Mayor Kevin Johnson said Tuesday that entertainment conglomerate AEG has officially withdrawn its participation and money from efforts to build a sports and entertainment complex at the downtown Sacramento rail yard site.
"At the end of the day, they did not feel that the economics made sense to go forward with a downtown arena without an anchor tenant," said Johnson.
AEG was a major component in efforts to build an arena that could allow the Sacramento King's basketball team to play in an updated facility that could be more lucrative for the owners, the Maloof family. But the Maloofs did not go ahead with a tentative agreement that would use $60 million of AEG money.
The company operates arenas in numerous cities overseas and in the U.S., including the highly successful Staples Center in Los Angeles. The company would have operated the new arena bringing in concerts and other events in addition to booking 40 to 50 Kings home games. It would have shared proceeds with the city.
The "Think Big Committee," which was created by Johnson, was instrumental in finding financing for the arena will now concentrate on brokering large projects that could be brought into the rail yard.
Johnson said the effort was not wasted because it brought attention to the city from outside developers. The committee also identified $250 million in non-tax funding that could be used to entice projects to the rail yard. That could include other sports teams in which case AEG might reconsider given their interest in Sacramento.
"If you bring in an anchor tenant in then let's resume where we w4ere and continue full speed ahead," said Johnson in describing AEG's stance.
In the meantime, work continues on building a major transportation hub and three major streets that will provide access to the site. Johnson said even without the arena, the larger redevelopment goal remains.
"It was about job creation, it was about economic development, it was about downtown revitalization," said Johnson.
While Johnson is putting a positive spin to the long range plans for the site, the death of the arena deal means that it may take several extra years for the full potential of the rail yard site to be realized.Copyright © 2014, The Baltimore Sun