Las Vegas Sun

November 24, 2017

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Your last chance, city tells arena developer

The cheeriness Las Vegas officials have displayed about the prospects for a downtown arena vanished Wednesday.

Impatient about the delay of the project and unsmiling to drive home their concern, Mayor Oscar Goodman and Councilman Gary Reese told the would-be developer they have put their reputations on the line and expect results.

"We gave you our blessings many, many months ago - years ago, it seems like - to do this for us," Reese said. The comments came as REI Neon/Warburg Pincus asked for another extension, its third as it works toward a contract agreement with the city on the $10.5 billion multiuse project.

An exasperated Reese laid out his hopes for this project, the mayor's dream for an NBA team in Las Vegas, and fears of those dreams dissipating.

"It would be a terrible travesty to the city of Las Vegas if, (after) all the work that our mayor has done to bring an NBA-type team or league to the city, it goes someplace else," he said.

Then he spoke very clearly and deliberately.

"I think it's important that you understand how important it is to us that if an NBA team comes to Clark County, it needs to be in the city of Las Vegas."

There was no need to read between the lines. Harrah's Entertainment and Anschutz Entertainment Group announced their own project for an arena just off the Strip shortly after the city decided to go ahead with REI Neon. The property is outside Las Vegas city limits. Goodman has often said that the first group to get its shovel in the ground is the one likely to win an NBA franchise.

Reese ended by extracting a promise from REI Neon representative Jill Ferrari that she can't possibly keep.

"Do your due diligence on this and see that we get an NBA franchise in the city of Las Vegas," he said.

"Absolutely," Ferrari replied.

So in about 60 days, it will either be the end or a new beginning for REI Neon, which with much hullabaloo in July was awarded an exclusive negotiating agreement to build an arena in the city.

REI Neon promised a multiphase $9.5 billion project (later upped to $10.5 billion) on an 85-acre parcel just south of Charleston Boulevard that now is home to auto-related shops, boxing gyms, a used-auto lot, a swimming pool supply store and myriad other businesses.

Just before the City Council unanimously approved the last and final extension Wednesday, the mayor leveled his gaze on Ferrari.

"The extension is a benchmark date," he said. "In the sense that, if we don't believe on Feb. 20 that REI is going to be able to perform, then I want you to know, as far as I'm concerned, that's the end of it. And we'll wish each other well."

Ferrari used a football metaphor, which was twisted negatively by council members, to demonstrate how close REI is to finishing the agreement.

"We think that we are on the 15-yard line," she said.

"Which 15-yard line?" Councilman Steve Wolfson asked.

"The good one!" Ferrari said, beaming.

Reese said it seemed to him "we're not on the 15-yard line, we're on about their 15-yard line and it's scary."

Reese implored Scott Adams, the city's business development director, to remember that the 12 acres of land assembled east of City Hall on Las Vegas Boulevard would be a prime location for an arena. At least two of the arena proposals that lost to REI Neon last summer included that land.

"I would love to see an arena built at this site east of us," Reese said.

Adams acknowledged that developers have shown a lot of interest in that land, which has immediate access to U.S. Highway 95 ramps. At the same time, the city is bound by its contract with REI Neon not to discuss any kind of arena plan there. REI Neon's agreement gave it an option to develop that land - but the option will be surrendered as part of the city's extension.

After the council approved the extension, another development came up for an extension. That one was in the 61 acres of Union Park, not far from REI Neon's 85 acres. After a presentation, Goodman smiled. That plan, which includes benchmarks to be met during the extension, put him at ease.

"I wouldn't have the same fears with REI if we had a program like this," he said.

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