Richmond Coliseum demolition on pause, could start in 2025 (2024)

Demolition of the Richmond Coliseum, a key first step for what developers say could be a nearly $1 billion transformation of a fading part of the city’s downtown, is on pause after the City Council decided not to fast-track work, rejecting Mayor Levar Stoney’s request for $3 million to cover the cost.

That would have allowed work to start as early as the July 1 start of fiscal year 2025, if the council had not decided this month to take $2.5 million of that money to boost City Hall’s support for the public schools.

“It’s on pause; we’re continuing to look at the timeline,” said Gianni Snidle, Stoney’s press secretary.

But work could start sometime in 2025, since Richmond’s Economic Development Authority and the Greater Richmond Convention Center Authority are looking to settle on a developer for their City Center downtown redevelopment before the end of Stoney’s term in January, said Richmond’s chief administrative officer, Lincoln Saunders.

With that decision in hand, the City Council could approve the financing mechanism for the project and the EDA could transfer ownership of the Coliseum to the selected developer, he said. Work on the demolition would follow quickly, he added.

The formal request for offers from developers, issued in March 2023, said “the Coliseum must be demolished by the developer within 12 months of the EDA conveying the property” to whichever of the four groups contesting for the deal won the EDA and Convention Center Authority’s nod.

The idea was that developers would manage the demolition with costs covered by a bond issue from a specially created Community Development Authority, Saunders said. These are bodies that, under Virginia law, can pay for the costs of new infrastructure and additional services within a defined district out of revenue the authority collects.

While the language of the request for offers left open the possibility that a developer would simply pay for demolition itself, Saunders said this was always seen as unlikely, though the EDA and Convention Center Authority did not want to rule it out.

Neither any delay in the demolition, nor the fact that the city wanted to pay for it with taxpayer funds instead of through the development authority bonds, means City Center is looking unfeasible, said John Moster, chairman of the Economic Development Authority board.

The EDA and Convention Center Authority envision City Center as a mixed-use development of commercial buildings and housing, anchored by a 500-room hotel that is intended to bring new life to the convention center, which would be losing tens of millions of dollars a year if it were not subsidized by hotel taxes collected in Richmond, Chesterfield, Hanover and Henrico counties.

City Center project

Phase 1 of the City Center project covers 9.5 acres, including the 7.36-acre site of the Richmond Coliseum, which the city wants to demolish, as well as the Blues Armory at 411 N. Sixth St., and what remains of the old Sixth Street Marketplace — the downtown shopping mall with the dramatic pedestrian bridge over Broad Street, most of which was demolished in 2003. The work would also include a bit more than an acre of open space in the 400 block of North Seventh Street. The hotel is to go up on Fifth Street.

Four developers submitted proposals last spring, but so far there’s been no word from the EDA and Convention Center Authority on how it’s going.

The cost of delay

But while the EDA and Convention Center Authority mull over which of the developers they will select, the Coliseum’s condition is getting worse and worse.

“We wanted to get work moving,” Saunders said. “It’s a safety issue.”

Delaying the demolition will impose a $1 million-a-year running cost for security measures to keep people out of the structure and to try to deal with its continuing decay, he said. The City Council left in Stoney’s request for $1 million to cover security at the Coliseum and a new homeless shelter, of which $516,000 was slated for the shelter. The $500,000 of the Coliseum funding request the council left in the budget will also go to securing the decrepit building.

Concerns about delay and cost of the city’s other, even bigger redevelopment project, the baseball stadium-anchored Diamond District redevelopment along Arthur Ashe Boulevard, earlier this year led Stoney and the City Council to take a more direct financing role. They opted for a general obligation bond — debt repaid with taxpayer dollars — rather than the bond to be financed by lease payments and the additional tax revenue to collected as new homes, offices and stores arise in the district.

In the Diamond District, the pressure to act was intensified by the threat that the city’s minor league baseball team might move, disappointing the roughly 6,400 fans who on average attend its home games.

Hope in a hotel

For City Center, the EDA and Convention Center Authority hope that a prospective new hotel, across the street from the convention center, will bring the volume of business it has never seen since its 2003 expansion.

In fiscal year 2023, the convention center collected just over $738,000 in lease payments and food and beverage sales, according to its annual, audited financial report. Its operating expenses were $4.3 million, including $3.5 million just for the facility itself.

On top of those expenses, it recognized another $3.5 million as a depreciation expense, and it had to pay $2.7 million in interest and principal on its $79 million in bonds.

If it were not for the net $14.6 million of hotel taxes that the city and Chesterfield, Hanover and Henrico sent last year, the convention center would operate in the red, as has been the case since at least 2009, past financial reports show. (The localities actually gave the convention center $35.4 million of hotel taxes, but it rebated $20.8 million.)

The 13,000-seat Coliseum, at 601 E. Leigh St., was shuttered in 2019 after years of citations related to structural damage. In 2016, the Virginia General Assembly passed a bill allowing for its replacement.

Since then, the future of the site has been in question with numerous redevelopment projects pitched to replace it — namely, the doomed Navy Hill redevelopment plan.

The $1.5 billion Navy Hill plan, spearheaded by Stoney, promised the creation of a new city district with hotels, additional housing and businesses as well as a new arena with chosen developers tasked with covering demolition costs.

The home of Virginia Commonwealth University’s men’s basketball teams until 1999, the Coliseum hosted the Colonial Athletic Association men’s basketball tournament from 1990 to 2013 and served as the primary home for the Mid-Eastern Athletic Conference men’s basketball tournament between 1998 and 2005.