Top Update: Michigan announced a $900 million stadium upgrade.
Oklahoma City On Tuesday, the Oklahoma City Thunder announced their intention to play in the $900 million arena as well as the proposal to construct a new one downtown.
In a June interview, Mayor David Holt stated that a new arena would be “the issue of 2023” in order to keep the Thunder in Oklahoma City and that a plan will be unveiled by the end of the summer.
For fourteen months, there were talks between the basketball team’s leadership and city officials.
The plan for the new arena and the commitment from the Thunder are conditional on city voters approving an extension of the temporary 1-cent sales tax that is funding MAPS 4 projects and is set to expire in 2028. The temporary tax for the arena would start after that, so it would not increase the city’s current sales tax rate.
Holt and City Manager Craig Freeman will bring the plan to the City Council on Sept. 26. Approval by a majority of council members would set an election on the sales tax extension for Dec. 12.
The project cost for the new arena will be a minimum of $900 million, according to the announcement.
In addition to the temporary 1-cent sales tax over 72 months, at least $70 million earmarked for improvements to the current downtown arena would be used along with a $50 million contribution by the owners of the Oklahoma City Thunder.
All three of the city’s previous downtown arenas – dating back to 1927 – have been paid for entirely by taxpayers. Like them, the new one would be owned by the city.
Holt and Freeman said they have a letter of intent signed by Oklahoma City Thunder Chairman Clay Bennett, committing the Thunder to play 25 years in the new arena if the December vote is passed, along with related legal documents.
The new arena also would secure Oklahoma City’s status as a destination for premier concerts and similar events, officials said.
“The people of Oklahoma City have overwhelmingly expressed to me two desires – 1) keep the Thunder for as long as possible, and 2) don’t raise taxes if it can be avoided. We have accomplished those two priorities with this plan, and it is truly a win-win for all of us,” Holt said in the announcement. “Perhaps the most important aspect of the deal is the length – this is twice the commitment we received in 2008 and will keep the Thunder here beyond 2050.”
He thanked Bennett and the Thunder organization for their collaboration during the planning process.
“For fifteen years the Thunder has been honored to help lead the transformation of Oklahoma City and enhance the tremendous pride our citizens have in their community,” Bennett said in a statement. “We now have an opportunity to build on that progress, advance our status as a true big-league city, continue to grow our economy and secure the long-term future of the Thunder.”
Holt repeatedly has said Oklahoma City has reaped enormous economic benefits since the Thunder’s arrival in 2008, but without a new arena that meets National Basketball League standards the city could lose the franchise to another city.
One economic impact study shows the direct annual economic impact of the Thunder is $600 million and 3,000 jobs. Additionally, since the team’s arrival 15 years ago, the city’s gross domestic product has grown 62% and since 2008 Oklahoma City has moved from the 31st to the 20th largest city in America, Holt said.
Three NBA teams play in arenas that cost at least $1 billion when they were built – Golden State Warriors, $1.4 billion; Milwaukee Bucks, $1.2 billion; and Brooklyn Nets, $1 billion. The LA Clippers are on track to open their $2 billion arena in 2024, and the Philadelphia 76ers’ ownership say it will build a $1.3 billion arena.
The 21-year-old Paycom Center is the smallest in the NBA by square footage and has the second-smallest capital investment of all NBA arenas. The Thunder will host the San Antonio Spur there in their preseason opener Oct. 9.
