Bill Oram at Olive has an article about Dundon and the renovation of the Lenovo Center in Raleigh where the NHL Hurricanes play. Oram spends his typical amount of time being snarky, but generally, it was reporting and there was some interesting tidbits in the article:
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While Portland leaders contemplate an arena deal of their own with Dundon, Hurricanes officials are deep into a multi-year renovation project on the 27-year-old Lenovo Center. Baldwin, a Democrat who was the city’s mayor from 2019 to 2024, helped push through a $300 million funding package built entirely on hospitality and tourism taxes.
Dundon bought the Hurricanes from Peter Karneros in 2018 with six years remaining on the lease at the then-PNC Center. When he and Baldwin first started discussing renovations and a new lease, she laid out the road map.
She told him it was going to take three years to get to a deal. “He said, ‘What?’” Baldwin remembered.
She explained to him that government is not business, and the deal was complicated by the fact that it involved not just the city, county and state, but also North Carolina State University, whose football stadium also sits on the property.
“There has to be consensus,” she told him. “So I’m asking for time. It’s going to happen, but I need patience.”
so...3 years to complete a funding package....
3 YEARS
for all of the people complaining about the speed of the Moda funding package, try to remember that the the Oregon legislature passed the Bill on March 6. That's less than 3 months ago
in other words, slow your roll. This was always going to take time. The easy lifting is done; that's the state backed bonds. The harder lifting is ahead and that's a city in the midst of dealing with a 170M budget shortfall that is taking priority.
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As part of the agreement in Raleigh, Dundon will invest at least $800 million in development around the Lenovo Center. The agreement calls for four phases of $200 million each in development. Dundon told The Oregonian/OregonLive last week that they will soon announce an office complex on the site.
Ultimately, Dundon and the Hurricanes committed to building an entertainment district around the suburban Lenovo Center, which is currently surrounded by nothing but blacktop. Dundon and the team pay annual rent and have contributed $10 million toward the up-front costs of the renovations. That $10 million represents barely 3% of the total project, but it’s still more than he has been willing to pay toward Moda Center.
In fact, none of those stipulations are in the deal in Portland.
Oregon lawmakers approved legislation earlier this year that authorized up to $365 million in bonding for the arena, backed by income taxes on Trail Blazers players and other high earners at the Moda Center, and established the state as a co-owner of the arena with the City of Portland. But those bonds can only be sold if the city and county contribute toward the project and a 20-year lease agreement is reached.
Why no rent? Why no private investment?
The deal’s advocates would point toward the arena’s history and say that Portland benefited from the arena for 30-plus years without a significant investment in its construction — just $34.5 million of the original $262 million cost — or in ongoing operation and maintenance. Paul Allen covered all of that."
The Moda cost 262M to build. The city contributed 34.5M to that cost; a little over 13%. But, the city also contributed the land the Moda is built on; or at least most of it. As part of the 2024 agreement when the city supposedly bought the Moda for one dollar, they also bought the small chunk of land the Blazers owned for 7.13M.
So, PA paid 228M for the Moda and paid for it's operations. However, he did profit from non-basketball events held at the Moda; and he was able to shelter some income with a depreciation exemption. So, both parties, the city and the Allen's benefited
basically, the city paid over 7M for a 30 year old building in desperate need of a major renovation. If the State, City, and county end up owning a 33 year old building they spent 600-700M on, will the building be worth 600-700M? And just how fast will a 33-year-old-building--->53-year-old-building actually depreciate in value?
but it sure sounds like Dundon is paying nothing; not even current or future rent. Maybe rent would be part of the required 20 year lease agreement but if it was on the agenda I'd think we would have heard about it; maybe not though as it's early stages.
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the Mayor and some members of the city council have seemed to be counting on dipping into the City's voter-approved Climate Fund. But some council members are opposed, one calling it a "non-starter":
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Portland Mayor Keith Wilson’s push to divert dollars from the city’s one-of-a-kind climate tax to bankroll a renovation of the Moda Center faces significant public resistance, a recent poll commissioned by The Oregonian/OregonLive found.
Fifty-five percent of city voters said they are opposed to spending up to $75 million from the Portland Clean Energy Community Benefits Fund as part of a complex public financing deal deemed essential to keep the Trail Blazers from leaving town.
Just 37% of Portlanders polled by DHM Research between April 23 and 30 said they supported tapping into the cash-rich climate program to help cover the $120 million Wilson has pledged toward the project, which under existing plans would be solely funded by taxpayers."
in the middle of a budget crisis, if the city 'can't' back door some of the 120M from the climate fund, it's going to create an even bigger hurdle
North Carolina officials provided $300 million in public money to renovate the home of the Carolina Hurricanes in 2023.
www.oregonlive.com
Most Portland residents would rather see their clean energy fund money go to police, firefighters and homeless services than help finance a $600 million arena renovation.
www.oregonlive.com
