Battle of Las Vegas arena projects proceeds

The race to build a sports arena in the Las Vegas Valley shows that the business of professional sports can be just as competitive as the sports themselves.

Two companies and a nonprofit group want to develop arenas with 20,000-plus seats for sports and other events. Two are proposed on the Strip, and one would be on the south Strip near South Point.

The proposals are in various stages. A Texas developer is furthest along and already has a detailed plan for an arena on the Strip's north edge.

Each of the three, designed to house a basketball or hockey team, comes with a half-billion-dollar-plus price tag that would be paid for with a significant amount of public money.

Clark County commissioners on Tuesday will discuss the dueling plans, though none of the interested parties is yet scheduled to give presentations.

These three aren't the only game in town. Another arena has been proposed in the city of Las Vegas, next to City Hall.

Proponents say the Las Vegas Valley needs a new, high-end arena to accommodate a professional sports team and prevent cities with larger stadiums from stealing premiere local events -- such as the National Finals Rodeo -- that have proved lucrative to the local economy.

They also say that a pro team is a missing piece in the area's medley of entertainment choices and that it would boost tourism.

County Commissioner Steve Sisolak asked that the board explore the three Strip proposals so he could get a better feel for how viable they are and how exactly they would be funded.

He's also concerned about the impact a new sports complex would have on current arenas.

"It would compete with them," Sisolak said.

He said what appeals to him is that an arena project would create 3,000 to 4,000 construction jobs while it's being built and thousands of jobs after it opens.

Those who support a new arena say it would meet a demand that the aging Thomas & Mack Center at the University of Nevada, Las Vegas cannot.

A 2006 report by Las Vegas Events concluded that the Thomas & Mack, although able to seat 19,000 people, lacks the building space, equipment and amenities of more modern stadiums, making it unsuitable to draw pro sports teams.

THE PROPOSALS

One arena is proposed at the site of the former Wet 'n Wild water park near Sahara Avenue and Las Vegas Boulevard, near the unfinished Fontainebleau resort. Sue Lowden, a Republican candidate for U.S. Senate, and her husband own the property.

Texas-based IDM hopes to build the Silver State Arena there at an estimated cost of $750 million.

The company wants the county to revive the scrapped redevelopment district encompassing the site. That way, about $9.3 million a year in property tax revenue generated in the district could help pay for construction.

Chris Milam, IDM's president, said the project would create 4,100 construction jobs and as many as 7,000 jobs either at the arena or directly supporting it. He wants to break ground by August so the arena will be open by fall 2012, in time for basketball season.

Meanwhile, another arena is being proposed on 10 acres that Harrah's Entertainment owns behind the Imperial Palace. Harrah's would donate the land, worth about $182 million, for the sports complex.

Former County Commissioner Bruce Woodbury founded a group that is spearheading the half-billion-dollar project.

The arena would be paid for with a revenue bond and a seven-tenths-of-a-cent sales tax imposed only in the resort corridor, Harrah's spokeswoman Marybel Batjer said.

Although the sales tax would only affect Strip businesses, a countywide advisory question would be put on a ballot to gauge public sentiment.

Developer Gary Goett is behind the third proposal. He is looking to build an arena on 260 acres he owns on Las Vegas Boulevard South at Cactus Avenue.

Goett said he could generate most of the needed funding through an entertainment tax on the resort corridor, similar to the sales tax that Woodbury's group proposes.

The other competitor is on city turf. Cordish Cos. is studying the feasibility of building a sports arena near Las Vegas Boulevard and Stewart Avenue.

Details are hazy about how Cordish would finance the project. The company has two years to finish its study.

THERE IS OPPOSITION

All four projects will meet resistance from another front.

MGM Mirage opposes funneling public money to a sports arena, saying it subsidizes competition for events. MGM has some of the Strip's biggest casinos, including CityCenter, The Mirage and Mandalay Bay.

"Creating new taxes to spend on new arenas to compete with arenas that were built with private money doesn't seem to be an appropriate use of resources right now," MGM spokesman Alan Feldman said.

County Commissioner Chris Giunchigliani said she also doesn't think public dollars should fund an arena but wants to learn more about the various plans that are percolating.

She also wants to hear from developers at some point. "Come make your case," she said. "Tell us what the meat is."

Giunchigliani said she doubts this is a large enough market for top-tier pro teams.

"We just don't have the population to support a professional sports team," she said.

Batjer disagreed. Harrah's research shows that pro teams think Las Vegas would be big enough if it had a major arena, she said. "People are excited about a sports team."

The new arena would not siphon business from existing ones but would accommodate events that current arenas can't, she said. It would bring more foot traffic to the resort corridor, benefiting all the casinos.

"What are we missing? A state-of-the-art stadium," Batjer said. "We need a facility to attract the biggest and best events."

Milam said that even though the area is filled with transplants loyal to their home teams, they still want to attend professional games without traveling out of state.

He said he was confident that Las Vegas could attract an NBA team, especially a franchise struggling in a smaller market.

Silver State Arena would be paid for with a mixture of funding, Milam said. The Lowdens would lease the land to the company and use it as collateral to borrow $350 million for the project. The company would chip in $275 million, he said.

And if the county restores the redevelopment district, the company would borrow $125 million in bonds that would be repaid using property tax money from the district.

Redevelopment districts are set up so a portion of the tax revenue goes toward improvements in that area, especially ones that create jobs.

Milam estimated the arena's activities would generate enough sales tax revenue to offset any redevelopment money spent on the project.

Woodbury said the complex his group plans to build on the Harrah's site would be non­profit, making it a true community center, whereas the other arenas being proposed would be privately owned.

"It will be something that goes beyond what's been done in Las Vegas," Woodbury said.

Goett argued that his south Strip site is more traffic-friendly than his competitors'. Fans would drive in and out of the stadium through multiple interchanges and avoid gridlock, he said.

"There's just too much congestion on the Strip," Goett said.

Contact reporter Scott Wyland at swyland @reviewjournal.com or 702-455-4519.