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Sonics Forever: Episode 2 – Sam Perkins & Duff McKagan

by Kevin Nesgoda January 21, 2021
written by Kevin Nesgoda


Courtesy Sonics Forever (Truth+ Media and Simply Seattle)

Courtesy Sonics Forever (Truth+ Media and Simply Seattle)

Big Smooth and one of the roses of Guns N’ Roses. Two great tastes that go great together? Or a discordant symphony that makes you questions your senses?

Let’s find out.

Former Sonic Sam Perkins and musician Duff McKagan join host Brad Burns in this episode of Sonics Forever.

Sonics Forever, the joint podcast venture from George Karl’s Truth+ Media and Simply Seattle, wants to take you through the journey of Seattle’s one-time — and hopefully, soon again — NBA team. As seen through the fog of memory of some of the biggest names associated with the club, it wants to tell you a well-earned history and maybe share some things you’ve never known.

Smooth shares some insights into his quiet, calm demeanor on the court, which Duff says inspires him in the moments he wants cooler heads to prevail. Duff talks going to a number of games up in the 300 level at KeyArena with Kim Thayil of Soundgarden fame.

Both address the biggest rumors about them: Was Duff Beer on The Simpsons named after McKagan, at one point known as “Duff, the King of Beers”? And was Perkins ever as high on the court as many in Seattle assumed?

It’s a fun discussion with some ‘90s Sonics love.

January 21, 2021 0 comment
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Tim Leiweke ‘100% certain’ Sonics, NBA will return to Seattle

by Kevin Nesgoda January 15, 2021
written by Kevin Nesgoda

Tim Leiweke is “100% certain” that they will bring the Sonics back to Seattle.

The CEO of Oak View Group, the developers of the city’s new Climate Pledge Arena, spoke with KJR 950-AM’s Dave “Softy” Mahler and Dick Fain on Thursday afternoon to offer insight into the NBA efforts.

In a 20-minute conversation, Lewieke reiterated that the group isn’t going to get ahead of the owners and NBA commissioner Adam Silver on the process. They are ready to go as soon as the league is ready to move forward on expansion.

“When the day comes, and it will, and [the NBA] says ‘We’re going to begin the [expansion] process, ‘I am 100 percent certain we’re going to get the Sonics back.”

He pointed to their methodical effort in securing the arena deal with the city, as well as their successful pursuit of an NHL expansion franchise. The new arena is set to open in October ahead of the inaugural season for the Seattle Kraken.

OVG and the hockey ownership made sure to predict what the NBA would want in the arena, would want with revenue, and would want in ownership, Leiweke shared. This was built into the arena process, from design to construction to sponsorship deals they made sure would be NBA-friendly as well.

Cascadia SN has also confirmed that plans for an NBA practice facility have been factored into the NHL team headquarters and ice center in Northgate. “It is not part of the current construction, but there is the possibility within the current footprint,” the Kraken front office told us.

A key part of the NBA focus is Kraken majority co-owner David Bonderman, Leiweke stressed. Also a minority owner of the Boston Celtics, “Bondo” has a good relationship and connections with the NBA. The arena and hockey organizations on the whole have “enormous” NBA experience, he added.

Leiweke, himself, was an executive with the Minnesota Timberwolves, the Denver Nuggets, and of course the Los Angeles Lakers through his work with AEG, and the Toronto Raptors as one-time president of Maple Leaf Sports & Entertainment.

Mahler and Fain asked about the rumored $2.5 billion expansion fee being bandied about. Leiweke wouldn’t speculate, but added that Silver “doesn’t do kneejerk” and would safeguard the long-term condition of the league.

The NBA isn’t in any danger of folding, but consideration of expansion follows a year where the league took it in the teeth financially due to pandemic impacts.

The exec shared an outlook “Bondo” took when everyone was discussing the record-breaking expansion fee paid for the Kraken: It’s more on how you pay than what you pay.

Ultimately, the addition of Seattle to the NBA portends to add significant value that could prove more beneficial to owners than solely the influx of cash from a one-time fee.

Asked what he thought of the possibility of Amazon founder Jeff Bezos joining a Sonics team ownership, he pointed to a “phenomenal” partnership the arena group has had with Amazon regarding the arena naming rights. If Bezos proves interested, Leiweke sees him as nothing but a positive for the team, the city, and the league.

While offering no timeline, he is bullish on things going Seattle’s way. He asked for fans and supporters to “just have faith,” offering they’ve provided on every promise and goal they’ve made in the past five years.

“We’re going to get there. I’m very confident that this will end well for everyone in Seattle.”

January 15, 2021 3 comments
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Sonics Forever: Episode 1 – Shawn Kemp

by Kevin Nesgoda January 13, 2021
written by Kevin Nesgoda


Courtesy Sonics Forever (Truth+ Media and Simply Seattle)

Courtesy Sonics Forever (Truth+ Media and Simply Seattle)

There was perhaps no more fitting a nickname for a Seattle athlete than Reign Man.

The play on words encapsulated the baller and his city to a ‘T’ at a time when the energy of the SuperSonics around the league was wowing the nation. Shawn Kemp and his cavalcade of dunks helped give personality to a brash Sonics squad that was arguably the second most popular team at the time behind the Chicago Bulls, the very definition of 1990s NBA.

Kemp, though, didn’t want to be known as a guy who could dunk.

He tells host Brad Burns on the first episode of Sonics Forever that he recognized the opportunity to stand out in the crowd, sure. Yet, he believed, as many players did then, that dunking was a flourish you added to being an all-around good player.

Sonics Forever, the joint podcast venture from George Karl’s Truth+ Media and Simply Seattle, wants to take you through the journey of Seattle’s one-time — and hopefully, soon again — NBA team. As seen through the fog of memory of some of the biggest names associated with the club, it wants to tell you a well-earned history and maybe share some things you’ve never known.

Turns out Kemp’s memory is pretty good, and this premiere is a great sit-down with the Sonics legend walking through his history and some finer points of that ’90s team.

His recruitment to Kentucky when he was heavily favored to play for home state Indiana and coach Bobby Knight. His subsequent transfer to Trinity Valley Community College; he never had a single practice let alone played a game for either school.

His 4 weeks of training with Magic Johnson and the Lakers ahead of the 1989 NBA Draft in anticipation of being picked by L.A. Only to have a son of Barry Ackerley show up and convince him to take a trip to Seattle.

His disappointment that the Sonics didn’t capitalize on the two years Michael Jordan had retired from basketball, when they were the best team in the league. Matched by his joy that making the ’96 Finals finally gave fans the goods following the build-up and hype of previous seasons.

Though, when asked for a favorite game of that series, Kemp soberly wonders how anyone could have a favorite game from a series they lost.

From being drafted 17th when many teams were interested, to game time logged with Dream Team 2, to the nixed trade that almost brought Scottie Pippen to Seattle and sent him to Chicago. It’s an informative, insightful discussion that still feels all too brief at nearly two hours.

There’s even talk of some guy named Gary, who occasionally lobbed him the ball.

Take a listen below.

January 13, 2021 0 comment
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Sonics Forever: Podcast revisiting the Seattle SuperSonics journey with the biggest names

by Kevin Nesgoda January 11, 2021
written by Kevin Nesgoda


Image from Truth+ Media and Simply Seattle (used with permission)

Image from Truth+ Media and Simply Seattle (used with permission)

As the Green and Gold Faithful get revved up about the growing likelihood of NBA expansion — the strongest possibility of returning the league to Seattle since the failed purchase and relocation effort of the Sacramento Kings in 2013 — a site, a podcast, a project is helping to celebrate the legacy of the team.

Sonics Forever launched this past October. It’s a joint effort of Truth+ Media and Simply Seattle, the local retailer that has long championed the team in its absence by offering apparel as the “World’s Largest Sonics Store”.

The podcast seeks to remember the team by speaking to some of the biggest names in Seattle SuperSonics history. It looks to provide new insights for a fanbase just as fervent as when the team took to the boards at KeyArena.

Truth+ Media offers a unique perspective and access to team dignitaries through its founder, George Karl. Karl, the sixth-winningest coach in NBA history, was leader of arguably the greatest stretch of success in the Sonics 41 years in the league.

The company debuted last year with the coach’s excellent Truth + Basketball podcast, an exploration of the game, coaching success, and Karl’s own history.

In the 12 episodes released to date, Sonics Forever has come out hot with discussions with the likes of former Sonics Shawn Kemp, Detlef Schrempf, Sam Perkins, Eddie Johnson, Spencer Haywood, and Gary Payton.

Add to that talks with fans like musicians Sir Mix-A-Lot and Duff McKagan, definitive NBA 6th man and Seattle native Jamal Crawford, and longtime broadcaster Kenny Mayne.

Topped with conversations with legendary player and coach Lenny Wilkens and the man considered by many as the voice of the Sonics, Kevin Calabro.

And of course, Steve Scheffler.

It’s a stacked lineup, and we look forward to covering it as episodes drop. And we’ll be playing catchup with current episodes on Wednesdays.

January 11, 2021 0 comment
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Seattle mayor spoke with NBA, “optimistic” about expansion

by Kevin Nesgoda January 8, 2021
written by Kevin Nesgoda

The mayor of Seattle has spoken to the NBA, believes expansion is coming, and is “pretty optimistic” about Seattle chances to land a new Sonics team.

In an exclusive with KING5-TV’s Chris Daniels, Mayor Jenny Durkan revealed she most recently spoke with NBA commissioner Adam Silver prior to Christmas following his remarks on the league analyzing the prospect of expansion.

She also admitted she’s had regular contact with Silver, most recently attending NBA games with him while in New Orleans for a conference.

Given the economics of the NBA impacted by the COVID pandemic, Durkan believes that talk of expansion is real and likely to occur faster than most think.

“I think [Silver]’s not going to get ahead of the (owners),” Durkan said. “They’ve got to make the decision there first. I think that him saying it publicly means that they are very seriously considering it, and if you look at how sports moves, I don’t think it’s going to be a long multiyear process. I think it can be a shorter process than that, but it might be, you know, more than one year. I think first you got to get the ownership group in line. And they’ve got to decide what an expansion team price could look like. And how they choose the cities that goes to. As we know, there’s also teams that are underperforming in the NBA, so they have to look at the economics in those cities and make sure that the teams they have are competitive. So they’ve got to look top to bottom as they’re coming out of COVID and went through a very different season than they had before.”

She stresses that Silver doesn’t want to get ahead of the team owners he works for, and that cities interested in a team can’t get ahead of them either. This echoes a mantra that Tim Leiweke, CEO of the developer of Seattle’s new arena Oak View Group, has long publicly expressed.

Leiweke has recently stated that the arena group and potential team ownership are looking to focus this year on bringing the NBA back to Seattle. They will be “100% ready” if and when the NBA presents the opportunity.

Seattle is seen by most as a lock for one of potentially two expansion teams, if and when the NBA decides to move forward. Recent scuttlebutt is that the league is eyeing an expansion fee of $2.5 billion per team.

Durkan feels Seattle’s economic position, the NBA connections of both the arena group and the ownership group for the NHL expansion Seattle Kraken, and Seattle’s history with the NBA puts the city in good stead.

“I think it was a very positive conversation [with Silver],” Durkan said. “I think he has said publicly that Seattle is at the top of the list. Look, if there’s basketball karma, we’ll get the Sonics. If there’s economics involved, we’ll get the Sonics. If there’s just smart, what’s the best city in America, we’ll get the Sonics. So, I’m pretty optimistic.”

Check out KING5 for more, including thoughts on the potential of a Jeff Bezos involvement in team ownership.

January 8, 2021 0 comment
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2021 is year to focus on getting Sonics back to Seattle, arena group head says

by Kevin Nesgoda January 4, 2021
written by Kevin Nesgoda

Tim Leiweke says this year is the time to focus on bringing the beloved SuperSonics back to Seattle and the NBA. Go ahead and get excited.

The CEO of Oak View Group, the developers behind Seattle’s new Climate Pledge Arena, responded to a Twitter post on Sunday regarding the Sonics. He says the group “must make our case to [the] NBA that we have an opportunity to do the right thing.”

2021, the year we must turn our attention to bringing Sonics back to Seattle. For 41 years, this community was there for franchise. Now, we must make our case to NBA that we have an opportunity to do the right thing. We will have one of best Arena’s in world. Time to fix this

— tim leiweke (@leiweketim) January 3, 2021

It’s a somewhat surprising public comment on the effort, especially one unsolicited, but another welcome one for the Green and Gold faithful.

The Seattle Kraken hockey club is set to take the ice for the first time this fall, helping to open Climate Pledge Arena, a $930 million redevelopment of the former KeyArena.

“The Key,” and its original life as the Seattle Center Coliseum, served as home to the Sonics for the majority of their 41 years in the Emerald City.

The hockey ownership group, led by investor David Bonderman and Hollywood film producer Jerry Bruckheimer, has expressed interest in owning a new Sonics team.

Talk of expansion in the NBA has recently begun heating up. Commissioner Adam Silver revealed that the league has been analyzing the prospect, if not actively pushing to add teams just yet.

Seattle is a presumptive favorite to land a team if and when the growth to 32 clubs gets a green light. Still, Leiweke continued that they need to make the league “appreciate 41 years of loyalty” from the city.

I get it, feel for you. We have a good story to tell. The new Arena is extraordinary. Can’t get ahead of league, but we need to make them appreciate 41 years of loyalty from community to NBA. The market was never the issue. It was the Arena. Now have one of the best in world.

— tim leiweke (@leiweketim) January 3, 2021

With extensive experience as an executive in both the NBA and the NHL, Leiweke has long maintained a public position of not “getting ahead” of the leagues and commissioners regarding relocation or expansion. He recently told the Seattle Times the arena group and team ownership are “100% ready” when the NBA decides to go formal on a process.

Nothing’s a lock, but things certainly seem ripe for opportunity.

January 4, 2021 0 comment
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Silver: Seattle at ‘the top of the list’ when NBA ‘invariably’ considers expansion

by Kevin Nesgoda December 24, 2020
written by Kevin Nesgoda


This image was originally posted to   Flickr   by Keith Allison at  https://www.flickr.com/photos/27003603@N00/15847004771 . It was reviewed on 22 November 2014 by   FlickreviewR   and was confirmed to be licensed under the terms of the cc-by-sa-2.0.

This image was originally posted to Flickr by Keith Allison at https://www.flickr.com/photos/27003603@N00/15847004771. It was reviewed on 22 November 2014 by FlickreviewR and was confirmed to be licensed under the terms of the cc-by-sa-2.0.


NBA Commissioner Adam Silver says Seattle will be at the top of the list when the NBA seriously considers expansion.

On Thursday, speaking with NBA vet Jalen Rose on his podcast “Renaissance Man“, Silver was asked which city he would like to see next host an NBA team. His response is a nice Christmas stocking stuffer for Sonics fans in Seattle.

“I’m going to say Seattle, because I was in this league for many years while Seattle still had a team. And we were all sad… It was an unfortunate set of circumstances that led to that team leaving. And it still remains a great market.”

Silver continued, “And so, there’s no doubt, when we do turn back to expansion, which we invariably will one day, that Seattle will be at the top of the list.”

While the ultimate gift would be to have the expansion granted so the new Sonics could tip off in the soon-to-open Climate Pledge Arena in the next two or three years, it’s a welcome message for the league, through Silver, to acknowledge the appetite to make Seattle super again.

This adds to a week of renewed public talk about exploring expansion in the NBA. On Monday, during his preseason press availability ahead of the just-started 2020-21 season, Silver stated that while it’s not “on the front burner,” the league is analyzing the possibility of expansion.

“I think I’ve always said that it’s sort of the manifest destiny of the league that you expand at some point,” ESPN reported. “I’d say it’s caused us to maybe dust off some of the analyses on the economic and competitive impacts of expansion. We’ve been putting a little bit more time into it than we were pre-pandemic. But certainly not to the point that expansion is on the front burner.”

The league’s official position is they are still not considering expansion. [Ed: until they are, of course.] The effect of the pandemic on various NBA teams might be forcing their hand, though. It’s said expansion usually occurs following recessions when the league needs to inject cash as a means to continue growth. Certainly, a potential $1-2 billion (or more) expansion fee each from likely two teams being added has got to seem appealing to team owners amid significant financial losses.

For their part, Tim Leiweke of Oak View Group, the developer of Climate Pledge Arena, says they are ready when the NBA takes steps to formalize an expansion process.

Geoff Baker of the Seattle Times points out that “nearly $50 million of the arena’s [$930 million] cost has gone toward outfitting it with particulars the NBA insists upon.” These include things like locker rooms specifically for the NBA players and officials, and facilities for NBA team training staffs.

Speaking to Baker, Leiweke stated, “We’re not anticipating anything. The league knows the leadership on our side — from ownership to our management of the building — are NBA ‘family’ members. They’re well aware of that. They’re well aware of the steps we’ve taken so that if and when they come knocking on our door, our building will be 100% ready.”

David Bonderman, majority owner of the NHL expansion Seattle Kraken, is a minority owner of the Boston Celtics. He has expressed his interest in bringing a new SuperSonics club back to Seattle.

Kraken minority owners Chris and Ted Ackerley are sons of one-time Sonics owner Barry Ackerley. Speculation has been that, in addition to being sports fans, the Ackerleys joined the NHL ownership for the potential to be part of an NBA ownership group as well.

Regarding the economics of an NBA club playing in the new arena, Leiweke added, “Everything we’ve done — from naming rights, to sponsors, to suites, to opera boxes, to club seats — we have built in to protect the economics of the NBA team. And that’s critical — to maximize the revenue streams. So, we’ve done that as well.”

Sonics fans, by and large, remain skeptical of expansion until it happens. But it’s nice to get a Christmas card all the same.

December 24, 2020 0 comment
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Quarantine Hoops: Catch up on classic Sonics and Blazers games

by Kevin Nesgoda March 23, 2020
written by Kevin Nesgoda


Seattle Municipal Archives  /  CC BY

Seattle Municipal Archives / CC BY

As we all stay at home in response to the COVID-19 outbreak, we’re looking for things to do outside of work and those pesky house chores we’d kept putting off. The NBA’s got you covered, offering a free preview of its subscription NBA League Pass service through April 22nd.

While you can check out all games of the 2019-20 NBA season prior to its hiatus, there are also a number of archived classic games available for your basketball fix. The selection is limited, but there are a few great or notable SuperSonics and Trail Blazers games you can revisit. There are also some All-Star Games and events featuring some fave Sonics and Blazers players for your enjoyment.

Seattle SuperSonics

  • 1979 NBA Western Conference Finals – Game 7: Phoenix Suns vs Sonics (5/17/1979: “Seattle pulls out a Game 7 victory with a wild finish at the buzzer”)

  • 1987 NBA Western Conference Semifinals – Game 6: Houston Rockets vs Sonics (5/14/1987: “Hakeem Olajuwon records 49 pts, 25 rebounds, 6 blocks in Game 6 loss”)

  • 1993 NBA Western Conference Finals – Game 5: Sonics vs Phoenix Suns (6/1/1993: “Barkley’s triple-double with 43 pts is rivaled by Kemp’s 33 pts”)

  • 1994 NBA Western Conference First Round – Game 5: Denver Nuggets vs Sonics (5/7/1994: “Eighth-Seeded Nuggets upset Sonics in NBA’s biggest upset”)

Portland Trail Blazers

  • 1977 NBA Western Conference Semifinals – Game 3: Denver Nuggets vs Blazers(4/24/1977: “Bill Walton and Maurice Lucas“)

  • 1990-91 NBA Regular Season – Game 65: Blazers vs Golden State Warriors(3/19/1991: “Mitch Richmond scores 40 points for the Warriors beating out the Trail Blazers”)

  • 1992 NBA Finals – Game 1: Blazers vs Chicago Bulls(6/3/1992: “Michael Jordan hits six 3-pointers in the first half, then shrugs his shoulders in 1992 NBA Finals Game 1″)

  • 1996 NBA Western Conference First Round – Game 3: Utah Jazz vs Blazers(4/29/1996: “Karl Malone‘s 35/10 not enough vs. Trail Blazers”)

All-Star Games

  • 1977 All-Star GamePOR: Maurice Lucas, Bill Walton (injured); SEA: N/A(2/13/1977: “Dr. J is named 1977 All-Star Game MVP”)

  • 1984 All-Star GamePOR: Jim Paxson; SEA: Jack Sikma(1/29/1984: “OT thriller Magic Johnson 22 assists”)

  • 1986 All-Star GamePOR: Clyde Drexler; SEA: N/A(2/7/1986: “Michael Jordan hits six 3-pointers in the first half, then shrugs his shoulders in 1992 NBA Finals Game 1”)

  • 1991 All-Star Weekend – Slam Dunk ContestPOR: N/A; SEA: Shawn Kemp(2/9/1991: “Dee Brown used his “Peek-A-Boo” dunk to win the 1991 NBA Dunk Contest”)

  • 2001 All-Star GamePOR: Rasheed Wallace; SEA: Gary Payton(2/11/2001: “Allen Iverson MVP”)

Although the Sonics’ Desmond Mason won the 2001 All-Star Weekend Slam Dunk Contest, they don’t have video of that year’s competition.

To access the preview, make sure to sign up for an account at NBA.com. When signed in, visit the NBA League Pass page and a pop-up will let you select the current season or the classic games.

March 23, 2020 3 comments
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Understanding the Seattle Center Arena agreement

by Kevin Nesgoda August 1, 2019
written by Kevin Nesgoda


D5rhNV3U0AErVoB.jpg

“What in the world did the city agree to with the new arena?”

Okay, that’s not a specific quote, but among various basketball and even hockey fans in Seattle, it’s not an uncommon sentiment. All the passion and fire from campaigning to get the city to sign off on a new building to lasso NBA and NHL clubs wanes a fair bit when nose-deep in the hundreds of pages of documents that do so.

Confusion abounds around the particulars of the city’s agreement with Oak View Group and Seattle Hockey Partners (“NHL Seattle”). This, unsurprisingly, makes for strained and inconsistent conversation.

It was evident in the recent pro-SoDo arena proposal op-ed by Seattle City Council candidate Ann Davison Sattler, which didn’t appear to have a full understanding of the Seattle Center Arena agreement.

Last year, I was able to detail the deal in broad strokes, but let’s do a bit deeper dive to clear some things up.

ARENA SPECIFICS



SCAFootprint.png


The new arena obliterates the interior of the old arena, allowing construction to dig down 15 feet and dig outward to expand the footprint. The new arena will put on its big building pants at a whopping 800,000+ sq. ft., up from 368,000 sq. ft. for the old KeyArena.

The majority of the new building will exist underground, allowing OVG to maintain the historically landmarked roof and three of the existing exterior walls. The south wall will be leveled to make way for a fancy entrance atrium to welcome guests starting with a planned June 2021 opening.

The new haunt will seat 17,363 for the NHL, 18,627 for the NBA, 17,739 for an end-stage concert, and around 19,000 for a center-stage concert. This would rank SCA 27th on the list of NHL arenas and 16th on the list of NBA arenas by capacity at the time it opens. By comparison, KeyArena was the smallest NBA home in the Sonics’ last season at 17,072 and was downright inhospitable for major league hockey with 15,177 seats, a far off-center scoreboard, and obstructed views aplenty.

TEAMS

Seattle made an extraordinary statement in March 2018 on the thirst here for winter sports and NHL hockey, in particular. Shattering expectations and records, a sanctioned season ticket drive to demonstrate interest saw 10,000 ticket deposits made in the first 12 minutes, and 32,000+ total deposits laid down in the first day. The NHL’s previous expansion team, the Vegas Golden Knights, had impressed by garnering 10,000 deposits in 8 weeks. The day in Seattle shook through the sports world like a Beast-quake.

Don’t fret, hoops fans, the NBA is on the menu. As part of the agreement, Seattle Arena Company LLC (“ArenaCo”), the umbrella company for the arena construction and operations, is charged with using “commercially reasonable efforts” to pursue both NHL and NBA clubs. Despite claims and thoughts otherwise, they must pursue an NBA team. Prior to beginning demolition of the existing building earlier this year, OVG gained approval from both leagues on the SCA design.

An NBA ownership group would join ArenaCo as equity partners, becoming equal “owners” of the arena with OVG and SHP. The city owns the building, but ArenaCo will manage and operate. The NHL ownership is also anticipated to have cross-ownership in the NBA club, either as majority or minority owners.

Seattle was, of course, granted expansion for the NHL’s 32nd club back in December. One down, one to go.

The group will also take over the lease for the reigning WNBA champion Seattle Storm from the city.

MUSIC

ArenaCo is anticipating 70-80 concerts and live events annually. These are the lifeblood of any arena, even though the anchor sports team(s) tend to get higher profile. The new arena will allow Seattle to host those 15-20 major touring events it has missed out on each year due to previous insufficient facilities.

Music has been referred to as an “anchor tenant,” leading many to believe this will shut out NBA opportunities. With 200-250 potential use dates planned each year, there is plenty of opportunity to go around. And with single facilities hosting events, in addition to programming both the NBA and NHL, in the biggest markets in the country — New York, Los Angeles, Chicago, Boston, Dallas, Denver, Detroit, Philadelphia, Washington, D.C., and even Toronto in Canada — Seattle would not be reinventing the wheel.

The NBA requires teams to submit at least 50 available dates each year to coordinate that season’s schedule. Tentative scheduling of other events during potential playoff timing is a regular aspect of the business.

OVG has long stated that the sports anchor teams will get priority scheduling. On the SCA website, when discussing the initial “music-first” approach to building the arena, they state, “If we attract teams, we will adjust the music programming to accommodate the Storm, NBA and NHL schedules before booking other events to ensure teams can be competitive.”

FINANCIALS

Alright, enough teasing. Let’s get to the sexy part, money and taxes.

The project is estimated to cost about $930 million. All of the cost, and the risk associated with it, is borne by OVG. The city and its taxpayers bear no responsibility, which is great considering the project when first proposed was around $600 million.

Costs of labor in the booming Seattle construction market, as well as costs of materials due to the oh-so-fun present geopolitical environment, have contributed. The group has also iterated upon and added elements to the arena to improve the overall experience.

Speaking to KOMO News in July 2018, OVG chief executive Tim Leiweke stated,

“A lot of the extra money we’re spending on this building is geared to make sure we have three anchor tenants: the Storm, the NHL, and if the NBA chooses one day, we will not only make it work where they’re equal, but the revenue they can generate from the building will be as if they are in a brand new building that they own without them having to pay for it.”

Oak View Group CEO Tim Leiweke speaking with KOMO News, July 31, 2018

Scoffing at a group willing to drop a cool billion to deliver a top-flight arena may signal a loss of some perspective. And don’t worry, the group has been independently verified as financially capable to deliver the arena and operate it.

City getting paid

So what does the city earn each year through this deal?

A guaranteed annual rent payment of just over $2.8 million. A guaranteed annual baseline tax payment of $2.24 million. Claims to the first $2 million in net parking revenue each from the 5th Avenue N and the Mercer Street parking garages.

To deal with that pesky inflation, all amounts will be escalated annually based on the lesser of 3% or that year’s percentage change in the urban Consumer Price Index for the Seattle-Tacoma-Bremerton area. The amount cannot be de-escalated.

There is a $350,000 annual rent abatement — a discount, if you will — for the first ten years of the lease. It’s not explicitly spelled out what this is for in the documents.

The math

How did they get to those numbers?A financial analysis of the last four operating years of KeyArena (2014-17), which was operating at a profit, to create historical averages for each payment element. OVG has agreed to guarantee that the city does not “go backwards” from the profit it was making.

The averages for the rent include 2 elements:

  • combination of the KeyArena net facility revenue and the net parking revenue from the 1st Avenue N parking garage

  • the net revenue from Seattle Center sponsorship rights



BaselineRentGraph.png


The averages for the baseline tax payment include 5 elements, all directly attributable to arena operations and related businesses:

  • the city’s portion of sales tax revenues related to the arena

  • Business & Occupation tax revenues related to the arena

  • the city’s portion of Leasehold Excise tax revenues related to the arena

  • the annual Admissions tax revenue related to the arena

  • combination of the annual commercial parking tax revenue and the city’s portion of the sales tax revenues from the three Seattle Center parking garages



BaselineTaxGraph.png




CPIPerChange2.png


The percentage change of the area CPI is a common and effective means of determining the local rate of inflation. This allows the baseline rent and tax payments to keep pace with the change in dollar value long-term. The average percentage change in Seattle’s CPI from 2000-2018 was 2.41%. By comparison, the national average rate of inflation during that time was 2.14%.

How the city earns more

One of the more common misconceptions of the SCA agreement appears to be the belief that the city stands to make no more from it than rent and little to nothing from associated taxes. While there’s no guarantee the city will make more money, that actually holds no guarantee that ArenaCo will make any more money than its annual obligations to the city. It’s safe to chalk that under the not very likely category.

Think of it as pie. Flavor of your choosing.

Not simply as a metaphor for sharing but as a dessert after a meal. Here, the meal has a full course of the baseline rent and a full course of the baseline tax payments. The treat afterward is a split of excess revenue as each of seven payment thresholds — four of the five ensured tax amounts and the first-served payouts on sponsorship and parking revenues — is met. This is called the “rent adjustment”.

For the first ten years of the lease, the city gets 25% of that excess and ArenaCo gets 75%. After that, the two share a dead-even 50-50 split for the remainder of the lease, including any of the extensions. That’s the potential of 45 years of matched shared dessert dollar for dollar.

Parking

1st Ave N garage: ArenaCo will take over operating the garage from Seattle Center and will lease it as part of the overall arena lease. The baseline rent payment guarantees the city is paid as much as the garage was earning on average. ArenaCo gets the net parking revenue above the rent payout. During arena construction, the group will pay the city rent on the garage.

5th Ave N garage: The city gets dibs on the net parking revenue up to the threshold of $2,009,969 annually, escalated for inflation. The city and ArenaCo split any revenue above that.

Mercer St. garage: Like 5th Ave, the city earns the revenue up to the threshold of $2,010,704 annually, escalated for inflation, and splits any revenue with ArenaCo beyond that.

Sponsorships

During the arena lease, ArenaCo will be the exclusive sponsorship benefits representative for Seattle Center as a whole entity and specifically for the arena. They will not be permitted to sell benefits for any “specific portion, place, facility, segment or feature of the Seattle Center Campus, or any event or activity occurring at the Seattle Center Campus” outside of the arena, but may be consulted and help administer and activate these other sponsorships.

Speaking with Q13 Fox TV’s Bill Wixey back in November 2017, Leiweke explained that their sponsorships (and corporate sales) will escalate with the arrival of an NBA team to offer incentive to the NBA ownership without taking away from the NHL club.

Wixey: It’s basically like an escalator clause that you have in there…?

Leiweke: Exactly right. So we’re building all of that into our deals. We’ve already made that understanding and agreement with everyone including the NBA knows what we’re gonna do […]At the end of the day, we’ve already built all of the contractually-obligated income into every contract we did and all of them go up in order to make sure we have the basketball team as a top quartile within the NBA. That’s the way that’s going to work.

Oak View Group CEO Tim Leiweke speaking with Q13 Fox’s Bill Wixey, November 5, 2017

Arena sponsors: ArenaCo has the right to sell sponsorship benefits to one (1) arena naming rights sponsor, eight (8) arena founding partners, eight (8) arena presenting partners, and eight (8) arena partners. Recently, Symetra and Virginia Mason were announced as two of the founding partner sponsors.

Rent adjustment: ArenaCo guarantees to pay the net sponsorship revenue up to the $781,454 threshold annually, escalated for inflation. If the annual revenue is less than that amount, ArenaCo will pay the difference to the city. If the annual revenue is more, the city and ArenaCo will split the excess. This includes the arena naming rights.

After the first ten years of the lease, if there is a period of three (3) consecutive years with no rent adjustment payments made to the city from sponsorship revenue, ArenaCo must pay the city the threshold amount and then pay the city an additional 50% of the then-current threshold amount out of pocket.

This is a rolling provision. So, say there’s no rent adjustment in years 11, 12, and 13, ArenaCo pays the threshold plus 50% in year 14, but there’s still no rent adjustment in year 14? They have to pay the 50% extra cash in year 15 to cover the run of years 12, 13, and 14, and so on.

Taxes

The city gets first cut of the taxes. Under the agreement’s “Baseline Tax Guaranty,” each of the five tax thresholds must be met each year. ArenaCo agrees to pay the difference to the city if a threshold is not met.

Rent adjustment: As each of the sales tax, B&O tax, leasehold excise tax, and combo of commercial parking tax and parking sales tax thresholds are hit, whichever tax has excess revenue, the city and ArenaCo will split that excess amount.

Admissions tax: Again, city receives first cut of admissions tax revenues up to the annual $1.3 million threshold, escalated for inflation. ArenaCo will pay the difference to the city if the threshold is not met. If it is met and there is excess, ArenaCo will keep 100% of the excess amount.

COMMUNITY AND ADDITIONAL BENEFITS

As with many of these public-private partnership projects, a plethora of additional benefits are provided for the community at large both associated with the arena and beyond it. These focus on youth, arts, sports, music, and culture.

  • agreements to foster equity and social justice

    • Community Workforce Agreement / Project Labor Agreement adhering to city’s Priority Hire Program for women, people of color, and those in social and economic distressed areas

    • Labor Harmony Agreements with all relevant labor organizations

    • Women and Minority-Owned Businesses inclusion plan

  • a charitable foundation with a minimum $20 million fund established to aid various community organizations around Seattle

    • $10 million earmarked for YouthCare, a group aiding homeless youth

    • 12-member “giving council” will vote on how to provide funds to other organizations and administer

  • $2.5 million contributed towards affordable housing

  • minimum of $3.5 million to be spent on public art in two phases

    • One phase with art dedicated specifically to the arena

    • One phase with art, music, and cultural programming in public spaces around the arena

  • city granted 14 days of arena use each year free of charge

    • up to 6 consecutive days around Labor Day weekend for Bumbershoot

    • up to 8 days for the Seattle/King County free health clinic or other community events

  • meeting space provided for the Uptown Alliance and the Uptown Arts & Culture Coalition

    • bi-weekly up to 12 people

    • quarterly up to 50 people

  • dedicated positions with ArenaCo and city to coordinate with the communities around Seattle Center

    • full-time ArenaCo community liaison

    • Seattle Center ombudsperson position

  • Monthly meeting to discuss construction impacts, and eventually arena operation

    • ArenaCo, city, and community coordination committee established by the development agreement

  • addressing affordability and arena access at all income levels

    • various pricing at all seating levels

    • coordinating with tenants on opportunities for reduced pricing at games and events

FURTHER ARENACO RESPONSIBILITIES

In addition to the responsibility of pursuing an NBA team, ArenaCo agrees to use “commercially reasonable efforts” to garner the ‘Seattle SuperSonics’ name for the team, pending NBA approval, of course. The group also has to maintain and operate the arena to the standards of three benchmark NBA/NHL arenas: TD Garden in Boston, United Center in Chicago, and Pepsi Center in Denver.

They were charged with preserving the iconic Paul Thiry roof of the existing building. As part of that, they engaged in the preservation entitlement process at their own cost and gained historical landmark status for the roof from the city in August 2017. They are still pursuing a spot on the National Register of Historic Places. If they make the list, ArenaCo will be eligible for federal historic tax credits for the project. They will also need to have the arena green building certified LEED Gold.

Capital Improvements

As part of the maintenance, the arena group is required to cover all expenses for any repair, restoration, or replacement of any element within the arena due to minor or major damage. That’s your basic wear-and-tear.

Beyond that, they are required to spend a minimum of $1 million per year on capital improvements during the first 10 years of the lease. This doubles to a $2 million minimum per year each year after that. These are investments toward the future of the arena. But that’s not all.

Above those minimum improvements, during the first 20 years of the lease, they are required to make any additional capital expenditures that would be commonly expected in a leasehold mortgage. To then qualify for the first of the two built-in 8-year lease extensions, the arena has to be home to one or both of the NHL and NBA clubs, and they have to spend at least $50 million in capital improvements above the minimums during years 21 to 30 of the lease.

If they want to go for the second lease extension, they’ll need the team(s) and have to spend at least another $50 million in capital improvements above the minimums during years 31 to 47.

Development and construction

ArenaCo reimburses the city on costs associated with the development, execution, and performance of the Memorandum of Understanding entered into in December 2017, and the transaction documents that make up the arena deal agreed to in September 2018, up to $3.5 million. They also pay and/or reimburse the city for all costs associated with the permitting process and the SEPA environmental review process.

The arena group also pays to help relocate tenants and facilities affected by the redevelopment of the arena site. For tenants at the Bressi Garage and the Blue Spruce building, they have paid up to $500,000. To relocate the Seattle Center Skatepark, a campus maintenance facility, and public restrooms, they’ve contributed $1.5 million.

They have also agreed to offer employment to both city workers and employees of contractors previously working at KeyArena who have been displaced by the construction.

Transportation

Long the sticky wicket in the debate over the viability of the Seattle Center site for an arena. With changes in urban planning due to growth, the arena is better located for the future than many will give credit. That said, even in the waning years of the Sonics’ original time in Seattle, it was a challenge to get to the arena let alone find parking for the many who drove. With big changes to mass transit still years away, no one can deny it will be a bit strenuous getting to (and potentially from) the new digs.

There are some compelling ideas being explored and possibly initiated to improve traffic and transportation regarding the arena. This is a feast of discussion unto itself better saved for another day. While it’s unrealistic to expect ArenaCo to solve all traffic in the South Lake Union-Downtown-Belltown-LQA/Uptown areas, they are contributing $100 million+ to address traffic concerns directly related to the arena.

Part of this is a $40 million transportation fund that ArenaCo will pay into annually during the lease. Many have argued the fund is not helpful unless fully paid upfront. The city counters that they can borrow against the fund with bond-backed financing for any traffic improvements knowing that they have a dedicated source for repayment.

The transportation fund is in addition to money ArenaCo will outlay towards traffic and transportation identified as mitigation during the environmental review process.

WRAPPING UP



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The Seattle Center Arena project addresses the two main issues raised by an arena replacement project: the need for a new arena in Seattle and what to do with the aging KeyArena.

Analysis during the MOU discussions, and the run-up to the transaction documents to seal the deal, clearly demonstrated that capital improvements needed for KeyArena would’ve destroyed any profit to be further gained from the building.

With this project, the city has gained a private partner who has agreed to take on all costs of development, construction, operation, and maintenance of the new arena. More important, the risk is shifted off the city and away from taxpayers.

The amount the city was making in revenue and taxes from KeyArena is preserved with the opportunity to make more locked in place.

ArenaCo has already delivered an NHL club on the strength of this project, and we are better poised to get our beloved Sonics back than we’ve been in the eleven years of their absence.

Not everyone likes, agrees with, or believes in this arena deal or its appeal to the NBA. It’s fine to be of that opinion. At the very least, hopefully, this helped to clarify the arena agreement to better discuss the differences of opinion going forward.

Download our handy reference guide to play bingo with the talking points in your discussions.

August 1, 2019 0 comment
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For Sonics and Thunder, it’s time to separate the histories

by Kevin Nesgoda February 15, 2019
written by Kevin Nesgoda
SonicsThunder.png

It’s time for the Seattle SuperSonics and the Oklahoma City Thunder to officially set sail from one another. The NBA needs to separate their histories.

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February 15, 2019 3 comments
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