The Oklahoma City Council has approved a development agreement for the City’s new arena between the City and PBC Sports and Entertainment, LLC (PBCS&E), owners of the Oklahoma City Thunder and the Oklahoma City Blue.
Voters approved funding for the new arena in December.
The development agreement is based on the original 2008 development agreement, which was used to improve the current arena and build the practice facility used by the Thunder. It also aligns with the Letter of Intent approved by City Council in September 2023.
The development agreement covers major elements of the process of designing and constructing the new arena.
LOCATION:
- The agreement identifies the City-owned former site of the Cox Convention Center as the site of the new arena. The City will own and be responsible for maintaining and operating the new arena.
- Approximately 1.4 acres of the site will be reserved for a potential future intercity transit hub.
- PBCS&E can negotiate with the City for a ground lease to develop any unused property on the new arena site at market rate, with revenue from the lease to be used for the arena’s maintenance and improvements.
FUNDING:
OKC agrees to spend a minimum of $900 million on the new arena. The new arena will be funded by (listed in order of how the money will be spent):
- $78 million from MAPS 4
- $50 million from PBCS&E
- a minimum of $772 million, financed through the 72-month, one-cent special sales tax
Any surplus revenue from the one-cent special sales tax after the arena's construction and repayment of financing costs will be allocated to capital improvements and maintenance of the new arena.
The agreement acknowledges that there are no other sources of revenue to fund the new arena, and so the agreement provides that if the costs appear to exceed available budgeted funds, the parties will work together to value engineer the project. PBCS&E can privately fund portions of the project to avoid removing them through value engineering.
TIMING:
- The Thunder will continue to play home games at the Paycom Center until the new arena opens.
- The agreement maintains the completion date of 2029 as outlined in the letter of intent but provides a path to a target completion date of June 2028, with a contractual obligation to open the new arena by June 2030.
- The Thunder’s 25-year commitment to remain in Oklahoma City begins when they move into the new arena.
ARENA BACKGROUND:
The Oklahoma City Thunder has called Oklahoma City home since 2008. In 2023, the initial term of the 2008 use license agreement expired. The Team exercised an option to extend the agreement for three years to allow time to develop a plan for a new arena to keep the Thunder in Oklahoma City for 25 years after the new arena opens. In December 2023, Oklahoma City voters overwhelmingly approved a penny sales tax to build a new, publicly owned arena. The new arena will be the fourth downtown arena in city history constructed by the public.