The Washington Capitals and Washington Wizards would stay in D.C. until 2050 under a $515 million deal announced Wednesday by Mayor Muriel Bowser and the teams’ owner Ted Leonsis.
The deal was announced just hours after the City of Alexandria said negotiations to bring the two teams to Northern Virginia have ended.
“We are just very, very pleased to be able to support one of our most important employers, one of our most popular destinations, and continue to invest in catalytic initiatives and businesses that will bring the District all the way back,” said Bowser, who was wearing a Wizards jersey during the news conference at Capital One Arena announcing the deal.
The agreement still needs D.C. Council approval, and Council Chair Phil Mendelson said it will be up for a vote Tuesday and is expected to pass. The $515 million deal will be folded into the city’s capital budget to be paid over the next three years.
“I am confident that will go through the council,” Mendelson said. “It’s easier to do business in the District of Columbia than in some other jurisdictions.”
Renovations to the arena and surrounding area are projected to cost $800 million total, according to a news release from the District, and will include arena upgrades, expanded retail and concessions, and improvements to pedestrian and vehicular traffic flow.
“How do we make this the greatest downtown? You can’t do it alone, and I felt that we were really in a good partnership, as opposed to where I thought I would have a great partnership,” Leonsis, managing partner of Monumental Sports & Entertainment, said, referring to his failed deal in Virginia. “Now, they did have one thing that we didn’t have and the mayor identified and we talked about that — land, space. We need space.”
Leonsis said more space around Capital One Arena has become available recently, which will allow Monumental to fulfill its vision of a sports and entertainment complex in Downtown D.C., rather than having to relocate to Potomac Yard.
In December, D.C. offered $500 million in upgrades to the arena to keep the teams from moving to Virginia. The agreement announced Wednesday includes an additional $15 million for improvements to the alley connecting Gallery Place to Capital One Arena.
In all, the deal calls for nearly 200,000 square feet of newly programmed space throughout the arena and in the Gallery Place building next door.
“It is an offer that’s not only good for the teams, it’s good for Washington, D.C., and I dare say it’s good for the entire region,” Bowser said. “We, with the teams, have identified additional opportunities to expand their footprint right here in Downtown and we’re also going to invest $15 million in that.”
The deal will also bring 17 dedicated officers around the arena from two hours before games to two hours after games, according to a news release from Monumental, which added the agreement also gives it the ability to close off F Street two hours before games.
What went wrong in Virginia
The $2 billion plan for a sports and entertainment complex in Potomac Yard, championed by Republican Gov. Glenn Youngkin, ran into trouble in the Virginia General Assembly after Democratic opposition.
“We negotiated a framework for this opportunity in good faith and participated in the process in Richmond in a way that preserved our integrity,” the City of Alexandria said in a statement. “We trusted this process and are disappointed in what occurred between the Governor and General Assembly.”
In a statement to WTOP, Youngkin expressed his disappointment with the General Assembly for not agreeing to the deal.
“Virginians deserve better. A one-of-a-kind project bringing world-class athletes and entertainment, creating 30,000 jobs and $12 billion in economic activity just went up in smoke. This transformational project would have driven investment to every corner of the Commonwealth,” Youngkin said.
He added that “personal and political agendas drove away” the deal.
Democrats responded by saying Youngkin had mismanaged the proposal from the start. House Speaker Don Scott said he was blown away by Youngkin’s statement, which he said seemed like it had been written by a teenager, and bristled at the suggestion that the Legislature should have given the deal an easy signoff.
“He has lost his sense of good judgement right now,” said Scott, who had not fully endorsed the deal but expressed openness to it.
He added that from the tone of the statement, he expects Youngkin might retaliate by vetoing the budget lawmakers sent him earlier this month.
In December 2023, Leonsis, along with Youngkin and Alexandria City Mayor Justin Wilson, announced their plans to bring the Capitals and Wizards to Potomac Yard with a new arena and entertainment district.
However, it had immediate opposition from residents, labor unions and local officials. Earlier this month, Virginia lawmakers approved a two-year budget, which didn’t include Youngkin’s proposed arena deal. State Sen. L. Louise Lucas strongly opposed the plan because it would rely on bonds from the state and city governments.
In a post on the social media platform X, Lucas said Virginia is celebrating that “we avoided the Monumental Disaster!”
Developer JBG Smith, which owns much of the real estate at Potomac yard and stood to benefit from the team moving to Virginia, laid blame for the collapse of the deal elsewhere.
“It is now clear that our efforts may have been complicated and ultimately blocked, in part, by special interests seeking to move the Monumental arena to Tysons Corner and to combine it with a casino,” JBG said in a statement. “When one follows the money, the implications are deeply troubling for Virginia and for the future of transparency in economic development pursuits.”
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