Downtown Arena? GM Ernie Hahn Gets Candid over Future of the Valley View Casino Center

The future of the Valley View Casino Center Arena and the current lease agreement between AEG Management, San Diego and the City of San Diego has become a hot political and business topic.

General Manager of the Valley View Casino Center Arena and partner of AEG Management, Ernie Hahn, spoke with IVN San Diego about the opportunities presented, thoughts on a new poll being circulated over the future of the arena, and a number of interesting timelines with an inside view into the future of the site.

Your current lease with the city is up in 2 years, where do negotiations stand with the city and AEG?

Our number one priority is to renew the lease for at least another 5 to 7 years. The city has been great to work with in terms of getting an extension and we have been talking about this for the last couple of years.

10-years ago we did a deal with AEG that allowed us to reinvest capital into the arena, upgrade the facilities and extend the lease from 2017-2020 while bringing a naming rights partner and investing another 10 million dollars into the building.

We do around 130 events at the arena every year and as partners with AEG, have enjoyed our relationship and expect it to continue for the foreseeable future.  Our Building is one of the top grossing arenas in the world in the 10,000-15,000 seat capacities which is saying something when you consider there is another 11,000 seat arena in town and 20,000 capacity amphitheater in Chula Vista.

We just had three of our best years ever in the 26 years I have been here, 22 as the GM, so I like to think we're doing a lot of things right.
Ernie Hahn, GM Valley View Casino Center Arena

We just had three of our best years ever in the 26 years I have been here, 22 as the GM, so I like to think we’re doing a lot of things right.

The district where the Sports Arena sits has a 30-foot height limit. How does that 46-year-old restriction limit opportunities for a new arena?

The 30 foot height limit ordinance went into effect in the early 70’s after the arena was built, consequently nearly all of the construction in the area looks the same.  Because of this, most all buildings are retail big box users and strip malls that can maximize the land values with rent and usage.

Courtesy: San Diego Union-Tribune

If someone were going to consider building a new arena on the same site, it would require going to the public for a referendum, much like Sea World did many decades ago. A community plan update would also be part of that conversation.  You would also have to assemble the land that the city owns over time and with respect to current leases and figure out all of the infrastructure needed with transportation needed for the project.

Over the years we’ve identified downtown and Mission Valley as more advantageous considering the height ordinance, infrastructure issues and the need to have this arena operate with its 130 events and 180 plus days that Kobey’s Swap Meet Operates each year.  Building on the same location with a similar or smaller building would be way down the priority list for us in the end.  You would be better off putting in the money improving the existing building like we have with the new scoreboard, sound system, LED lighting, and every other aspect of the fan’s experience which we have addressed over the last 10 years specifically.

The San Diego Seals of the National Lacrosse League start this November and I know they are excited about a long term relationship with this building and success

There are also a number of bigger land leases that still have a number of years remaining in their term.  We expect to be one of these leases after we get our extension done with the city.  We have shows that book 2-4 years out that need this extension today and the Gulls who lead the AHL in attendance with over 350,000 fans annually are in the third year of their 5 year term so an extension is important to them as well.

The San Diego Seals of the National Lacrosse League start this November and I know they are excited about a long term relationship with this building and success.

Could a non-contiguous expansion of the convention center be tied to a new arena downtown?

Certainly there are powerful interests in town with deep pockets that might be interested in that opportunity. Some of those interests were outlined in a recent column in the Union-Tribune.  To the extent that there becomes an opportunity downtown, our group would be very interested in those discussions over time.

We still feel that downtown is the best area for a new arena and that a new building should be in size and scope to have the ability to handle the current tenants and also either NBA or NHL
Ernie Hahn, GM Valley View Casino Center Arena

Downtown is the area that our group (Arena Group 2000) got very close to getting an arena built in the early 1990’s.  We still feel that downtown is the best area for a new arena and that a new building should be in size and scope to have the ability to handle the current tenants and also either NBA or NHL.

Photo Courtesy: Sam Hodgson

We have always felt that the new arena would be like the 3rd phase of the convention center with all of the convention business that it could handle in addition to new building that would do 180-210 events annually.

The firm Competitive Edge is conducting a new poll regarding the viability of the Sports Arena location, have you heard of or taken part in this?

I have seen the first poll call and heard about the second one that is coming.  We are not involved with this polling and are more concerned with what can happen here and now vs. what may be the case over the next 15 years.

We are not involved with this polling and are more concerned with what can happen here and now vs. what may be the case over the next 15 years.

Right now our plans are to extend on the current lease which has this building in place until a new one can be built in a location that maximizes all conditions.  We have the only arena ice sheet for professional hockey, represent 130 annual events and over 350 businesses that call our leased land home with Kobey’s swap Meet for the last 38 years.

My job is to make sure that we bring the biggest and best events to San Diego and with a lease extension we can continue to bring shows like Andrea Bocelli, Disney on Ice, Cirque De Solei, Lakers Preseason NBA exhibition games and the other 30 annual concerts and events that make us San Diego’s Place for Entertainment.