Leonsis Makes Stunning Turn Back to D.C., Will Renovate Capital One Arena

The clues were certainly there that something was even more amiss than before with the proposed $2 billion arena in Alexandria, Va., when Monumental Sports & Entertainment chairman Ted Leonsis went on an unexpected social media spree Wednesday morning repeatedly extolling the virtues of D.C.’s Capital One Arena. 

It turns out there was much more than what appeared as Leonsis made a dramatic reversal, ending his attempt to build a new venue in Virginia for the Wizards and Capitals and instead striking a new deal with D.C. mayor Muriel Bowser to renovate the 27-year-old Capital One Arena. 

In a rapidly reconstructed agreement, D.C. will now spend $515 million over the next three years to upgrade the venue, while Leonsis and MSE will sign a lease keeping the teams where they are until at least 2050. The agreement also contemplates a nearly 200,000-square-foot expansion for MSE of its footprint into the neighboring Gallery Place, allowing Leonsis to get at least a portion of the additional space that was fundamental to the Virginia plan. The new D.C. agreement also contains a series of additional enhancements with regard to neighborhood safety, transportation, and signage permissions.

“I’m really relieved,” Leonsis said. “You never know how things are going to end. The amount of work that has been done since December [on the D.C. plan] has been extraordinary.”

External Forces

To be clear, this is anything but an independent change of heart by Leonsis, as his hand was forced on multiple fronts. He and Virginia Gov. Glenn Youngkin, also a staunch advocate of the Alexandria project, ran into fierce and immovable resistance from powerful state Sen. L. Louise Lucas. Largely through her extensive influence, public funding for the Virginia project never passed Virginia’s senate and wasn’t part of the next budget. As news broke of the revived D.C. deal, Lucas continued her savage social media criticism of the now-dead Virginia proposal, posting on X “FAFO,” short for “f*** around and find out.”

D.C. attorney general Brian Schwalb also told MSE last week that his reading of the existing bond/lease agreement for Capital One Arena ties the Wizards and Capitals to the arena until at least 2047.

Still, that hasn’t stopped Youngkin and other allies of the proposed arena from criticizing the rapid turn of events, lamenting how the deal “just went up in smoke.”

“This should have been our deal and our opportunity,” Youngkin said. “Personal and political agendas drove away a deal with no upfront general fund money and no tax increases.”

While Leonsis pursued the potential arena and mixed-use development in Alexandria, Bowser and other D.C. officials maintained that their roughly half-billion-dollar offer to renovate Capital One Arena was still on the table. And as the mayor waited out the situation, continued to engage with Leonsis, and was rewarded for her patience and persistence, this turn of events still represents one of the quickest about-faces in a large-scale pro sports venue project, with the whole Virginia saga unfolding in less than four months.

The Capital One Arena deal now moves to the D.C. council for formal approval, with a vote slated for April 2.