BREAKING: Washington Capitals and Wizards are officially moving to Potomac Yard

Updated 3/27/2024 — The Washington Capitals and Washington Wizards are not, in fact, coming to Potomac Yard

It’s official: the Washington Capitals and the Washington Wizards are moving to Alexandria’s Potomac Yard neighborhood.

The Alexandria Economic Development Partnership (AEDP) confirmed the news this morning ahead of a 9 a.m. announcement from Virginia Gov. Glenn Youngkin and the team’s owner, Monumental Sports & Entertainment Chairman and CEO Ted Leonsis.

Washington Post first reported the development on Monday. The Post said that Virginia’s Major Economic Investment Project Approval Commission unanimously voted to approve a complex that was tantamount to a mini-city, with a music venue and hotel in addition to the sports center.

The project will be adjacent to the Virginia Tech Innovation Campus in the Alexandria portion of National Landing — the collective term for Potomac Yard, Crystal City and Pentagon City.

“After many years of dreaming, many years of discussion, I’m pleased to announce that right here, in Alexandria’s Potomac Yard, we have a plan to unleash a brighter, more extraordinary future,” said Youngkin. “We will build a spectacular $2 billion dollar sports and entertainment district.”

Leonsis said the move to Virginia is a “transformative step forward.”

“I have always believed there is a higher calling in sports — to unify our community, build a lasting legacy over multiple generations, and lift all our neighbors towards a shared sense of prosperity,” Leonsis said. “Today, we deepen that commitment as we enter a phase of rapid expansion in service to our fans, employees, and partners.”

Leonsis said starting a new stadium with a sense of tabula rasa was a big part of Potomac Yard’s appeal.

“When I saw 70 acres and the ability to start with a clean slate… to build a digital first experience, it really is a very romantic but also pragmatic vision that we can’t do anywhere else,” Leonsis said. “I got goosebumps again when I came here a week ago and looked at all of the expansion capabilities.”

As part of the deal, the construction and ownership of the arena would be overseen by a new Virginia stadium authority, and the arena would be leased to Monumental.

“Subject to legislative approval by the Virginia General Assembly, the Entertainment District will break ground in 2025 and open in late 2028,” said a press release from the governor’s office.

This morning’s announcement is being made in a large makeshift tent next door to the Potomac Yard Metro station and near the under-construction Virginia Tech campus.

“Pending completion of agreements and General Assembly and City Council approval, the new Entertainment District will feature an industry-leading arena for both the Washington Capitals and Washington Wizards, the global business headquarters for Monumental Sports & Entertainment, an expanded esports facility, and a performing arts venue — in addition to new retail, restaurants, and conference and community gathering spaces,” AEDP said.

A map of the planned Monumental development, directly adjacent to the Metro station, also includes a fan plaza, a practice facility for the Capitals and Wizards, and a TV studio for the Monumental Sports Network — formerly NBC Sports Washington. The map also notes the future development of the current Potomac Yard shopping center.

AEDP said the development will still need to go through a community engagement process, with community meetings and workshops, which it said will kick off in early 2024.

In the release, Alexandria Mayor Justin Wilson called the move a direct result of the work on the Potomac Yard Metro station.

“Alexandria’s ability to attract this ambitious project is a direct result of the success of previous investments made in Potomac Yard and across our City,” said Wilson. “A project this special will help the City realize our collective strategy and the vibrant vision for this neighborhood and for our City as a whole.”

The move comes with a $2 billion investment into the new entertainment district. AEDP said the new arena is estimated to generate 30,000 jobs and a total economic impact of $12 billion over the next few decades.

“This includes millions of dollars over the project term to create affordable housing, offer rental and homeownership assistance, and to invest in transportation improvements and education,” AEDP said.

“This exciting new project is the result of decades of thoughtful long-term strategic planning and a clear vision for growth across Alexandria,” said AEDP President and CEO Stephanie Landrum. “From the Virginia Tech Innovation Campus to the new Potomac Yard-VT Metro Station, Alexandria has created the ideal environment and location for this exciting project.”

Battles ahead in the arena

With large-scale development in Alexandria, though, comes arguments around density and traffic impacts. Some Alexandria residents already aren’t happy with the move, which comes 30 years after Alexandria leaders rebuffed a proposed football stadium for the Washington Redskins (now the Commanders).

“Imagine typical rush hour traffic on the George Washington Parkway and Route 1 and then throw in a playoff hockey game at 7 p.m.,” said Mark Haney, a local resident. “Madness.”

Fresh off a fight over single-family-only zoning, Roy Byrd, Chair of the Coalition for a Livable Alexandria, told WJLA there was real concern about gridlock and traffic along Route 1 that would be exacerbated with the new arena.

I do NOT want this increase in traffic if they decide to build the arena here, omg. This is my literal back yard 😩😩😩 https://t.co/Se7FDcsinu

— An (@annleeee) December 13, 2023

At the meeting, Youngkin’s speech was accompanied by a chorus of boos and jeers from outside of the tent.

“We want you here,” said Wilson.

“We don’t want you here,” someone outside of the tent shouted.

Some protestors gathered outside of the tent.

“There’s been no plans presented to the public,” said one Potomac Yard resident protesting the move. “What about the environmental impact? There are wetlands here. We found out about this plan this week. Where’s the transparency?”

One of the only acknowledgements of the battles ahead came from Senator Mark Warner.

“Our job is to make sure neighborhoods adjacent, here in Potomac Yard and in Del Ray, feel engaged and know their quality of life will be protected and, at the end of the day, their quality of life will be improved,” said Warner. “We’re going to need to be missionaries out in to the community to hear concerns, legitimate and otherwise.”

City Council members said after the announcement that transportation planning would be a major focus of the public planning process following the announcement.

“This is not a done deal yet,” said City Council member Kirk McPike. “There is a lot of negotiation and a lot of discussion, both between the people on the stage but also between Alexandria and our residents. Traffic conditions are going to be a major concern.”

McPike said the city will try to incentivize Metro use over driving, but there will also be improvements to the nearby roads to accommodate drivers.

“We will address transportation issues, a lot of our investments locally will be about improving the roadways and improving the flow of traffic, which we’ll have to do anyway as this area develops out.”

City Council member Sarah Bagley said the project will still need to have a public development special use permit process.

“[This project] is going to go through a similar public process, though the Planning Commission and public hearings,” said Bagley. “The public will have ample opportunities to weigh in with questions about transportation, about housing, about environmental impacts: all the normal SUP and DSUP processes.”

“Nothing here is finalized,” said City Council member Alyia Gaskins. “What we’ve presented is a framework and a concept, now begins the work to engage with our community to figure out what we need to protect against, what are the benefits people want to see, and what is the vision that the community wants integrated into this process.”

City Manager James Parajon said the city will continue to work on transportation planning.

“We have a pretty good game plan for how to manage the traffic and the amazing visitors and residents who will take part,” Parajon said. “It involves several hundred million dollars in improvements we’ll be working with the state on.”

Parajon said Potomac Yard was ideal because it featured multiple routes to get to the station: via driving, bus rapid transit, Metro and bicycle. At the end of the day, though, Parajon said the area was always going to see an uptick in traffic with new development.

“This has always been planned to be a fairly intensive and significant area for activity, which means there is going to be vehicular traffic in this area,” Parajon said. “But this site has been designed to offer maximum choice for people to get to and from the area.”

Parajon also said, like McPike, that the new arena was far from a done deal — though with the presence of every City Council member at the announcement, a future rejection of the arena development seems unlikely.

“What’s occurred is the development of a proposed framework that still requires multiple improvements, multiple approvals, by the legislature and by the city,” Parajon said. “It will be a robust and very involved public engagement process.”

Local residents outside the building had little faith in the city’s promises to address their concerns.

“We will tie this up in litigation,” said Adrien Lopez. “If this is being shoved down our throat without public consultation, we’re going to have to lawyer up and tie this up in litigation if they’re talking about bringing it here by 2028. That’s crazy.”

“Leonsis is worth billions of dollars and could finance his own stadium if he wanted to,” said Patrick Hedger. “If it’s such a great deal, taxpayers shouldn’t be asked to pay for it.”

Upon being told the new sports arena was going to be build next-door, a barista at a nearby Starbucks shook her head and muttered, “oh god.”

The broader impact

The topic came up at a meeting of the Local Emergency Planning Committee, on which ALXnow editor Vernon Miles serves. In the meeting, committee members said the arena could serve as both a hub and hurdle for emergency planning.

“In theory, it does offer a facility for such things as large mass care and large reception centers,” said Red Cross representative Paul Carden said. “At the last inauguration, the convention center in downtown D.C. brought together a medical team to set up 20,000 cots. It was a place to send large numbers of people that might need care.”

Others noted that the facility must be factored into the city’s emergency planning.

“It does add a [chemical, biological, radiological and nuclear] element to the city,” said Jerome Cordis from the city’s Public Health Advisory Commission.”How they staff up and what types of threats are things to be considered.”

While the discussion of the merits and costs of a new arena in Potomac Yard are just starting to be discussed among the Alexandria public, D.C. residents have already begun lamenting the loss of the teams — though Washington Wizards fans at least should be used to that.

Goodbye Caps & Wizards. Deal with Virginia being announced tomorrow morning at Potomac Yards (where celebratory announcement tents are being prepared now). A significant blow to DC and its ailing downtown. Sad part is, it could have been avoided if city had acted.

— Tom Sherwood (@tomsherwood) December 12, 2023

I have to see it to believe it. Capital One Arena being an empty spot in Chinatown/Penn Quarter would be devastating to Washington, DC. The #Wizards and #Caps moving to Virginia would be a disaster. #NHL #NBA https://t.co/WkToq27bdB

— Faisal Hassan (@Faazzla) December 11, 2023

What this means for Potomac Yard

Terry Clower, professor of public policy in the Schar School of Policy and Government at George Mason University, said the proposed development is a game changer for the city’s Potomac Yard plans.

“Certainly, it is potentially a real changer for the visioning for what they were going to do in Potomac Yard,” Clower told ALXnow. “It is a spectacular amenity for the city of Alexandria and for folks that live nearby who happen to be basketball or hockey fans, or fans of concerts in the venue”

Clower said it remains to be seen whether the new development will bring new economic investment to the region or just cannibalize development from the Gallery Place area.

The impact to watch, Clower said, will also be on how the Monumental Arena affects the plans for Potomac Yard to be a technology hub.

“The interesting piece is — this might change, in some ways not necessarily good or bad — what was originally envisioned for development there,” Clower said. “Now you’re talking about a distinct shift into more entertainment, as opposed to technology businesses and residences.”

Clower also said protests from nearby residents aren’t particularly surprising, but that doesn’t mean they aren’t raising legitimate issues.

“One thing we have in this region whether we’re talking about data centers and arenas, you will definitely have folks who will bet in that ‘not in my backyard’ category,” Clower said. “But there are legitimate concerns. Traffic is not easy even today.”

Lastly, Clower said there’s little hope for a change to the Alexandria Wizards and the Alexandria Capitals.

“I don’t think there will be a name change,” Clower said. “This is not like moving them to some outer ring suburb, this is very much the team identity. It still remains a regional asset, in large part because they’re doing it at what amounts to an inner ring suburb Metro.”

The press release from the governor’s office is below.

Governor Glenn Youngkin today announced a $2 billion public-private partnership to create a world-class Entertainment District in the City of Alexandria at Potomac Yard. This new 9 million-square-foot district developed by JBG SMITH will feature the global corporate headquarters for Monumental Sports & Entertainment (MSE), an industry-leading Arena for both the Washington Capitals and Washington Wizards, a state-of-the-art Monumental Sports Network media studio, the Wizards practice facility, a performing arts venue, and an expanded esports facility, in addition to bringing new retail, residential, restaurants, hotels, conference, and community gathering spaces.

The project, a partnership among the Commonwealth of Virginia, Monumental Sports & Entertainment, the City of Alexandria, and JBG SMITH, will bring more than 650 relocated MSE headquarters positions to Potomac Yard. The Arena, Phase 1, and future phases of development are estimated to generate a combined $12 billion in economic impact for the Commonwealth and City of Alexandria and create approximately 30,000 jobs over the next several decades. Subject to legislative approval by the Virginia General Assembly, the Entertainment District will break ground in 2025 and open in late 2028.

“This is the most visionary sports and entertainment development in the world, bringing together entertainment, sports, and technology in the most advanced innovation corridor in the United States: a once-in-a-generation and historic development for the Commonwealth, sports fans, and all Virginians. The Commonwealth will now be home to two professional sports teams, a new corporate headquarters, and over 30,000 new jobs – this is monumental,” said Governor Glenn Youngkin. “This was only made possible through consistent collaboration between Virginia’s economic development team, the Monumental Sports & Entertainment team, the City of Alexandria, our administration and the Virginia General Assembly’s Major Employment and Investment Project Approval Commission, and JGB SMITH. Virginia is undoubtedly the best place to live, work, raise a family, and now watch basketball or hockey.”

“Ensuring a stable financing structure was the Commonwealth’s top priority, and we are confident this transformational project is a win-win for Virginia, the City of Alexandria, and Monumental Sports & Entertainment,” said Secretary of Finance Stephen Cummings. “All project investments backed by the Commonwealth and the City will be paid back in full by incremental project revenues; there is no upfront investment by the Commonwealth and no existing taxes or tax increases are a part of this financing plan. This tremendous opportunity will drive billions in total economic impact over 40 years.”

“The Commonwealth of Virginia is truly a catalyst for innovation, and this transformational project represents a unique opportunity for the region’s premier sports and entertainment company to forge meaningful connections with Virginia Tech, and other corporate partners in the region, including Amazon, Boeing, and Raytheon. This district will generate tens of thousands of jobs and billions of dollars in economic impact, creating a prime regional destination,” said Secretary of Commerce and Trade Caren Merrick. “It is an honor to partner with Monumental Sports & Entertainment, VEDP, the City of Alexandria, and JBG SMITH on this historic win for Virginia.”

“Investments in the Commonwealth’s transportation infrastructure, including the Potomac Yard-VT Metro Station, enable developments like this to become powerful regional economic drivers. Today’s announcement underscores the importance of strengthening our multimodal transportation network, and it is exciting to see this world-class Entertainment District come to fruition,” said Secretary of Transportation W. Sheppard Miller III. “We look forward to working with Monumental Sports & Entertainment and the City of Alexandria, as well as the regional business community, to ensure future investments in the National Landing corridor support the safe and reliable movement of automotive, pedestrian, and transit users to and from this cutting-edge District.”

“We are committed to providing world-class fan experiences while continuously evolving our teams, deepening community ties, and solidifying our role as leaders at the forefront of sports and technology,” said Monumental Sports & Entertainment CEO Ted Leonsis. “The opportunity to expand to this 70-acre site in Virginia, neighboring industry-leading innovators, and a great academic partner, would enable us to further our creativity and achieve next-generation, leading work – all while keeping our fans and the community at the forefront of everything we do.”

“Alexandria’s ability to attract this ambitious project is a direct result of the success of previous investments made in Potomac Yard and across our city,” said Alexandria Mayor Justin Wilson. “It is our collective strategy and vision for purposeful economic growth that will ensure Alexandria remains a vibrant, accessible, and inclusive community for all.”

“Monumental Sports’ major commitment to National Landing marks another milestone in its evolution into a model, 21st-century urban destination in Northern Virginia and will serve as a powerful catalyst for growth and opportunity in the neighborhood,” said Matt Kelly, Chief Executive Officer at JBG SMITH. “We are grateful for Governor Youngkin’s leadership and look forward to partnering with his administration, the City of Alexandria, Virginia Tech, and Monumental Sports in cultivating a dynamic district anchored by world leaders in commerce, sports, entertainment, and higher education.”

Located on the Potomac River just across from Washington, D.C., the Entertainment District is easily accessible by all modes of transportation and is minutes from the newly opened Potomac Yard-VT Metro Station, Ronald Reagan National Airport, community bike paths and foot trails, and underground parking. Joining National Landing as part of Potomac Yard, the Entertainment District will be adjacent to the Virginia Tech Innovation Campus and near Amazon HQ2, creating opportunities for unique partnerships between MSE and Virginia Tech focused on entrepreneurship, sports analytics, immersive technologies, and innovative new business and media strategies.

“We’re excited by Monumental Sports & Entertainment’s plans to be our neighbor in Potomac Yard,” said Virginia Tech President, Tim Sands. “We believe in the great potential of this location, and are eager to welcome others who are passionate about this community and building an exciting and vibrant future together.”

“Securing this public-private partnership is truly a game changer for the City of Alexandria, the region, and the Commonwealth, benefiting a generation of Virginians and putting Potomac Yard on the map as a regional sports, entertainment, and innovation destination,” said Major Employment and Investment Project Approval Commission Chair Delegate Barry Knight. “The thousands of jobs and economic impact generated by this project cannot be overstated, and I am proud the MEI Commission could play a role.”

“Thanks to everyone who played a role in this historic project for the City of Alexandria and the Commonwealth,” said Major Employment and Investment Project Approval Commission Vice Chair Senator George Barker.“Accelerating economic development in Virginia is a top priority, and the Entertainment District will have a ripple effect on the economy and catalyze additional investments for decades to come. I am pleased the MEI Commission could be part of the collaboration to help secure this critical project.”

Monumental Sports & Entertainment is one of America’s leading sports and entertainment companies. Its people, players, teams, and events bring excitement and joy to millions. The company invests and innovates to consistently raise the game so they can deliver extraordinary experiences that will inspire and unite their community, fans, and partners.

The Youngkin Administration and Virginia Economic Development Partnership worked with the City of Alexandria, JBG SMITH, and the General Assembly’s Major Employment and Investment (MEI) Project Approval Commission to secure the project for Virginia.

In the upcoming General Assembly session, legislators will be asked to approve the creation of a new Virginia Sports and Entertainment Authority. The $2 billion transformational investment will be supported through bonds issued by the to-be-created Authority, as well as a $403 million investment by MSE. The bonds will be repaid through annual rent paid by MSE, arena parking revenues, District naming rights, and incremental taxes generated by the Arena and Phase 1 development. There is no upfront investment or inclusion of any taxes already being collected by the Commonwealth to repay the bonds and there will be no tax increases for local residents. The City of Alexandria will also contribute $56 million toward the construction of the performing arts venue in partnership with MSE, and $50 million toward underground parking development. The land and buildings will be owned by the to-be-created Virginia Sports and Entertainment Authority. The Virginia Sports and Entertainment Authority will enter into a 40-year lease with the company.

The project includes $110 million in on-site infrastructure including site development and roadway, signal, and intersection improvements funded through the bonds. VDOT, Alexandria DOT, MSE, JBG SMITH, and transportation consultants continue to refine a detailed analysis of the National Landing corridor needs, with input from regional partners, the business community, and residents to ensure a safe, reliable, and successful Entertainment District. Potential transportation improvements will focus on transit, roadway, smart mobility, and neighborhood protection.

This public-private partnership is subject to legislative approval by the Virginia General Assembly and the City of Alexandria.

Vernon Miles and James Cullum contributed to this story