New Arena (formerly Prairie Surf)

[Pete]

No matter how you slice it, the city will lose a lot of money until the very end of this deal, if they make it that long.

I've made some calls and there are no personal guarantees on the agreement, which means if this tenant fails, the city will never even come close to break-even.


This is not a "nothing to lose" deal.

[Urbanized]

I’ll add that investing in (for instance) higher education as you suggest in the Enable thread (with which I fully agree) is another example of taxpayers investing in economic growth.

As taxpayers we employ government representation to make judicious usage of our funds, and in this case I believe that investing in a sector that has clear momentum and for which we already own an easily-adapted facility free and clear with very little other economically sound options is indeed judicious use.

In this case we are also leveraging existing state incentives and hopefully making 2+2=4 (or perhaps even 14). Until proven otherwise I’m a fan of this endeavor.

[Laramie]

I spoke today with a (well-known) broker friend of mine who said most commercial inquiries in OKC right now are either MMJ related or film industry related.

This studio is a definite net gain for OKC during a time when we really need to lean into industries outside of our historic wheelhouse. And this is a rare occasion when we are particularly well-positioned to embrace a dramatic market shift. There is very little downside here.

Glad to see you back in the game; really miss your contributions to this board.

[Pete]

I'm not against it, just adding some much-needed facts to offset the incorrect reporting, editorial repeating the same false information, and the typical 'This is great!!' rhetoric from the city.

[Urbanized]

...This is not a "nothing to lose" deal.

I’m not sure where I’ve seen anyone refer to it as such. Certainly I haven’t.

I just think it is a pretty well-reasoned gamble, and most taxpayer incentivized economic development efforts are indeed gambles.

[Urbanized]

Glad to see you back in the game; really miss your contributions to this board.

Thank you Laramie! Appreciate your posts too.

I’m mostly just lurking, and have been doing so a bit over the past few months. Just felt like I had something relevant to add to this particular conversation. Most of the time when I have previously undisclosed info on a topic here, it’s privileged in some way. But this wasn’t.

[Pete]

They are paying $1 in rent for the first year and only a very small fraction of the utilities. Not much better for the next couple of years, only getting close to the city breaking even by the end for their 5-year term, after which it is completely their option whether to continue or not.

And since there are no guarantees on the lease, they could bail at any time.


Having said all that, it would be awesome if they could book some big productions. I know the city (independent of Prairie Surf) was working on a big deal that fell through.

Here's hoping this all works out.

[Urbanized]

The New Orleans Hornets were essentially gifted a brand new Ford Center in 2005 in part because the City hoped to create a proof of concept that OKC could indeed become an NBA-capable city. Sometimes you have to roll the dice.

[Laramie]

Thought it would be nice to review this diagram:

As Pete mentioned the fifth year when this goes into the black. Who knows, since we're not selling the convention center--we may need it as a backup in the next 6 to 10 years (fingers crossed; not double-crossed ).

[Laramie]

The New Orleans Hornets were essentially gifted a brand new Ford Center in 2005 in part because the City hoped to create a proof of concept that OKC could indeed become an NBA-capable city. Sometimes you have to roll the dice.

Put your chips on 9; gambling in time.

Meanwhile, the biggest gift we received was from an NBA ownership group which comprised most of the deepest pockets of investors in Oklahoma City & Tulsa. These investors had 10x the purchasing power of our 1997 NHL expansion derby group.

[Rover]

No matter how you slice it, the city will lose a lot of money until the very end of this deal, if they make it that long.

I've made some calls and there are no personal guarantees on the agreement, which means if this tenant fails, the city will never even come close to break-even.


This is not a "nothing to lose" deal.

So, you would be in favor of shuddering it to lose less money? Or level it? Or do you think this deal was taken while better deals were available?

[bombermwc]

So, you would be in favor of shuddering it to lose less money? Or level it? Or do you think this deal was taken while better deals were available?

I think this is it exactly. Better to get something to help offset it than just have it empty doing nothing. If you lock the doors, it's just as simple as just turning the lights off and the bills go away.

[Pete]

So, you would be in favor of shuddering it to lose less money? Or level it? Or do you think this deal was taken while better deals were available?

I'm not advocating for anything, merely trying to contribute factual information, especially because the reporting on this (and then the subsequent editorial from the Oklahoman) has been in complete error.


And a reminder that Blue already had a contract as did several events, with more planned for the future. The city not only loses that revenue but now has to pay to move them.

[jn1780]

So what all is being done to turn this facility into a movie studio? Is it mostly just the empty space they need and sets are built?

[Rover]

I'm not advocating for anything, merely trying to contribute factual information, especially because the reporting on this (and then the subsequent editorial from the Oklahoman) has been in complete error.


And a reminder that Blue already had a contract as did several events, with more planned for the future. The city not only loses that revenue but now has to pay to move them.

Do we know what the terms of the Blue contract was? Or the projected income of already planned and potential new events?

Not trying to be difficult, but trying to figure out why you think they would turn down better possibilities to take this deal. If there were better options, they were either not wise/smart or something nefarious was going on.

[Pete]

I'm working on getting all the numbers.

I don't think anything was nefarious; just sold by economic development people in a typically one-sided way.


I am not against economic development; just the only one in this town trying to present objective information instead of running PR propaganda.

[Bellaboo]

The Blue ended up in the bubble this year in Orlando with 17 other teams. They will finish up in March. Not sure if anything other than practice after that.

[Pete]

The Blue ended up in the bubble this year in Orlando with 17 other teams. They will finish up in March. Not sure if anything other than practice after that.

They still have a contract with the Cox Center and the city will have to pay to move them regardless.

[Dob Hooligan]

They still have a contract with the Cox Center and the city will have to pay to move them regardless.

I have a fuzzy recollection that the city gave the Blue the logo floor they play on and some other Blue logo specific signage or somesuch to close out the contract.

[Pete]

I have a fuzzy recollection that the city gave the Blue the logo floor they play on and some other Blue logo specific signage or somesuch to close out the contract.

Part of the deal was to let the Blue take things with them at no cost to the team.

The city still has to pay to help them move.

[Laramie]

The G-League Blue should be able to play in the Chesapeake Arena just like the Thunder for the (2022) season since the Cox CC will no longer be an option. It would give the players familiarity with the court or make the new coliseum available as an option for AA hockey and G-League basketball.

We approved MAPS 4 in December 2019 which will provide $104 million in arena upgrades and $11 million to renovate the Thunder practice facility; $63 million for a new fairgrounds coliseum with hotel sales tax revenue.

Since 1992, Chesapeake Arena investments funded thru MAPS & Go-Bonds will total $313 million after funds are collected.

We realize the Thunder are the anchor tenant ($40,000 per game lease); we appreciate their investment: $350 million NBA franchise ($2006), $75 million settlement & $30 million relocation fee totaling $455 million--franchise now valued at $1.575 billion .

My point; this arena can be shared with the G-League Blue as well as the possibility of ECHL AA hockey entering our market in 2022 or beyond.

[progressiveboy]

Here is hoping that this new business grows in this State and attract people from outside the State. Although, it does sound like OKC is losing out on revenue in a city owned building, here I am hoping that lots of movies are made in Oklahoma. This State needs good jobs with people that have skills that are in demand.

[Plutonic Panda]

^^^ Amen!

[SouthOfTheVillage]

I know Georgia has a similar set of state-level incentives and has done a nice job of landing major productions.

However, that State also received some pushback from producers concerning certain conservative proposals pending in the State’s legislature.

If Oklahoma is going to land projects that air on Netflix or Amzn, we need to do a better job of managing the crazies on 23rd Street.

[BG918]

I know Georgia has a similar set of state-level incentives and has done a nice job of landing major productions.

However, that State also received some pushback from producers concerning certain conservative proposals pending in the State’s legislature.

If Oklahoma is going to land projects that air on Netflix or Amzn, we need to do a better job of managing the crazies on 23rd Street.

That’s a legitimate concern. Always worried about what some rural OK yahoo will propose in the legislature and scare off companies wanting to invest in the state.