In October, the New Orleans Pelicans traveled to Alabama for their final preseason game.
The Pelicans faced the Atlanta Hawks inside Legacy Arena, the Birmingham venue that underwent a $125 million renovation before the Pelicans’ G League affiliate, the Squadron, relocated there in 2021.
The event was a success. The sellout crowd got to watch Brandon Ingram breeze to 19 points in 20 minutes. The Pelicans won.
Members of the Pelicans organization were impressed by the Squadron’s sparkling new home. Some players and staffers were so impressed, they remarked that it seemed to be a nicer venue than Smoothie King Center.
The Pelicans’ lease at Smoothie King Center expires June 30, 2024. There are no imminent plans to build a new arena, or to green-light a major renovation of a venue that some in the Pelicans organization said is inferior to the one their G League affiliate plays in.
The Pelicans plan to exercise an option in their lease agreement that will keep the team at Smoothie King Center for most, or all, of the rest of this decade.
“The intent is to exercise the option and shortly thereafter commission a study on Smoothie King Center’s short- and long-term viability with an eye to the future,” senior vice president Greg Bensel said.
The Pelicans said they frequently poll fans about their game-day experience at the 23-year-old arena. The data they've gathered indicates fans are happy with the arena.
The New Orleans Saints, who are also under Gayle Benson ownership, are in the midst of a $450 million renovation of the Caesars Superdome. State funds have covered the majority of the cost of that project. Benson has contributed $175 million toward it.
A little more than one year ago, Benson said she was focused on completing the renovation at the Caesars Superdome before devoting more attention toward the Pelicans' arena situation. The Caesars Superdome renovation could be finished by August 2024.
“You know, that's in the future, and we're trying to look for now,” Benson said at the NFL annual meeting in March 2022. “We're talking about it, but we've been talking about it. Hopefully, at the right time we'll make that decision.”
NBA commissioner Adam Silver, who in 2013 advocated for the Milwaukee Bucks to replace their aging arena, said he is supportive of the Pelicans' plan to commission a study on the short- and long-term viability of Smoothie King Center. Silver said “every NBA team, regardless of location and market size, needs a model, state-of-the-art arena to compete in the league.”
Smoothie King Center’s origins
The Pelicans’ home opened its doors in 1999. The venue then known as New Orleans Arena was built on spec with state funds in the hopes of allowing the city to attract a second pro sports team. That plan worked. The NBA approved the Hornets ownership group’s decision to relocate the team from Charlotte, North Carolina, and the Hornets played their first game in New Orleans in 2002.
In 2012, the Bensons bought the Hornets from the NBA for $338 million.
A $54 million renovation to Smoothie King Center was completed before the start of the 2014-15 season. It was entirely state-funded. The upgrades included adding a glass-enclosed entrance lobby; an exterior paint job; 16 new loge boxes in the lower bowl; the addition of a party perch in the upper bowl; and the construction of the 12,000-square-foot Chairman's Club.
The Pelicans said they contribute roughly $2 million a year toward upkeep of the arena, and that they have pumped in $5 million in upgrades to private spaces like locker rooms, weight rooms and the family room.
In December, Sportico estimated the Pelicans’ worth at $1.63 billion. If that figure is correct, that means the Pelicans have increased in value by roughly $1.3 billion in 11 years.
The Pelicans are one of two NBA franchises, along with the Charlotte Hornets, to have never paid the luxury tax, though indications are that Benson is open to footing a luxury-tax bill for a team that is capable of making a deep playoff run in the future.
Silver: Every market ‘needs a model, state-of-the-art arena’
In 2013, Silver traveled to Milwaukee to tour BMO Harris Bradley Center, the then-home of the Bucks. Silver concluded it was unfit for an NBA team.
“At the end of the day, compared to other modern arenas in the league, this arena is a few hundred thousand square feet too small,” said Silver, who took over as NBA commissioner in 2014. “It doesn’t have the sort of back-of-house space you need. Doesn’t have the kinds of amenities we need.
“It doesn’t have the right sort of upper bowl/lower bowl (seating) configuration for the teams, frankly, that Milwaukee wants to compete against.”
Two years later, Wisconsin legislators approved a plan to build a new downtown arena. The $524 million Fiserv Forum was built using a combination of private and public funds. Taxpayers contributed $250 million. The team’s incoming ownership group contributed $174 million. Former U.S. Sen. Herb Kohl, who owned the Bucks from 1985-2014, contributed $100 million.
Smoothie King Center's tiny lower bowl is one of its major issues. It has the fewest seats of any lower bowl in an NBA arena.
The Pelicans have said that a study on Smoothie King Center’s viability needs to be completed before the team determines whether a renovation of the building will be sufficient. ASM Global, which oversees lease negotiations with the Pelicans for the state's Louisiana Stadium and Exposition District (LSED), will be in charge of the process.
“That information will be very useful in helping determine what’s best for the team and community,” Silver said.
“The situations in New Orleans and Milwaukee are different, but ultimately every NBA team, regardless of location and market size, needs a model, state-of-the-art arena to compete in the league. The next step in New Orleans is a detailed study on the long-term viability of the Smoothie King Center.”