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Amway Center
Amway Center

  Venue Resources  
Address Church Street
Orlando, FL
Phone
Weather
Newspaper
Magic Gear
  Calendar / Tickets  
Hotels, Dining & Deals in Orlando

  The Facility  
Opened 2010
Ownership
(Management)
Cost of Construction $380 Million
Arena Financing
Naming Rights Amway Corp. will pay the city $40 million for a ten-year deal.
Arena Architects Populous
C.T. Hsu + Associates
Baker Barrios Architects
General
Contractors /
Construction Managers
Hunt Construction Group
  Other Facts  
Tenants Orlando Magic
(NBA) (2010-Future)
Orlando Predators
(AFL) (2010-Future)
Population Base 1,750,000
On Site Parking 7,400
Nearest Airport Orlando International Airport (MCO)
Retired Numbers #6 "The Sixth Man/The Fans"

  Seating  
Capacity 18,500
Luxury Suites 66 Suites
327 Loge Boxes
Club Seats 1,428
  Attendance History  
Season  Total  Capacity Change
1992-93 621,191 88% 0%
1993-94 626,931 89% 0.9%
1994-95 656,410 93% 4.7%
1995-96 707,168 100% 7.7%
1996-97 726,597 103% 2.7%
1997-98 701,647 99% -3.4%
1998-99 411,091 95% -41.4%
1999-00 576,409 82% 40.2%
2000-01 605,031 85.6% 5.0%

2001-02 2002-03 2003-04 2004-05
621,121 605,901 589,194 597,942

2005-06 2006-07 2007-08 2008-09
638,005 700,887 709,346 698,768

2009-10 2010-11 2011-12 2012-13
715,901 777,852 623,587 721,414

2013-14 2014-15 2015-16 2016-17
666,046

1992-2010 - Attendance at the Amway Arena, Orlando, Florida.
1998-1999 - Attendance for 25 games due to NBA lockout.
2011-2012 - Attendance for 33 games due to NBA lockout.

Sources: Mediaventures

New arena drawings revealed, showing new home for Orlando Magic, Orlando Predators, Concerts

Mark Schlueb and David Damron
Sentinel Staff Writers
December 11, 2007

The Amway Center will rise 15 stories and feature a dramatic glass tower and an outdoor public balcony twice as big as its basketball court.

Early details of the $480 million center's design that were shared with the Orlando Sentinel on Monday show a facility that would be markedly different than the team's current home court.

More than twice as big, it would have seven levels and four concourses. The 800,000-square-foot building, scheduled to open in 2010, would feature four restaurants and bars inside, along with restaurants and retail space accessible from the street when there are no games or events.

But perhaps the biggest difference between the new building and the Amway Arena would be the exterior. Where the current arena has an exterior made mostly of concrete, the new design incorporates a 20,000-square-foot, glass-front entryway facing Church Street and a 151-foot glass tower facing Interstate 4.

"We'd like people, as they come to this building for the first time, to be blown away," said John Shreve, an architect with the firm HOK Sport who is helping design the arena. "At the same time, we want it to have a sense of what Orlando is."

Architects said they incorporated one prominent element because it's common in Florida architecture: balconies.

One of them -- the largest at 10,000 square feet -- will sit 38 feet above the ground, several feet higher than the raised deck of I-4 as it passes by. The glass tower will feature a second, smaller deck 116 feet above the ground with a sky bar.

The building -- known as an events center -- would hold only slightly more seats than the current arena: 18,500 versus 17,282 when configured for an NBA game. But the layout bears little resemblance to the current arena and is designed to accommodate the pricier seating options largely absent from the Amway Arena.

There will be three bowl levels instead of two. In between each level will be a row of luxury suites -- 56 total -- compared with the current building's ring of 26 skyboxes along the roof line. There will be 10 other specialty suites. Magic premium-ticket holders would get access to other events, including concerts and college sports.

Magic Chief Operating Officer Alex Martins said the pricing of the luxury suites hasn't been decided, but they'll probably go on sale in the spring.

While there are amenities meant to lure deep-pocketed fans, Magic executives are sensitive to criticism that the new arena will serve only the wealthy. Magic officials say just 15 percent of the total seating will be premium.

The team will offer at least 500 tickets for $5, but exactly how many remains undecided. Fans at all levels will be able to see the event floor from a public bar and food court. And even the cheapest seat will be at least 20 inches wide, 3 inches more than found in the existing arena.

"We've tried to create a wide variety of amenities for every level," Martins said.

Even so, a public parking garage connected to the arena via a raised walkway will likely have most of its spaces set aside for players and high-priced ticket holders. Most fans will have to park in other nearby garage and lots or arrive via a nearby commuter-rail station.

The Amway Arena is only 18 years old but was considered obsolete almost immediately. Architects say that won't happen with the new building. The large size -- 800,000 square feet compared with the existing arena's 367,000 square feet -- allows for "maximum flexibility" in adjusting the new facility for a variety of events.

"This is the most complex bowl they've designed anywhere in the country, and that's because of the flexibility," Martins said.

City officials, who are working with HOK Sport architects, said they consulted with promoters to ensure the building would accommodate touring events. As for college sporting events, only the men's Final Four basketball event would be too big to fit in the new arena, although the Orlando facility could host all other NCAA tournaments, officials said.

"We want to make sure it has the elements you need to operate 365 days instead of just 41 days a year," said Allen Johnson, the city's venues director.

City officials said they also wanted to make sure the design would complement downtown and fit the community. That's one reason it has a different look on each side. To the east, its large LED sign, glass tower and monolithic height -- 23 feet taller than the Amway Arena -- is designed to grab the attention of I-4 drivers.

On the opposite side, the one facing the Parramore neighborhood, there's a public plaza and the team's indoor practice court, with the height dropping down to about four stories. The practice facility would have a glass wall for the public to watch from the street.

Amway Center

October 9, 2008
Copyright 2008 MediaVentures

The Orlando Magic's new arena will feature a beacon with color-changing lights visible across downtown, according to new design details from the building's architects. The lighted beacon - along with an even taller spire - will dominate the arena's main entryway and serve as an iconic emblem for downtown Orlando, Magic chief operating officer Alex Martins said. The 150-foot tower will be clad in stainless-steel mesh and illuminated by about 200 LEDs that will change color based on events taking place inside. A narrow spire will reach 188 feet above street level and be lit by spotlights. HOK Sport, the arena's architect, also released details of the building's open-air party deck, which would sit 42 feet above the ground, and the 110-foot-high sky bar at the top of the building. Construction of the building started in November. Martins said 1,600 pilings have been driven at the site to support its foundation. Structural columns will begin rising as early as next week, and completion is scheduled for fall 2010. (Orlando Sentinel)

Orlando's New Arena Shoots for on-time Finish
December 6, 2008
Copyright 2008 MediaVentures

Construction of the Orlando Magic's new $480 million arena is on target to finish on time in 2010, with the building now rising from a dirt lot in Parramore.

"In certain respects, we are a little bit ahead of schedule," Magic chief operating officer Alex Martins said Friday.

Workers have finished driving concrete support pilings into the ground at the 9-acre site. Columns and horizontal decks have begun going up as workers start on the east side of the site and work clockwise around what eventually will be center court to complete the exterior shell of the building during the next seven months.

Hunt Construction Group, the prime contractor on the job, also has built Lucas Oil Stadium, home of football's Indianapolis Colts, and is finishing the New York Mets' new baseball park. In Florida, the company built the Tampa Bay Buccaneers' stadium as well as the St. Pete Times Forum and Joe Robbie Stadium.

The Magic are scheduled to move into the new building in August or September 2010, in time for the start of that year's NBA season. Magic execs stressed that the project is bringing much-needed construction jobs in a tough economy.

Willard Holmes Jr., president of True Power Electric of Orlando, said his contracting business was on the verge of ruin until he landed a $170,000 subcontract to work on the arena. His 11-man crew is finishing 12 weeks of work ahead of schedule in just seven weeks.

"About two years ago, when the economy started to bottom out, our account receivables withered with it," Holmes said. "I had maybe a month, month and a half and I would have had to close up shop." Source: Orlando Sentinel

MAGIC TAKES LOAN TO COVER LOSSES
February 26, 2009
Copyright 2009 MediaVentures

Orlando, Fla. - The Orlando Magic plan to borrow about $10 million from the NBA to largely offset operating losses incurred by the franchise, helping to bridge its move into a new arena in 2010.

Alex Martins, the Magic's chief operating officer, said the club is among as many as 15 teams who intend to tap into a $1.7 billion league-wide credit facility that will soon be supplemented.

"In general, the NBA has a league-wide credit facility, just like the other leagues do. The league had already utilized the major portion of that," Martins said. "The league went out to the 30 teams and asked if they were able to get another line of credit, would we be interested? We said, 'Yes.'"

The league surveyed its 30 teams, and 15 were interested in acquiring a loan. Each of the 15 teams can borrow a maximum of $11.7 million from the debt proceeds.

Martins said the money will be used to help the club offset huge operating losses.

He estimates the Magic have lost an average of $15 million each season during the last half-dozen years - and will lose at least another $15 million this season - and won't begin to break even until the club moves into its new arena in 2010.

"Because of our operational deficits, which will be about a $15 million loss this season, that is not going change until we get in the new building.

"It's a bridge for us. It helps us cover some of our operations losses and debt as opposed to additional equity in the team," Martins said. (Orlando Sentinel)

SUITE SALES STRONG FOR MAGIC
March 12, 2009
Copyright 2009 MediaVentures

Orlando, Fla. - Luxury is on its way out, but the Orlando Magic are hoping it's back in by the time the new arena opens in the fall of 2010.

So far 54 out of 60 premium suites and 65 of 68 loge boxes are under contract, said team Chief Operating Officer Alex Martins. A $10,000 deposit was required on the suites, which cost between $150,000 to $295,000 a year, and on the loge boxes, which cost $40,000 to $60,000 a year.

Those numbers aren't bad, especially given the slash and burn cost-cutting most companies are going through right now. Time will tell, however, whether those contracts get broken. It's a lot easier to leave a $10,000 deposit behind than commit to annual payments in excess of $150,000 for at least three years.

No matter how many suites are actually sold the Magic will owe the city of Orlando, owner of the arena, $1.75million each year - a fee set to escalate 3 percent each year for 25 years - as part of its overall contribution to the arena.

"People don't want to miss out on the opportunity of the new facility," Martins said. "By the fall of 2010 the economy will have rebounded into a better place."

But the recovery from the recession is widely expected to be a flat one. That means slow to no growth.

The translation is dim prospects on big sponsorship deals for the arena as well.

With a number of stadiums and arenas in the hunt for sponsorship agreements right now, including naming rights, it's a buyer's market for the brands that are willing to pay to intertwine with an NBA, NFL or even college team.

Still, Martins remains optimistic.

"We've had some really positive conversations," he said.

The Magic are also selling memberships to their "Champions of the Community" program, which would include brand exposure in the five community gymnasiums the Magic pledged to build for $25 million as part of its deal with the city and county to construct the $480 million arena with mostly public money.

Construction on the first community gym at Curry Ford Community Park will begin in April. (Orlando Sentinel)

April 23, 2009
Copyright 2009 MediaVentures

Melbourne, Fla.-based Harris Corp. and the Orlando Magic have signed a multiyear deal To make Harris the official technology provider for the new arena. Under the deal, Harris will put in 1,100 high-definition screens, an Internet television system and a state-of-the-art sign network. Harris will get a key spot in the Magic's marketing and communications campaigns. The company will also sponsor a new Fan Zone on the west side of the new arena. The price of the deal was not revealed. The new Orlando Events center is scheduled to open in October 2010.

Putting Amway Brand on Orlando Magic's New Arena Goes Beyond Naming Rights
by Chris Knape | The Grand Rapids Press
Wednesday August 05, 2009

Calling the Orlando Magic's next home Amway Center wasn't a simple naming rights deal.

The Ada-based multi-level marketing giant calls the 10-year, $40 million deal with the 2009 NBA Eastern Conference champions a far more sweeping "vision rights commitment."

The deal continues the re-emergence of the Amway brand in North America and the close relationship between the company and the team.

Amway co-founder Rich DeVos owns the Magic. Team President Bob Vander Weide is DeVos' son-in-law.

Sports Business Journal reported that the agreement is tied for sixth-largest naming rights deal in the NBA.

In an interview after announcing the deal, Candace Matthews, Amway's chief marketing officer, said the $380 million city-owned Orlando, Fla., venue will provide the company with a world showcase for its brands when it opens in fall 2010.

"The Orlando arena and Orlando itself is a global destination place," Matthews said.

"We operate in over 80 countries and territories, so it has the ability for us to bring our global business to a place that is actually global."

Amway struck a deal to name the Magic's current home Amway Arena in 2006, an agreement that also gave the company the exclusive option for naming rights at a new arena, The Orlando Sentinel reported.

Since then, the company has rebranded its U.S. and Canadian operations Amway Global, launched an extensive U.S. advertising campaign, and cut endorsement deals with other sports teams and prominent athletes as it tried to polish a well-known brand that had been tarnished by tax scandals, sometimes questionable recruitment practices and disputes with its distributors.

Matthews said the company's plans for promoting its brand at the arena aren't adequately described as "naming rights."

Amway "experiences" -- like the mobile units promoting its Nutrilite and Artistry brands that have followed Amway-sponsored events around the country -- will be part of the arena, allowing visitors to "interact with our brands," Matthews said.

More than 1,000 screens inside the arena, which seats up to 20,000 people, might be adjusted to promote Amway brands most relevant to an event's audience.

An event with a large female audience, for example, could use the boards to promote Artistry cosmetics. Male-oriented events might have marketing geared toward Amway's sports nutrition and men's skin-care products.

Although Amway is increasingly rolling out stores where consumers can buy its products in Asia, the company will not have a retail presence in Amway Center, Matthews said.

The company's desire to make Orlando a hub showcasing its brand will not detract from the amount of business it brings to Grand Rapids, she said.

Amway's headquarters and its three downtown Grand Rapid hotels play host to thousands of visitors from around the world each year.

"Grand Rapids will always be the primary place where we bring our distributors from all around the world," she said.

CONCESSIONAIRES VIE FOR ORLANDO VENUE
October 15, 2009
Copyright 2009 MediaVentures

Orlando, Fla. - Three firms - Levy Restaurants, Centerplate and Aramark - are bidding for rights to be the concessionaire for the Orlando Magic's new arena that opens next year. Levy currently serves the Magic at Amway Arena.

Other possible contenders are: Ovations, which serves the Ocean Center in Daytona Beach and Jacksonville Municipal Stadium; and Delaware North Companies Sportservice, with clients including the St. Pete Times Forum in Tampa, Dodger Stadium in Los Angeles and Soldier Field in Chicago.

The concession contract has always been competitive. But the new arena boasts many more dining options and bars than the Magic's current home court - and will presumably earn more money for its concessionaire.

Levy has hired lobbyist Kelly Cohen of Southern Strategy Group, a former campaign fundraiser for the mayor who also has close ties to his chief of staff. Centerplate's lobbyist is attorney Fred Leonhardt, a senior partner at the powerful Gray Robinson firm who has cultivated deep political connections over the years.

Levy, Centerplate and Aramark have also opened their checkbooks. Records show that Lynum, Diamond and Robert Stuart, the three city commissioners who face re-election in the spring, each has received campaign contributions recently from one or more of the prospective concessionaires. Stuart has received $1,650, Lynum $700, and Diamond $900.

Because the city requires that a percentage of the contract go to businesses owned by minorities and women, bidders typically partner with local minority firms. Levy already partners with Orlando food-service manager Arthur Lee. Former San Antonio Spurs center David Robinson's investment firm, Admiral Capital Group, has a stake in Centerplate. And Aramark is partnering with Johnny Rivers - a relationship that some say said led to his recent ejection from Amway Arena by Levy after 10 years at the venue.

City officials have not yet solicited bids. Once they issue a formal request for proposals, bidders won't be allowed to lobby commissioners. Bids will be evaluated and ranked by a committee made up of city staffers and Magic employees. The City Council has the final say.

Currently, the city and Levy have a management contract. The city covers all expenses and pays the concessionaire a flat fee of $250,000 a year plus a small percentage of revenues.

The annual payment is capped at $500,000, which is nearly all profit for the contractor. The city collects the balance of the concession revenue.

But the city and the Magic are also considering a "commission contract," which is also common at public venues. The concessionaire would pay expenses and pay the city a percentage of sales, typically around 40 percent.

One other difference that will affect Orlando's bottom line: Unlike the current arrangement, the city has agreed to let the Magic keep concession payments on game nights.

November 12, 2009
Copyright 2009 MediaVentures

The largest video screen in an NBA arena will be installed at the Magic's new Amway Center in Orlando. The venue opens in 2010. Daktronics will design and manufacture more than 50 full-color light emitting diode (LED) displays for the arena. The centerhung scoreboard alone will include four primary high definition LED video displays with 840 lines of resolution, approximately 17 feet high by 24 feet wide, eight auxiliary video/scoring/statistics displays, and two LED ring displays. The venue will be the first in the world to utilize high resolution 6 mm surface mount LED pixel technology on all of the centerhung digital displays. More than 9 million individual LEDs will be used in the 18 displays incorporated into the centerhung scoreboard. Overall dimensions of the centerhung scoreboard are 42 feet by 41 feet by 41 feet, making it the largest of any in NBA venues.

TICKET PRICES RISE IN MAGIC'S NEW ARENA
December 3, 2009
Copyright 2009 MediaVentures

Orlando, Fla. - The Orlando Magic have begun the process of working with season ticket holders to prepare for a move - and new prices - at the team's new arena. While some prices have declined, others will increase by up to 51 percent.

The cheapest seat in the lower bowl is now $27 per game for season ticket-buyers. In the new Amway Center, the cheapest lower-bowl ticket - on the terrace level - will cost $40.

The most expensive seat in the lower bowl is now $230 per game; that will increase to $295.

The priciest ticket in the house - the courtside seats next to the teams' benches - will jump from $1,000 to $1,350 per game. However, that also comes with new benefits, including valet parking, food and drink, concierge service and an autographed player jersey.

Architectural differences make it difficult to compare the current building to the new one; some seats simply won't exist anymore because they've been displaced by premium seating. Mid-level luxury suites took the place of eight to ten rows of lower-bowl seats.

A restaurant and a bar on opposite ends of the building will have views of the court, and the building has been designed to ensure no seats infringe on that view. Disabled seating has been added at all ticket levels.

Magic officials point out that they've reduced the cost of the two lowest-cost ticket tiers; there will be 650 $5 seats and 1,850 $15 seats.

Of the 18,500 seats in the new arena, 7,000 are priced at $25 or less; another 3,000 are between $25 and $50.

MAGIC GETS INITIAL APPROVAL FOR OUTDOOR VIDEO SCREEN
December 17, 2009
Copyright 2009 MediaVentures

Orlando, Fla. - City commissioners, in a narrow vote, have given preliminary approval to a 46- foot tall, 54-foot wide video screen the Orlando Magic want to erect outside the new $480 million Amway Arena.

Those opposing the screen, in a 4-3 vote, were concerned about distracting drivers on nearby I-4 and whether it would degrade the building's appearance. A final vote will happen in January.

The big LED screen is a premier element of a $10.5 million package of high-tech video signs and screens that will blanket the arena inside and out. Magic executives have boasted that their screens will be the most advanced of any NBA arena.

That screen, along with another on the building's garage and a third on its rounded nose, will be used primarily to promote events at the city-owned building. But all three will also feature advertising for companies with sponsorship deals with the team.

A private business would not be allowed to display such a large video sign under city code, but the City Council can grant permission to allow them on public buildings.

Under an agreement with the city, the Magic keep the revenue from the sale of naming rights, luxury suites and advertising in lieu of an annual payment to the city of $1.75 million, an amount that increases 3 percent a year.

By state law, the signs can advertise only businesses or events associated with the building. In the arena's case, that means the seven "community partners" the Magic expect to sign to promotional deals with. So far, only three are confirmed: Amway, the company co-founded by team owner Rich DeVos; Harris Corp. and AirTran Airways.

City officials have veto power over any advertising.

STATE MAY LIMIT POTENTIAL OF MAGIC'S VIDEO SCREEN
January 14, 2010
Copyright 2010 MediaVentures

Orlando, Fla. - State officials say a large LED screen planned for the Magic's new arena in Orlando could violate state billboard laws if it promotes anything other than goods or services provided inside the building. If advertising were planned, the sign would become a billboard and would violate the laws and could be prohibited.

The Magic plan to offer screen time to seven key sponsors that team execs are calling "champions of the community." So far, Amway - co-founded by Magic owner Rich DeVos - has signed a deal, along with AirTran and Harris Corp.

Chief Operating Officer Alex Martins said each sponsor that will have screen time will supply something inside the arena. Fans will be able to buy AirTran tickets while at a game, for instance. Other sponsors may be beverage companies such as Pepsi or Budweiser, whose products would be sold during events. Harris Corp. is supplying much of the technology within the arena, and Martins said the building would serve as a showroom of sorts where Harris can display its work to the owners of other venues.

Most of the time, Martins said, the video screen would promote events, not commercial advertising.

The city has given initial approval to the sign. It comes up for a final vote Jan. 25, and Magic execs are expected to launch a full-court press to make sure the vote goes their way.

The city may have a financial stake in the video screen. The arena agreement calls for the Magic to pay the city $1.75 million a year in lieu of revenue from naming rights, luxury suites and advertising. The team factored in the money it will earn from the sponsors broadcast on its video screen when that number was negotiated.

ORLANDO APPROVES SIGN FOR MAGIC
January 28, 2010
Copyright 2010 MediaVentures

Orlando, Fla. - The Orlando Magic has won approval from the city for a large video sign on its new arena, but the approval comes with conditions. The plan barely passed a preliminary vote last month, with several commissioners fearing that flashy video of larger-than-life Magic players would prove too distracting for drivers on the congested stretch of I-4 that's next to the new arena.

Just before the vote, city staffers introduced an eleventh-hour compromise meant to address those concerns.

Magic execs had previously estimated video clips would be about 15 seconds long. Under the new rules, the screen can display only two full-motion video clips per minute; they can't run consecutively; and each clip can be no longer than five seconds. In between video clips, the screen will display static images that change every eight seconds.

With those guidelines, the Magic can display a combined 10 seconds of video and six different images each minute.

Mayor Buddy Dyer said he would support nonstop video clips but thought the new rules were a good compromise.

The new arena is owned by the city, and Magic representatives said the screen will split time equally between Magic programming and promoting concerts and other events at city venues. The Magic's screen time will include advertising for a half-dozen team sponsors, including Amway, AirTran Airways and Harris Corp. State law says any advertising must feature only goods or services available in the building; otherwise, the sign would be considered a billboard and be subject to Florida Department of Transportation rules. The team wants to avoid that because the sign is so big it would never be approved for a billboard permit.

So, sponsors featured on the video screen will either sell or display their goods in the building, Magic chief operating officer Alex Martins said. AirTran, for instance, will sell plane tickets there.

NEW CONCESSION DEAL BOOSTS MAGIC'S REVENUE
February 4, 2010
Copyright 2010 MediaVentures

Orlando, Fla. - The Orlando Magic will get more revenue from concession sales in its new arena under its agreement with the city. The city would take in an estimated $12.9 million during five years from arena concessions, or about $2.6 million a year. That's less than the $4 million the city brought in last year under its contract at Amway Arena, the Magic's current home court a few blocks north.

But during the same period, the Magic would make $29.9 million - just less than $6 million a year.

The split is the result of an agreement between the city and the Magic that was approved when the venues were being debated in 2007. That agreement changed the basic structure of who will profit when fans buy food and drink at the new arena.

At the old arena, the city pays all expenses but collects most of the money. The city pays the company that runs the food operations a flat fee plus a small percentage of revenues. The payment is capped at $500,000 a year.

At the new arena, a food-service company will pay all expenses and keep most of the money, paying the city a commission based on its sales.

But the biggest change in the new agreement is that city officials agreed to let the Magic keep the commission revenue from all of its games. The city will keep the commission generated by the roughly 150 concerts, graduations and other events at the arena every year.

Magic Chief Operating Officer Alex Martins said the deal is good for the city because the 47 percent commission the likely winning bidder agreed to pay is among the highest of any NBA venue. Bidders offered a generous commission on the strength of the Magic's fan base, he said.

Concession bidders expect Magic games to sell out and Magic fans to buy more food and drink than those who attend the venue for other events, such as a circus. For that reason, bidders were willing to offer more than they would if they were simply serving food at concerts and other city events, Martins said.

The 2007 agreement also requires the Magic to pay the city $1.75 million a year - increasing 3 percent annually - in lieu of revenue from naming rights, luxury suites and advertising. And switching to a commission contract allows the city to avoid paying food-service expenses, and to assume less risk, Orlando Venues Director Allen Johnson said.

Orlando Foodservice Partners, which offered the highest percentage, at 47 percent, is expected to get the final contract. The firm is a joint venture led by Levy Restaurants. The other bids ranged from 39.2 percent to 43.1 percent.

February 25, 2010
Copyright 2009 MediaVentures

Orlando Foodservice Partners, a group that includes Levy Restaurants and Orlando businessman Arthur Lee, has won the concession contract for the Magic's new Amway Arena. The group had been selected earlier for the five-year deal, but the latest vote by the Orlando City Council solidifies the agreement between the two. The deal is estimated to be worth $50 million over its term. Orlando Foodservice Partners offered to share a 47 percent cut of sales, a higher percentage than its competition. Based on sales projections, the city would collect an estimated $12.9 million in commissions over five years - or about $2.6 million a year - while the Magic would collect $29.9 million. The city collects about $4 million a year now and must pay expenses from that total.

FITCH DOWNGRADES BONDS FOR MAGIC ARENA
April 8, 2010
Copyright 2010 MediaVentures

Orlando, Fla. - Fitch Ratings has downgraded $311 million in bonds sold to help finance a new arena for the Magic to "junk" status and warned the city could default on the payments at November 2012.

"At some point in time, the city may exhaust its reserves, which could result in payment default," said Rachel Barkley, director of public finance for Fitch Ratings.

The Amway Center arena, scheduled to open this fall, isn't in danger. The city sold $311 million in bonds in 2008. Along with contributions from the Magic and other public funds, the project has all the money needed to finish the job.

But a default would hurt the investors who bought the bonds, and potentially make it more expensive for Orlando and Orange County to finance projects in the future.

And Fitch's warning undermines confidence in the city's ability to patch together a financing "Plan B" for the two other venues approved at the same time as the arena. Construction has yet to begin on the $425 million Dr. Phillips Center for the Performing Arts and the $175 million renovation of the Florida Citrus Bowl stadium.

"If we hit a default with that tax revenue, long-term that will make it more expensive to issue bonds," said Jim Gilkeson, a University of Central Florida finance professor.

The bonds are in trouble because tourism is weak. Hotel taxes were pledged to make the debt payments over 30 years, but the dismal state of tourism has caused hotel-tax collections to plummet 15.5 percent in 2009 and an additional 5 percent so far this fiscal year.

The financial picture is far different than in 2007, when the venues plan was approved. Since then, the city has twice had to dip into reserves set up for the bonds to make scheduled twice-annual payments; withdrawals total $231,419. Payments on the bonds vary through their 30-year life, with the highest at $24 million a year.

Unless tourism picks up, the city could burn through the reserve account by late 2012, causing a default, Fitch warns.

City officials are more optimistic. They predict hotel-tax collections will begin to grow this year - buoyed in part by the much-anticipated opening of the Wizarding World of Harry Potter at Universal Studios in June.

Even if the city does default on the arena bonds, investors will still get paid, said Rebecca Sutton, Orlando's chief financial officer. The city bought an insurance policy that kicks in if the reserves are drained, though the insurance money would eventually have to be repaid with hotel taxes.

A default also wouldn't threaten taxpayers or the city budget. Only hotel taxes were pledged toward the bonds, so investors have no claim to any other revenue.

Orange County controls tourist taxes. In a memo released just days before the 2007 vote on the venues, County Comptroller Martha Haynie warned that the county could be at risk from "guilt by association" if any of the bond issues ran into financial problems.

But she said the Fitch rating would not hurt the county's ability to leverage tourist taxes in the future. If there are any consequences, they would likely fall on the city, she said.

"It could have a long-term effect on Orlando, if they get a reputation for having junk bonds out on the market," Haynie said. "But it should not have any major short-term impact."

City officials expect to sell an additional $75.5 million in bonds shortly to enable the start of construction of the first phase of the performing-arts center. These bonds would be backed by property taxes collected from a downtown district known as the Community Redevelopment Agency.

Fitch also gave a slight downgrade to those bonds, from "A+" to "A," though the rating remains strong. At the same time, analysts noted that property-tax collections downtown - like tourist taxes - have declined drastically. Property values are expected to fall 9 percent next year, an additional 4 percent in 2012, and remain flat for the following two years.

RENTS TO RISE FOR MAGIC'S NEW ARENA
April 29, 2010
Copyright 2010 MediaVentures

Orlando, Fla. - Orlando officials did a quick turn-around after reports surfaced that the cost for both community events and major promoters were expected to climb at the Magic's new Amway Center that opens this fall.

The reports included comments from community groups that they may not be able to afford rent at the new arena and might have to look elsewhere. The city now charges $5,000 plus expenses such as utilities, ushers and security, and had planned to increase the rent to $15,000 plus expenses at the new Amway Center. Mayor Buddy Dyer's administration agreed to impose a smaller increase for graduations: $7,500 plus expenses per day.

City officials point out that the rent for ticketed events such as concerts hasn't changed since 2001, and the rate for community events has been the same since 1991. And at 800,000 square feet, the new building will dwarf the Amway Arena.

"The Amway Center is about three times the size of the current Amway Arena," said Allen Johnson, the city's venues director. "It's just like if you bought a house that's three times the size your apartment was, you'd expect your utilities and maintenance to be higher."

For ticketed events such as concerts, city officials start with a base rent that could include a percentage of receipts, but typically negotiate each deal separately with a promoter. That will still be the practice at the new building, but the minimum base rent will increase from $5,000 to $25,000.

Promoters typically pay a negotiated maximum amount for many concerts. That's now about $50,000 and would increase to about $65,000 at the Amway Center, a 30 percent increase.

That's on target with some other venues, such as the arenas in Memphis, Charlotte and St. Louis. "The promoters we deal with said it's in line with the size venue you're going to be operating," Johnson said.

Ticket buyers could also feel the pinch. The city began adding a facility fee to ticket prices in 2005 that is $1 for most tickets. Under the new plan, the fee would double to $2 for most tickets.

June 17, 2010
Copyright 2010 MediaVentures

Parking rates at the Magic's new Amway Center arena in Orlando, Fla., will climb to $20 from the current $10 rate. City officials say their survey of parking rates show that theirs was too low and the higher rate is more in keeping with the marketplace.

September 9, 2010
Copyright 2010 MediaVentures

The Orlando Magic have signed two more corporate sponsors for the new Amway Center, a multi-year renewal agreement with Anheuser-Busch Cos. and a five-year deal valued at more than $1 million annually with insurance provider Geico, according to the Orlando Sentinel. The giant beer brewer's sponsorship package includes signs throughout the arena, naming rights for what will be known as the Budweiser Baseline Bar, and a collaboration with Orlando's National Basketball League team to institute a "Good Sport" program. Geico is the Magic's fourth "founding partner" at the new arena, joining PepsiCo, AirTran and Harris Corp. as top-level sponsors. That partnership includes naming rights to the new, seven-level parking garage next to the arena and the connecting skywalk. The insurer is also title sponsor of the halftime countdown clock, and it will receive exposure on two outdoor signs, the arena marquee and a digital billboard on the building's exterior facing Interstate 4.

MAGIC SELLS OUT OF LUXURY SUITES
September 23, 2010
Copyright 2010 MediaVentures

Orlando, Fla. - The Orlando Magic says the team has sold out of its 60 luxury suites for the new Amway Center arena that opens Oct. 1, according to the Orlando Sentinel. The 16-seat suites are priced at $135,000 to $295,000, the newspaper reported.

Promoters tout the suites' flat-screen televisions, the Herman Miller-style designer leather chairs, and the granite counters. But the biggest difference between the new suites and the old suites at the Amway Arena is the altitude: The new suites are just 19 rows above the basketball floor - the second-lowest position for executive suites in the National Basketball Association.

The suites at the team's previous arena, Orlando Magic President Alex Martins told the Sentinel, were the worst seats in the house.

"Here you were trying to create hospitality experience for corporations and groups and fans, and you're seating them in the worst seats in the building," Martins told the newspaper. "It was the old generation of sports facility, where they were public-assembly space and didn't focus on amenities."

Magic officials continue to market 13 "hospitality spaces" that rent by the event, each with room for 24 to 60 guests. The hospitality suites are on different levels of the new arena, including some on the IOA Founders level that is 19 rows off the floor. Prices for those spaces range from $1,500 to $8,000 per event, the newspaper reported.

Martins said the one-event suites are ideal for businesses that want to reward employees by leasing a suite on a particular game night - or for parents who want to treat a child to a birthday party during something like Disney on Ice.

NEW MAGIC ARENA SHOWING FEWER PROFITS
February 24, 2011
Copyright 2011 MediaVentures

Orlando, Fla. - WFTV in Orlando says the Magic's new Amway Center arena is generating less revenue than expected. "My first reaction was I thought the city should be making a lot more money," Orlando Commissioner Phil Diamond, told the television station.

WFTV took the Arena's balance sheet to Diamond, the only city commissioner who voted against the Amway Center plans.

In the Amway Center's first quarter, it pulled in close to $4.7 million in revenue, roughly the same as the Amway Arena in the previous year. But the Amway Center's expenses are $1.3 million more than the old arena. In the end, the Amway Center had only $34,000 worth of net income. The old Amway Arena made over $1 million in the same amount of time, WFTV reported.

A spokeswoman for the Mayor says the Amway Center is three times larger than the old one, making it cost more to operate.

When asked when the Amway Center might start turning a better profit, city officials told the television station they would not speculate on that.

FINAL BILL FOR AMWAY CENTER TO COME IN OVER BUDGET
March 10, 2011
Copyright 2011 MediaVentures

Orlando, Fla. - Orlando's new Amway Center arena could cost as much as $10 million more than its original $480 million price tag, the Orlando Sentinel reported.

The final tally on the city's most expensive public building still isn't finished, but officials acknowledge to the newspaper the Orlando Magic's new home court is over budget.

The city owns the arena, but construction was controlled by the Magic. The team is still negotiating the final tab with its builders, but president Alex Martins told the Sentinel it's expected to cost $2 million to $10 million more than planned.

The Magic are responsible for any unexpected construction costs, so taxpayers aren't on the hook for the extra expenses.

The final bill could be followed by a more detailed accounting of the project. As Martins wraps up talks with contractors, Orange County Comptroller Martha Haynie is finishing a year-long audit of the arena's construction process, which would be released in the next couple months. Team officials said standard construction revisions, such as efforts to make the facility more concert-friendly, explains why the arena is expected to exceed its budget.

ORLANDO ARENA DEBT COVERED IN EVENT OF LOCKOUT
July 21, 2011
Copyright 2011 MediaVentures

Orlando, Fla. - The NBA lockout might threaten the Orlando Magic's next season in Amway Center, but city officials tell the Orlando Sentinel they'll be able to pay the bills for their new building even if the Magic aren't there.

The Magic have played only a single season in the $480 million arena, which opened just nine months ago. With NBA players and owners still far apart in contract negotiations, the lockout could last long enough to put the second season in jeopardy.

That would have been a bigger problem a few blocks away in the old arena. But the new Amway Center came with a new contract between City Hall and the Magic. The newspaper said that deal has been criticized as too generous to the Magic, giving the team nearly all revenue collected at its games, from concessions to parking.

But the newspaper said it also differs from the old contract in a way that provides an important safety net for the city. Under the new deal, the city is guaranteed a payment from the Magic - on top of rent the team pays - even in situations when the Magic don't play or attendance plummets.

"It's not like last time, where if they didn't play they didn't pay. This time, they don't play, they pay," venues director Allen Johnson told the Sentinel. "That's why we kept the contract the way it is: so we're covered."

Next season, the team is on the hook to pay the city $2.8 million. Annual rent amounts to $1 million of that, and the rest comes from another contractual payment in lieu of the revenue earned from advertising, naming rights and luxury suites.

That doesn't mean there won't be some financial pain for City Hall if the lights are out. The city will lose out on a "facility fee" tacked on every ticket sold to an event at the Amway Center.

The fee - ranging from 25 cents for the cheapest Magic tickets to $2.50 for tickets costing more than $100 - helps pay for building maintenance.

At the same time, if a game is canceled, the city doesn't have the expense of paying ushers, ticket-takers, security guards and others.

MAGIC CONSIDERING ENTERTAINMENT COMPLEX
September 15, 2011
Copyright 2011 MediaVentures

Orlando, Fla. - The Orlando Magic may invest as much as $100 million in a sports and entertainment complex the team wants to build across from the new Amway Center, the Orlando Sentinel reported.

The project, still in the earliest conceptual stage, could be built on city-owned land at directly north of the arena.

A city parking garage with ground-floor retail shops is now on the site and would be torn down, potentially displacing a handful of largely African American-owned businesses.

Magic President Alex Martins told the Sentinel it's impossible to say with any certainty exactly what will be built until a year-long feasibility study is conducted. But the project would be modeled after entertainment complexes that have sprung up around arenas in Charlotte, N.C., Memphis, Tenn., Nashville, Tenn., Columbus, Ohio, and, on a larger scale, Los Angeles.

"This could be a $100 million development when all is said and done," Martins said, adding that it could bring 300 permanent jobs.

The project would be anchored by the Magic's own corporate headquarters. The team's lease at RDV Sportsplex in Maitland expires in 2014, and the 145 Magic employees who work there would move downtown. The mid-rise building could also include a hotel and conference center, along with dining, retail and entertainment space.

"We've always talked about that area in terms of a sports-and-entertainment district," Mayor Buddy Dyer told the newspaper. "I would hope this builds off the public investment we made in the Amway Center and continues the transformation ... ."

The Sentinel said demolition of the parking garage carries potential pitfalls for City Hall. The garage is one of two closest to the Amway Center and is used by people attending events there. It also provides parking for the Police Department headquarters next door.

Any new development would have to replace that parking and add more spaces for Magic employees, retail shoppers and hotel guests, the newspaper said.

Dyer will soon ask the City Council to grant a one-year exclusive purchase option for the property to a newly formed development company, SED Development LLC. The company is led by the family of Magic owner Rich DeVos but would ultimately include other investors.

Over the next year, the company would pay for the feasibility study - estimated to cost $2 million or more to come up with a development plan. At the same time, an independent appraiser will determine a fair market price for the city to sell the property to the developer.

A final deal would require City Council approval.

MAGIC GETS APPROVAL TO BUY PARKING GARAGE
September 22, 2011
Copyright 2011 MediaVentures

Orlando, Fla. - The Orlando Magic has won the exclusive right to buy a city parking garage across from the arena where the team plays - if they can reach a deal with Orlando leaders over the next year, the Orlando Sentinel reported.

The City Council approved a one-year purchase option agreement for the Magic, despite complaints from one commissioner who called it a "sweetheart deal" for the team.

The agreement is the first step in what may eventually be a $100 million investment to build a sports-and-entertainment complex and corporate headquarters.

The approval gives the team a year to address a slew of unanswered questions, including what type of retail and dining is feasible on the site. If the Magic and Orlando officials agree on a price so far it hasn't been discussed the garage would be torn down to make way for the Magic's project.

If built, the project could bring an estimated 300 jobs, including Orlando Magic employees now headquartered in Maitland. But it could also displace 11 small businesses that rent retail space in the city garage that's there now.

HIGH MARKS GIVEN ON AMWAY ARENA CONSTRUCTION
October 27, 2011
Copyright 2011 MediaVentures

Orlando, Fla. - After two years of scrutiny, Orange County auditors gave the Orlando Magic and Orlando a largely glowing grade for the construction of the Amway Center arena, the Orlando Sentinel reported.

The audit from County Comptroller Martha Haynie's office is mostly free of criticism of the handling of the $487 million construction project. Orlando owns the building, but the team was the developer.

It took Haynie's team two years to complete the audit, and it arrives a year after the facility opened. A Magic representative confirmed the building came in $7 million over its $480 million budget, but the financing agreement required the team to pay the overrun.

"We think the city and the Magic and their construction team have done a good job," Haynie said. "They understood public scrutiny was an important part of this project."

One conclusion Haynie's team reached was that county officials should consider taking a greater role in the oversight of such big-ticket projects. Former Mayor Rich Crotty took a hands-off role in the project, but Haynie said that may be something to reconsider as two proposed future venues get under way, including the Dr. Phillips Center for the Performing Arts now under construction.

November 3, 2011
Copyright 2011 MediaVentures

Orlando leaders agreed to change the terms of the Orlando Predators' lease at the Amway Center to give the arena football team a greater share of the money spent at its games. Under the terms of the agreement approved by the City Council, the Predators will earn more from concessions and advertising, pay less to use a practice field at the Citrus Bowl and receive 300 parking spaces per game, an increase of 200 spaces. The Orlando Sentinel said the changes mean additional revenue for the team estimated at $106,000 per nine-game season, for the next four years. The city will net an estimated $152,279 per season from Predators games.

MAGIC LOOKS AT ARENA LEASE CHANGES
November 10, 2011
Copyright 2011 MediaVentures

Orlando, Fla. - Orlando officials and the Magic executives are negotiating changes to the team's lease to formally give the NBA team the authority to handle advertising sales, suite leasing and operation of audio-visual systems, according to the Orlando Sentinel.

At the same time, the parties will try to clarify their agreement to make sure the Magic's exclusive advertising rights aren't so restrictive they hobble other tenants and cause touring shows to bypass Orlando.

Both sides contend there have been no significant problems with the Magic's "use agreement" at the $487 million Amway Center, and changes were expected after an initial shakeout period. Discussions primarily focus on two areas: operations and revenue.

On the operations side, the parties are expected to cement the practice of allowing team employees to handle many functions at the arena. That includes technicians who control audio systems, the video scoreboard, and promotional and advertising images that appear on hundreds of video screens and ribbon boards.

Magic employees also sell the advertising on those video screens during the team's home games, and for some time have been offering advertisers screen time during other events, too. The city keeps the revenue for those ads and pays the Magic a sales commission. The same is true for the rental of eight hospitality suites at the arena.

Venues director Allen Johnson said the arrangement saves the city the cost of hiring its own sales staff. Magic president Alex Martins said it simplifies sales.

"It gives both parties the ability to have one sales force out in the market rather than competing sales forces," Martins said.

When it comes to revenue, the Magic already have control of six exclusive advertising categories, meaning other tenants such as the Orlando Predators can't sell ads to those sponsors' competitors. Those sponsors are Amway, AirTran, Disney, Florida Hospital, Harris and Pepsi.

City Attorney Mayanne Downs said city officials and the Predators' management wants to know exactly how far that exclusivity extends. Does Pepsi's sponsorship, for instance, cover only soda or does it extend to other products manufactured by PepsiCo, such as Doritos?

In addition, city officials don't want to lose concert business because of permanent advertising in the Amway Center. That hasn't happened before, but the some promoters have made special requests about the Kia vehicle on display inside the arena. When Brad Paisley played at the arena in February, Chevrolet a tour sponsor displayed cars outside. The Kia was covered entirely during a Bon Jovi concert in May.

"You don't want a sponsor of your sports team to cause you to not get a date with a major act," Johnson said.

ORLANDO ARENA TURNS PROFIT IN FIRST YEAR
December 1, 2011
Copyright 2011 MediaVentures

Orlando, Fla. - The Orlando Sentinel says the new Amway Center turned a profit in its first year, but just how much profit is up for debate, records show.

Financial results distributed to city commissioners show the arena ended its inaugural year with an operating profit of $998,913. Even after some non-departmental expenses were included, venues director Allen Johnson claimed a bottom line of $584,536.

"So let me repeat this great news: The Amway Center finished the year in the black," Johnson wrote in memo to Mayor Buddy Dyer and commissioners.

But financial records show that in addition to rent, concessions and other income directly tied to the building, the venue also received a taxpayer subsidy of $980,053. That contribution came from Orlando's general budget, the fund that pays for police, parks and most services. Taxpayers routinely subsidized the city's old arena, too.

Either way, city officials label it a success because their goal is simply to break even.

"Anything above zero is good," chief financial officer Rebecca Sutton said. "We're not trying to make money on the Amway Center. The city is not a business. Our main goal is to have a good, well-run facility that provides an enjoyable experience for our visitors."

Regardless, the newspaper said it will be tough for the Amway Center to match its performance in its second year. The city earned $1.57 million in its first year from a surcharge added to Orlando Magic tickets, but the NBA lockout will impact that income.

The arena's first-year bottom line also included a one-time, $200,000 signing bonus from Ticketmaster when the city gave the company exclusive ticketing rights at the venue.

The reason for the subsidy goes back to a decision the City Council made before the arena opened.

The Dyer administration asked the council to raise rent and parking rates substantially higher than they'd been in the city's old arena. Commissioners agreed, but balked at raising expenses for family shows, fund-raisers for nonprofit organizations and high school graduations. Those community events saw smaller increases.

As it turns out, that money was needed to pay the mortgage on the Amway Center's new parking garage. So taxpayer money was used to subsidize the arena's bottom line.

But city staffers never told City Council members that taxpayers would have to make up for the lost income if they chose to keep rent and parking affordable for community events.

"That was never discussed," said Commissioner Daisy Lynum, who led the charge against a price hike for community events. "No one ever said, 'If we don't raise these fees, we are going to pay it.'"

MERCHANTS NEAR ARENA MAY MISS ALL-STAR ACTION
February 2, 2012
Copyright 2012 MediaVentures

Orlando, Fla. - February's NBA All-Star Game may pump up to $100 million into the local economy, but the Orlando Sentinel said shops and restaurants across the street from the Amway Center won't be in the midst of the action.

The city is allowing the league to erect an eight-foot, opaque fence in front of businesses along Church Street across from the arena. The barrier and gated-off areas along Division Street and Hughey Avenue will keep away everyone who doesn't have tickets to the game and other events taking place over three days.

The sidewalk will stay open, but the stretch of road will be closed to traffic for a week leading up to the Feb. 26 game.

"It is really so unjust," said Andria Brown, who owns Sweet Stop Candy Co.

Merchants say they want $3.5 million in compensation from the city and NBA and plan to meet with a lawyer.

Orlando leaders approved the fence, saying the NBA requested it for security purposes.

"High-profile events like this now typically include a very high standard of security in order to prevent any tragedy," said Thomas Chatmon, director of the city's Downtown Development Board. With tickets starting at $500, the All-Star Game is expected to attract lots of celebrities.

Chatmon said he understands the business owners' frustrations. The city of Orlando, the merchants' landlord, offered them two weeks of free rent, Chatmon said. But the shop owners turned that down, saying it wasn't enough.

Shop owners were given an option of being included within the cordoned-off section around the arena though only after they complained when they learned they were getting fenced off. The business owners turned that down because it means the general public would get no access to their shops. NBA spokesman Mike Bass called the security fence "one component of a large-scale safety and security plan" that includes ticket holders going through metal detectors as they arrive. Putting up such fences is typical at All-Star Games, he said.

He would not say what types of problems the fence is designed to prevent or why metal-detector screening couldn't take place close to the arena.

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