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Oct. 30, 2009
Copyright © Las Vegas Review-Journal

New downtown plan tied to new city hall

Goodman calls arena developer serious contender

By ALAN CHOATE
LAS VEGAS REVIEW-JOURNAL

This land east of Las Vegas Boulevard and Stewart Avenue could be the site of an arena. The City Council is expected to let The Cordish Companies study whether a 20,000-seat arena makes sense.
Photo by Gary Thompson.

A company that might build a sports arena in downtown Las Vegas is a more serious contender than a previous would-be developer, but the project is still linked to building a new city hall, Mayor Oscar Goodman said Thursday.

It's a restatement of one of Goodman's themes: Building a new city hall would spark a wave of development downtown, which in turn would bring jobs, businesses and enough revenue to pay for the new city hall.

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    • The idea has its detractors, and even supporters on the Las Vegas City Council have acknowledged that the city hall proposal exposes the city to risk.

    Next week, the Las Vegas City Council is expected to approve an agreement with The Cordish Companies, which will study whether building a 20,000-seat arena, an entertainment district and a hotel-casino makes sense on roughly 19 acres the city owns around the intersection of Las Vegas Boulevard and Stewart Avenue.

    "If this site isn't vacant, then I don't think there's a deal," Goodman said of any eventual plans to build the project.

    Cordish is a Baltimore-based developer with retail-entertainment projects and casinos across the country. That sets them apart from the backers of a previous arena proposal, REI Neon, which did a good job assembling land for a project but couldn't make it viable, Goodman said.

    "I don't think they'd be wasting the time unless they were very, very serious," he said of Cordish. "They don't have time to play games."

    They have two years to study the arena project's feasibility, a period that can be extended by a year if necessary.

    Meanwhile, the council expects to vote on the next steps in building a new city hall before the end of the year.

    The project hit a snag over the summer when officials sought financing for the new building and couldn't get a low enough interest rate to make the project affordable.

    Since then, a new program called Build America Bonds has started. It subsidizes the borrowing costs for local governments, making capital projects less expensive.

    Las Vegas plans to use "certificates of participation" for the new city hall. It's similar to bond financing but carries a higher interest rate because there is no specific source of revenue pledged to repay the debt.

    According to an analysis by the city, building a new city hall would require borrowing $205 million. Payments would start four years later at $974,000 the first year, $1.9 million annually for the next three years and eventually adjusting to $15.7 million yearly payments.

    The city could refinance the debt after 10 years.

    That's where the risk comes in. The expectation is that at least one of several planned projects, including the reopening of the Lady Luck, the completion of new office towers or an arena with a hotel-casino, will be done in time for the new revenue to carry that debt load.

    Contact reporter Alan Choate at achoate@reviewjournal.com or 702-229-6435.

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    I can;t wrote on October 30, 2009 06:46 PM: Hell, I have tried to reconstructure my debt on future earnings and was turned down. This just doesn't seem fair. Harry will you ask President Obama for help on my futures.


    Vegas Quixote wrote on October 30, 2009 10:24 AM: So in order to build a new City Hall, the City of Las Vegas needs to go into debt and "could refinance" in ten years after a series of balloon payments. Does this sound like responsible planning?


    "According to an analysis by the city, building a new city hall would require borrowing $205 million. Payments would start four years later at $974,000 the first year, $1.9 million annually for the next three years and eventually adjusting to $15.7 million yearly payments.

    The city could refinance the debt after 10 years."


    butcher wrote on October 30, 2009 09:18 AM: We have a lot of money ? That's what Oscar the Clown thinks.Imagine if there were no slow down what the clowns would be building ?


    Hugh Briss wrote on October 30, 2009 09:14 AM: We should have known. It's all about the plaque at the new city hall that needs to say Oscar Goodman.

    Let's all raise our glasses in a toast for term limits. Sometimes they kick out good people. But in Oscar's case, the end can't come soon enough.

    "I don't think they'd be wasting the time unless they were very, very serious." That's what they've said about every arena developer for the past 20 years. It's another high-speed train. Hot air that ain't happenin'.


    Robert wrote on October 30, 2009 08:54 AM: We don't need the Goodman Palace.
    The city can't provide essential services as it is now. Just how much is the study going to cost?????? Conveniently omitted from the story.
    MAKE DUE WITH WHAT YOU HAVE OSCAR!!!!!
    Big league sports do not provide good jobs once the construction is over. What do you get? Sweepers, cashiers, souvenir sales! All part time, low wage, no benefit jobs. The only folks who make out are the team owners.
    Build it and they will come?????
    Try St Petersburg. They built the dome, and for years had to support the costs with the country's largest yard sale/flea market venue. When they finally agreed to come, it cost the city millions in remodeling costs and new skyboxes etc, etc, etc. DON'T WASTE OUR PRECIOUS MONEY. A sports team is a hole you pour money into. Then 5 years down the road, they decide the venue isn't large enough, or luxurious enough and they threaten to leave if you don't build a NEWER, BETTER, FACILITY. BAH, Humbug


    Too_much_government wrote on October 30, 2009 08:45 AM: The people want more social networking sites, apps, and HD channels. The politicians want downtown redevelopment, flu shots, and domestic partnerships.


    ted wrote on October 30, 2009 05:31 AM: What's in it for Harry Reid?


    No Workee wrote on October 30, 2009 03:31 AM: "That's where the risk comes in. The expectation is that at least one of several planned projects, including the reopening of the Lady Luck, the completion of new office towers or an arena with a hotel-casino, will be done in time for the new revenue to carry that debt load."

    There's another assumption being made that would have to happen. That assumption is that people are actually going to start returning to Las Vegas as a vacation destination. The economy is still in the toilet and visitor volume is well below average so the chances of the revenue to pay for all this construction will be questionable, to say the least.