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Monumental Sports & Entertainment has reached an agreement with the District of Columbia to carry out major renovation work at Capital One Arena, after plans were dropped for an entertainment district in Virginia that would have housed a new arena for the NBA’s Washington Wizards and the NHL’s Washington Capitals.
The District has committed to financing of $500m (£397m/€464m) towards a renovation of Capital One Arena, the current home of the two franchises. D.C. will also provide an additional $15m towards improvements of the alley connecting Capital One Arena to the Gallery Place shopping centre.
MSE announced in December that it had reached the framework of an agreement for a public-private partnership to create a new entertainment district in Alexandria, Virginia. Had the proposal been finalised, the Capitals and Wizards could have relocated to Virginia as early as 2028.
In January, Ted Leonsis, founder and chairman of MSE, defended the proposed relocation, reiterating his stance that the move was the “best decision” for the two teams.
When announcing plans for the Virginia project, MSE said that it was “excited” about the potential opportunity to update Capital One Arena to be the future home of the WNBA’s Washington Mystics, which currently play at the Entertainment and Sports Arena. Capital One Arena will now continue to serve as the home of the Wizards and the Capitals.
It has previously been reported that MSE was seeking $600m in public funds for a major renovation of the facility, which opened in 1997. Yesterday (Wednesday), MSE announced that it had reached an agreement with D.C. for a $515m financing project.
The announcement came after the City of Alexandria announced earlier in the day that it had ended negotiations relating to the proposed entertainment district. The City had engaged in community engagement over the project and expressed its disappointment that negotiations did not result in a proposal that protected its financial interests and respected community values.
The Alexandria entertainment district had been heavily backed by Virginia Governor Glenn Youngkin, but the plans were dealt a blow earlier this month after the project was excluded from the proposed budget for the state. The arena would have been located around eight miles from Capital One Arena.
In a statement released yesterday, Youngkin expressed his disappointment at the plans being scrapped.
“Virginians deserve better,” he said. “A one-of-a-kind project bringing world-class athletes and entertainment, creating 30,000 jobs and $12bn in economic activity just went up in smoke.
“This transformational project would have driven investment to every corner of the Commonwealth. This should have been our deal and our opportunity, all the General Assembly had to do was say: ‘thank you, Monumental, for wanting to come to Virginia and create $12bn of economic investment, let’s work it out.’
“But no, personal and political agendas drove away a deal with no upfront general fund money and no tax increases, that created tens of thousands of new jobs and billions in revenue for Virginia. I’d like to thank Ted Leonsis and the Monumental team, the City of Alexandria, JBG Smith and countless other partners for their professionalism, belief in Virginia and fortitude. Congratulations to Monumental for striking a great deal, I’m sorry you won’t be in Virginia.”
Leonsis said: “I look at outcomes, not process, and we got to the right outcome. I know this was a difficult process and I want people to understand how much I love Washington D.C. and how much I’ve always loved Washington D.C.
“Mayor (Muriel) Bowser and her team heard us and worked with us and gave us the tools for us to meet the needs of our business to expand right here in downtown. We are going to have time to talk about our experience in Virginia, but that is not today. Today is about staying in D.C. and is about what the Mayor and Council have done in downtown D.C.
“We got to this place because we kept an honest dialogue with the Mayor and her staff, and we both took the high road as we didn’t know how things would end. This is more than an investment from the city – it’s a true partnership demonstrated by all of these investments which the city has committed to for our fans to have an exceptional gameday experience.”
Leonsis has invested over $200m in Capital One Arena in his 14 years as owner. Improvements have included new seats, a new sound system, a centrehung scoreboard, and a new broadcast and production studio for Monumental Sports Network.
MSE said the new deal with D.C. will enable the company to develop the best sightlines for fans, premium hospitality options, better digital infrastructure and other critical improvements to modernise fan areas.
The agreement will see nearly 200,000 square feet of newly programmed space throughout Capital One Arena and in Gallery Place. Other terms include a new practice facility for the Wizards, and more games for the Mystics at Capital One Arena.
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