No. 5
City of L.A. Approves Sports Arena
In other major metropolitan cities, there’s no end to what local politicians will do to attract a new state-of-the-art sports arena to a troubled downtown core.
Not here, as developers of the Staples Center sports arena discovered.
The $300 million venue, which will house the Los Angeles Kings hockey team and Los Angeles Lakers basketball team starting in 1999, was given final approval by the City Council in late October of last year, with a groundbreaking set for February.
But the process was long and contentious, and at times the deal seemed to be on life support. What emerged, through all the haggling, is what some have called the best deal for a city in the history of professional sports facilities.
The plan to build the 20,000-seat sports arena adjacent to the L.A. Convention Center in the South Park area of downtown sailed along relatively smoothly during the first half of 1997.
Then came some stumbling blocks.
First, in mid-July, City Councilman Joel Wachs asked that all contracts relating to the deal be made public. Wachs argued that because the city was contributing $70.5 million to the project through tax breaks and land leased at nominal rates, the public should be guaranteed that the two teams be required to play there for at least 25 years.
Though developers Ed Roski Jr. and Philip Anschutz released the documents, Wachs announced on Aug. 21 that he was moving ahead with a professional sports facilities initiative drive. The initiative, if passed by voters, would require voter approval before any professional sports facility including the sports arena could receive city funds for construction or improvements.
The developers, labeling the initiative a deal-breaker, went into negotiations with Wachs to get the proposed complex excluded from the initiative. In early October, the two sides emerged with an agreement, under which the arena would be excluded from the initiative if the developers could guarantee the repayment of $58 million in city bonds with revenues rather than sales or property taxes.
In early December, the developers signed a naming rights agreement for $100 million over 20 years with Westboro, Mass.-based Staples Inc.
Work is being done on relocating water and power lines at the arena site, currently home to the Convention Center’s North Hall. The North Hall soon will be demolished and much of the arena structure is expected to be completed by the end of the year.
Wachs has questioned the value of the arena, but civic boosters say it will energize a downtown hurt by corporate defections. It is also seen as a way to inject some much-needed nightlife into an area that often looks like a ghost town when the workday ends.
Daniel Taub
