Considerable interest and activity has been experienced in the development of sports and entertainment facilities in the Las Vegas – Southern Nevada area. Guy Hobbs, Managing Director of Hobbs Ong, has served in a key advisory position for most of these projects. Hobbs Ong has been fortunate to serve in these advisory roles for these projects, briefly discussed below.
Hobbs Ong was engaged by MGM Resorts to conduct a review of fiscal and economic impacts for the development of a multipurpose arena on the Las Vegas Strip. This engagement involved a review of materials prepared by other economic consulting firms, collection of primary data relative to project impacts, and generation of a final report summarizing the expected economic output, job creation, income and fiscal effects. The report was ultimately used by the project developers to reach agreement with local government service providers with regard to the provision of public services to the project. The debut of the T-Mobile Arena on the Las Vegas Strip was in April 2016.
Hobbs Ong was engaged by the Howard Hughes Corporation to conduct a variety of analyses in support of a project to relocate the Las Vegas 51’s from their current home at Cashman Center to a new location in the unincorporated County area of Summerlin. The first undertaking was to prepare an economic and fiscal impact analysis relative to the construction and operation of a new stadium in Summerlin, taking into consideration the closure of the current Cashman location. The next undertaking was to provide analytical and strategic support to the Howard Hughes Corporation in constructing a funding partnership with Clark County, the Las Vegas Convention and Visitors Authority and other stakeholder parties. The ultimate objective of this engagement was to facilitate a funding and financing solution for the new stadium project. This project is ongoing, and is an example of a project that involves managing both complex quantitative and non-quantitative issues. As is the case with other stadium and arena projects, this requires a very specialized skill set to balance the financial elements with the political forces bearing upon the overall solution.
Hobbs Ong was engaged by Majestic Realty to provide financial planning support to their efforts to design, build and operate a stadium on the UNLV campus. This project contemplated a 60,000 seat multi-use stadium on the UNLV campus featuring an enclosed venue with advanced, state of the art amenities. The project budget for this project approximated $900 million, and envisioned a public-private partnership between Majestic Realty and the University. The scope of services included Hobbs Ong being the lead in the preparation of a project capital and operating pro forma, including an event pro forma and all capital financing and funding scenarios. Hobbs Ong also led the efforts to produce a fiscal and economic analysis in support of the proposed stadium construction and operations. Throughout the process, our team produced over four dozen alternative funding and revenue sharing scenarios. This project lasted approximately two years, and culminated with UNLV determining that it would proceed without a private partner. However, the work performed on this project served as foundation for subsequent stadium funding discussions. Stadium and arena funding and financing analyses are a very specialized niche, due to the nuances of these very challenging projects. Hobbs Ong has significant experience and expertise in this very specialized area.
Expanding upon the knowledge and experience gained during the earlier iterations of stadium planning for Las Vegas, Hobbs Ong & Associaites was at the forefront of the effort to bring the multi-purpose and National Football League stadium project to fruition. With the addition of the Oakland Raiders as a potential tenant, and with more refinement with respect to the venue location, the project matured into a viable and realistic venture. The earlier iterations of financial models for the stadium served as the basis for continued analysis and planning for the proposed $1.9 billion covered stadium to both serve as home for the Raiders and to host numerous other sporting and entertainment events. Guy Hobbs served on the Technical Advisory Committee to the special committee established by the Governor to study the tourism infrastructure needs in southern Nevada. Concurrently, he provided professional support to the efforts of the development team (Las Vegas Sands and Majestic Realty), affected local governments (primarily Clark County), and the Raiders. Focus of this effort was upon the financial plans for funding and financing the project, and organizational and procedural requirements necessary to permit the project to move forward. Much of this effort also focused upon the development of several of the key elements of the legislations that would be required to both create the necessary revenue sources and the framework of the financing for the project. Mr. Hobbs was a part of the effort at the special session of the legislature during which the law enabling this project was considered and approved.
Hobbs Ong was engaged by Boyd Gaming to conduct a series of analyses, including a financial summary of the City of Las Vegas general fund and redevelopment agency fund, an analysis of major tax payments made by the downtown gaming properties to the City of Las Vegas and other units of government, and an analysis of the City of Las Vegas arena funding and financing plan. In addition to the work cited in the prior sentence, Hobbs Ong has also provided continuing analytical support to Boyd Gaming with respect to the City of Las Vegas proposed soccer stadium. With regard to the financial analysis of the City of Las Vegas general and redevelopment agency funds, our work focused upon evaluating the overall financial position of both funds, as well as an analysis of outstanding indebtedness. The analysis of major tax payments focused upon the following revenue sources: Property tax, sales tax, room tax, live entertainment tax, gross gaming revenue, and the modified business tax. Of interest on the part of the downtown gaming properties was their overall contribution to the City of Las Vegas general fund and redevelopment agency fund. Hobbs Ong also performed a thorough financial analysis of the City of Las Vegas proposed downtown arena, finding that the proposed plan was deficient in several material ways. As with the foregoing tasks, these findings were incorporated within a comprehensive report to Boyd Gaming. As was noted, Hobbs Ong has also provided support, as needed, to Boyd Gaming with regard to the changing funding and financing plans for the proposed soccer stadium.