New Richmond Arena

[Brent114]

 

You have a low threshold for alive and well. 

So far they’ve plopped colour plates on a map.  No tenants.  No investors.  Hysterically inflated attendance  and hotel rates/nights projections (higher room rates than the same brand in downtown San Francisco for  example).

I still don’t see it surviving scrutiny before Jan (the earliest it could be voted on). 

The Shockoe ballpark (which I supported) had a tenant with a 20 year lease, a hotel and Kroger (and federal money for flood mitigation) with highly detailed plans and was still DOA by the time it got to city council. 

 

Edited August 6, 2019 by Brent114

[Icetera]

25 minutes ago, Brent114 said:

So far they’ve plopped colour plates on a map.  No tenants.  No investors.  Hysterically inflated attendance  and hotel rates/nights projections (higher room rates than the same brand in downtown San Francisco for  example).

Unfortunately I do worry about this as well.  I like the plan but there is a lot of unaccounted for space such as the medical building and a lot of potential empty storefronts.  I am still optimistic, however.

[vaceltic]

They are still using the Hunden Partners Analysis in the schemes financial projections. I cannot overstate what a huge red flag that is for the viability of this project! 

Edited August 6, 2019 by vaceltic

[Brent114]

I really do want to be optimistic about it too.  I’m frustrated that the the project won’t be able to pay for itself (and I’m akso worried about how ugly these developments end up being,  but I am excited about the potential of building on Grace  and Broad). 

My mention of the state portion is in regards to sales tax collected.  Before the tif was expanded, it was assumed that sales  taxes around the arena could service the debt.  The number crunchers failed to consider that a portion of that tax is actually earmarked for the state (4.8% I believe).  The GA hasn’t relinquished that tax in other similar situations and likely won’t this time either.  So they expanded the tif placing present day revenue for the city, out of the city’s coffers.  That isn’t the same as “it will pay for itself through new tax revenues”.  

The attendance figures assume 750k  annual visits to the arena for 30 years (doesn’t account for attendance dropping off as the building ages and the project costs don’t include renovations in the future (which will be in the 100s of millions too).   That number is more than visitors to Raleigh’s and  Charlotte’s combined and is on par with DC and Atlanta figures (Richmond would have to be a top10 entertainment city in the USA to see those figures).   It also assumes a $84 price of admission.   The taxes generated from hotel stays assume a rate over $100 a night higher than the existing hotels downtown. 

Edited August 6, 2019 by Brent114

[Icetera]

25 minutes ago, Brent114 said:

I really do want to be optimistic about it too.  I’m frustrated that the the project won’t be able to pay for itself (and I’m akso worried about how ugly these developments end up being,  but I am excited about the potential of building on Grace  and Broad). 

My mention of the state portion is in regards to sales tax collected.  Before the tif was expanded, it was assumed that sales  taxes around the arena could service the debt.  The number crunchers failed to consider that a portion of that tax is actually earmarked for the state (4.8% I believe).  The GA hasn’t relinquished that tax in other similar situations and likely won’t this time either.  So they expanded the tif placing present day revenue for the city, out of the city’s coffers.  That isn’t the same as “it will pay for itself through new tax revenues”.  

The attendance figures assume 750k  annual visits to the arena for 30 years (doesn’t account for attendance dropping off as the building ages and the project costs don’t include renovations in the future (which will be in the 100s of millions too).   That number is more than visitors to Raleigh’s and  Charlotte’s combined and is on par with DC and Atlanta figures (Richmond would have to be a top10 entertainment city in the USA to see those figures).   It also assumes a $84 price of admission.   The taxes generated from hotel stays assume a rate over $100 a night higher than the existing hotels downtown. 

Virginia has a 4.3% sales tax while Richmond is 1%.  The projections appear to account for this though they are hoping to gain an additional 1.5 to 2.8% of the state's portion (remainder locked for education and transportation).

Raleigh's PNC arena claims 1.5 million visitors per year so this is actually projected at half.  The comparisons were for Pinnacle Bank Arena (Lincoln, NE) with 700k and Bank of Oklahoma Center (Tulsa, OK) with 800k .  As far as the Hyatt Regency, the report shows $35 over the current average for the older Marriott and explains their reasoning fairly well.  The same brand in San Francisco is currently $219.00 for weeknights and and $399.00 for weekend nights.

[RiverYuppy]

It looks like there will be $1.1 billion dollars in private investment.

How many of the previous private projects that we were excited about would we have to add up to get to $1.1 billion? For comparison the 12 story locks apartment building is $58m.

Edited August 6, 2019 by RiverYuppy

[vaceltic]

9 hours ago, Icetera said:

Virginia has a 4.3% sales tax while Richmond is 1%.  The projections appear to account for this though they are hoping to gain an additional 1.5 to 2.8% of the state's portion (remainder locked for education and transportation).

Raleigh's PNC arena claims 1.5 million visitors per year so this is actually projected at half.  The comparisons were for Pinnacle Bank Arena (Lincoln, NE) with 700k and Bank of Oklahoma Center (Tulsa, OK) with 800k .  As far as the Hyatt Regency, the report shows $35 over the current average for the older Marriott and explains their reasoning fairly well.  The same brand in San Francisco is currently $219.00 for weeknights and and $399.00 for weekend nights.

This is wrong. Page 283 of the 600 page proposal provides an annual average attendance estimate of 471,500 for the new arena.  Yet another example of these cronies cherry picking WRONG numbers to make an overly optimistic narrative to push this boondoggle through.  

[Downtowner]

It doesn’t matter what the nimbys say the people who fight this project don’t stand a chance especially when Goldman’s referendum he wants had to go through the va general assembly and signed off by northam. Stoney seems to be good buddies with Northam to begin with. I doubt Northam would sign off what Paul Goldman wants I also feel like from a state level with it going into the general assembly before signed off by Northam that it’s not as big of an issue to them than it is here in Richmond. I don’t know if I’ve heard this correctly but I feel like I heard the mayor in Richmond has the power to veto something that city council doesn’t pass and can still pass it through. I feel like Stoney is still going to go through with it even if city council doesn’t pass it. I just feel like he will veto and still make it happen.


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[Icetera]

1 hour ago, vaceltic said:

This is wrong. Page 283 of the 600 page proposal provides an annual average attendance estimate of 471,500 for the new arena.  Yet another example of these cronies cherry picking WRONG numbers to make an overly optimistic narrative to push this boondoggle through.  

I have yet to actually find the 750k number that Brent mentioned but looked up the current listed attendance for the Raleigh comparison he listed plus those listed as examples by the documents.  Given that the two arenas specifically mentioned at points average to 750k, I would not be surprised if that number exists somewhere, but all I have seen so far is around the 500k mark as you show.  Regardless, the arena proceeds itself are not the most significant financial generator here.

[vaceltic]

54 minutes ago, Icetera said:

I have yet to actually find the 750k number that Brent mentioned but looked up the current listed attendance for the Raleigh comparison he listed plus those listed as examples by the documents.  Given that the two arenas specifically mentioned at points average to 750k, I would not be surprised if that number exists somewhere, but all I have seen so far is around the 500k mark as you show.  Regardless, the arena proceeds itself are not the most significant financial generator here.

Images attached for the Richmond Arena projections (800K) versus existing comparable arenas (400K and less) from the HSP analysis the city is using for its financial projections. The attendance estimate included in the proposal is less than 60 percent of these numbers! Every financial generator of this proposal matters, as it is a crumbling house of cards if not one is accurate. I’ll continue to dig and provide additional false or incorrect assumptions as I find them.

Edited August 7, 2019 by vaceltic

[Icetera]

It appears Hunton Strategic Partners may have a history of being overly optimistic, though Fort Wayne is not the greatest example given they were trying to have competing arenas rather than replacing an obsolete one.

https://www.news-sentinel.com/news/local-news/2017/12/07/kevin-leininger-demise-of-downtown-arena-shows-fort-waynes-momentum-comes-in-many-forms/

[eandslee]

Does anyone have access to more renderings of the project?  For example, I’ve seen some posters in backgrounds of photos of what appear to be renderings of the GRTC bus transfer station, etc., but I don’t see any of these online anywhere.  Would just like the see all the renderings available out there. 

Edited August 7, 2019 by eandslee

[Shakman]

I'm hoping the aesthetics of this street scape can spread through the rest of Downtown and beyond.  (i.e. up kept sidewalk with possible special patterns, uniform street lights, pruned trees.) 

 

Perhaps the pruned trees maybe too much to ask for?

Edited August 8, 2019 by Shakman

[DowntownCoruscant]

So we’re finally getting a Richmond Roasters!

[Icetera]

And this is why we cannot have nice things:
 

https://vpm.org/news/articles/5952/voter-referendum-on-richmond-coliseum-deal-faces-legal-challenge

"Richmond lawyer Paul Goldman collected nearly 15,000 signatures to get the referendum on the November ballot. It would create new rules governing how the city can finance economic development projects and how new tax revenue can be spent. Goldman has admitted the referendum would essentially kill the deal between the city and a private development group headed by Dominion CEO Tom Farrell. "

[eandslee]

Old news.  Doesn’t appear to be a factor, but not 100% sure of that. 

[eandslee]

I have a few questions:

Can the privately funded portions of this project be more than what is envisioned?  For example, can a private developer say, “no, instead of erecting a 20-story Tower here, I’m going to go for 25 stories?”  Also, does a private developer have to stick with the minimum of what’s envisioned?  For example, does the hotel have to be shaped just like the one in the drawings or is there some latitude given to the developer?  Can the developer build something shorter as long as it meets the criteria outlined in this plan?

[wrldcoupe4]

It’s usually required minimums for things like number of rooms, square feet of space, etc. I haven’t seen anything about limits.  On height, I don’t see a situation where the city says they want it to be a certain height. They care about room count. 

Edited August 10, 2019 by wrldcoupe4

[vaceltic]

 There could be limitations on height based upon the apparatus, personnel, and equipment available to the City’s fire and emergency response departments and the parameters they need to meet for emergency response times. For instance, meeting a 3 minute response time might be calculated up to 20 floors but any higher would be outside these parameters and prevent the building from going higher. It all depends on the location of the proposed fire station and the heights of surrounding buildings. 

[eandslee]

A different, yet skeptical article from the Richmond Free Press regarding the NH Development.  It’s good to look at all angles to see what everyone is thinking:

http://m.richmondfreepress.com/news/2019/aug/09/moving-or-out-mayor-stoney-submits-city-council-15/

[DalWill]

1 hour ago, Hike said:

I could be over reacting, doubt this will be good news,  maybe others can read the tea leaves better than I can.  If a referendum is to move forward, the wording of the referendum will be key here, if it says something like Trammel says, it will go by way of a typical RVA transformational project.

“Personally, I’m tired of rich corporate millionaires and billionaires trying to drain city coffers of our taxpayer money to finance their pet projects,” Trammell said in a text message. “My view is if they want to build something, let them do it with their own money.”

Trammell said she wants voters to answer the question: “Shall the city of Richmond support taxpayer funding, estimated to be as much as $600 million, for a new Coliseum or arena in downtown Richmond?”

https://www.richmond.com/news/local/city-of-richmond/richmond-councilwoman-wants-referendum-on-coliseum-redevelopment-financing-special-meeting/article_1a7497bb-da2b-5c3c-ab52-75ff4cc5a99a.html

 

 

Just so we can clear of the information being presented, Dominion is still paying for the arena? 

[DalWill]

1 hour ago, Hike said:

There are an estimated 600 million dollars of investment bonds, which is the estimated value over 30 years,  that the city would have to put up as part of the cost is how I'm reading this.  

Looking at it now, they have every right to be concerned. However, what I'm uncomfortable with is that there are no alternatives to this master plan or financing options. I highly doubt developers would take a total chance on this if the project wouldn't have a good ROI. And I'm sure they are looking at this from the perspective of past failed projects (6th Street Marketplace, Redskins Training Center; etc.). If greediness does take place and leads to mismanagement, there should be some sort of clause that should hold those parties accountable.

Either way, the area is draining the city of $1,000,000 or more now. Something has to be done. What I respect is that Stoney is taking the initiative to try and solve a problem with Richmond's most desolate areas, whether if it gets passed or not. I do believe the ball is in City Council's court now.

Edited August 12, 2019 by DalWill

[DalWill]

Double post, my apologies.

Edited August 12, 2019 by DalWill

[vaceltic]

46 minutes ago, DalWill said:

Looking at it now, they have every right to be concerned. However, what I'm uncomfortable with is that there are no alternatives to this master plan or financing options. I highly doubt developers would take a total chance on this if the project wouldn't have a good ROI. And I'm sure they are looking at this from the perspective of past failed projects (6th Street Marketplace, Redskins Training Center; etc.). If greediness does take place and leads to mismanagement, there should be some sort of clause that should hold those parties accountable.

Either way, the area is draining the city of $1,000,000 or more now. Something has to be done. What I respect is that Stoney is taking the initiative to try and solve a problem with Richmond's most desolate areas, whether if it gets passed or not. I do believe the ball is in City Council's court now.

The $1 million loss is a false narrative. That does not account for the existing arena's admissions taxes, sales taxes, and hotel taxes it generated from its shows. Yet when we are supposed to look at the new proposal, of course they include those taxes revenues in their projections of how successful it will be. We are not getting apples to apples comparisons of the existing versus new cost/benefit. The proposal is so complex it is designed to mislead and hide the risks of the project from its citizens. 

I have taken a thorough look through Davenport & Company's financial impact statement on the proposal.  I pointed out numerous errors and blatant omissions of costs in their assumptions on just TWO SLIDES of their presentation and forwarded these to city council so they won't be duped. Not all costs have been accounted for with respect to Police, Fire, and Planning. Social Services and Richmond Public School costs were  even completely omitted from their analysis. 

There HAVE been development alternatives before going back over a decade. Piecemeal development proposals for sure, but the city declined them because the city owns the land and wants to control the outcome.  Cheerleaders of development in other resurgent neighborhoods (newly upzoned Monroe Ward, Manchester, Shockoe Bottom) will be waiting a LONG time for new development to occur if this is approved. Downtown residential and commercial development will stagnate for a 6 year period if this moves forward. This is based on Navy Hill's own market analysis conducted by CS&L (Page 283 of 589 of Navy Hill’s original development proposal; Page 23 of CS&L Analysis) claiming a 450 apartment unit absorption rate for downtown (which CS&L defines as VCU area, Jackson Ward, all of Manchester south to Maury Street, and Shockoe Bottom). This proposal will be all we get for quite some time - and none of the tax revenues are guaranteed to go to any city services other than servicing the arena debt.

[wrldcoupe4]

What were the mistakes and omissions by Davenport that you sent to City Council?