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Hours after the owner of the Washington Capitals and Wizards announced tentative plans to move the teams from downtown D.C. to Northern Virginia, D.C. Mayor Muriel E. Bowser (D) promised that the fight to keep them is not over be.
If the move goes through, it would be a major surprise for a mayor who just five months earlier had dubbed the city the country's “sports capital” and announced an entire staff dedicated to maintaining and recruiting sports franchises. Bowser made a $500 million offer to billionaire Ted Leonsis before Wednesday's announcement to keep the teams at Capital One Arena in the heart of downtown D.C. – an offer she said remained on the table Wednesday lies.
But it seems to have been too little, too late. As she and D.C. Council President Phil Mendelson (D) passed formal legislation for the investment late Tuesday night, they were near the Potomac Yard subway station in anticipation of a joint appearance by Leonsis and the Virginia governor. Glenn Youngkin, marquees have been erected (R).
While Bowser said she had been negotiating in good faith with Leonsis for months, the seemingly short-term nature of the “best and final” offer made it so Critics privately questioned whether she had moved with the necessary urgency as Virginia's efforts to woo Leonsis increased.
She said this at a press conference on Wednesday.
“We believe we put as much money on the table as we could,” Bowser said, pointing out that DC approached its borrowing limit earlier this year, hampering negotiations. A changing financial situation allowed DC to refinance some of its debt this fall, she said, creating a path to make Leonsis' company, Monumental Sports & Entertainment, a more attractive cash offer. “We were aggressive about it.”
The teams' departure would be a major economic blow to the district and the Gallery Place-Chinatown neighborhood surrounding Capital One Arena. It also complicates a major goal of Bowser's third term: downtown revitalization, as the forecast for commercial building vacancy rates is only expected to worsen. She announced that the city will have a plan in place by fall for a vibrant downtown in the spring. But instead, the mayor's agenda has been stymied by a vexing rise in violent crime and turnover in key top positions in her administration – most notably, until recently, an executive who oversaw economic development.
Councilman Charles Allen (D-Ward 6), who was perhaps the most vocal lawmaker in favor of focusing on Capital One Arena, said he had worried over the summer that the city was taking the Wizards and Capitals for granted see. But in this case, “the urgency wasn’t there,” he said.
“I think it's easy to get distracted by the latest shiny ball, but we knew we were going to get a lease,” Allen said, appearing to refer to Bowser's focus on luring the Washington Commanders to RFK Stadium , while Leonsis was considering a move. “We knew Virginia was courting the Monumental Sports teams. This made it even more important for us to ensure that we considered a vibrant Cap One as part of our overall strategy for the city center.
And I just don't think the city is taking as urgent and strategic a approach to redeveloping our downtown as we need to. It wasn’t inevitable.”
Bowser said Wednesday her administration will move forward with the formation of a task force to rethink economic development in the area around Capital One Arena.
“We know that DC, fans, DC residents are loyal and that they are disappointed today, and they are disappointed in Monumental's decisions – or what appear to be their decisions, just like I am,” she said before she turned to what she was saying trying to portray an optimistic future. “But already people have contacted me and agreed to be part of what’s next. A senior just said to me at our annual senior holiday event, 'Remember, when one door closes, many others open.'”
Leonsis has long complained about the city's lack of investment in Capital One Arena — which was built in 1997 and is one of the older arenas in the NHL and NBA — and also about a rise in crime in the area following the pandemic.
But while Monumental Sports tried to secure financial investment and increased security measures from the city, Bowser also worked to lure the commanders – something the mayor has set as a long-standing goal. At the same time, the Washington Nationals were seeking city investment in major upgrades to their ballpark.
With the goal of meeting all of the teams' needs, Bowser announced the “sports team” within her economic development department in July and reflected on the transformative impact of the Wizards' move downtown in the 1990s brought – “where they belong”. she added pointedly.
But while Bowser said the effort remains on track and on schedule, things seemed to move slowly over the last five months: It was only in October that consultants were hired to conduct a “sports study” on the economic impact of professional sports teams to launch – A study that would examine the impact of the Capital One Arena on downtown.
As Wednesday's announcement approached, Bowser and Mendelson appeared to step up their efforts, privately committing $500 million public financing offer on Sunday, money that would be borrowed under the capital projects budget over three years.
It was the day before Virginia lawmakers voted in closed session to move forward with the tentative agreement.
In a 34-page slide presentation the two leaders shared with Leonsis, the pitch envisioned the Gallery Place-Chinatown neighborhood as an “entertainment epicenter” and touched on the museums and restaurants and potential for outdoor festivals in the bustling downtown area a. She also pledged to increase security around the arena to respond to Leonsis and the community's concerns and created a task force focused on improving security and reducing crime, loitering and busking.
“We have the opportunity to once again embark on a once-in-a-generation transformation of our downtown,” Bowser and Mendelson wrote in a letter to Leonsis at the start of the presentation. “We can set new standards for urban arenas and create an unparalleled fan experience, while seamlessly connecting Capital One to the community and firmly establishing the arena as the epicenter of entertainment in our nation’s capital.”
On Tuesday morning, Bowser and Mendelson met with Leonsis at Monumental's offices and discussed the pitch in person, Mendelson said in an interview.
While Mendelson described Leonsis as “impressed” with the presentation, D.C. leaders learned of Virginians' planned announcement Wednesday morning, prompting them to leave the meeting to expedite the drafting of legislation released Tuesday evening.
“The value of the arena operating as it is and being renovated to attract even more activity is a tremendous impact, a tremendous benefit to downtown. “With what Virginia is going for, we would have most of that lose,” Mendelson said.
Critics have privately worried that Bowser and her team did not take seriously enough the threat that Leonsis would pursue a deal to build an entirely new stadium in Virginia, according to two people familiar with the conversations who spoke to them on condition of anonymity languages Discuss sensitive negotiations.
Bowser rejected that proposal Wednesday, saying she and officials took it seriously — but there was little she could do for Leonsis in D.C. if his ultimate desire was to build a suburban arena on a campus from scratch . Mendelson added that the chief financial officer only refinanced the debt in mid-November – not to help Monumental – and that he and Bowser only discussed using increased borrowing capacity as part of an offering from Monumental this weekend.
Still, there was a sense by and large Wednesday, from residents to council members to critics, that it didn't have to be this way as they wondered what went wrong.
Like Allen, Kenya Councilman R. McDuffie (I-At Large), chairman of the economic development committee, said he only learned of the offer or legislation on Tuesday and was frustrated with how negotiations were going.
“First of all, I am extremely disappointed – even angry – with the way things stand,” he said. “I don’t think we had to get to this place where Monumental made the decision to leave the District of Columbia. I think given the urgency with which we need to address downtown and actually do some renewed investment in downtown recovery, I would have expected a quicker and stronger offer from the executive branch. And I would have expected a more collaborative approach to seriously negotiating a deal.”
Gerren Price, president and CEO of the DowntownDC Business Improvement District, said the loss of the Wizards and Capitals would be “a little painful,” especially because those teams' presence helps generate $341 million in revenue.
“As people flow in and out of this arena, there's an energy and vibrancy that draws people in, and it attracts other businesses – that's what people use to justify opening new businesses,” Price said. “I think a lot of people are feeling tension and unease this morning, just wondering, 'What will the future look like?'”
Price said his job now is to work with the newly created task force on a new vision for Gallery Place — with or without the Wizards and Capitals. “We have been saying for years that we need to reinvest and revitalize our Gallery Place-Chinatown neighborhood.”
Derek Hyra, a professor of public administration at American University, said that despite Bowser's vision of making D.C. a “sports capital,” Washington's economy does not revolve around sports and believes the city is bouncing back with a new mixed-use vision the legs could come from the area around Capital One.
Still, “this is a blow to Muriel E. Bowser and Washington, D.C., and it is a major political victory for Youngkin,” he said. “There is no doubt.”
Monumental Sports wouldn't give up on Capital One Arena entirely if the Virginia plan becomes a reality. Monica Dixon, president of external affairs at Monumental, said the plan is to expand live events at the arena and potentially bring the Washington Mystics — which began playing at the new Entertainment and Sports Arena in Congress Heights in 2019 — to Capital One embarrassed.
Bowser did not immediately address the question of what the plan would be for ESA if the Mystics moved to Capital One.
Dixon declined to discuss why Monumental didn't accept D.C.'s offer or why the city lost Monumental on a contract, saying the company hopes to continue its partnership with the city.
Bowser and Mendelson seemed to be holding on to the hope that they were still “in the game,” as Bowser said. There was, after all, the time in 1992 when the then-Washington Redskins appeared alongside Virginia Gov. Doug Wilder (D) to announce a deal to move from RFK Stadium to Potomac Yard. That never happened – a story that the two leaders hope will repeat itself.
Barry Svrluga, Teo Armus and Sam Fortier contributed to this report.