BY: Gerry Cantlon, Howlings
HARTFORD, CT – Since the release of the SCI Report in March regarding the proposal for a new, downtown XL Center at the same spot, not much has happened publicly, but behind the scenes is a different story as Cantlon’s Corner can exclusively report.
The public portion is about to kick into high gear as the CRDA seeks to get a unified proposal to take to the public and the legislature.
The process, since the spring unveiling of a two-option solution to the aging, desiccated 40-year-old building, has produced some good news and some bad news.
First, the bad news.
The $500 million option, plus acquisition and demolition costs, which were both undefined, has been taken off the table. Given the current financial shape the state is in, that should surprise no one. But with that money off the table, with that goes the dream of returning the NHL to Hartford. That news will disappoint its committed coterie of diminishing fans.
It’s not that the CRDA didn’t dip its toes into the recent NHL expansion waters.
“We had discussions with a group and in the final analysis there was too short a time frame and a very cost prohibitive process, that quite frankly, Hartford didn’t have the ability and wasn’t able to enter at this time,” CRDA Executive Director Mike Freimuth said. Friemuth declined to identify the name of the investment group.
The winners in Las Vegas and Quebec City had numerous advantages over Hartford.
“Look, Vegas is a casino. They have a boatload of cash with which to operate and are in the process of building a new facility. Quebec City has the federal (actually provincial) government backing it and they have a brand new building all done (set to open in September). We are at the very beginning of the process and when you look at $10 million just to apply, another $500 million to get into the league and on top of that build a brand new building at $500 million plus with the all the issues we have to face, it was very steep price tag and time frame we couldn’t match,” Freimuth said.
The process did reveal two things to Freimuth, “Seattle is a city the NHL clearly covets and I’m surprised they did not submit a bid. I think when they get someone to commit on a building there I bet there will be an NHL team in Seattle someday.”
The talk of relocation has also been around, but the NHL under Gary Bettman has loathed to go down that road. Winnipeg was fortunate as it came into a perfect storm to get the then floundering, Atlanta Thrashers.
“We did learn there are three NHL franchises who are likely candidates for relocation, but there seems to be no real movement in that direction at all.”
Friday’s unanimous passage of a new amended two-year agreement between the City of Glendale and the Arizona Coyotes, by the very same city council that voted to terminate their lease a month ago, shows the soap opera like issues surrounding the team will continue in the Southwest desert region for as long as the NHL will tolerate it.
On the plus side, the $250 million dollar proposal, plus atrium acquisition costs and demolition costs still undefined, is very much alive and much work has been on going to solidify it. It too has many mountain steps yet still to climb.
Governor Dannel Malloy is said to be supportive of the CRDA’s $250 million proposal and that is part of the reason the final report is, well, not so final. The firm SCI Architects of New York City, the ones who did the report, have been asked to submit a further detailed breakdown of the costs and construction time frames of a renovated XL Center in maintaining building operation.
“The Governor came to us and said is that number rock solid? Let’s get a firm handle on the numbers and go forward,” Freimuth said. By the fall, the breakdown analysis will be completed and given to the CRDA. The other key linchpin, and quite frankly to any new building, is the relationship with UCONN. That also must also be in place in the fall.
Sitting on UCONN’s desk is a 20-year operation agreement proposal covering all three teams that will operate in the building (men’s and women’s basketball and college hockey).
“It is vital to have this nailed down to move forward in this process. We have a proposal of sharing revenue from sponsorship, seating, and concessions. In exchange, we have to have a threshold number of games at the building we need to make this work. A 30 game per sport per year is there. I can’t go into any other details as you can understand, but this is critical that we need a return on the investment. The $500 million we had doubled the costs and was not doable and we think this deal fits both UCONN’s needs and ours,” said Freimuth.
Reminder, the two sides agreed on a five-year deal at the present XL Center, but UCONN never signed the contract and works on a game-to-game basis, a highly unusual move. The inclusion of UCONN hockey in the proposal makes clear the proposed on-campus hockey arena in Mansfield is a non-starter and a UCONN Hartford campus makes the XL Center their on-campus arena in their eyes and meets their Hockey East requirements.
Even if agreed to, and the process of selling the $250 million proposal to the legislature which would vote to bond whatever the final number is, is not a slam dunk or even an easy tap-in to be approved. Freimuth was blunt in the fact that resisting putting a proposal to the legislature this year and waiting a year was a wise move.
“Given what just happened there (in the legislature during in the budget process) we would have been sawdust. This is an uphill battle and is by no means settled. The jury is still out and a lot of questions and good ones, have been asked. We’re working on putting forth the best proposal we can for the XL Center.”
According to Freimuth, the proposal, when finalized, would go to the Finance committee and would become a budget item as a capital expenditure project.
“This whole process is a Rubik cube. You might get all the colors on one side and be all over the place on the other three sides and that’s the nature of dealing with one of the most complex and challenging endeavors to get involved with. People want a quick or easy answer with all these elements, it’s just not possible.”
The future interest rates for bonding also remain tenuous. If the federal Treasury raises interest rates, the long-term costs of the project would be elevated thus making an already difficult proposition even harder for the legislature with so many extenuating budget commitments.
The XL Center’s other major tenant, the AHL Hartford Wolf Pack, are entering its 19th season and the last year of their contract before the two, one-year options at their disposal kick in.
Freimuth was coy about their future.
“We have had talks about this with MSG, and granted they are heading into the final year of their deal. I hope they are around when we hopefully start construction of a new place.”
The CRDA also completed another piece of the puzzle in acquiring the Church Street garage from the city of Hartford with $16 million of state bonding money and the work is about to begin.
“Were taking active bids right now on the repair and renovations and we hope to make selections next month and start the work. We’re absolutely committed to integrating it to the XL Center. It’s not going to happen overnight, but gradually, as we do the repairs, we will start to do so.”
The CRDA also has concluded an operational contract on the atrium portion of XL Center with Northland Corporation, but the final status talks on ownership are down the road and have not yet begun.
Lastly, Freimuth expressed optimism that the Wolf Pack and minor-league, professional hockey will be operating at the XL Center even though they team aggregately added about 400 more fans in its year-end numbers, despite the budget cuts by the state, Freimuth has an optimistic feel for the 2015-16 calendar year.
“We finished up the year well. All the numbers are trending upwards for hockey. We had a couple of very good concerts, especially the Eagles concert did exceptionally well. Certainly, the budget cuts hurt. Right now we’re holding our own, but we will feel the pain. We’re not alone. Everybody in the (state) budget took a hit. We expected problems. I’ll be honest, we didn’t expect it would be daily in some instances, but I think we have turned a corner.”
Whether that corner will a brick wall or open pathway will be determined in the fall and winter seasons.