In all likelihood, a funding deal for a new Virginia Beach arena will be approved by the City Council, according to local officials.
As agreed upon in July, United States Management LLC (USM) and the Virginia Beach Development Authority will partner on the project. The development authority will act as a conduit issuer for USM, which is seeking to construct a $210 million arena.
In order for that development agreement to go forward, it requires approval from the Virginia Beach City Council. The council will make its decision based off of the results of two studies–one on revenue feasibility, and another on bond ratings. The council is expected to render its decision later this month.
All indications at this point are that the project will move forward, according to city manager Doug Smith and city finance director Patti Phillips: More from Southsidedaily.com:
The feasibility study assesses whether or not the estimated value of the arena and its revenue projections are fair and accurate, Smith told the Development Authority during a July meeting. During the briefing on Tuesday, Smith said a very recent look at a draft of this study indicates fair revenue projections.
“In terms of the appraisal, it’s frankly a good validation of USM’s pro forma,” Smith said. “When you look at the number of shows, attendance, income, expense per capita – all key indicators – USM is right on the mark.”
During the briefing, Smith said he and Phillips did not yet have copies of the studies, but they reviewed a draft of the feasibility study, and he expects the bond rating letter to be in this week. If all goes well, which Smith anticipates, the development agreement would come before council for approval Sept. 20. It would also be presented to the Development Authority earlier that day.
Recently USM offered deposits on the suites, even though no date had been decided for the beginning of construction. The arena is currently slated to open in 2018.
RELATED STORIES: Suites Already on Sale for New Virginia Beach Arena; Virginia Beach Approves Arena Funding Deal; New Virginia Beach Arena Funding Plan Emerges; Status Update on New Virginia Beach Arena on Tap
