Ted Leonsis Is Chasing A Wad Of Public Dough Out To The ‘Burbs
11:11 AM EST on December 13, 2023
Ted Leonsis, founder and chairman of Monumental Sports & Entertainment, is planning to move the Washington Wizards and the Washington Capitals to a new publicly funded arena in Virginia. Leonsis cut a deal with reptilian Virginia governor Glenn Youngkin to bring his teams to a proposed development project at Potomac Yard, south of Washington, D.C. and about six miles from the perfectly fine downtown arena that has been the home of the two franchises since 1997.
Monumental Sports owns the current arena, the construction of which was privately financed by then–Wizards owner Abe Pollin. Monumental will own the building outright after 2027, but the company currently leases from the city the land that it sits on. It's an arrangement that Leonsis inherited when he purchased the team from the Pollin family in 2010, and he hates it. In 2016, when Leonsis first broached the topic of perhaps one day moving his franchises out of D.C., he lamented “the worst building deal in professional sports,” and said that the downtown arena costs his company $36 million a year. Back then, Leonsis said he had not spoken to Virginia or Maryland officials about relocating his teams, and pledged he "would never do that."
Monumental's lease runs through 2047, but there is an opt-out after 2027 that would cost Leonsis $35 million. The arena is on the older side for a professional sports venue, at least by North American standards, and Leonsis knows that even as reviled a lowlife as Dan Snyder can get local politicians to stumble over each other in a race to hand over public money for new construction. Leonsis has been after a reluctant D.C. government for $600 million in renovation funds—that is, he would like for the residents of D.C. to pay through the nose to shine up a building that is owned by a billionaire—and this created an opening for Youngkin. Youngkin has been hunting a signature development victory so that he can say he's luring new business to his state, even if it costs taxpayers into the decuple digits; recently he did a whole lurid courtship dance with Snyder in an effort to bring the Commanders to this same plot of land.
The proposed site in Alexandria is currently owned by JBG Smith Properties, a real estate investment fund that recently sold four million square feet of land to Jeff Bezos for Amazon's new Arlington headquarters. The deal with Leonsis would see JBG Smith selling the Potomac Yard property to a proposed Virginia stadium authority, which would then be responsible for building the arena portion of the 12-acre "world-class entertainment district." The proposed 20,000-seat arena would then be leased to Monumental Sports, reportedly for a term of 35 years. This proposal has all the usual fanciful boasts about how it will create 30,000 jobs and $12 billion in economic benefit, numbers that have little basis in reality.
The Washington Post reported Wednesday that Monumental plans to subsequently convert the old downtown arena into a "unique, flexible" venue for a more aggressive schedule of live events, and to make it the new home of the Washington Mystics. The Mystics currently play at the Entertainment and Sports Arena, in Congress Heights, a neighborhood in Southeast D.C.; that arena was built in 2018, a $65 million project that used approximately $60 million of public funding. The Entertainment and Sports Arena contains practice facilities for the Wizards, which in the Potomac Yard proposal would become obsolete, as the Wizards and Capitals would both move their practice facilities to Alexandria. This despite the publicly funded complex in Congress Heights being so freshly built that Monumental's own website still refers to it as "new."
The deal with Youngkin appeared to come together quickly. D.C. mayor Muriel Bowser was up late Tuesday night meeting with D.C. Council chair Phil Mendelson to formalize and announce a bill that would cobble together $500 million in public financing for renovations to the downtown arena. The bill, if passed, would spread the financing over three years and would extend Monumental's commitment to 2052. But Bowser cannot promise that this thing will pass: She is also working to put together a proposal to bring a new football stadium into the district, and the Post reported that the Lerner family, which owns the Washington Nationals, is beginning to make noise about wanting public funds for upgrades at Nationals Park, which was built [checks notes] approximately yesterday.
The Virginia deal is far from done—Youngkin will have to convince local and state officials and lawmakers to approve his grand plans—although it is serious enough that Leonsis went grip-and-grin mode with Youngkin at an announcement ceremony at Potomac Yard Wednesday morning. Leonsis spoke loftily of what he described as an opportunity to build a "super-community" in Northern Virginia, developing "one of the 10 most important communities on the planet" and to "really help this region go up to its total promise." These are very over-the-top ways to describe yanking your business out of the city because an unpopular term-limited sleazebag offered up billions in public money in order to salvage his own tailspinning political ambitions, but go off, man.