City, Atlanta Hawks strike $193 million Philips Arena renovation deal
City will pay for roughly 75 percent of cost using city’s car-rental tax, Turner Field cash, other land sales
No value assigned
The City of Atlanta and the Hawks announced a nearly $200 million remake of Philips Arena that’s meant to keep the basketball team in its home downtown until 2046.
The city will contribute $142.5 million, Mayor Kasim Reed said at a Tuesday press conference. Of that, about $110 million will come from an existing car rental tax and another $12.5 million will come from the sale of Turner Field to Georgia State University. The rest of the city’s contribution will come from smaller real estate sales. The Hawks will invest $50 million.
The announcement comes one week before Atlanta voters visit the polls to decide whether to give the city hundreds of millions of dollars in sales tax revenue — and MARTA many times more — to fund needed infrastructure and transit projects.
Reed said he’s seen lots of renderings of how the renovated arena will look once complete, but the Hawks declined to release the images for now. Steve Koonin, the Hawks’ president, says the team was inspired by the Beltline to make sure the renovated arena connected with the surrounding area. The project shouldn’t disrupt basketball seasons, team officials said. Right now, the plan is to do work between seasons and have it ready for the 2018-2019 season.
The mayor said the deal “really does mark a special day for South Downtown.” He says the revamped arena will play a key role in the city’s tourism industry.
The city and the team have been chatting about a redo of the 1999 arena for more than a year. The Hawks have also thought about spreading their wings over more space in Downtown, potentially redeveloping areas around Philips Arena into an entertainment and mixed-use district.
Asked how the renovation deal affects those talks, Reed said “really it affects the overall energy. Across South Downtown, the ... number of real estate closings that are going on are just going through the roof.”
He said there are 11 closings within a mile of Five Points right now. Though he did not mention them by name, the number likely includes several parcels currently occupied by arts groups along South Broad Street. Reed said he expects the sales of Underground Atlanta and Turner Field to close this year. A deal is also in the works for a four-star hotel at the Georgia World Congress Center.
No value assigned
“Richard Ressler has expressed his serious interest and done a lot of due diligence in developing The Gulch,” said Reed, referring to a property investor and manager who is associated with several companies, including the CIM Group. If the name looks familiar, that’s because he’s brother of Hawks majority owner Tony Ressler.
Reed said the city will continue to work with the Hawks ownership and stakeholders to transform the Gulch. The mayor said that “we believe a $1.5 billion dollar investment is possible over the next 20 years.”
Tony Ressler said that from the time his ownership group took over into the Hawks organization, part of the goal has been to help develop the area around Philips Arena. He said that the CIM Group, which he said his brother is a senior partner in, is absolutely looking to spend time in the city and looking to looking at ways they could figure out how to contribute to Downtown’s redevelopment.
“We as the Atlanta Hawks have tried our best to participate as well and will participate in some way in the redevelopment to the best of our ability because we believe that is a critical component of having a world-class franchise here for the next 30-plus years,” Tony Ressler said.
UPDATE: The Hawks have sent links to a video and sketches of the renovation plans.