Capitals, Wizards Move From DC To $2 Billion NoVA Entertainment Site Revealed

ALEXANDRIA, VA — A proposal to relocate the Washington Capitals and Wizards from D.C. to a new entertainment district in Alexandria's Potomac Yard was officially released Wednesday by Virginia's governor and developers.

Gov. Glenn Youngkin was in Potomac Yard Wednesday to announce the $2 billion entertainment district project with the teams' owner Monumental Sports & Entertainment, developer JBG Smith and City of Alexandria officials. The proposed entertainment district would be subject to approval by the Virginia General Assembly and the City of Alexandria.

"We are committed to providing world-class fan experiences while continuously evolving our teams, deepening community ties, and solidifying our role as leaders at the forefront of sports and technology," said Ted Leonsis, CEO of Washington Capitals and Wizards owner Monumental Sports & Entertainment. "The opportunity to expand to this 70-acre site in Virginia, neighboring industry-leading innovators, and a great academic partner, would enable us to further our creativity and achieve next-generation, leading work — all while keeping our fans and the community at the forefront of everything we do."

According to a news release from the governor's office, the 9-million-square-foot entertainment district would include an arena for the Washington Capitals and Wizards, corporate headquarters for Monumental Sports & Entertainment, a Monumental Sports Network media studio, Wizards practice facility, performing arts venue and expanded e-sports facility. JBG Smith's mixed-use development is already planned to have new retail, residential, restaurants, hotels, conference and community gathering space uses.

"This is the most visionary sports and entertainment development in the world, bringing together entertainment, sports, and technology in the most advanced innovation corridor in the United States: a once-in-a-generation and historic development for the Commonwealth, sports fans, and all Virginians," said Youngkin in a statement. "The Commonwealth will now be home to two professional sports teams, a new corporate headquarters, and over 30,000 new jobs — this is monumental."

The relocation of the Washington Capitals and Wizards from Capital One Arena in D.C.'s Chinatown would be a blow to the district's downtown. In response to the proposal, D.C. leaders have offered $500 million to upgrade the existing Capital One Arena and extension of the ground lease to 2052, the Washington Post reported. The existing arena dates back to 1997 and is one of the NHL and NBA's oldest.

Monumental Sports & Entertainment has been seeking $600 million for Capital One Arena renovations, as Leonsis has criticized the area surrounding the arena and DC not making enough investments in the building.

The project would be near Amazon's Arlington headquarters and next to Potomac Yard's upcoming Virginia Tech Innovation Campus, which expects to open its first academic building next year. Metrorail access to the entertainment district would be available at the new Potomac Yard Metro station on the Blue and Yellow lines.

"This exciting new project is the result of decades of thoughtful long-term strategic planning and a clear vision for growth across Alexandria," said Stephanie Landrum, president and CEO of the Alexandria Economic Development Partnership. "From the Virginia Tech Innovation Campus to the new Potomac Yard-VT Metro Station, Alexandria has created the ideal environment and location for this exciting project."

Mayor Justin Wilson attributed Alexandria's success in attracting the project to investments in the Potomac Yard neighborhood and around the city.

"Our City Manager Jim Parajon led a talented team, working hand-in-hand with the Alexandria Economic Development Partnership, to bring us this opportunity," said Wilson. "A project this special will help the City realize our collective strategy and the vibrant vision for this neighborhood and for our city as a whole."

The $2 billion project would be supported by bonds issued by the state's proposed Virginia Sports and Entertainment Authority and $403 million in contributions from Monumental Sports & Entertainment. The company and city would each contribute $56 million for the construction of the performing arts venue. Another $50 million toward underground parking development would be contributed by the city. The city government says no existing taxes or proposed tax increases are supporting the project.

"All project investments backed by the Commonwealth and the City will be paid back in full by incremental project revenues; there is no upfront investment by the Commonwealth and no existing taxes or tax increases are a part of this financing plan," said Virginia's Secretary of Finance Stephen Cummings. "This tremendous opportunity will drive billions in total economic impact over 40 years."

The Virginia General Assembly will be asked to approve the proposed Virginia Sports and Entertainment Authority in its upcoming 2024 session. Bonds would be issued by the authority, repaid by annual rent from Monumental Sports & Entertainment, arena parking revenues, entertainment district naming rights, and incremental taxes from the arena and mixed-use development. The authority would own the land and buildings and would enter a 40-year lease with Monumental Sports & Entertainment. Bonds would also support $110 million in on-site infrastructure like site development and roadway, signal, and intersection improvements.

The City of Alexandria plans to start community engagement on the project in early 2024.

If the project is approved, Monumental Sports & Entertainment said the Capitals and Wizards would continue playing at Capital One Arena through 2027. Construction on the new project could begin in 2025 with an expected opening in 2028.

Updates and more information on the project are being shared at MonumentalALX.com.