Cleveland Cavaliers withdraw participation in Quicken Loans Arena renovations
The Cleveland Cavaliers have announced that they are withdrawing their participation for the proposed renovations to Quicken Loans Arena.
The $140 million dollar renovations were cancelled because of the referendum put forth by the Greater Cleveland Congregation, along with other groups. The groups have opposed the plan from the beginning, believing that the money should go into renovating inner-city neighborhoods. Earlier this month, the Ohio Supreme Court ruled that the City of Cleveland must accept and review more than 20,000 signatures proposing a referendum on Q renovations. More than 13,000 were deemed valid.
In a statement, the Cavaliers say the prospective referendum will cause the groundbreaking of The Q Transformation to miss the current construction cycle, which pushes the overall price tag of the project higher due to rising construction costs. In addition, a time sensitive financing package that included historically low interest rates would be negatively impacted by further delay due to a prospective referendum exposing the project to an expected higher interest rate environment.
$70 million of the cost of the plan was to have been funded privately by the Cavs/Quicken Loans Arena organization, with the additional $70 million to have come from a portion of the existing Admissions Tax and a portion of the existing Cuyahoga County Bed Tax.
The Cavaliers had also made further pledges as part of their commitment to the project:
- For every dollar of admission tax that would have gone toward financing the renovations, $1 would also go to the city's general fund.
- Second, the Cavaliers had agreed to restore every surface of every basketball court at Cleveland recreation centers across the city.
- Finally, the Cavaliers said they'll donate all the proceeds from the team's road game watch parties to Habitat for Humanity in order to restore 100 homes across Cleveland over the next three years.
The cancellation of the Q renovations means that the NBA will likely take the All-Star Game that was to have come to Cleveland in 2020 or 2021 elsewhere. The 23-year-old arena is one of the oldest in the NBA.
The renovations would have also extended the arena's lease with the city through 2034. It's currently slated to expire in 2027.