhouse

        I hadn’t even considered all of the additional residential traffic that’s headed the way of that part of town.

  • jafabian

    I always found it interesting that the NBA was in Oakland and not SF. Next to the ballpark is probably the better location, though the idea of people arriving by boat to a Warriors game would be cool. Not sure if they’d allow boats to moor next to arena if it was build on the piers. The concept of building on abandoned piers doesn’t sound terribly safe to me either, though I’m sure that would be addressed. This should help offset losing the 49ers to San Jose.

  • RadioGuy

    There’s nothing I can really add to the conversation below beyond agreeing that traffic near Seattle Center is already a nightmare and the Mercer Street project did nothing to alleviate the problem. It would be nice if the Monorail could be incorporated as a shuttle as an inducement for people to park downtown and ease congestion, but likely unrealistic.

    I WOULD like to say that, even though I’m foursquare behind any privately-funded sports venue, the Oakland fans who’ve really supported the Warriors through some very lean years are about to get the shaft with the new arena in SF…they don’t deserve to lose their team, even if it’s only across the bay. Imagine the NBA coming back as the “Cascadia Sonics” with home games played at a renovated Tacoma Dome. Not that what fans want ever factors into stadium or arena politics.