With an arena planned in Henrico, what’s next for the Coliseum?

After a brief run last year as a post-apocalyptic set in a zombie TV franchise, the Richmond Coliseum has become a go-to spot for homeless encampments.

It has sat dormant for most of the last two years, a casualty of the failed Navy Hill proposal.

But last week’s announcement about an arena-anchored development in the works in Henrico puts the future of the Coliseum land in a new light.

If the $2.3 billion GreenCity proposal and its 17,000-seat arena on the former Best Products site get a green light, city administrators said last week that, in such a scenario, they would not fight to keep a regional arena in Richmond. That would leave one less option for invigorating development of that part of downtown.

“We do not believe the region has the capacity to support two 17,000-seat arenas within 15 miles of each other, and should the GreenCity development win approval, we do not think it would make sense to pursue a similarly-anchored development within city limits,” administration spokesman Jim Nolan said in an email.

“That being said, if the Henrico arena development is approved, then this provides a great opportunity to rethink our options to redevelop the Coliseum area,” Nolan said. “Leaving this underperforming downtown acreage undeveloped does not serve our long-term economic interests to generate revenue to fund priorities for our children and families, which is why, as the mayor says, we will boldly pursue opportunities to transform this valuable city-owned real estate.”

John Gerner, a leisure industry consultant who vice-chaired the City Council-appointed Navy Hill Development Advisory Commission, said the prospect of a downtown without an arena could prove to help the city in terms of determining how the land should be developed.

“In some ways, the situation in Henrico makes it even clearer,” Gerner said, “because if the Henrico announcement had not happened, we would still be under the possibility that there could be what had been talked about as ‘Navy Hill 2.0,’ in which the developers would come back with some variation of the original plan that would still have a new arena.”

The Navy Hill plan — designed by the same development team that’s behind GreenCity — was rejected in February by the City Council.

“With them clearly moving their arena project over to Henrico County, that in some ways actually makes things both clearer and simpler for the former Navy Hill parcels, because now they can move forward without the arena aspect,” Gerner said. “And since that was the sticking point, because of the bonds that would have needed to be issued to support the arena … once you take that away, it simply now becomes a much more conventional use of those parcels.”

Coliseum still costing the city

The aging half-century-old Coliseum has essentially been in zombie status for the past two years, ever since the city closed its doors at the start of 2019 while Navy Hill was under consideration. At the time, city administrators said the closure would reduce an operating deficit that, with fewer events being booked at the Coliseum, was costing the city $1.5 million annually.

While that deficit is now significantly reduced, the Coliseum is still an expense for the city — costing about $250,000 annually. Nolan said those costs include about $150,000 for utilities and $100,000 for other expenses, including armed security.

The city also is still paying down remaining outstanding debt on the Coliseum, with six payments left to be made through 2023. Principal and interest payments over that time are budgeted to total more than $1.5 million, according to the city.

City Councilmember Kristen Larson, who was among a majority of councilmembers who voted down the Navy Hill plan in February, said the Coliseum’s costs need to be addressed.

“We need to look at getting that off our books,” Larson said. “Any sort of vacant space that we have that is sucking money out of the general fund coffers, we need to look at what we can do to move that off our books in a fiscally smart way.”

Part of this year’s operating costs went toward erecting new fencing at the below-grade Leigh Street entrance, which had attracted homeless encampments. Other encampments have been regularly popping up under the entrance awnings around the Coliseum’s perimeter, despite “No trespassing” signs the city posted on the doors prohibiting camping on the property.

The signs include phone numbers for support agency Homeward and other area homeless services. The city also is looking to identify a location for a new inclement weather shelter in light of the previous homeless shelter’s closure due to COVID-19. A resolution to that effect, co-patroned by Larson and Kim Gray, is headed to the council next week.

Plan in the works

Since Navy Hill, city officials have been working toward achieving benchmarks laid out in a council resolution, including development of a Coliseum-specific small area plan with community input, and appraisals of the properties involved that have since been conducted.

The requested small area plan has been in the works in conjunction with the Richmond 300 master plan update, which the council is scheduled to vote on at its Dec. 14 meeting. Nolan, the city spokesman, said the Coliseum plan would be completed after the holidays, with potential adoption next spring as an amendment to Richmond 300.

Additional community meetings to solicit input on the plan are to be held by then, adding to two virtual meetings that were held over the summer and provided indications of public preference for the area.

The so-called Coliseum Area Framework Plan, which would inform a formal request for proposals, is shaped around the concept of a “mixed-use destination” that would add to the city’s tax base and include regional attractions. Baseline elements in the plan include public open space, including green space that would form an area park.

A survey conducted in June found that responses from 879 respondents were generally supportive of such uses as dining, a city market, shopping and a cinema.

About 15 percent said they hated the idea of a sports arena there, while 45 percent said they hated the idea of a casino — another economic development opportunity that the city is currently mulling.

The survey also found support for a proposed redevelopment of the city’s Public Safety Building, which was among the properties involved in Navy Hill. A newer, separate proposal for that building, by the same team behind Navy Hill and GreenCity, calls for a mixed-use development with a 20-story, VCU-anchored tower.

Gerner said the revival of that portion of Navy Hill bodes well for the other properties, including the prospect of a much-discussed hotel to complement the Greater Richmond Convention Center.

“That shows by itself that at least parts of the original Navy Hill plan can still continue to happen,” Gerner said. “It was not my understanding that a convention center hotel was undoable unless there was an arena, so that’s still, as far as I know, a possibility — once, of course, we get back to a situation where the city is generating a significant number of conventions.”

Demolition a costly option

Beyond addressing homeless encampments at the Coliseum and in adjacent Festival Park, some councilmembers say the structure is an eyesore and potential liability that needs to be addressed.

“We need an update on the status and the condition of the existing Coliseum,” Gray said. “It’s definitely a blight. It’s definitely a concern.”

The Navy Hill plan called for demolishing the 13,500-seat Coliseum and replacing it with a 17,500-seat arena. Demolition remains an option for clearing the way for new development, though some developers including Douglas Development have proposed that the Coliseum could be rehabbed and incorporated into a new development.

Michael Hallmark, the principal with Richmond-based Future Cities who with developer Susan Eastridge designed Navy Hill and is proposing GreenCity and the VCU-anchored tower on the Public Safety Building site, said city estimates at the time that Navy Hill was being considered put the cost of demolition between $8 million and $12 million. He said Navy Hill was structured to absorb that cost as part of the larger, arena-driven development.

“We believe the arena was necessary to get the kind of privately funded infrastructure development done to attract enough use for a convention center hotel and those kinds of uses,” Hallmark said. “Those things generally are underwritten by cities, convention center hotels especially.”

He added, “I presume there will be more traditional uses envisioned there in the future. Certainly getting more residential downtown will be important, and perhaps some discreet office uses.”

While the VCU tower would essentially salvage the Public Safety Building portion of Navy Hill, Hallmark said he and Eastridge are not looking to develop any of the other parcels.

“Our focus in downtown is 100 percent on the Public Safety Building. It’s an important project to get done, and we’re laser-focused on trying to advance that as fast we can. There’s a lot of noble organizations, like Ronald McDonald House and Doorways, that are desperate to be in these new facilities, so we don’t want any distractions from that at all.”

With Hallmark and Eastridge’s focus also on GreenCity and the $250 million arena that would anchor it, Richmond’s planning efforts for downtown can move forward without the weight of a regional arena being involved, Gerner said.

“Because of the move to Henrico, this now makes the Coliseum a situation where the city can now decide that it is no longer expected to be the host of a regional arena,” he said. “Without that understanding with the surrounding counties, which it has had for decades, the city is now free to look at what is the highest and best use of those parcels for the city.”

Despite the pandemic’s impacts on arenas worldwide and the hospitality and leisure industry in general, Gerner said the conditions are an opportune time for Richmond to set the stage for what’s next for the Coliseum area.

“This really is the best time to be doing planning for the next stage, because it takes time to do that planning and to get things into place, and there are benefits to being ready-to-go, shovel-ready, once we are clearly in a post-COVID world again,” he said. “In some ways, that’s the optimum time to be doing projects of all kinds, because there’s going to be pent-up demand.”