Virginia Beach Arena (Cancelled)

[zeppelin14]

Does anyone else think that USM actually reads user comments such as on Pilot Online, WAVY, etc. to see the public opinion? I'm sure they have noticed the negativity of VB residents and the talk of Military Highway being a more ideal location. This info HAS to have been seen by them at some point. Perhaps some behind the scenes work is going on with USM and Norfolk.

[baobabs727]

I think they probably go by their own research rather than the opinions of various posters around the net.

Also, they're from Virginia Beach. They've been very specific and emphatic in mentioning this as motivation in their talking points.

Finally, this arena was conceived as self-sustaining in the absence of pro sports. Therefore, they would like to tie-in to the tourist market for various other types of events 365 days per year. There is no other sub-market around here as large as Virginia Beach for tourism (or for locals for that matter).

[HRVT]

27 minutes ago, zeppelin14 said:

Does anyone else think that USM actually reads user comments such as on Pilot Online, WAVY, etc. to see the public opinion? I'm sure they have noticed the negativity of VB residents and the talk of Military Highway being a more ideal location. This info HAS to have been seen by them at some point. Perhaps some behind the scenes work is going on with USM and Norfolk.

I doubt a few dozen people in the comments section of a local newspaper is going to push them away from the research that millions of dollars of investments has shown them. I think what's more likely is the obvious answer. It's a really large project that is probably biting off more than the developers can realistically chew... especially in VB. It's not usually a good sign when a developer has to go from financing option to financing option as USM has had to. First they had an unnamed American firm, then it was a Chinese bank, then it was JP Morgan, now it's.... well who knows... possibly nobody.

I would agree that considering NOTHING else other than physical proximity within the Hampton Roads area that the Military Highway location is a better option than where they are looking to build. But that isn't considering the logistical issues (and costs) with building there. 

[BFG]

I think Norfolk is the last resort; they are committed to VB as baobabs said. I do, however, remember reading that if VB fell through, they'd try for another city, but I think they'd prefer like VB for the reasons above.

[baobabs727]

Remember, the bankers hold all the cards. 

[HRVT]

6 hours ago, baobabs727 said:

Remember, the bankers hold all the cards. 

Exactly, and the bankers aren't going to let years of hard work get in the way of their decision one way or another on this project. If they determine this project to be a poor investment, they will not be investing their money. It doesn't matter how long anyone has worked on it. 

This was supposed to close in June. It's now the middle of August. This happens all the time in development and is usually a bad sign. Sometimes the financing does come through.... but often it does not. In development, no news is usually bad news. If there's good news to share, the developers are going to be tripping over themselves to make the announcement. Sometimes things happen a little bit later than expected, but we are now closer to the deadline then we are to the time that the loan was supposed to close.

Edited August 11, 2017 by HRVT

[baobabs727]

I wouldn't read too much into this, but for what it's worth….

On Monday when vdogg posted re: the 30 day deadline mark, I sent emails to two people. One is an acquaintance who is a member of the local business media, and the other is a friend who has many contacts relevant to the universe of our discussions here. They don't always tell me  something specific, but occasionally I get a tidbit here or there...or at the least a notion of an impending article or the progress of ongoing reportage.  

Well, this time one of them said they had "nothing for me," while the other never wrote back. The latter scenario is very unusual, though perhaps they're just super busy this week.

Either way, I agree that silence is, more often than not, a bad sign in these types of deals.

Edited August 11, 2017 by baobabs727

[BFG]

This NBA rumor has started to take off. 

http://www.13newsnow.com/mb/news/could-an-nba-team-come-to-virginia-beach/463464637

[vdogg]

Meh. These rumors come around once a year. Kind of a moot issue if we don't have an arena to put them in.

[HRVT]

3 hours ago, vdogg said:

Meh. These rumors come around once a year. Kind of a moot issue if we don't have an arena to put them in.

Heck, this isn't even really a rumor other than the momentum that the article carried. The whole article where this "rumor" originates from was just a hypothetical. It wasn't saying anything was imminent. It wasn't saying that sources say anything. It was just a giant game of what if.

And yeah, if the arena falls through then it doesn't matter. The Scope (even when/if heavily renovated) isn't nearly capable of hosting a professional team, even as a temporary stay while a bigger arena is built. 

[carolinaboy]

The city of VB will be roped into building a parking deck at the cost of about $65 million. The arena will then be value engineered and seating capacity will be reduced to 12,000 so the developer can actually get a loan. Upon finding out the old bait-and-switch has happened, the city will still proceed because it is still "development" that will spur other "development" and is therefore a bargain at any price. There will be few luxury amenities if any. VB will end up with a mediocre arena with no tenant and an expensive parking garage. Hooray for monster trucks, boat shows and an indoor flag football team franchise!

 

Seriously though, I hope everything works out as envisioned. God knows VB needs something more that a new grocery store.

[baobabs727]

Hypothetically speaking of course, might it be within the realm of possibility that a developer of a large, high profile  project whose financing arrangements are questionable or precarious might seek to improve the potential calculus of any investment therein by encouraging friendly media to promulgate highly suggestive, favorable buzz relative to said project?

[baobabs727]

Well, well, well. Just look at who's "picked up on" the buzz. 

[baobabs727]

EXCLUSIVE ARENA UPDATE from WAVY 10:

(Watch the video)

https://www.google.com/amp/wavy.com/2017/08/11/only-on-10-first-look-of-proposed-virginia-beach-arena/amp/

Edited August 12, 2017 by baobabs727

[vdogg]

i'm not sure why she thinks she'll get a couple of month extension to close when you need 9 of 11 council members to vote on such a thing. There are 3 of them that are sure noes. 

[baobabs727]

Right. I thought it very strange that Bruce was the one saying that she'd obtained an extension and then seemingly attributing that notion entirely to Ms. Kilmer absent independent verification or even an explanation of how that might possibly occur, legally. Bruce's only implied support for this statement appeared to be Ms. K's own rationale that she was awarded extra time because things had moved along so well, so quickly,  and also because...well...they have a new...video rendering?!?  As if that's proof of anything. 

But again, she didn't say it, he did. The word "extension" never left her mouth, nor did she even address the current financing status/situation beyond indicating the agreement was in excess of a thousand pages.

Despite her goosebumps and Bruce's slick cheerleading, I found the whole story rather vague and not at all dispositive.  Along with my floating of the theory related to the SBNation story, I believe that  WAVY's news piece might possibly be part of a larger PR attempt to influence public opinion in a favorable manner toward this project in the event that she needs an extension vote from Council. Creating an air of inevitability is an old tactic in PR and in politics. 

"The arena will be in Virginia Beach. We will begin construction by the end of this year."  --A. Kilmer

Edited August 12, 2017 by baobabs727

[BFG]

I will admit, the story got me anxious at first, but reading the comments here allowed me to come back down to earth a bit. Honestly, I don't know what to believe anymore...just strike a deal already. Hopefully she's not blowing smoke, but how many extensions are they going to need, if what Bruce is saying is true? And how is yet another extension a good sign, if all you're doing is pushing the finish line further and further back?

[baobabs727]

Andrea Kilmer officially given additional time to close on the loan with J.P. Morgan Chase.

The new deadline will be 11/6/17.

USM is now operating as Mid-Atlantic Arena, LLC –at lender's request,

https://www.google.com/amp/pilotonline.com/news/government/local/developer-of-proposed-arena-in-virginia-beach-given-more-time/article_e0e5d2b9-9092-5ac2-9c60-6cf0b8a139df.amp.html

Edited August 15, 2017 by baobabs727

[vdogg]

Hmmm...What's your take? Good/bad? I'm unsure at this point.

[baobabs727]

I'm totally torn. That contact of mine in business media finally got  back to me today. Well, actually his boss got back to me telling me that the gent had left the company. Oh my goodness.  He also added his two cents…which was... "many doubt, and that doubt is growing."

Of course, he meant doubting the developer's ability to close. 

On the one hand, I do understand that these deals are massive and complex, and that banks are extremely detail-oriented and cautious when it comes to lending out 9 figures.  So, it would make sense that you are going to need additional time now and then beyond what are simply educated guesses/artificial timelines. 

On the other hand, I do understand that these deals are massive and complex, and that banks are extremely detail-oriented and cautious when it comes to lending out 9 figures. LOL. So, I also wouldn't be surprised if things fell apart.

I wish I could handicap this thing a bit better,  but it's almost...almost...like reading tea leaves at this point. 

Edited August 16, 2017 by baobabs727

[BFG]

1 hour ago, vdogg said:

Hmmm...What's your take? Good/bad? I'm unsure at this point.

Like I said the other day, how many extensions do they need? To me, if you're three weeks from the finish line, and you still need more time, after you've received several other extensions, that's a red flag. Of course, I'm not privy to details and don't know how the business world operates, but I can't think of too many other sports venues that have taken this long just to secure financing.

Having followed the construction of other stadiums/arenas, I know ironing out details of such a massive project takes a while. You gotta clear the land, touch up renderings, get funding, etc. But after 4 or 5 years, the developers usually have the funding and start the groundbreaking process. It's been at least 2 years just trying to get the money. The original idea was to start construction at the end of 2015 or early '16. It could've almost been done by now!

[HRVT]

28 minutes ago, BFG said:

Like I said the other day, how many extensions do they need? To me, if you're three weeks from the finish line, and you still need more time, after you've received several other extensions, that's a red flag. Of course, I'm not privy to details and don't know how the business world operates, but I can't think of too many other sports venues that have taken this long just to secure financing.

Having followed the construction of other stadiums/arenas, I know ironing out details of such a massive project takes a while. You gotta clear the land, touch up renderings, get funding, etc. But after 4 or 5 years, the developers usually have the funding and start the groundbreaking process. It's been at least 2 years just trying to get the money. The original idea was to start construction at the end of 2015 or early '16. It could've almost been done by now!

That's the thing. This has been going on for almost half a decade now. They said they were going to close in June. They had a deadline of September just in case. Half a decade in, is two months going to make all the difference?

It makes sense that VB extended the time line to secure the loan. It's not like there's a ton of other projects that could go there anytime soon. All energy from all parties related to that site have been working towards the arena. If two months makes the difference, good. If it doesn't, nothing was going to come up in that time anyway.

Handicapping it, based on what I'm reading, my personal feelings, etc, I'd call it about 25/75 at his point. 25% likelihood of success. 75% likelihood that this fails to come to fruition. Then again, I never really thought it was much more than about 50/50.

ADD: I think baobabs hit the nail on the head. That news article came off as a fluff piece for PR purposes. Usually for projects that have been going on for this long, to hear that "great things are happening" without any mention of when we will hear anything is almost always a bad sign. It's one thing to hear something generic like that when it's a newer project in development. But for something half a decade in.... it comes off as a desperate fluff to me.

Edited August 16, 2017 by HRVT

[vdogg]

What would be nice is if WAVY 10 actually had real journalists who would try to get to the bottom of a situation and figure out what is going on, instead of doing a fluff piece. Perhaps the Pilot will dig something up in the future.

[baobabs727]

A speculative piece on the arena.  It quotes Sessoms, Henley, Moss, Ms. Kilmer and a professor.  

Do the bankers believe that the $$ projections add up? 

https://pilotonline.com/news/local/columnist/roger-chesley/latest-delay-on-beach-arena-financing-ratchets-up-pressure-on/article_94f90dc0-0b94-5a11-9463-126a0d4acb3e.html

[chris722]

 Seattle is not ahead of us.  Louisville would be competing with major college basketball teams within their state.  Pittsburgh does not want the NBA.  Vegas might be the only city ahead of us.

Why doesn't Pittsburgh want an NBA team?

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