Council Gives Arena Developer Financing Extension

VIRGINIA BEACH - After hitting roadblocks last year, the developer that wants to build an arena on city land hasn't given up yet.

The City Council voted Tuesday night to grant United States Management more time to obtain a loan to build an 18,000-seat sports and entertainment venue. A majority of members supported the extension, while Barbara Henley, John Moss and Jessica Abbott opposed it.

The council made it clear it will be the last extension offered to the company. In closed session, the council amended the proposal to direct the city manager to terminate the agreement if United States Management doesn't meet the terms by March 8.

A year ago, the council approved a plan for the developer to seek a $170 million loan from a Chinese bank and invest $40 million of equity.

United States Management decided last summer to work with a Chicago investment bank, which would require it to take on more debt and reduce the developer's contribution.

Valerie Wilkinson, chief financial officer for United States Management, told council members Tuesday that the company is working with a major U.S. investment bank lender that she said has experience with arenas and a strong relationship with the chosen arena venue manager, AEG. She also said the company has moved away from seeking bonds to finance the project and is instead opting for a traditional loan structure.

In October, the project stalled when the council rejected changes to the finance plan in an 8-3 vote. The first deal is still officially in place. An extension on that proposal was granted in November and was set to expire Jan. 7.

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