'Not A Final Deal': Alexandria Mayor Addresses Sports Arena Proposal

ALEXANDRIA, VA — After the announcement of a proposed entertainment district with an arena for the Washington Capitals and Wizards in Alexandria’s Potomac Yard, Mayor Justin Wilson fielded questions from nearby neighbors in the Del Ray Citizens Association.

Click Here:

The citizens association hosted the mayor to respond to questions about the proposal, which the teams’ owner Monumental Sports & Entertainment unveiled Wednesday with Gov. Glenn Youngkin, developer JBG Smith and City of Alexandria officials. Hundreds of residents attended the virtual meeting Wednesday.

“This has the potential to be a very, very significant net positive for the city’s taxpayers, and has the potential to offset the cost of the services that the residents of this city expect and demand — public safety, human services, transportation, education — for a long time to come and do so in a way that ultimately does not compromise our quality of life,” said the mayor during the Del Ray Citizens Association’s virtual meeting.

Interested in local real estate?Subscribe to Patch's new newsletter to be the first to know about open houses, new listings and more.

The proposed $2 billion entertainment district, which would require approvals from the City of Alexandria and Virginia General Assembly, would include an arena for the Washington Capitals and Wizards, corporate headquarters for Monumental Sports & Entertainment, a Monumental Sports Network media studio, Wizards practice facility, performing arts venue and expanded e-sports facility.

JBG Smith’s mixed-use development at Potomac Yard is already planned to have new retail, residential, restaurants, hotels, conference and community gathering space uses. Virginia Tech’s upcoming Innovation Campus and the new Potomac Yard Metro are nearby.

Interested in local real estate?Subscribe to Patch's new newsletter to be the first to know about open houses, new listings and more.

The mayor told residents that city leaders entered discussions about the proposed arena about six to eight months ago. He acknowledged that the announcement came as a surprise to local residents, but said major economic initiatives like the entertainment district and Landmark Mall redevelopment are negotiated behind closed doors.

“It has to be, it has to be confidential at the lead-up of the process, but just like we did with Amazon and Virginia Tech, and obviously, with Landmark and others, we are now entering the phase of public engagement and the opportunity to be transparent about this and talk to the community and ensure that that your input … is part of this process,” said Wilson. “We are going to spend the next year doing (that), so this is the beginning of a very public phase of this process and one where we’re going to have a lot of this, opportunities, large and small, for the community to engage with us, give input, tell us what they think about this.”

Economics and Development

The Potomac Yard has been the focus of significant development in recent decades, including the ongoing construction of the Virginia Tech Innovation Campus, which expects to open its first academic building in 2024. East of the current Potomac Yard shopping center is where Virginia Tech and the proposed Monumental Sports & Entertainment’s arena and Wizards practice facility would go. The current shopping center is eyed for future development by JBG Smith. Wilson noted that the shopping center’s Target does well and that an urban format Target would work well for Potomac Yard in the future.

“The north part of Potomac Yard is planned for about a million square foot of density eventually,” said Wilson. “The understanding was a suburban-style surface parking shopping center was not the future of a site adjacent to the Potomac Yard Metro.”

The mayor noted the COVID-19 pandemic’s lingering impact on commercial properties, which makes it unlikely for new offices to be built near Metro. City leaders have also been discussing for decades on diversifying tax revenue, as much of the tax revenue comes from residential property owners.

“The strategy of the city for a long time has been to diversify our revenues and promote more commercial growth that ultimately eases that burden on our residential taxpayers. And that drove this discussion in the first place,” said Wilson.

The mayor also addressed a concern that the arena is a taxpayer-funded handout to the wealthy CEO of Monumental Sports, Ted Leonsis. Pending Virginia General Assembly approval, the site would be owned by the Virginia stadium authority and would lease it to Monumental Sports & Entertainment. While the Virginia stadium authority would issue bonds for the project, that would be paid by several sources: Leonsis providing $400 million, rent payments over time by Monumental Sports & Entertainment, and a portion of new city and state tax revenues. That funding strategy was similar to the Potomac Yard Metro was funded, Wilson said.

“We are not using city tax dollars that are committed, tax dollars that we use to pay police officers, firefighters, educators, etc. We are using the new money generated by the project to pay off the debt,” said Wilson.

An economic study on the proposal will soon be released to the public to detail debt servicing, revenue impacts and more, Wilson said.


Transportation Impacts

The city’s community engagement process will likely bring up “very real concerns” about transportation, infrastructure, impacts on city services and more, according to the mayor. On parking, Wilson said the arena area is intended to be a transit area with parking kept to a minimum with 2,500 underground parking spaces proposed at the site. Neighborhood parking permit districts could be part of neighborhood protection discussions that would happen if the deal moves forward, according to Wilson.

The mayor also acknowledged that the current Potomac Yard Metro station doesn’t currently have the capacity for an arena and would need infrastructure investments. He believes some of the needed transportation improvements would be improvements to the Metro station and intersection and roadway improvements on Richmond Highway and adjacent intersections to address the volume of cars.

“I think that’s what we want to talk about with the community and determine a really robust transportation plan around other options for what can be done, and I think there are a lot of options and I think we’re going to work with Richmond to help ensure that the transportation impacts are managed as part of this process,” said Wilson. “But you know, I think our goal is to have this be transit that’s going to serve this site and get people to and from this site.”

But the proposal to move the teams from D.C.’s Capital One Arena in Chinatown to Alexandria isn’t a done deal. D.C. leaders have offered $500 million to upgrade the existing Capital One Arena and extension of the ground lease to 2052, the Washington Post reported. The existing arena dates back to 1997 and is one of the NHL and NBA’s oldest.

“This is not a final deal, this is not done,” said Wilson. “We have a lot of work that has to happen at both the local level and in the state and so, we will work to engage with the community and determine you know what types of mitigations are required to move this forward, and yeah, at any step of the way this could, this [proposal] could absolutely still die.”

Get more local news delivered straight to your inbox. Sign up for free Patch newsletters and alerts.

Leave a Reply