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The Virginian - Pilot (Norfolk, VA.)

 

VIRGINIA BEACH

City Manager Dave Hansen on Tuesday gave the developer of a proposed arena more time to close on a loan after it asked for an extension.

The new date to secure financing would be Nov. 6.

The developer's request comes before its September deadline, when the City Council asked for the funding to be finalized.

The current agreement says the developer is allowed to take two 30-day extensions.

In a letter, United States Management - which is now operating as Mid-Atlantic Arena, LLC - requested the full 60 days. The company changed its name at the lender's request, said Joel Rubin, a spokesman for the developer.

The city has seen "real progress toward the closing of the loan," City Attorney Mark Stiles said in a statement.

"The need for additional time was contemplated at the time the Development Agreement was executed," he wrote, "and this request is not surprising given the size and complexity of this transaction."

Hansen granted the developer's request after council members met in closed session to discuss it.

The project has faced many obstacles since the council approved the deal in December 2015.

The developer originally wanted to be open by this fall. That goal was pushed to October 2019.

The arena would be privately owned and operated, but the city has a major stake in it, too. It would give the developer 1 percentage point of the hotel tax, real estate and personal property taxes and taxes generated at the arena. The developer could get up to $476 million over more than 30 years.

In March, JPMorgan Chase said it was willing to finance a $150 million loan for the 18,000-seat sports and entertainment arena. Additionally, the developer said it had $70 million in private investment.

"I remain optimistic that the developer will be able to finalize the necessary financing," Hansen said in a statement.

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