Northern Virginia

Washington Wizards, Capitals make deal to stay in DC after Virginia plan is scrapped

Monumental Sports and Entertainment — the company that owns both the Washington Capitals and the Wizards — and DC Mayor Muriel Bowser have inked a deal to keep the teams in DC

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It seemed like a done deal in Virginia — until it wasn't.

The Washington Capitals and Wizards have called off their move to Northern Virginia, a stunning reversal in what has been a tumultuous three months filled with bitter battles between community members, a billionaire and political leaders.

Officials in Alexandria announced they ended negotiations on a $2 billion sports and entertainment complex that was intended to house the Capitals and Wizards, and Virginia Gov. Glenn Youngkin blamed "personal and political agendas" for driving the teams away.

Hours later, a jubilant D.C. Mayor Muriel Bowser announced she has signed a deal with the teams' majority owner, Ted Leonsis, to keep the Caps and Wizards in the District "at least until 2050."

"As Ted likes to say, we're going to be together for a long time," Bowser said.

The Monumental move that would have taken the Wizards and Caps to Virginia is no more. The City of Alexandria said they are ending negotiations. News4's Ted Oberg reports.

'DC is home': $515M deal keeps the teams at Capital One Arena

"Several months ago, we came together as a city, and we said, 'We're going to fight for our teams,'" Bowser said during a news conference at Capital One Arena Wednesday evening.

Bowser said the city will keep its commitment to invest $500 million for a "total transformation" of the arena and downtown. The District will also provide an additional $15 million for Monumental Sports and Entertainment to expand its footprint downtown, Bowser said.

"We are the current home, and the future home, of the Washington Capitals and the Washington Wizards," she said.

Monumental Sports also will receive access to 200,000 square feet of space at the Gallery Place building adjacent to the arena.

The District will also contribute to improvements in transportation, security and other infrastructure around Capital One Arena, including a dedicated ride share and drop-off zone for events, the ability to close off F Street NW two hours before games, and restrictions on vending, loitering and noise around the arena.

"This was not only the right thing for the community, the right thing for the city, the right thing for us; it's a really smart business deal," Leonsis said.

He also said he's eager to recruit more companies to "come back" to the District.

Monumental Sports and Entertainment — the company that owns both the Washington Capitals and the Wizards — and DC Mayor Muriel Bowser have inked a deal to keep the teams in D.C.

But an angry Gov. Glenn Youngkin released a statement saying Virginians deserve better.

"This transformational project would have driven investment to every corner of the Commonwealth. This should have been our deal and our opportunity, all the General Assembly had to do was say: ‘thank you, Monumental, for wanting to come to Virginia and create $12 billion of economic investment, let’s work it out.’ But no, personal and political agendas drove away a deal with no upfront general fund money and no tax increases, that created tens of thousands of new jobs and billions in revenue for Virginia," Youngkin said in part.

Youngkin had said it would be the single largest economic development deal in Virginia's history.

Under the proposed move to Alexandria, taxpayers in Virginia would have backed $1.5 billion in bonds to build the sports and entertainment complex. Leonsis would have put in $400 million in cash and paid rent on the Virginia facilities for years.

Virginia state Sen. Louise Lucas, D-18th District, had staunchly opposed the arena plan.

She commented Wednesday: "As Monumental announces today they are staying in Washington DC we are celebrating in Virginia that we avoided the Monumental Disaster!  Thank you to everyone who stood with us in this fight!"

The Capitals and Wizards have played at their downtown D.C. arena for more than two decades. Leonsis had expressed dissatisfaction with the aging arena and the terms of his ground lease. While Monumental owns the arena itself, the District owns the land on which it sits.

Just days ago, D.C. Attorney General Brian Schwalb told Monumental that the Wizards and Capitals were obligated to remain at Capital One Arena through the end of their lease in 2047.

Lawyers with Monumental disputed that position. But, on Wednesday evening, Leonsis said, "D.C. is home."

"The mayor told me — when I said that we'd probably be leaving — she said, 'No, you won't!'" he recalled with a chuckle.

Leonsis praised Bowser, calling her a smart businessperson.

"This is really the mayor's day, and I mean that sincerely," he said. "Because she could have just stopped talking to me, and I would have stopped talking to her. And she did the right thing, as a businessperson, and while this is important for the city and the community, we are a really good business. We are a profitable business for the city."

Courting Monumental: Dueling multimillion-dollar bids came from Virginia, DC

The change comes just three months after Virginia officials and Leonsis' Monumental Sports and Entertainment had announced their plans for a $2 billion sports complex in Alexandria. The plan would have included an arena for both teams, a performing arts venue, and new retail, residential and office space, the officials said when they announced the proposed deal in December.

At the time, they said the development would transform Alexandria's rapidly developing Potomac Yard neighborhood.

But it was also poised to send shockwaves through downtown D.C., which has been accustomed to the economic rewards of hosting tens of thousands of Caps and Wizards fans but struggled with increased crime.

In the meantime, plenty of questions remained, including about Northern Virginia traffic, the future of downtown D.C.'s Capital One Arena — and exactly who would pay for the Alexandria development.

The announcement of a tentative deal in December 2023 to send two of D.C.'s marquee sports teams across the Potomac River to Virginia caught most DMV residents by surprise. And it came during a week of whiplash, as D.C. and Virginia lawmakers proposed dueling multimillion-dollar bids to either transform the teams' existing arena in the District or spur the move across the river. But then, Leonsis and Youngkin made a surprise announcement that it was all but a done deal.

And then, it wasn't.

Monumental dispute: Virginia lawmakers, DC attorney general sought to halt move

Opposition came from both sides of the river.

It arrived almost immediately — both from D.C. officials seeking to keep the teams in a downtown that's struggled with crime, and from Alexandria residents and small business owners who opposed turning their quiet enclave into a sports and entertainment destination.

Northern Virginia residents expressed major concerns about traffic, and Metro said that it wouldn't be able to handle arena crowds at its Potomac Yard station, which opened just months before the announcement of the arena plans. Metro’s general manager even stated that the transit authority wasn’t even asked about the proposed development. A consultant to the project found that the station would see extreme crowding and waits of 60-90 minutes after events if no significant improvements to the station were made.

But it was Virginia Democrats who put the brakes on the development plan touted by Republican Gov. Youngkin. They stripped funding for the complex from the state budget last month.

Sen. Lucas, the Virginia Senate's finance and appropriations chair, had staunchly opposed the move, calling it a waste of taxpayer dollars.

State Sen. President pro tempore Louise Lucas is blocking Gov. Glenn Youngkin's efforts to bring the Washington Capitals and Wizards to Virginia. Youngkin would not name Lucas but called the block a "monumental mistake." News4's Drew Wilder reports.

Then she started trolling Youngkin and Leonsis for trying to fast track the development. Lucas posted a meme edited to depict herself flashing a peace-out sign over a grave with the caption "Youngkin and Leonsis' $5 billion arena" on X, formerly known as Twitter.

Then, just days ago, D.C. Attorney General Brian Schwalb told Monumental that the Wizards and Capitals were obligated to remain at Capital One Arena through the end of their lease in 2047.

"The District very much prefers not to pursue any potential claims against MSE," Schwalb wrote to Monumental general counsel. "It remains committed to maintaining and growing its partnership with MSE and to keeping the Wizards and Capitals at the Arena until the end of the existing lease term in 2047, if not beyond. It is in that spirit that the District urges MSE to re-engage with District officials around a mutually beneficial arrangement that advances the long term interests of both the District and MSE."

Leonsis has said he believed Monumental would be able get out of their lease in 2027 if his company paid off a $36 million bond on the lease.

Late on Wednesday, Schwalb released a statement saying in part, "District residents could not have been louder or clearer in expressing their desire for the teams to stay in DC, and as the District’s chief legal officer, I will always have Washingtonians’ backs and use every legal tool available to defend District resident’s interests."

Schwalb said he was "delighted for the District," both as a lifelong D.C. sports fan and as its attorney general.

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