Posted by: Kingsguru21 | January 14, 2010

Is a Land Swap the key? (An Sacramento arena analysis.)

For those who aren’t aware, and many already are so I’m stating the obvious, is that I live in Seattle. So, from a direct standpoint I’m not that involved. But, on that token, that isn’t to say I don’t have an opinion either. As most are aware, I’m originally from Sacramento, and I know all the key players are involved. I don’t have to be there to know how this deal could potentially work. The key word? Work. None of the previous deals had the financing or the political will to get this deal done. Additionally, any of the previous deals didn’t have much in the way of unified support.

The question here is: Why would anyone object? I think it’s the best idea I’ve heard for any number of reason’s. Cal Expo, in my opinion, already has enough traffic issue’s, and adding 18 thousand screaming idiots is not a way to relieve that traffic. (Especially since getting to Exposition on Biz 80 is only 3 lanes coming from the south, and it’s only 3 lanes coming from the North afer the merge with 160.)

Here is the current Arco Arena (via SacBee):

This is what the current dump looks like.

So do you want to imagine what that new arena could be? I don’t. I don’t even want to go there. So, let’s break down the initial report from Tony Bizjak and Marcos Breton.

Opening Paragraph:

The National Basketball Association tonight will announce its support for a dramatic land-swap proposal to build a new state fairgrounds at the current Arco Arena site in Natomas and a new arena for the Sacramento Kings downtown next to the rail depot.

Question #1: What is in it for the current developers (Thomas Enterprises) to switch properties?

There is a ton of interesting sidenotes, and ploys that come with all of this. Since I’m not smart enough to know how property taxes really work in California (I could ask my mother or father, but I doubt either are expert enough to explain how the difference in property taxes from a private development spot like the railyards to Cal Expo would be sufficient to complete this property swap), I would ask exactly what it is in this for the developers Thomas to switch the ownership of properties from the Downtown Railyards to Cal Expo?

I say that is question #1 because I have no problem understanding why the City of Sacramento and the State of California are clear winners in this. But, is the Cal Expo property a great piece of private re-development to entice the owners of the railyards to switch their ownership of properties? I would hope so as I could argue that the potential benefit to Cal Expo with any private developer is that getting the project off the ground far sooner than any deal with the Railyards is already a bonus. But, that’s me. Again, it comes down to how the current developer of the Railyards, the Thomas Enterprises, views the property at Cal Expo. I wonder how involved they are with the land swap proposal. Either way, right now, I see them as being the first obstacle to overcome.

Question #2: How is this going to be paid for?

Well, according to Bizjak & Breton’s story, there are “financing commitments from two major investment firms” at the moment. That’s very new. As to what this entails, I’ll know more when you do.

Question #3: Now that the proposal has the state owning the current Arco location, and the City owning the current Railyards that Thomas Enterprises has the rights to, does this mean that any federal money could be coming?

I ask this if only because of the federal money that goes into building transit systems, and how it could be tied not only getting light rail to the arena (which would already happen because the Rail is run into the Amtrak station and the Arena will be built next door to the Amtrak Station) but also the State Fairgrounds in Natomas and ultimately the Airport?

I mean, seriously, if you’re a public transportation advocate in the Sacramento area, and you want to see public transportation grow through Natomas to the airport, this is a great deal for you. If you’re not that interested in growing public transit in a city that is badly lagging in this area (and I live in a city that is ripping up it’s own infastructure with a lot more difficulty because of the hills in Seattle), you clearly have unrealistic expectations.

Side Note: I also think it would be wise if the current light rail line that goes out to Watt Avenue and the Biz-80/I-80 merger be extended by running the line down I-80 itself. Even though someone could argue that it would be easier to build that line down Roseville Road, I don’t see that working very well. The ability to continue that line down the middle of where I-80 is immensely valuable. It could, eventually, create a huge decrease in congestion in eastern Sacramento County and Western Placer County. Of course, everyone driving by themselves from Madison Ave to Douglas Blvd will claim that it gets in there way. As always, individual progress tends to rule out over forward progress for everyone. Go figure.

As far as any idea of Monorail goes on, it’s a terrible idea. The techinology isn’t reliable, and the idea that monorail works well around cars is stupid too. The Monorail in Seattle is a dumb tourist attraction, and it’s only that because the Monorail runs between the Westlake Mall on 4th & Pine (a big tourist mall spot) and the Space Needle. The actual people who live in between both those spots never use it because it’s A) too expensive and B) it doesn’t stop anywhere in between either spot. The idea of monorail sounds good in theory, but the reality of making it work is a lot more difficult. That’s one reason I think Cal Expo (this is about Sacramento remember?) was always such a terrible idea from a public transportation standpoint. Monorail works for a place like Cal Expo, but not for most of Sacramento. It’s not really needed. Very few places along the light rail line are even impacted by the light rail coming and going all day. The places that are (like 65th and 59th streets) are used to it and either wait for the train to pass or they go around and find different routes. That’s what smart people, and metropolitan area’s figure out. Eventually people adjust, or they don’t and they complain because the world doesn’t move at their whim. I would submit, that those stuck in the mud people, are probably not the types who will get any type of major revival going within the Sacramento community.

Question #4: Did David Stern have any influence in this deal moving along quickly?

I think this is actually a fair question from a number of perspectives. While it pains me to say this, one man’s loss is another man’s gain. The issue with Seattle was lost in a number of ways, and from a number of vantage points. The biggest problem was the lack of connect with the community from the Howard Schultz/David Stern end. No matter how people around the 206 feel about Greg Nickels and the bargain he eventually struck up with Clay Bennett, it remains that the amount of burnout, as one of the co-founders of Save Our Sonics, Brian Robinson, stated in the documentary “Sonicsgate” was so tremendous that it over-shadowed the idea of what keeping the Sonics meant. One of my big regrets to this day in late June of 2008 was not going down to the rally of the fans who were all around the Federal Courthouse on Stewart.

However, I don’t bring this up again because I live in Seattle. The issue is germane because the lessons, and the many mistakes made in the process up here (many of which happened before I moved in Summer of ’07), should not be repeated again with the new arena in Sacramento. I submit that David Stern talking about their needing to be forward movement quickly from the Sacramento DID spur some idea’s from area thinkers that it ended up with some out of the box thinking. Land swapping 3 properties is out of the box, and it’s not something that I ever thought of to be honest. (I don’t think anyone but the actual guy who came up with it, Gerry Kamilos and whomever else–I don’t want to usurp credit here, but I don’t know who all was involved–ever thought it was even possible.) Again, I don’t think David Stern himself did much other than say action needed to be had, and made the statement that the viability of Sacramento from the NBA standpoint if Arco continued to be the building of choice from the Sacramento perspective that the NBA would pack up & leave the Sacramento area.

Question #5: What about the other proposals?

According to Bizjak and Marcos, these were the proposals submitted:

Downtown rail yard owner Thomas Enterprises also is proposing building a sports and entertainment center on the city-owned land at the lower end of the downtown rail yard.

Natomas ESC Partners proposes an arena on the city-owned 100 acres adjacent to the existing Arco Arena.

Two submissions call for siting an arena in the heart of downtown: Tripp Development would place an arena at 3rd and L streets, at the current site of a city parking garage. Ali Mackani proposes an arena at the east end of the Westfield Downtown Plaza shopping mall on K Street.

M&M Group, led by Matt Haines, proposes an arena along the Sacramento River, south of the Embassy Suites hotel, in what city planners call the Docks area.

Doug Tatara has submitted a proposal for an arena at the current Cal Expo site.

Let’s dig into this one by one. First, I don’t think Cal Expo was going to fly because of the enormous amounts of upgrades to infa-structure that was going to be needed if a new Arena was going to work there.

Building a new arena next to the river isn’t just stupid; it destroys one of the real desirable places that Sacramento has.

I really don’t see how 3rd & L is more attractive to than the current Rail-yards spot. In fact, I don’t understand why the condo’s never got finished there to begin with. (I know there were a lot of problems with that. Money is always an issue with these deals.)

Natomas ESC partners has an interesting idea, but not one I think the Maloof’s will get behind. If they do get behind it, I suspect it’s because the land swap idea fails and there is a plan B. I can see that happening if the land swap idea can’t fly.

I don’t really see a sports & entertainment center being exactly what the city has in mind for the Railyards. But, I don’t think the Thomas Enterprises group ever had much vision to pull off a deal this grand anyway. I think that’s why this deal has stalled to begin with. On the other hand, Cal Expo would be a brilliant place for a sports and entertainment center with many of the resources already built in to accomodate such a place. (I suppose this is the answer to Question#1. The city hopes to entice Thomas with less of a headache and a problem by saying look you want to do this this and that at the Railyards. Wouldn’t Cal Expo be the type of place that would be better served for this particular project?)

I think for the city to appear transparent they needed a lot of proposals. But, really, only 3 people will be considered for this proposal. The Natomas ESC partners as a backup plan to the land swap. The Thomas people will be looked at, but I suppose that will be a very-very last ditch effort if the Natomas backup plan can’t go through.

I would not be surprised if any of the people who submitted proposals will be rewarded with work down the line as different projects come up. That’s the only reason I think so many people came up with proposals that they knew in advance nobody thought would fly. As the saying goes, I scratch your back and you scratch mine.

Question #6: Does this mean anything else for any other development elsewhere?

I have no clue on this one to be honest. I would hope it re-spur the development of K-Street (which needs it) and the general area around downtown on J-St (that is way too run down for a major street) all the way to 12th st (which has always been run-down as far back as I can remember).

As I stated in the 5th Question in all this nonsense, I think the idea of Thomas Enterprises building their Sports Entertainment Complex at Cal Expo is a wonderful idea. To my probably naive eye, the Cal Expo location seems far better suited for Thomas Enterprises than what the Railyards offers as the traffic, and infa-structure, would not create the type of traffic needed to justify the money going into such a location. I do think, on the other hand, Cal Expo would create that necessary engine for Thomas Enterprises. Maybe that’s my well wishing, though.

Who are the biggest winners in this potential deal?

I think the State is the biggest winner in this deal. They do nothing, get a better property for free essentially, and watch a highly visible business in the capitol of the state get the new arena it needs for it’s basketball team.

There are a lot of winners, and the fact is that the people who will complain simply don’t want the Kings around. They want to grumble about anything and everything. While I’m not certainly very swayed by any idea that centers around making the wealthy wealthier, I’m also not sure that the Kings leaving Sacramento because civic leaders took a “stand” is the right course either. Sacramento doesn’t have many major attractions to the city, and I think an unhealthy portion of city residents prefer it this way. However, when you’re a city the size of Sacramento (no matter whether it’s a big country town or not), that’s backward thinking. You don’t want to lose all your entertainment dollars to the Bay Area or LA or somewhere else because a few residents don’t like people traveling to Sacramento. Tourism is a fine thing, and while I don’t think Sacramento will ever be a tourist destination, there is no reason to be hostile towards tourism and trying to attract people to come to your city. Sacramento is a beautiful, fun place to be outside of June-July-August-September when it’s 100+ degrees. It’s not San Francisco sure, but who cares?

Since the Sonics left town, several businesses near Key Arena have complained that the amount of traffic has gone considerably down to their businesses. It’s not really hard to figure out why. The Sonics brought in 15000 people a lot of nights, and in the lower part of Queen Anne, it’s very hospitable to a lot of tourists and foot traffic.

Hmm, sound familiar? I’m not saying Sacramento has to be Seattle because it’s not. Seattle is the biggest city for a 1000 miles in every direction, and as such people come here to do things that they could not do in Boise Idaho for instance. Sacramento doesn’t have to be that. But if Sacramento also can’t keep the residents who reside in the area long enough to do things within the community and keep the money that is in Sacramento (of which there is plenty despite the unemployment–in total dollars is what I mean), than I think it’s being short-sighted. I don’t see how this hurts the city in any capacity.

For every complaint that the city loses money to people by moving out to the suburbs (whichever place you’re referring to), this is the chance to regain SOME of that money. Obviously it’s costly, and there are risks involved. But the risks seem far smaller (as opposed to places that actually put tax dollars into these deals), and the upside seems great. The need to redevelop Sacramento’s downtown into a thriving entertainment district is a must if the city wants to take that next leap. I’m not saying the downtown area needs to become LA Jr, but it needs to thrive in the area’s that are really about bringing people in.

For those who say: Well we can just drive down to San Francisco, think again. You may not be able to in 10 years if the oil runs to the point that 10 dollars a gallon for gas is cheap. We’re not at that point yet because the conservation of oil is actually happening, but it’s not out of the realm of possibility. (I also think it’s pointless to claim that because other cities do things it’s the reason for Sac to do a deal of this magnitude.)

So what do you think?

My opinion is that because the deal is so incredibly hellacious to pull off, I hope citizens (like you Mom) have an open mind about this. I don’t think any deal that is centered around consumerism or just the simple selling of goods is the real point here. We need more than that if Sac is going to have the downtown it needs and deserves. I’ve lived in Midtown Sac for many years in my childhood and adulthood. There are few places better on Earth to reside in.

One of the ways that Sacramento could improve as a city, and region (there are so many good things about the place already) is thinking about the best ways to make the city desirable for those who’ve chosen to live and spend their lives in the 916. If this is about money, the quality of schools, the crappy roads, or any of the pointless supplementary arguments I’ve seen made then you just want to complain.

I, personally, want to see a city that has more diversity in nightlife (it’s not the only reason I moved but it was definitely one reason), no real entertainment district, no real vision among city leaders (and I’m not going to be stupid enough to claim that Kevin Johnson has provided leadership on this issue), or a need among citizens who live in the city to get a deal done. Hopefully all of that can change because the city of Sacramento needs more than what it currently has. I don’t have any answers here, but just simple hope. And it damn sure isn’t about the Kings. Sorry naysayers.

So, while I’m certainly not without an opinion on such a crucial deal on this, I don’t think Sacramento citizens should look at this at the Maloof’s getting rich off this deal because of taxpayer dollars. They’re already wealthy and what not.

I do think it’s a pretty amazing turn of events that each entity grows with the potential land swap, and that synergy involved (as Mike Lamb said to Marcos Breton is his radio interview during the 5pm hour today) is crucial to getting this deal done.

What is now the biggest obstacle in all this?

Quite frankly, I think the financing will always be, and remain, the biggest obstacle in all of this. My initial concern was that the land swap wouldn’t work for Thomas Enterprises, but I think it very much will from a development standpoint. The only reason I see Thomas holding up the deal because they are angry that they aren’t getting more for the Railyards. (Which is my biggest concern from that angle.)

Still, I think the deal here will be the money that goes into building the arena. The logistics, also, include where the Kings would play if the land swap would happen. Right now, the Maloof’s control the finances that surround Arco, and I suspect that any development of the Natomas property by the state would have to be happening independent of what’s going on at Arco for the time being. Anything that holds up the new arena would be bad for the state, the Maloof’s or the city if only because a hold up doesn’t help anyone. Getting this deal done sooner than later is always a problem.

My real concern with the financing is that the building is done too cheaply and the problems that the Sonics ran into with Key Arena will crop up with a new arena. However a new arena is payed for it had be betting fucking A spectacular if it’s expected to hold up as long as Arco has. (I don’t think 30 years is unreasonable for a new spiffy building to hold up.)

So, there you have it. Rather than leaving you with the last word, I submit what Chris Lehane (one of the co-chairs of the arena task force for Kevin Johnson) said in response to the proposals submitted:

“We intend to ask the hard questions and … approach this review process with the mindset that the teams behind the proposals will have a significant burden of proof to make clear that Sacramento is indeed being put first,” Lehane said.

(Note: I know there is more, but I wanted to break this down independently of the Maloof’s statements today. I’ll have something on that up later. I promise. Give me time people! Writing 3500+ words is not as easy as it looks I swear.)

UPDATE: Ed of StR has an excellent writeup of what Kamilos plans. (It’s merely a re-written copy of what was passed at City Hall.)

UPDATE 2: 27Freethrows of StR also has a geat writeup on what the proposals mean.

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Responses

  1. Great post, Pookey, I need to read it again to tease out all your points…but a couple of things pop out to me:

    !)If Stockton, a much poorer city could build a new arena how can Sacramento be considered a “destination” city if it can’t match what Stockton could accomplish?

    2)Funding is everything:I found it interesting to see the Spanos Corporation listed in the Bee in reference to new arena proposals(both Cal Expo & about the other proposals). In Stockton, Alex Spanos has invested in numerous city projects including the renovation of the Fox Theatre, the renovation of the Pacific Music Conservatory,and of course, the building of the Spanos center, where the Men’s and Women’s Pacific Tigers play basketball. Ironically enough, the Spanos Center was built in 1988 and when I visited ARCO for the first time recently I was struck with how similar ARCO was to the Spanos Center. Kind of ironic, actually….

    3)if it were up to me, there’d be high speed rail all the way from the bay area(via the Altamount pass, NOT Pacheco which is stupid) into Stockton & up to Sactown. I’d love to go to a game without using my car. less hassles, and this could help to attract and even larger fan base from the south and the west that would be encouraged to go to Kings games(and events at the Stockton Arena too, but that’s another story).

    As for the land swap, whether Thomas enterprises would be interested in Cal Expo really is the key.I dislike the Cal Expo site personally, too much of a hassle to get in there with the traffic. A real pain in the…well, you know.But that’s just me.

    • Ain’t just you Rhondda. My mom lives by Sac City Community College, and it’s roughly a 10 minute from her house to the Costco over there on a GOOD day. As she says, though, it’s usually not that bad since the economy is in a downturn. And she’s right. The few times I’ve driven it I’ve had no real problem getting into Cal Expo. That’s partly why I wrote what I did about Cal Expo being more ideal for what Thomas Enterprise envisions (I still think their vision is suspect) regardless of anything else.

  2. & your mom is right. Truth is, I don’t like to drive outta town & always use a driver; just cuz’ I prefer to be driven.

    Another thought on this post:if the state fair gets relocated to the Arco site perhaps Arco can be ‘saved’ to be an exhibition hall.there’s so much local sports history tied up in Arco & it’s well-worn bleachers it would be a shame to lose that history. I love the collegiate feel of those bleachers…you can praticaly “see” all the feet that have worn grooves in those aisles over the years(kinda quaint thoughts, but ain’t that “just Rhondda”)…

    • Never heard that one about the aisles Rhondda. Maybe those thoughts are worth saving.


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