Developer could get new partner
February 15, 2008 - 10:00 pm
It’s most likely not curtains — at least, not yet — for a proposed sports arena in downtown Las Vegas.
The last time would-be developers REI Neon were before the Las Vegas City Council, Mayor Oscar Goodman was sharp with company representatives. Show us by Feb. 20 that you can get this project off the ground, he said, or “as far as I’m concerned that’s the end of it.”
At a news conference Thursday, however, Goodman struck a more relaxed tone about the fact that REI Neon is seeking another 30-day extension on negotiations with the city. That may be because a new partner with deep pockets could join the deal.
The potential new partner is the Cordish Co., a Baltimore-based real estate company whose projects include two Hard Rock Cafe casinos in Florida and Ballpark Village in St. Louis, Mo.
Goodman said Cordish representatives have met twice with him and principals from REI Neon, that he had a “very positive conversation” with those involved Thursday afternoon and another meeting is scheduled Tuesday.
“We believe there’s probably going to be an announcement at the meeting of another partner in the deal,” said Scott Adams, the city’s director of business development.
While that’s potentially good news, the proposed arena, intended to attract a basketball or hockey team, still faces an estimated $200 million hurdle.
Building the arena complex would cost about $1 billion. REI has put forward $600 million, Goodman said, and about $200 million could be available from public financing.
At least, that’s the city’s position. The developers have asked for more, Adams said. “There’s a gap between what it takes to build it and what they believe is viable” to invest, he said.
“There’s some disagreement over the amount that’s available. We’re trying to get this built with the least possible public injection of resources.”
That’s because other downtown projects that are further along than REI Neon’s should have the public financing option available to them, and the city doesn’t want to be overextended. “I’m not going to jeopardize our ability to help other projects in the downtown,” Goodman said.
It’s understandable that REI Neon is having trouble getting the financing for the project, Adams added. “Right now is a very tenuous time in the capital markets,” he said. REI Neon’s plan calls for an arena to be built on land southwest of the intersection of Charleston Boulevard and Main Street. If fully realized, it’s an estimated $10.5 billion development with residential units, a hotel and casino, and retail space.
They’ve got competition, however.
In August, Harrah’s and Anschutz Entertainment Group announced plans for a 20,000-seat arena behind Bally’s and Paris Las Vegas on the Strip. At the time of the announcement, company representatives said funding was available and that it wouldn’t be necessary to seek public or private financing.
Contact reporter Alan Choate at achoate@ reviewjournal.com or (702) 229-6435.