The Arizona Coyotes are negotiating a deal with the city of Tempe, in which the team will invest “$1.7 billion to transform 46 acres of community property from a landfill into a landmark for millions of visitors.” the project was viewed sportico..
As part of the plan, the team would purchase the land and finance the construction, while the city would provide a permanent property tax rebate and $250 million in bonds for infrastructure, to be paid for by use fees on purchases and sales taxes received in website.
The proposed entertainment district east of Sky Harbor Airport, approximately 10 miles from downtown Phoenix, will include a new arena, training facility, several hotels and office buildings, a 4,000 seat amphitheater, 2,400 car garages, 300,000 square feet. restaurants and retail outlets, and 3,600 soundproof housing units built in two phases.
The arena, training facilities and corporate offices for the team are budgeted at $700 million and will be part of the first phase. If negotiations go smoothly, the new arena could open in time for the 2025-26 NHL season, team president Javier Gutierrez said in an exclusive interview.
“We have made it clear that we would like to do this as quickly as possible,” Gutiérrez said. “We would like to make a decision on the final deal by the fall and certainly no later than the end of the year.”
Negotiations began in earnest earlier this month when Tempe City Council closed a one-day meeting by approving a 74-page request for proposals. [RFP] Coyotes filed under the auspices of Bluebird Development LLP last September. The vote was 5-2 in favor, and the agreement that was being negotiated must be returned to the Council for final approval.
Tempe Mayor Corey Woods competed with the hockey club’s terms.
“I would really like everything to be ready by autumn; valid by the end of 2022 at the latest,” he told PHNX Sports. “The reality is that this is obviously a very big project with the potential to be a game changer for the city of Tempe and, I honestly think, for the entire region.”
Coyotes owner Alex Meruelo, whose net worth exceeds $2 billion, will finance part of the project directly and part will be borrowed, though the ratio is yet to be determined.
According to the RFP, the Coyotes are asking Tempe to issue $250 million in government bonds to cover infrastructure costs, including land reclamation, land clearing, sewers, and relocation of power lines to prepare the land for development. Municipalities can usually provide lower interest rates than private developers.
In the RFP endorsed by Gutierrez, the Coyotes are proposing that the bonds be redeemed with a user fee of up to 6% on any item, food, or ticket sold in an arena or entertainment district. And if that’s not enough, they will also seek to refund the 1.2% sales tax that will be generated within the entire complex. According to the document, the city is projected to earn $225.4 million in sales taxes over 30 years.
“It is currently a landfill where there is no economic activity right now,” Gutiérrez said. “We are simply asking that some of the sales taxes that we will create go towards payments on this public infrastructure. We declare that the taxpayers of Tempe will have no obligations, and they do not bear them.
Finally, the Coyotes want to buy the land for $48.4 million and are asking for a property tax cut, “just like they did with every other arena and stadium in Arizona. All of them have an indefinite decline,” added Gutierrez.
In exchange, the Coyotes will spend at least 30 years in the arena, with a subsequent 10-year extension. At the same time, the Coyotes will also apply to the Federal Aviation Administration (FAA) to comply with height restrictions – the arena is designed to be dug 30 feet below ground level.
Gutierrez said he was “very confident” the FAA application would be approved.
“Obviously there’s a lot of work to be done before we can dig the shovel into the ground,” NHL Commissioner Gary Bettman said at the Stanley Cup Finals in Denver last week. “But from all the reports I get, everyone is doing what needs to be done, as efficiently as possible.”
Environmental mediation could take up to nine months next year, with construction ready by early 2024, Gutiérrez said.
Meanwhile, the Coyotes are in the process of moving all of their hockey and commercial operations from Glendale’s Gila River Arena across the valley to Scottsdale.
They will play for the next three seasons at the new 5,000-seat hockey building on Arizona State University’s Tempe campus, which is expected to be ready for Coyotes games when the 2022-23 NHL season begins in October, Gutiérrez said. .
They are building a locker room and training facilities at the Ice Den in Scottsdale where the team will train, building an addition to them at ASU that will be donated to the school when the Coyotes leave, and upgrading the arena to meet NHL requirements. standards.
The whole thing will cost about $30 million as a “temporary solution” to their arena and financial problems before the deal for Tempe’s new arena is finalized, “because [Meruelo] so committed to staying in Arizona and because he wants to spend over $2 billion on a permanent solution,” Gutierrez said.
Bettman said that temporarily playing in a smaller venue is not unprecedented.
He noted that the NHL played Calgary, Tampa Bay, and San Jose in small arenas before permanent facilities were built. Even the National Football League Chargers played in the 20,000-seat football stadium after moving to Los Angeles until SoFi Stadium was built.
“You are doing what you have to do if you believe in the long-term market,” Bettman said.
He has always believed in the Phoenix market, even though the Coyotes have been losing money since they moved to Phoenix from Winnipeg in 1996.
Meruelo bought the Coyotes in 2019 for $300 million. sporticoAccording to the latest NHL franchise valuation, the team is worth $410 million, the lowest value of any franchise in the four major North American professional sports leagues.
Gutierrez said Meruelo insured millions of dollars in losses due to the pandemic by playing in an arena where the average ticket price was about $40. At ASU, the Coyotes are $160 league-average, and all of the premium seats along the glass are already sold out. Seats for the entire season in the front row cost $14,350, $350 per game.
At these prices, Gutierrez said the goal this season is to break even, or at least make some money. In three more seasons, the long-term future of the Coyotes in Arizona could be secured.
“We have laid out the vision, we have laid out the strategy and we are implementing it,” Gutiérrez said. “And you have an owner who has the resources and is able to do it.”