Islanders related “DGEIS” Lighthouse Summary

New York Islander Fan Central | 2/24/2009 04:47:00 PM |
This is kind of an Islanders only-overview of the Lighthouse project with a lot of numbers Forbes and other publications estimate or outright guess at.

I listed things in no specific order as I jumped around a lot in a summary that is well over a hundred pages with a lot of repeats.

It should be must reading for Islander fans who want details.

Existing Levels of Development and Activity:
Nassau Coliseum

Purpose, Needs and Benefits of the Proposed Action
The purpose of the proposed project is primarily to transform the Nassau Coliseum so
that both the New York Islanders and New York Dragons can remain, and can function in
a state-of-the-art venue that serves as a benefit to the Town, County and the region. In addition, this redeveloped facility will provide a quality venue for concerts and other events. The transformation of the Nassau Coliseum, including the Sport Complex and associated parking, is essential if the New York Islanders are to remain. This is demonstrated in the NorthMarq Study, which was commissioned by the applicant in order to determine what is needed to successfully transform the Coliseum to (a) help to ensure that the Islanders and Dragons will remain, and (b) potentially attract a professional basketball team. As demonstrated in the NorthMarq Study, arenas with characteristic similar to the existing Coliseum that do not have primary tenants are not viable.

According to the NorthMarq Study, development trends in the NHL indicate that 26 of 30 NHL franchises are tenants in new or re-developed arenas. Of the four remaining
franchises, the Pittsburgh Penguins and Rangers propose to have their
facilities renovated or reconstructed and the Edmonton Oilers were recently sold with the understanding that a new arena would be built. This will leave the Islanders as the only NHL franchise playing in an older venue.

Research by NorthMarq has demonstrated that older facilities, which lack modern
amenities such as multiple concourses and varied retail and food options, are often a
primary reason that major league sports franchises relocate to newer facilities. As a
result, the older facilities realize a steady decline in the revenue stream and are grossly underutilized. Without a primary tenant (i.e., an NHL or National Basketball Association [“NBA”] franchise), these facilities tend to deteriorate and are often demolished, resulting in eliminating a venue that has housed other important events to the community, such as concerts, ice shows, the circus, family shows and college fairs. Ultimately, the properties on which they are situated may be redeveloped for uses that may not offer the community the same opportunities for entertainment, education, cultural experiences, etc.

The continued relationship among the Islanders, the NHL and the Nassau Coliseum is
contingent upon the development of a state-of-the-art facility that can accommodate and address the needs of the team and its fans. The transformation of the Nassau Coliseum is essential if the Islanders are to remain, as the Coliseum will be facing increased competition for discretionary dollars within the region. Both Madison Square Garden and the proposed Barclays Center in Brooklyn are situated within 30 miles of the Nassau Coliseum. Madison Square Garden is scheduled for additional improvements and enhancements, and the proposed Barclays Center in Brooklyn would have a total square footage of 850,000 and a seating capacity of 18,000. For the Coliseum to maintain a successful partnership with the Islanders, and to be attractive to additional sports franchises and events in general, it must offer the overall square footage and amenities that patrons and franchises demand.

The Nassau Coliseum (located in the western portion of this parcel) is situated on 77± acres of County-owned land. It opened in 1972 and was renovated in the early-to-mid 1980s. It is home to the New York Islanders of the National Hockey League and the New York Dragons of the Arena Football League. Nassau Coliseum is also a major
concert venue and is the Long Island home to the Ringling Brothers Barnum and Bailey
Circus, as well as various other events. It also houses various exhibitions. The building contains concession stands, a pub, a lounge, and a room that can be used for private parties.

The Nassau Coliseum building is approximately 416,000 SF in size. The building rises
approximately 57 feet – 11 inches above grade level (“agl”) (to the top of the precast panels), according to the original construction drawings. The ice surface is located approximately 24 feet below the concourse level, making the total inside height approximately 82 feet (equivalent to an approximately eight-story building). The property contains approximately 6,800 surface parking spaces.

Under the existing conditions, direct spending by the New York Islanders for the year ended June 30, 2007 was $91.5± million. In addition, the direct spending by visiting hockey teams and the New York Dragons adds another $6.7± million, annually, for total direct spending of $98.2 million.

However, when the multiplier effect is factored in (when secondary economic impacts are considered), the total gross output increase and total earning increase for the Islanders, Dragons and visiting teams are $205.2 million and $74.9 million, respectively.

The viability of Nassau Coliseum is of great significance to the region. Under the existing conditions, direct spending by the New York Islanders alone for the year ended June 30, 2007 was approximately $91.5 million. In addition, the Islanders and Dragons generate approximately $2.6 million in entertainment and sales taxes (excluding concessions and other events sales taxes). However, when the multiplier effect is factored in (when secondary economic impacts are considered), the net gross output increase is almost $205.5 million and the earnings increase is almost $75 million, annually.

Based upon the socioeconomic analysis conducted, upon completion, the transformed
Coliseum could have 172 events in its first year of operation, including 44 Islander
games, eight Dragons games, 58 family shows and 23 concerts. The projections suggest
that first year ticket revenue will be approximately $81 million. In addition, concession and novelty sales could total almost $14.9 million. Thus, the transformed Coliseum is expected to generate over $95.9 million in ticket, concession and novelty revenue during its first year of operation.

Given projected first-year paid attendance for the Islanders and Dragons of 570,065, the estimated entertainment tax on Islanders and Dragons tickets alone would be $855,098. Furthermore, given the total projected first-year paid attendance of 1,295,765, estimated entertainment taxes in the first year of operation of the transformed Coliseum are estimated at over $1.9 million.

Based on projected Islanders and Dragons ticket sales of over $44 million in the first year of operation of the transformed Coliseum, there would be total sales tax revenues of over $3.8 million, of which approximately $1.77 million would go to New York State, approximately $1.88 million would go to Nassau County and $165,663 would go to the MTA. Total sales taxes generated by Islanders and Dragons ticket sales in the year ended June 30, 2007 were $1,892,478, of which $877,671 went to New York State and $932,526 went to Nassau County. Therefore, total sales taxes attributable to Islander and Dragons games would more than double in the first year of operation of the transformed Coliseum.

Further sales tax increases would follow as attendance increases in the
following years. There will also be sales tax revenues totaling approximately $1.29
million on projected concession and novelty revenue. This brings total projected sales tax revenue for the first year of operation of the transformed Coliseum to almost $5.1 million, of which approximately $2.5 million would go to Nassau County.

The generation of additional sales and entertainment tax revenues is only part of the
benefit that increased attendance at the transformed Coliseum will bring. Those who
attend events at the Coliseum also patronize local restaurants and other business
establishments either before or after the event. For purposes of analysis, it was assumed that patrons spend another 20 percent over and above the actual ticket price on goods and services in the immediate community. Total ticket revenues for the first year of operation are estimated at $81 million. Twenty percent of this figure is approximately $16.2 million. It is assumed that this money would be injected into the local economy and would undergo several rounds of re-spending, thereby creating a ripple or multiplier effect.

Transformed Coliseum/Sports Complex
The Coliseum is proposed to be transformed into a 20,000±-seat state-of-the-art arena, with luxury suites, restaurants, fan-experience amenities, and the most up-to-date technology designed to serve as a premier destination for sports and entertainment events.

The transformed arena would be part of a larger complex consisting of a world class
sports complex. The arena would continue to be the home of the New York Islanders and
New York Dragons, and will be able to accommodate a professional basketball team,
should one be secured, as previously noted. The transformed Coliseum would also
continue to host concerts, the circus, family shows, fairs, etc. The Sports Complex
comprises approximately 371,500 SF of the total 1,203,000-square-foot Coliseum Sports Complex.

The Sports Complex (including basketball courts, a fitness and recreation
center and ice rinks) within the building will provide the latest in sports and fitness technology. Four NHL-size rinks are expected to assist in making this complex the Northeast hockey capital -- attracting local, regional and NCAA tournaments. These rinks would not only be the home practice facility for the New York Islanders, but will also be available to the community for learn-to-skate programs, school and community groups. The facility would also include fitness center, party/meeting rooms, as well as viewing areas for the various rinks and courts. The Sports Complex is proposed to also house ground-level retail entertainment and restaurant facilities, situated along the north side of the Village Park.

Overall, it is expected that:
• Upon completion of the transformation of the Coliseum, the economic benefits
associated with the Islanders and Dragons would significantly increase;
• According to correspondence from the NHL, dated March 4, 2008, “a state-ofthe-
art arena on Long Island would be an attractive venue for high-profile League
events such as the NHL All-Star Game and the NHL Entry Draft…” Such events
would generate additional economic benefits for the surrounding community,
Town and County;
• Event attendance for other sports

It is also noteworthy that the need for a transformed facility is echoed by NHL
Commissioner Gary Bettman, who has indicated in correspondence dated May 5, 2008
“…the Islanders are not viable in the long-term without a major change in the arena
situation.” In addition, Commissioner Bettman further indicated that “the loss of the
New York Islanders to Long Island would be devastating from an emotional and financial perspective…once gone I could see no prospect of an NHL franchise returning.”

Given the above, the impacts associated with implementation of the no-action alternative would be virtually the same as the existing conditions presented in Sections 3.1 through 3.13 of this DGEIS, with the exception that, due to the loss of the premier sports franchise from the Coliseum, there would be fewer associated environmental impacts (e.g., less water use, less traffic generation, less sanitary flow). The most significant difference between the no-action alternative and the existing conditions relates to economics, as all of the economic benefits associated with the current operations of the Islanders and Dragons would be lost, and any increased economic benefit associated with implementation of the proposed action would be foregone.

Specifically, if Long Island were to lose the New York Islanders and (probably) the New York Dragons, its output of goods and services (gross metropolitan product) would
decline by more than $205 million, the earnings generated on Long Island would decline by almost $75 million and almost 2,200 jobs would be lost.

Bookmark and Share