Hercules Grigos, Klehr Harrison. I'm zoning counsel to the project. My understanding is the properties across the street are zoned CMX-5. And in order to have a casino you would need a zoning change to the -- there's a special district for casinos.
One is what will happen if you don't receive the state and federal funding that you're anticipating?
We don't have any specific numbers as of right now in terms of anticipation, so the project is not predicated on those.
Thanks. You mentioned before there's another opportunity that the 76ers would have for the arena. One I'm very personally invested in is whether or not to get a WNBA team here. And would you do everything in your power to commit to that to make sure the WNBA can come, a franchise can come to Philadelphia?
Yes. And we are -- there's only so much we can say in terms of being part of an active bid process or a potential bid process. But what we can say is that that is something we are very interested in and committed to pursuing and we would love to have a WNBA team in Philadelphia playing at this new arena. And we believe that the arena will help make our bid more competitive as a state-of-the- art facility.
Last one. Just for now, will you be responsible for all of the operations necessary for any of these other events that happen, whether it's WNBA, Disney on Ice? Any other event that comes, are you doing trash cleanup, security, all of the things for all of the other events?
Yes. Anything that would be happening at the facility would be our responsibility.
Thank you. Just real quick point of personal privilege around the issue of public safety that was kind of mentioned. So who's heading up your public safety plan and strategy for the immediate area?
Yeah. Our public safety consultant is Maureen Rush who is here today. And if there are questions, would be --
Can you bring Maureen Rush up to the table please?
I've spent 45 years in law enforcement. with 4 the Philadelphia Police Department 5 going up the ranks. Went over to 6 the University of Pennsylvania. And 7 for the last -- I retired in 2022. 8 And for the last 20 years of my 27 9 years, I was Vice-president for 10 Public Safety and Chief of Police. 11
Okay. Just real briefly 17 real quick because Members talked 18 about this. We have $50 million CBA, right, and not asking for any local public dollars, but there will still be costs overall as time goes along regarding the project where the City will have to chip in some way somehow indirectly. But around the issue of public safety, what is the strategy around that immediate area? I'll actually go from I guess I could say 8th to 13th Street, and Councilman Squilla knows better in terms of being the author of the Special Services District, but also from I guess it would be Pine Street to Spring Garden the strategy around making sure individuals are safe particularly around the arena area, Chinatown area as it develops, your plan, your vision?
So for the last couple of years I've been working with the stakeholders in Market East, not just Market Street East. Center City District obviously has done a great job with both east and west and most recently put a whole bunch of CCTV cameras along Market Street about a year ago. Philadelphia Police obviously will be very involved. Jefferson Hospital now has a police department. They will be involved as will SEPTA police. So in meeting with all of those folks, and the people who run the Reading Terminal Market, the Convention Center, what were the needs and what were their issues. And we put that into a comprehensive plan where we're looking basically at -- well, if I may say, a lot like we did in University City which became very successful, so making sure that there's good lighting, that there is good technology in closed circuit television, which lighting's already great in that area thanks to the Center City District. We would also create safe corridors. So when, you know, hoping that -- not hoping but people will take a lot of public transportation, so working with SEPTA police in a safe corridor handoff for people. Also, people are going to come out after a game and they're going to go to restaurants and making sure that the safe corridors are designated to where they will go to after the game.
What's your strategy and plan to deal with scalpers? I'm an old-school South Philadelphian. So you go down to the stadium, try to sell you a ticket to see WWF for like 100,000 to go see the game --
-- because we have to also be realistic. In the event let's say this moves forward and more traffic, right, also brings individuals who are looking to do -
That's just the reality. I mean, remember Market Street in the early '80s, right. And going downtown, I think somebody got me with a (inaudible) coming from school, took my little $15. I think he was from North Philly too, but that's a different story. But with more traffic, right, you also have people popping up scalping tickets, pickpocketing, preying on individuals who are from out of town, right, how are we being forward-thinking in terms of paying attention to that?
So I'll let Maureen speak specifically to the broader public safety strategy. I'll say just on the scalper piece, that is not something that we typically see at our games because our tickets are almost exclusively digital at this point. And so, often times back in the day when you see scalpers because they had 10, 20, 30 physical tickets they would sell you as opposed to going to the Box Office. That's not something people are able to do anymore, so that specific concern I don't believe would apply to the new arena and we don't see much of that where we currently play now.
So we would be working and contracting with Philadelphia police. They have a unit with the Center City District Bike Patrol. So events at the arena, whether it's basketball or concert, whatever, we would staff up for those events. Working with also the Center City District, they actually employ Allied Universal as their security ambassadors and we would contract through them to enhance not only just around this the arena but again safe corridors where you know people are going to travel to. Our hope is -- first off right now there's nothing down there at night. Even during the day it's very difficult, and the constituents I spoke with, you know, last week a GIANT Heirloom Market just closed and it's panhandling, it's mental health, it's homelessness and it's -- retail theft has gotten better with the new plan under our great Police Commissioner Kevin Bethel. That has become under control but it still is -- the area needs infusion of people, people walking. A destination location, which will draw more stores, more apartments, more activity. And right now if you go down at night what you're seeing is no one. After dark everybody's gone. Jefferson Hospital has people working around the clock. They don't feel safe. It would also enhance their safety.
Okay. Thank you very much. Chair recognizes the author of the legislation, Councilmember Mark Squilla.
Thank you, Mr. President. And thank you guys for being here. As we talk about security, one of the issues was to collocate a location around 11th and Market. And from what I understand, and maybe Maureen could answer this question, as SEPTA, PATCO, City of Philadelphia, Jefferson and the Arena folks would collaborate at that location to be able to better, I guess, judge how we as a City will look at safety during these events, but also that public safety headquarters would be there I'm assuming even when there's not events. And how would that operate at that point?
So Jefferson Hospital as I said created a police department a couple years ago. They are currently developing a public safety headquarters, which will be right at 11th and Market. So they're going to have all their uniform officers reporting into there. We would like to work with them and have a security hub that would be staffed perhaps by security officers, but it would be a stop-in for all officers, PATCO, SEPTA, Philly, Jefferson. Jefferson also has a pretty large public safety arm that does the same thing. I'm talking about around safe corridors for their people to come back and forth to Jefferson Station. So we envision that area will be covered by all these entities working together. The other important thing I didn't mention is the cameras that are up and down right now on Market Street, which was put in by Paul Levy right before he left in the Center City District. Those cameras and any additional cameras that we put in will be the kind of cameras that are made to be able to report into the Philadelphia Police DVIC Center, Delaware Valley Intelligence Center, where they can watch cameras. So in addition to people and uniforms and lighting, the technology won't just be after the fact. It will be virtual patrols is what we call it, and virtual patrols will be done at the DVIC Center and also at the security hub station alongside Jefferson police.
Okay. So there will be somebody I guess at that headquarters to be able to monitor that also?
Okay. Thank you. The other question I wanted to piggyback off Councilman Johnson, what he had said earlier because we had mentioned this yesterday during the hearing about if this legislation were to pass and after 30 years there would be an automatic renewal, 13 five- year renewals, and I believe you did say that you would be willing to support change in the legislation to allow a renegotiation of the CBA at that point; is that correct?
Yes, we're willing to commit to a pro rata continuation of the CBA as it relates to the extensions if they were to be elected.
Okay. So if we do amend the legislation at that point that would be something that would be supported by you guys?
All right. Thank you. I'll come back. Thank you, Council President.
Thank you, Councilmember Squilla. Councilmember Harrity.
Thank you, my brother. Good afternoon. How are you today?
Just have a couple of questions here. How does 76 Place activate the street surrounding the arena to spare development and can you tell us about your tax projections in regards to the City?
Sure. I think those are two separate questions. I'll take the first one about street activation and spurring development and I'm going to ask members of our design team also to come up and help answer that. In terms of spurring development, the investment that we're talking about, private investment, is as Maureen said going to bring activity. It's going to bring dollars to the area which is going to help build and give a reason for other developments that have long been stalled on the surrounding areas to build something of their own. Right now as you walk down Market East not only do you see the store closures that are happening, but you also see long vacant parking lots, DisneyQuest, you see the boarded-up retail that's there. And this is right in between City Hall and Independence Hall. And so, there's a reason for that and it's because there's not enough people there. And so, the anchor destination of an arena provides that spur development. In terms of activating the street and how that design speaks to that, I'm going to ask our design team, both Jonathan Mallie and Jonathan Moody.
Good afternoon. Jonathan Mallie, Senior Principal and one of the Global Directors of the architectural design firm Populace. We've worked on over 3500 projects across the world. And when it comes to urban arenas, over half of those have been arenas and stadiums. We really take a look at the street activation and how to enhance it. And I think the points that were made from a security standpoint before, when you have a venue like this that draws people to it, you activate the street and you bring it alive. But then how do you take the building materials of the actual venue and enhance that: Transparency, glazing, retail activation. And in this case, the fact that the team is incurring the cost of lifting the basketball court up in the air off of the street to further activate that whole ground plane, I've never seen that before in any of our projects to this extent, and this is something that will be special and unique to the city of Philadelphia.
Good afternoon. Jonathan Moody. I'm President and CEO of Moody Nolan, African American-owned architectural and design firm. Building on that, this is truly a unique experience. Typically, the rule of thumb is exiting is the priority. And basically exiting means you have your biggest exits of the main bowl section at grade. And in this case, the priority was different. The priority was to say to lift it up to allow as much of the community, and that was through feedback and other conversation to say that this can be a way to activate the city and activate all the adjacent streets. So it's not a block or a node or something that prevents, but something that actually activates and enhances the street presence.
Okay. And as far as -- sorry. As far as -- what can you tell us about your tax projections in regards to the City? What are we looking to get from taxes from you guys?
So we did a robust analysis of the project with Municap. I'm going to ask Max LeVee to come up and speak to -- the net result of that is a billion dollars of net new taxes projected for the City and School District. 800 for the City, 200 for the School District. And I'll let Max explain exactly what that means from a net new perspective and what was included in that. MR. LeVEE: Yeah. Thank you. My name is Max LeVee. I'm the Vice-president with Municap. Municap is a registered municipal advisor. We have both municipal entity and developer clients across the country. We manage over 400 public financing districts. We were engaged by the 76ers to look at estimates of tax revenue resulting from 76 Place. We analyzed a variety of scenarios, including a net new impact scenario to the City and School District of Philadelphia. We took what we call a reasonably conservative standard in our approach to the analyses. Specifically what I mean by that is we looked at direct impacts resulting from the Arena and Fashion District projects. We did not look at indirect or induced impacts or any other multiplier. Impacts, we relied on a variety of industry sources and third-party reports to prepare our tax calculations. And as Alex said, we showed that the project over the 30-year team-play agreement will net to the City about $775 million in tax revenues and to the School District about $200 million in tax revenue.
Okay. And I know my time is up, but I just -- one more thought let's say. So the Chinatown Collaborative or whatever it is, is saying that there will be about 600 businesses in that area affected, directly affected. You guys say that there will be only 40 businesses that will be affected directly during construction time at a stadium. Talking to people in Chinatown, some of the business owners and going over some numbers with them, I came up with a number closer to 120 businesses that would be directly impacted by the construction, mostly mom-and-pop shops, restaurants, a variety of different little stores, clothing stores, stuff like that. In the Community Benefit Package, there's 1.6 million going for that. That's nowhere near enough. If you look at it just on a a simple thing, and I'm a simple guy so I try to look at things in a simple way, with 120 businesses if we were to say that we were going to give them a grant program in order to try to survive through the construction process, just at a minimum of say the 120 businesses could apply within the five-year period for say $10,000 a year to get them over that hump. For 120 businesses, it's $50,000 over the five years total per business, that's 6 million just off the top of my head. There's a big difference there in numbers. And I get it that you guys are negotiating in good faith, and you have to not only deal with us but you have to deal with the Mayor's Office, but I would just ask that when we continue these conversations that you keep in mind that these are residents that are trying to make something for themselves. They're trying to succeed. And what me and my colleagues are, you know, for me it's different. I see the thing -- I'm a union guy, so I see the value in all these jobs that are going to be created. I see the value in the fact that we're going to be hiring other union people to run the shop. But that being said, we also have to think about those little mom-and-pop shops that quite frankly are hurting already. And even at the point where they said low interest loans, I'm not an economics guy but I know that giving somebody that's already struggling another payment is not going to work. We need to look at grant funding. And quite frankly, it needs to be more than 1.6. It's closer about $6 million just on a short, you know.
Thank you, Councilmember, for that question and comment. We'll just reiterate that based on the testimony of the Administration last year I know there's an openness to discuss the allocations to the CBA. We'd welcome dialogue around that. We're very sensitive to the dynamics that you're talking about. We've spoken to a lot of business owners and heard similar concerns, also heard some business owners were excited about what the potential could be after opening and these are dynamics that we need to balance, right. We take that seriously. It's not something that we take lightly. As far as the CBA, we welcome additional conversations about that. We also are welcome to conversations about how we as the 76ers just in our core business could also be supportive of those businesses moving forward as well. So we would love a discussion to learn more and figure out what a solution would look like.
And I appreciate that. And there are some excited people in Chinatown because traffic is a good thing for their businesses, especially restaurant business. So looking forward to trying to get that up, but I don't want to develop a property and not take the existing people with us. When we move, let's move together.
I was just being devil's advocate. Let's just say hypothetically let's say it was built, would more people go down -- I'm vegetarian/vegan, right. Wouldn't you go down there to eat after the game and get something to eat and kind of hang out or some great Chinese cuisine after the game or before the game? And I haven't taken a position one way or the other. I'm just looking at it in a variety of different ways. That's why people sometimes say if you build it they will come but, you know, who am I. I'm just observing, taking it all in.
Council President, we had that conversation when I met with some of the members of the Asian community from Chinatown, friends of mine that I talk to all the time. That was kind of their feeling, you know what I mean. The way it was put to me is an average cost medium range for a Sixers ticket's about $100 a person. If you're taking a family of four, that's 400 bucks. And the way the guy phrased it to me he said, Jimmy, if you're paying $400 to go to a Sixers game with your family, are you then going to go to say Capital Grille and spend another $400 or are you going to go to Chinatown and spend $80, you know what I mean. There's pros and cons to everything, Council President. And I just want to make sure that we're thinking about those small businesses.
Oh, we are, absolutely. I'm sure Councilman Mark Squilla has done a yeoman's job in making sure that his constituents in Chinatown are supported and did a robust job in terms of advocating on their behalf with the Administration. So just being objective and paying attention. At this time I would like to call on Councilmember Jeffrey Jay Young.
Thank you, Mr. President. And good afternoon -- Mr. Kafenbam?
Kafenbaum, thank you. It's nice to meet you. And, Dave, it's always good to see you. First question -- well, statement first. I really just think that from listening to the questions of my colleagues and their responses, I think that what is missing here is that there are two separate co-equal branches of government, right. And I think that you guys negotiated an agreement with one branch and not the other branch. And I really think that is kind of a slap in our face when we are the ones that have to go through the motions of voting on this, putting this out there. It's our face that's up there. As my colleague yesterday pointed out, it's our futures on the line here when it comes to this legislation. And so, for you not to talk to us when we have a clear leadership structure and the Council President, I think is a slap in our face and you're not willing to even negotiate that CBA. I mean, to me, right, when I've been in the public to say there's not enough money, to me you're telling me right there you don't want my support. That's clearly what you're telling me, right, if you're not willing to move the needle on that. And I just really think that the process of how that played out, although you've been going through this for a couple of years, I just think that how that played out, how that was negotiated, I don't think that was in good faith as far as this body goes. So I just wanted to put that on the record. First question is why the rush? Why does this have to be passed on December 12, 2024 versus January 30, 2025?
So it's a good question and an important one. The imperative date is 2031 and working backwards from that which is when our current lease expires at our current facility. We need a place for the team to play in 2031. And when you work backwards from that with the construction schedule, the demolition schedule, the design schedule, that's what gets us to the end of this year. In all honesty, we're already behind in terms of starting that. But that's kind of our drop- dead date of needing to be able to start the design process, which is about two years to enable us to get to be able to start the demolition, which is about months, to enable 12 us to start the construction which 13 is about 36 months. And there's 14 some overlap of those along the way. 15 But when you add them all together, 16 that's what backs us up to where 17 we're at. 18
Can I get a point of information just real quick. I thought I was under the impression that part of the timeline was based upon the bankruptcy deal with the Gallery? And this is something different than what you're responding to. So to answer his question, regarding Member Young's question regarding the timeline, can you give me clarity on the difference between the two? Because I was under the impression that the bankruptcy of the Gallery, Fashion District which y'all are about to purchase, actually is they're going to go through the whole bankruptcy process in order for y'all to purchase the building, yada, yada, yada, there's a timeline. So give me an idea on which one it is in terms of what we're dealing with.
It's a good question, Council President. So there was a time -- because we had pushed for getting legislation introduced even earlier because there was a time when that was a legitimate and serious concern in terms of working with the current owner of the mall. That has been addressed, it did come at a cost, because we wanted to make sure that this continued to push forward and remained viable. The deadlines that Alex just described that we're talking about right now are purely around the delivery date and what it takes to actually design, construct or demolition and then construct the project. That deadline would have always been there. We were dealing with an earlier deadline that was unrelated to that that we were able to get around. I don't know if you want to -
Thank you, Mr. President. So that one month will throw your entire schedule off when it comes to construction? There's always, always overruns and time, things like that. It just happens. It is the nature of the business because you can't control weather, you can't control a lot of things that happen. So that one month really throws this entire deal off?
I think what you just said is exactly the issue that we're protecting against. There are unknowns during the design, demolition and construction process and we need to provide for those realities. And so, we are already behind on where we would need to be for this site. But I also want to just clarify something that David said in response to Council President's question. The requirements of the transaction in terms of purchasing the various assets, the sites are under control subject to receipt of the approvals, which means that those buildings, the mall, are in this purgatory right now. They're not able to lease. They're not able to start the demolition. And so, the transaction agreements and structures also require us to come to a decision in a timely manner.
Thank you, Mr. President. Do you agree that -- have you done an analysis on the value of the team after this asset is acquired?
I believe -- I forget who it was, Councilmember Landau or somebody else who asked that question. I don't know that answer or if we have a definitive number off the top of my -- I don't have it off the top of my head. I have to check to see what we have, but happy to follow back up with that information.
So there's no one here testifying in front of this City Council today that can tell us about valuations of the team, valuations of this particular deal and valuations regarding what future projections are? You guys decided not to bring anyone that can talk to us about that?
I want to make sure I get you accurate information. And so, we will make sure that you have that information in a very timely manner.
All right. Well, Forbes says you're worth $4.6 billion, so I'm just going to put that out there, right. And so, if you have a $2 billion project that you're constructing, I'm just going to assume you guys have great accountants. You're going to figure out the tax liabilities and all that to do some write-offs. But I'm going to say once you acquire a $2 billion asset, your value is going to rise by $2 billion, right. And so, if you're getting $2 billion and the City's only getting $50 million, I think that's a huge disparity, huge disparity. And I understand there are other costs associated with development and things like that. But the moment you get your CEO for your building, your value rises exponentially higher than any one of us in this room probably can fathom, right. And so, I just want to make clear that I really think that having negotiations with one branch of government for $50 million when I'm on the record to say based on my analysis and talking to other folks that this deal could be worth potentially $300 million to the City, right, because -- and that's based on the lack of revenue that other cities have seen when it comes to arenas and stadiums, right. It's because no arena, no 15 stadium has ever brought forward the tax revenue that the projections say it would bring in. So based on that, based on facts, based on the value of the increase of the team, that's where I derived that number from. And so, as an organization will you commit to putting funds in escrow, maybe 5 or percent, of the projected tax revenue in escrow just in case the City doesn't meet those yearly projections afterwards, right, so we can reap that money that you say we're going to get a billion dollars? So would you put some money in escrow, $50 million in escrow every year to make sure we reap the benefits of this particular arena?
Sure. Thank you for the question. One thing I just want to clarify, we are not getting $2 billion as a result of this project. We are investing. So we're investing $1.3 billion so I just want to make sure that's clear for the record. In terms of --
I understand you're investing. But again, once you only -- let's just say it cost 300,000 to build a house. You're not going to sell it for 300,000. You're going to sell it for a profit, much more. So you're investing that money there, that's great. But when it's time to make that return on that investment, right, because you own the land after 30 years, you can say, you know what, we're done, we want to sell this land. You own that land. That's a win-for-all for the Sixers, right. So the value -- again once it gets appraised and all that other stuff, when Blitzer and Adelman want to sell, they're going to get the whole team appraised for the value of all the assets, including that particular arena, and that asset is probably going to be worth about $2 billion at that time. And so, that's where I'm coming up with that particular number. So I understand you're only investing 1.3 in the construction. But again, with the good accountants you have you're going to figure that out, right, to make sure that y'all good on that from a liability standpoint, right. So that's where that number is coming from. So just want to make that clear. So again, will you be willing to provide some money in escrow in order to help the City meet this loss of revenue if we don't meet those tax projections?
Sure. I would say we are not aware of any precedent where any business has been required to or would be required to do that. We are not asking for any City taxpayer dollars as a result of this project. As Max mentioned, the financial projections that we are putting forth are intentionally conservative. And a lot of the estimates that you were referencing include the generation of revenue outside the site in ancillary. We're just looking at things actually on the site. So we actually think the benefit of the City will be much greater than what we're proposing. And so, I mean the short answer is, no, we're not prepared to do that. But I just wanted to provide some context as to why, Councilmember.
So the City's estimate is more conservative than yours and that's about 700 million or something like that, whatever the number was. But again, we can't guarantee that these numbers are going to come to fruition because they have never, ever, ever come to fruition in any other scenario across this country. And so, if you want us to agree to a deal, I have to be comfortable that we're going to be -- it's an equal bargain. And right now it's not an equal bargain on both sides. And I know, Council President, I heard the time a long time ago, but thank you so much. I reserve the rest of my questions for the second round.
Yeah. So one thing I just want to make sure we're clear on, all your points are really good ones, this is all net new revenue to the City. So this is not revenue that is otherwise occurring. It's not revenue that's already happening. It's only net new revenue that would happen as a result of our project. So in regards to the City's more conservative analysis compared to our analysis, I think the City would agree and I believe they testified yesterday, both assumptions are valid and industry standard. They just took a more conservative view, but they still found that it's a net positive to the City.
Thank you. So even though, yes, it's a net. You say it's a net positive to the City, but your argument is that that's the incentive for us to do this, that the City will get all this money, that's your incentive. But if we don't get it, what's our incentive then? If we don't, what's the incentive? And that's what I'm trying to protect, protect that incentive for us to do this.
Chair recognizes Councilmember Jamie Gauthier.
Thank you, Council President. On the 76 Place website in your statement about how Philadelphia's experience with the arena will be different from what happened in Washington D.C. where their Chinatown was essentially displaced, you say "We are committed to investing in the preservation of local businesses and affordable housing options so that Chinatown retains its character, remains a cultural hub and that existing residents have the option to remain in place." First, can you say whether the Sixers still agree with that sentiment? And if so, as the entity leading this development and as the entity whose project will have both positive and negative impacts on the City and its neighborhoods, can you give an opinion on whether or not the measures proposed in the CBA provide adequate anti-displacement measures for the neighborhood surrounding the arena? Specifically, do you believe that the current allocations in the CBA provide an effective safety net for Chinatown residents and businesses? And I'm looking for an opinion here. I'm not, you know, I've heard you say we're going to have conversations, we're going to consider, we're open. I'm looking for an explicit opinion on this as the entity that's leading this project.
Sure. Thank you for the question, Councilmember. So the short answer to your first question is, yes, we are committed which is why there are line items in the CBA that include support for programs that address the things that you just referenced. In terms of whether or not is it adequate, I think it is definitely supporting the goals that you stated. I and -- we've had this conversation. I think our position is that there is no single developer that will be able to guarantee fully if it's solely their responsibility the preservation of any neighborhood. We are very excited and supportive and look to collaborate with how we can leverage the funds that are in the Community Benefits Agreement with the tools that the City has as its disposal to best protect and preserve Chinatown.
I think I want you to talk more specifically. You said you think. In general, the allocations in the CBA reflect the goals that I mentioned. Can you speak more specifically about how the allocations in the CBA will guard against displacement in Chinatown for residents and businesses?
Sure. So there's an allocation in the CBA for affordable housing. There is an allocation in the CBA for a business readiness fund, a business support fund I believe. I have to look at the additional line items.
Do you think those allocations are enough? As a developer, what's your opinion on whether $3 million over three years is enough to support affordable housing in a gentrifying community? Do you think that's enough?
Again, if you're asking if $3 million is enough to guarantee the preservation of all affordable housing in Chinatown indefinitely, no, I do not.
I guess what I'm struggling with is I hear this project being talked about, right, as this big bold thing and it is. I hear this project being marketed as something that will save Market Street, as something that will save the commercial office market, as something that will bring increased vitality to our city and Black and Brown jobs. All of those things may be true and that would be great, but I'm struggling with how you can claim the positive things, the big vision, the changing of Market Street, but not claim the things that were identified as negative impacts in our own impact study. What's your opinion on that? Does that feel like a conflict to you?
I don't believe it's a conflict because those are things that we're committed to supporting. And again, I would say I think we have to look at the totality of what the investment through the Community Benefits Agreement looks like in combination with things like Councilmember Squilla is proposing to ensure the community is protected. We did do a lot of research on this and so happy to bring Lee Huan from Econsult up to share more about what we learned, if that would be helpful.
I think what I'm looking for before I ask my last question is a more hands-on position from the Sixers about what you think needs to happen to protect vulnerable communities from displacement in light of this big, bold project that could also have a lot of positive impacts. I'm going to be personally looking to hear that throughout the rest of this process. I think that a lot of the conversation that we've been having and struggling with, right, around traffic, SEPTA, anti-displacement remedies are about the site, right. And so, I just wanted to ask for the purpose of conversation please shed light on why this site, why this site as opposed to other areas of the city? Why Market East for the arena as opposed to the Navy Yard or other places? And what was your process in landing on this site?
Sure. Thank you, Councilmember. There were a variety of considerations when looking for a site for the 76ers. Our priority was to look for a site within the city of Philadelphia. We also needed a site that was accessible. And one of the reasons we do like the site is because of its connectivity to public transit, as it sits right on top of Jefferson Station as we've referenced. And we also needed to find a site that was available, whether it's publicly- owned land, although we're not taking publicly-owned land, or whether it's a site where there is a willing partner ready to transact with us. We believe this site is also not just good for us and our fans and our players and the team, but also good for the City because we know that Market East is in need of investment. We know that that used to be the most vibrant commercial corridor in the entire city. We know that it used to be -- it was really the birthplace of department stores. I think we used to have nine there. A lot of us who grew up here used to spend a lot of time in the Gallery. If you go down to the stretch of Market East that we're looking to invest in right now, you see I believe an unacceptable amount of vacancy and blight and boarded-up retail, and that's not just like an eyesore, but that has specific impacts on our city. That is a deterrent for tourists. We've talked to people at the Convention Center who talk about conferences that don't want to come here because the experience that people who visit and scout locations have when they walk along Market Street. We have the Marriott who doesn't even have their doors open on Market Street. We need a revitalized Center City and not just for the folks that live in Center City or shop in Center City but for working-class Philadelphians across Philadelphia. One of the things that we're very proud to have is SEIU is supportive of this project, a union that represents a significant amount of Black and Brown working-class Philadelphians across the City. And they're supportive of the project not just because of the jobs that they're going to get in the arena because it's not that many for them, but because their job base for their members depends on a vibrant Center City to work in the office and residential buildings down there. And so, those are all the reasons that we think this is a project that is good for the Sixers as well as good for the City. We understand that there's also concerns around what the impacts could be in the surrounding community. And I think that what we are very much looking forward to do is collaborating with the City to make sure that we can accomplish those things and revitalize Market East. And I think a lot of the concerns that you raised will be raised regardless of what the development is. But we want to collaborate to make sure that we are revitalizing Market East and protecting and preserving the gems that should be protected in the surrounding neighborhoods.
Well, if you want to collaborate with us, you can't be hands off about the negative impacts that we're bringing up. We want to collaborate with you too, but we want to protect folks. Thank you, Council President.
You're welcome. The Chair recognizes Majority Leader Katherine Gilmore Richardson.
Thank you. Thank you very much, Council President. I wanted to sort of pick up where I left off. I have a few things I just wanted to review. First, relative to the overall agreement, and I think we talked about this yesterday, wherein you have the initial lease term that states that you have the initial 30 years and then the five-year 5 renewals. Okay. 6 And there was a section 7 in Bill No. 240966 around the ground 8 lease agreement, Section 3.3 renewal 9 terms, that mentions that you all 10 would give the City in writing 10 11 days prior to the expiration of the 12 secondary term or the then current 13 renewal term that you all may or may not renew. And so, based on -- and you're in real estate. Do you think 10 days is enough notice to the City if you all would exercise the option not to renew? Additionally, relative to the CBA that we're discussing, and I know you all know that many members have consternation relative to the CBA specifically, but the CBA only covers the first 30 years. There are additional five-year renewal terms, plus that last three year. I didn't miss that. That's in there too. So what would happen relative to the CBA after the initial 30-year term? And then also, if you could address the 10-day notice regarding potentially vacating the facility?
Sure. So 10 great questions. Regarding the CBA, 11 we said earlier that we would be 12 willing to commit to extending the 13 CBA pro rata with any extensions that we decide to exercise in the future. If that requires an amendment to the legislation, that's something we'd be amenable to. In regards to the notice periods, I don't have them directly in front of me. I trust that what you're looking at is correct. The notice period because of the structure of this transaction and that we are going to be purchasing the land, donating it to the City and then upon the termination that would be transferred back to us, we would ultimately be the owner of that land at the end of the day. Part of what Councilmember Squilla has required of us is a provision of what happens if the Sixers move out. We don't want a big vacant empty arena sitting on Market Street in 30 years and you all saying that you're not going to take it down. And so, he has required us to include provisions to --
I apologize for the interruption. I wanted to make sure that you had that information because I did bring this up yesterday. It's in the ground lease agreement. It's Section 3.3. If you look down at about maybe the 8th or 10th sentence in that paragraph is where it talks about giving the City 10-day notice. And because of the size of this project and just the potential size of the arena, that concerns me greatly because the City would need more than days' notice 8 that you would potentially be not 9 renewing the terms of this ground 10 lease agreement. And so, I wanted you to have it so we can have a real discussion. I heard the bell and I do want to honor the clock, but I think that's important.
What I was saying in regards to the transfer, one, if we were going to leave, we would need a new place to play.
If we were going to leave, we would need a new place to play. That would obviously take us more than days. 8 So I think that there would be 9 certainly advanced notice around 10 what our future plans are. But because the land reverts back to us and because we're purchasing it upfront, we have a vested interest in what happens there and the value that's going to be created there, not just now but in the future. And if it is at the end of the arena's useful life, hopefully what we're saying here has come to fruition and now it's surrounded by a lot of great new development and everything that already exists today. And so, we would want to continue that and see how we can now take that asset into the next generation.
Sure. And Councilwoman Lozada said this earlier, and it was something that my mentor and former boss would say all the time. If it is not in writing, it does not exist. And so, I think that's something that we do need to address and ensure that that information more accurately reflects what we know to be true regarding your intention around this specific project. Council President, if I may just put one additional question on the record?
Thank you very much for the accommodation. I wanted to go to the term sheet, and I know we had talked about this so you all know that I have some relative concern here relative to the conditions, precedent to conveyance and construction of the Arena facility on . You know we talked about this. This is a section list that the requirements must be met before the arena can be constructed. One of these is evidence of financing commitments sufficient to meet ArenaCo's obligations to construct the arena facility or ArenaCo's election to use its own funds to construct the arena. So could you tell me where I can find the evidence of your financing commitments regarding this project? And you know we're asking that for multiple reasons, including SEPTA. And have you all submitted these materials in writing to Council as a part of the public process and public record for these proceedings?
Thank you for the question. The reason why that's in there is the City in the negotiations wanted to ensure that we were not able to transfer the land to them and make it the City's obligation to own this land prior to being able to have shown proof that we have the funds in place to be able to build what we're saying we're going to build. They didn't want to get stuck holding the bag. And so, the process for getting the financing in place happens closer to construction as the design progresses, as the construction pricing has been finalized and as we're able to go out to the various private lenders and provide them with the documentation that's needed to procure the loan. And so, that's why it's not here today. It's a requirement for us to proceed to the next step in the transaction document.
So the question is if you will be able to submit the information that you shared initially for the record for these proceedings. And then if this should proceed, then also agree to submit all of your financing commitments to this body for the record? Because I think it's a fair question to ask relative to how you all are financing the project in its totality, one, because you're stating you will not need any City support, two, because of the challenge we know to be true with SEPTA and, three, so that we have relative assurity that, as you stated, as a City we are not left holding the bag. Is that something that you all could commit to share with us your financial projections? I'm sure you all have done something in advance of all of this to show that this project would be financially feasible to you or else you would not be moving forward with this project. So is there anything that you all could share with us on the record as a part of these proceedings that help us understand your financial projections?
So we have not shared with the City anything to date in that regard. So in terms of can you share with us what you've given them, I just want to be clear there's --
There's nothing that we have given them. We would have to come back to you with that. Because the risk is ours in terms of the private development, the private nature of this. The request to share the financials of the private development is something that we would have to come back to you. I don't know that we can commit to that.
Thank you for that. Now, the risk is yours financially but the risk is ours as a City. And that's why we are here and that's why this project would need our approval. So while financially it is your risk, we would also have to take a huge risk that you all would not have to come back to once you're finished with this part of the process that we would be left holding the bag. So while you have risk, we have an even greater risk. And particularly for my member colleagues who are here, this is probably one of the biggest risks we'll ever have to take. And so, I just want to be real clear about that, that we all have a vested interest in this project for a number of reasons, but it does impact everyone as well. Okay.
Councilmember, I just want to state very much appreciate what you're saying. And that there's risk that Council and the City have to take on with this project as well. I think we all have a little bit of risk here. I won't even say a little bit. We all have risk here. I think what we are saying is that in terms of the overall timing of specific information we'd have around financing wouldn't happen until we're ready to finance the project as things change, et cetera. But appreciate the spirit of what you're saying. And so, let us go back and see if there's anything in what we can share and circle back to you. I think we understand what you're trying to get at. So let us do some homework and see what we can come up with.
And to be clear -- Council President, I apologize for this delay -- but to be clear, it's not just the financing commitments and also projections, but also how you all came to the conclusion that this would be financially feasible for you to even engage in the first place. You have to have something to show your investors and others when you're working on a project of this magnitude. There is some documentation somewhere that exists that we have not been privy to that I think we should be as this project potentially may or may not move along. We need to have as much information as possible in order to make an intelligent decision. That's just the ask. Okay. Thank you very much, Council President, for the accommodation.
You're welcome, Madam Leader. The Chair recognizes Councilmember Quetcy Lozada.
Thank you, Council President. I just want to touch on a question that I asked you earlier, and I think Alex responded that there would be no displacement to some of those retail businesses on top of Jefferson Square. And I did get confirmation that if this project were to happen that all of the retail space at Jefferson Station would be lost and that none of those businesses have been communicated with regarding what the impact would be nor has anyone reached out to those employees. And so, I'm just trying to figure out where are we, what do we do, what's the engagement, who else do you need to talk to and who haven't you talked to?
No, thank you for the question Councilmember. We actually had a conversation about this during the break because I think we misinterpreted what the question was, so we appreciate the opportunity to clarify. And just to confirm, I think our earlier response was about businesses specifically within the SEPTA station versus the mall. We understand it's kind of open air so I think that may have been where some of the confusion came from. So Alex can clarify exactly what would happen to those businesses in the mall where the arena would actually go. So, Alex.
Yeah. Thank you. So David's correct, with regard to the mall any tenant that exists obviously has a lease. We're going to abide by those leases, the rights that those tenants have will be honored. And whether those tenants want to relocate if they did want to relocate, that would be as part of their leases. Each one has got its own nuance, but those obligations are on the landlord to offer them a space to relocate to, to fund the costs of the relocation and to make it available to them. And so, that's what I was referring to with regards to the existing mall. And David's correct, the delineation between the mall and the station gets a little murky down there.
I just want us to be conscious of the fact that when we're talking about projects this large, right, and we're talking about it in people's spaces, that there's anxiety, right, there's uncertainty. And so, let's be conscious of that and let's reach out to those people that feel like I'm going to be displaced. This goes beyond just the folks in Chinatown. This goes beyond the folks that are within walking distance. This is people right inside of that space. They should be a part of the conversation again on the front end as opposed to being an afterthought.
Yeah, you're right. And so, our partners at Macerich have been having those conversations, but we can certainly get more updates and would be happy to confirm with you if you have specific folks that you're hearing from. Would be happy to engage them directly.
Thank you, Member Lozada. Chair recognizes Councilmember Phillips.
Thank you, Council President. I just want to start by saying that this has been a riveting discussion and I've been relatively quiet throughout this entire hearing process because I truly wanted to listen and I respect all of our colleagues who have questions that are thoughtful to help us really make sure that we're getting this right. So I just want to say thank you on that regard. I just also want to note for the record so our public is very aware of the consciousness of our Mayor in terms of her negotiations. She is a -- one of the things I'll tell you is that when in the 9th District several years ago there was a marijuana dispensary that was trying to come into our neighborhood and she heard from neighbors that how important this was for this dispensary, this marijuana spot, not to come into our neighborhood. And she stood there to make sure that that didn't happen. She took neighborhood feedback, constant meetings. This also happened when some developers tried to come in and do work with building a house, right, houses that didn't fit our neighborhood and neighbors were complaining about that. So on record when she's saying that she's going to do everything that she can do to safeguard the neighbors in Washington West as well as those businesses in Chinatown, she has a track record of doing that. So when Councilwoman Blondell Reynolds Brown says, your previous actions dictate your future actions, her previous actions will dictate the fact that she's not going to allow for the Sixers, and I don't think the Sixers also would allow, for Chinatown to be in a position where they're not going to be thriving. So I do want to note that because -- the other thing is I do want to ask this question based off of that as well. The Sixers, you all have been in conversation about going to New Jersey for whatever reason. And our goal and I know the Mayor's goal is to keep you in Philadelphia. What was that possibility? And do you believe that our beloved Philadelphians would love for their beloved sports team to go anywhere else but Philadelphia? What was the possibility at hand of going to New Jersey?
For the record, you're still in discussion with Governor Murphy, correct?
That's correct. So our priority is and remains Philadelphia. That's why we're here today. Our company has a long-standing relationship with the state of New Jersey and are in constant conversations with them over a range of topics. But we are focused on this site. We want to be here. This is why we're here today. And if Council passes the legislation that's in front of them, our intention is to build here. We will be here.
Great. And I just have two quick questions as well. I'm sure you all have been to Chicago which is, outside of Philadelphia, one of my favorite cities in the nation, a great city --
Right. Well, don't go there. But when you look at the Chicago Cubs, can you talk about the research that you all did, what (inaudible) in the Chicago Clubs downtown and how that is -- I mean, it is a question but it's not comment too because it is electrifying, right. But did you see in Chicago, the Chicago Cubs downtown stadium that can work in Philadelphia?
It's a great question and it's more than just Chicago. It's 27 out of 30 NBA teams play in downtown arenas. There's also a very big distinction between an arena and a ballpark or a stadium. And I think that's something that's important to hit on. When we look at other venues and other cities, we looked at not just Chicago, but Boston or New York or Sacramento or San Francisco or Detroit or Milwaukee. And all of these have thriving districts that are mixeduse dynamic urban districts around the sports entertainment venue. They each have their own positives and negatives and there's a lot of things that we've picked up along the way and continue to. And I think that some of the key themes you've seen in our design are what we've been focused on, things like porosity at the ground level, activation at the ground level, non-event day activation, giving people a reason to be at this site when there's nothing happening inside our building as well as a transparency from the building materials and an aesthetic that is contextual to the surrounding neighborhoods.
Thank you. And real quickly, Building Trades how are they going to benefit from this experience? And then lastly everyone's been talking about this CBA, this Community Agreement, which I understand is really important because we got to keep Philadelphia thriving and increasing the funds. But in an ideal world, can you talk about -- I'm fairly confident, but you could tell me if it's true or not the Administration probably themselves would love to negotiate gazillions and gazillions of dollars, including the Mayor, for the Sixers to come back. And that conversation right now stands at $50 million, but that doesn't mean that our Mayor is not going to come back and try to increase that at some point. And you all will be open for that conversation as well; is that true? And also, the Building Trades, how does it help with our Building Trades and Black and Brown folks are going to be benefiting from that because we want the public to know how this is really going to help our labor community too?
Sure. So taking the first question with the Building Trades, we are very grateful to have the support of the Building Trades. We believe in union labor. We believe that this will be union built and union operated and also -- not we believe. We are committed for this to being union built and union operated. And then as I was detailing in an early part of the hearing, we're also committed to making sure we're working hand-in- hand with the building trades and the carpenters to increase the diversity and opportunities within their ranks. And that's why we're a founding member of Everybody Builds and really was the impetus to bring that together and are looking forward to continue to work with Everybody Builds, utilize that as a tool to ensure that this project and also development projects across the city are used as real tools to expand opportunity. The second question was around the CBA, right?
The CBA, as we've mentioned the CBA we believe is appropriate given the project in context of past projects as well as us not seeking City funding. And again, we welcome additional conversations around how that should look. We know the Administration does as well based on their comments yesterday.
I just want to say that some of these conversations that happened, I want folks to know it's fairly possible that $50 million might have been the first initial offer, but there's so many intricacies that go into coming to that final number, right. And I just know that our Mayor and our experience if there's a way to get more money from the Sixers, that's going to happen, right. And I think that we're going to continue to try to find ways to get more benefits from this. And that's why I appreciate our colleagues asking about it, but I also want the public to know if the Mayor wants -- if she could get a gazillion dollars from this deal, she would, and she's going to keep fighting to get that gazillion dollars if she could.
Thank you. The Chair recognizes Dr. Nina Ahmad, City Councilwoman.
All right. Thank you so much, Council President. All right. First, I wanted to echo what our Majority Leader spoke about, which I had referenced earlier as well, understanding the financial stack because what if you default on the loan, so understanding the terms and evaluate the risks are really incumbent upon us. And perhaps as evidence of financing, you can give us just a letter of credit that is contemplated, right. There's a myriad of ways to address our concerns, so I hope you will address that. I also want to go on the record about the economic analysis and details as provided in Bill 23 240973. It provides a context of new tax revenues being projected from the proposed 76 Place over 30 years. While the 248 million over 30 years is impressive, it is only 8.2 million per year in new taxes from all sources, sales tax, wage tax, PILOT, amusement, parking tax, et cetera, which includes that 1.82 million in PILOT payments per year, which includes City and school taxes combined. So for context, we took a look at similarly-sized projects, about 1 million gross square feet, and they're not exactly apples and apples, and this is on Market Street like the Marriott. The PILOT for 76 Place is 40 percent lower than the 3 million in real estate taxes being paid by the Marriott, which also has other revenues spinning from it, including hotel tax. I realize they're a different business. They're open not like you will be. However, that's just to give us some idea of what others are generating for us. So I want to go on the record that the City is making significant investments in the form of service fees that will be appropriated annually to PAID, the front-end, administrative and legal cost of striking streets entitlements, foregone real estate taxes under the PILOT and U&O payments and foregoing the fair market value of the fee interest in the site by providing the right to purchase fee simple title to the Arena for $1, right. For that I will propose that the participation at the exit lease termination to make us whole. We're giving up quite a bit, so you're going to be benefiting. And your projections are conservative, and I'm sure you'll do really well. We would love to see something for us to participate in at the termination. And I'll be finished in a second. I further believe that, and others have said this, the proposed 50 million CBA is not proportionate to other arena projects around the country. You talked about the ones inside Philly. It also stretched over a longer period, which dilutes the economic effect of investments in community projects and programs. So perhaps there's a way to shorten that to maybe years, replenished with 15 additional CBA commitments for the remainder of the lease term. That's maybe one way you can get around that. So we do have great opportunities and challenges ahead. We must balance the prospects of economic growth with the needs of our community that will face social and economic consequences and the fiscal impact on City finances. So thank you and I'd love to hear your responses.
Just one initial response because we appreciate that City Council has an important decision to make and we just want to make sure everybody has accurate information. The PILOT payment I believe, Councilmember, you referenced 1.82 million per year. Our PILOT payment would be an average of 6 million a year over the course of the lease, which would be multiple times more than every stadium and arena in South Philadelphia, would be significantly more than the mall currently generates, and would be one -- if you compare it to other privately- held buildings in the city, would be one of the highest tax buildings --
I'm talking about the net present value calculations which is from your table here. I took it from what was provided.
Yeah. I think that's an important distinction, net present value versus cumulative total.
Specifically as it relates to the PILOT, the PILOT is an annual amount that's set at starting at $5 million and then escalates.
Yeah, so net present value is what that's worth today to the City.
Right. I'm just using your numbers that were given to us in this 16.
I think those are from the City's studies. And I do believe that they look at the NPV as well as the cumulative, but happy to spend some more time --
-- over this. That's an important number for us, what are we giving up in terms for the PILOT payment.
Yeah. I think the answer is we're not asking the City to give up anything. We're not asking the City to give any dollars to this. We're not asking the City to put anything into this from a monetary perspective, notwithstanding comments previously around the risk and what's being asked from this Council. But financially, we are not asking for anything from the City and the billion dollars of projected revenue or if you use the City's numbers, the $700 million of projected revenue are at no cost to the City because the City is not putting any dollars in.
And the key word is projected, right, which was a concern that all of us have expressed. One is the projected and the net present value is what we can only use to say how we're making whole what we're not getting in real estate taxes. That's how we would say what we're doing, right. How else are we going to assess that?
The concept of net present value is typically used when you're trying to assess what should I pay today for the rights to a future revenue stream. In --
So in the context of this transaction because the City isn't paying anything, it is our position, and I believe the City would testify to the same thing, the concept of net present value is not really applicable to this agreement as well as our agreement for the PILOT is $5 million a year starting.
However, what we are -- the only way we can do it is today, right. We're looking at what we're foregoing over the years today, and that's what we're going to be able to negotiate with you to say either you increase your PILOT or maybe you can offset it by putting it into CBA. It seems like we're not getting our fair value is what I'm really trying to get at. That's one. And the second thing is we don't have any guarantees which is why the escrow conversation happened, which is why the need for getting some financial stack numbers are important. We're going to sign away a lot of stuff in giving you and hoping all of these -- and as we said projected. So these are the reasons why we need to in today's value understand what's going on and what we are foregoing.
Yeah, understood. I think in today's value the mall generates about a little over $1 million in taxes. And in today's dollars, we would pay $5 million in PILOT.
In the PILOT. However, why are these -- these are not your numbers?
I believe what you're looking at is from the City's studies.
So I'm going to -- obviously they did their study and that's what they're giving us to review in this bill so I'm going to go by this. So that is a discrepancy between what you're saying and what they're telling us.
I don't have the report in front of me. I believe there's a page towards the end that shows the cumulative numbers versus the NPV numbers --
I just want to make sure that we understand that we are foregoing value. Whatever we would have put in there instead of you we are not realizing those real estate taxes.
Sure. I think we definitely would like to spend time to make sure because I think we may be talking past each other and not fully understanding the information that you're looking at right now. But I do just want to be clear in terms of whether it's net present value or today's dollars, as long as it's comparable figures or analysis. What we will be paying on the mall is more than what -- what we would be paying in a PILOT is multiple times more than what the mall currently generates.
Well, yes, of course which is why we are even contemplating doing this. Of course, that's a given. But we're just wanting to know if not you, something else might be able to make us more whole and that's why this negotiation -- this is a negotiation --
-- or else you would not be testifying. This is not final. What you've said is not final. What we've said is not final. We're going to come up with something better and our job here is to make sure the City makes out, which means our constituents make out on this. So obviously what you're going to project, what we are going to project, we have to come to a place to say which one is the correct projection in order for us to move forward because I'm just looking at the projection in the bill that the City transmitted to us. And in that transmittal, I can tell you what the real estate taxes would have been from comparable, as I said, the Marriott, which is not exactly the same, is a lot more. So in the PILOT perspective, we are giving up some resources. And since there's been a conversation about the Community Benefits Agreement, I think reducing the time and having a back-end renegotiation on that and allowing some of what we're giving away in the PILOT to show up in the CBA, that's one way to look at this negotiation. Just telling you to -- we're going to negotiate.
This is not the final. And as my colleague Anthony Phillips mentioned, the 50 million from everybody I've heard here doesn't seem to be final for us. It sounds like it's a final for you, but we've got to sign off on this.
Understood and appreciate it. And we'd love to spend time because I think some of the numbers that you're referencing are not computing with how we interpret the numbers. So we want to make sure that we're speaking the same language. Absolutely.
Yeah. Just once again this is what was given to us by the City in this bill.
So can you and your team provide 76 Place numbers?
We'll take a look at what the Councilmember is looking at and make sure we have an understanding --
Compare some of the Councilmember's numbers. Okay. Dr. Ahmad?
Thank you. The Chair recognizes Councilmember Kendra Brooks.
Thank you, Council President. So my first thing is just a point of clarity from Councilmember Landau's question about the WNBA team, because we've been doing a lot of WNBA research. So are you committing today would a Philly WNBA team be playing in that stadium because it's to my understanding that currently the majority of the WNBA teams play in separate arenas?
Sure. So our expectation is that if we are successful in a bid for a WNBA team, the team would likely start before this is open. But this would eventually be -- once this opens this would be their permanent home.
It'll be a shared home between the Sixers and whatever WNBA team?
Okay. So my next question is about jobs. So what's the average wages for stadium employees and other properties owned by your company?
Because developers websites claims that the new arena will produce 12,000 jobs, and I know we've been going all over the place with this number. And the Mayor's presentation claims that over 1,000 construction and operations job. But the current economic study said around 700 jobs for Philly total, and a third of those will only happen during the three-year construction period. Which estimation is correct in your opinion and why?
So I think there's a number of different assumptions being talked about. One, there's during the construction period and then during the operations period. And so, those are two different periods that need to be delineated. I can tell you what our projections are for those periods, which are the numbers that I quoted before in terms of during construction. The 9,000 FTE jobs and the 3,000 FTE jobs for indirect and induced. And during operations, 1,000 jobs onsite.
Okay. So for that, we have a long history of developers making promises about jobs to get what they want and only to leave the residents with little to nothing in the end. So the 76ers owner received $82 million in government subsidies to build a practice arena in Camden, but seven years later the practice facility only employs seven Camden residents. Why did this happen and what went wrong in Camden that would prevent it from going wrong here in Philadelphia?
Sure. Thank you for the question. So a couple things. One is that -- and I just want to be clear and state for the record, when we built our practice facility in Camden there were a number of commitments that we made to the Camden community and we followed through on all those commitments. We also know that in contemplation for the redevelopment of the Camden Waterfront for a lot of different companies and employers that ended up building their homes in Camden there was the promise of jobs, to your point, Councilmember. We have invested -- we are investing over $1 million in Camden organizations and workforce development programs to better prepare Camden residents for jobs. Also with the 76ers, we have an agreement with Rutgers Camden to provide internships. One thing that's unique about our business is that a lot of the roles within an NBA team are extremely specialized. And so, that is an organic challenge in terms of ensuring that residents from a specific and relatively small city are equipped and capable to serve in those very specialized positions because they require a lot of specialized training. One thing that I think we're really excited about the potential for this project is there's a much vaster diverse array of jobs that will be available as a result of arena operations that will also be much more accessible, which is one of the things that we're excited about in terms of the opportunity for Philadelphia residents to take advantage of opportunities here. We also know that there's provisions in the Community Benefits Agreement to provide internships to ensure that we're preparing Philadelphians for those jobs as well.
So out of the jobs that are currently in Camden, so the seven are skilled jobs or they're --
I don't think the -- I'm not sure if the number is seven, but I'll confirm that. And I don't have the specific breakdown in terms of which jobs those are. We also know we've had instances where we hired residents of Camden that then chose to move out of Camden so that number fluctuates pretty regularly. But we can go back and make sure that we get you the classifications on the specific jobs.
-- because I know there are skilled jobs associated with the practice arena, but there are also unskilled labor that happens --