Wizards, Capitals plan Alexandria move in $2B deal

The Washington Capitals and Washington Wizards are planning a move to a new home in Alexandria in a $2 billion deal that would see the professional sports franchises exit Washington, D.C., by 2028, Virginia Gov. Glenn Youngkin announced Dec. 13, 2023.

The nonbinding agreement to build a new arena for the Capitals and Wizards is part of a 9 million-square-foot entertainment complex planned for the Potomac riverfront in Alexandria’s developing National Landing neighborhood. Virginia Tech’s $1 billion Innovation Campus would be a neighbor, and Amazon.com’s HQ2 campus is just two Metro stops away.

The project is a partnership between the state, the City of Alexandria, JBG Smith and Monumental Sports & Entertainment, which owns the Capitals National Hockey League franchise and the National Basketball Association’s Wizards. Monumental would invest $403 million in the deal. It would include the arena, new corporate headquarters for Monumental, a performing arts venue and retail, restaurants, hotels and conference and community spaces. 

The first phase, including the arena, could generate $12 billion in economic impact and create 30,000 jobs over the next several decades, Youngkin said. The project is expected to break ground in 2025 and be completed by 2028.

“Our commitment would be to build really iconic, fan-centric businesses,” Ted Leonsis, founder, CEO and chairman of Monumental, said.

The deal rests on approvals from the Virginia General Assembly and Alexandria City Council. The state legislature, which convenes Jan. 10, will be asked to approve a new Virginia Sports and Entertainment Authority that would own the land and buildings within the district and enter into a 40-year lease with Monumental. The $2 billion investment would be supported through bonds that would be repaid through annual rent from Monumental and arena parking revenues, naming rights and incremental taxes generated by the arena and development of the first phase. Alexandria would contribute $56 million toward construction of the performing arts venue and $50 million toward underground parking development.

But the proposal is far from a sure thing.

In a Dec. 19, 2023, tweet, Democratic Sen. Louise Lucas, incoming chair of the Senate Finance and Appropriations Committee, said the deal does not have her support. “Anyone who thinks I am going to approve an arena in Northern Virginia using state tax dollars before we deliver on toll relief and for public schools in Hampton Roads must think I have dumbass written on my forehead.”

Youngkin, however, called the deal an “affirmation of what’s happening in Virginia,” citing other prominent economic development deals in Northern Virginia, including Amazon’s HQ2 and the 2022 headquarters relocations of global Fortune 500 defense and aerospace contractors Boeing and RTX in back-to-back announcements.

“This once-in-a-generation historic development will be the best place to live, work, raise a family and watch hockey and basketball,” Youngkin said.

A longer version of this story was published on VirginiaBusiness.com on Dec. 13, 2023. This article was updated after publication.