The proposed Oceanfront arena developer received another extension to create a new loan commitment.
Virginia Beach City Council voted 8-3 Tuesday to grant United States Management, LLC an extension to create a new funding mechanism that meets its agreement with the city for the $210 million arena. Council members John Moss, Barbara Henley and newcomer Jessica Abbott voted against it.
This is the second time city council has granted a 60-day extension to its arena developer.
Now, the developer has 60 days to create a funding mechanism that meets its agreement with the city: keeping its cost below $170 million and provide $40 million in equity.
If United States Management doesn’t come up with a way to secure a loan in 60 days, the agreement will be canceled by the city manager, according to a resolution in the agreement.
About 10 people spoke during the public comment portion of the formal session, including United States Management CFO Valerie Wilkinson.
“The logistics to meet the January 7th date had been complicated by the holidays,” Wilkinson said. “The [Federal Deposit Insurance Corporation] recommends that banks require all officers and employees take no less than an uninterrupted two-week time off each year … several key decision-makers have not been available to us.”
Wilkinson said they are working with a major domestic bank to create a loan commitment that meets the terms of its current agreement with the city.
President of Seatack Civic League George Minns spoke against the extension grant, focusing on congestion.
“Seatack, as a community, has nothing against an arena. In fact, if it was another location, not at our front door where we only have one intersection, and 10,000 cars would surely disrupt everything … Seatack would be all for it,” Minns said. “The adverse impact has not been addressed, public safety has not been addressed.”
Councilwoman Abbott administered a survey asking the public about their thoughts regarding the arena, which influenced her vote.
“Largely, the individuals who were surveyed opposed the project as a whole. But what’s more interesting to me is that more people opposed giving a financing extension than just outright oppose the project as a whole,” Abbott said. “I’m concerned that if we don’t have the support of the general public, people won’t have the ability to bring someone to the table to advocate on their behalf.”
Councilwoman Henley, who was the sole opposition of the initial extension vote in November, said a lack of parking is a major concern.
“One thing that was not factored in to the city’s cost would be the building of a parking garage, which I’m absolutely certain is going to have to happen because the city is responsible for providing the parking places,” Henley said. “I think the fact that we don’t have all of that data is very troubling.”
Mayor Will Sessoms gave his final remarks before city council voted.
“I will reiterate that private financing, in my mind, is the only way to make this happen,” Sessoms said. “We have storm water infrastructure issues and schools to build. Therefore, we cannot let that arena compete with those projects.”
