(C) El Paso Matters.org This story was originally published by El Paso Matters.org and is unaltered. . . . . . . . . . . Northeast El Paso $80M amphitheater hinges on lifetime, high-income investors, closing city deal [1] ['Elida S. Perez', 'More Elida S. Perez', 'El Paso Matters', '.Wp-Block-Co-Authors-Plus-Coauthors.Is-Layout-Flow', 'Class', 'Wp-Block-Co-Authors-Plus', 'Display Inline', '.Wp-Block-Co-Authors-Plus-Avatar', 'Where Img', 'Height Auto Max-Width'] Date: 2024-06-23 The proposed Northeast El Paso amphitheater is the latest effort to develop entertainment venues in the city, but the project will only come online if the company raises the $80 million it needs to build it. To do that, Venu, the 6-year-old entertainment development company formerly named Notes Live, would need to implement a fundraising model that relies heavily on lifetime, high-income investors and expensive memberships. It also hinges on a combination of $31 million in city incentives, which haven’t been finalized. While the entertainment business is leaning toward amphitheaters, it is largely because Live Nation, one of the largest concert promoters in the world, heavily invested in amphitheaters, said industry expert Bobby Welch. She previously served as director of special events at the University of Texas at El Paso and concert coordinator at New Mexico State University. “The tours that you see – what we call the amphitheater tours – the bigger ones are actually Live Nation tours that are going from Live Nation amphitheater to Live Nation amphitheater,” said Welch, who also co-owned the now closed Tricky Falls venue in Downtown said. “Having an amphitheater will not tap into Live Nation amphitheater tours.” The U.S. Justice Department in May sued Live Nation and its subsidiary, Ticketmaster, alleging that it had an illegal monopoly on live entertainment events that should be broken up. Live Nation disputes the allegations. The proposed 12,500-seat Northeast El Paso amphitheater, which developers say will boost economic development in the region and provide a “luxury” experience to concertgoers, is one of several Venu is promoting across the country. One is set to open in Colorado Springs, Colorado, in August, but others proposed in other cities have yet to open – and some have hit hurdles that delayed the venues early on. Planning of the venue at the former Cohen Stadium site comes as the city, county and UTEP are considering asking taxpayers to spend millions to renovate existing entertainment facilities or build new ones – including the long-stalled $180 million multipurpose entertainment center, or arena, approved by voters in 2012. How does Venu plan to finance the amphitheater? The company aiming to build the amphitheater was established in 2017 and based in Colorado Springs. Venu, as it was recently renamed, is owned by JW Roth, who plans to build amphitheaters nationwide. Venu did not respond to multiple El Paso Matters interview requests. The company’s financing model includes looking to private investors to buy fire pit suites and selling various owner-membership levels to accredited investors, according to Venu’s website The website for Venu, formerly Notes Live, shows partnership levels and benefits for its Broken Arrow, Oklahoma, amphitheater. The planned El Paso venue is not yet listed on its partnership opportunities page. (Screenshot noteslive.vip) Investors must have an annual income that exceeds $200,000 individually or $300,000 with a spouse for two years – or have an individual net worth of more than $1 million, the website states. Only about 5% of the 300,000 households in El Paso County have incomes of $200,000 or more, according to U.S. Census Bureau estimates. General admission ticket buyers would not have access to the firepit suites. “Their business model is that they want to basically take the income from (fire pit sales) to offset some of the costs and so, if those don’t sell, one has to wonder – do they have the necessary financing without those to really pull off an amphitheater?” Welch asked. In El Paso, Venu plans to build Sunset Amphitheater on a 50-acre plot of city-owned land in the Cohen Entertainment District, around the former location of a Minor League Baseball stadium.. The agreements, once finalized, will include Chapter 380 incentives and the city conveying 15 acres of land for the amphitheater. The deal includes $31 million in incentives and tax rebates over the next 20 years as well as waiving 100% of development, building and permitting fees for the construction of the amphitheater, among other financial benefits. A 12,500-seat amphitheater at the Cohen Entertainment District in Northeast El Paso is being planned under a partnership with the city of El Paso and entertainment venue developer Notes Live. (Courtesy city of El Paso) Site map for planned Sunset Amphitheatre in Northeast El Paso The city will also amend Tax Increment Reinvestment Zone 11 established on the site in 2018. The tax zones encourage development and capture tax increments of property within the zone to help fund public improvements to roads and other infrastructure. Two public hearings that would have been the next steps to solidify agreements with the developer, including the land sale and TIRZ 11 amendment, were postponed by the City Council earlier this month. City officials said the move was a mutual decision by the city and developer. City Rep. Joe Molinar, who represents Northeast, told El Paso Matters that city staff did not discuss how the company would fund their end of the project. But, he said from what he understands, the company has the funding sources it needs. “If any company comes and says, ‘Hey, we’re gonna start here, we’re gonna do this, we promised that’ and they go to another City B, and they promise the exact same thing, and they never deliver – well, obviously you’re going to have a lot of problems,” Molinar said. Complex financing, deals halt one planned venue At least one other city where Venu is looking to build an amphitheater had to put its plans on hold after the company hit major roadblocks in its financing plans, filings with the U.S. Securities and Exchange Commission show. The records show Venu, under the Notes Live name, has been working with Murfreesboro, Tennessee, to build a $30 million venue that would include a Bourbon Brothers Smokehouse & Tavern, The Hall, a 500-seat indoor music venue and a 4,500-seat outdoor amphitheater. The first economic development agreement was nixed by the Murfreesboro City Council in July 2022 when it called for conveying the $3.3 million city-owned land to Venu. A later version approved by the City Council in August 2022 stipulated the company buy the land as part of the arrangement. The land deal was closed in December 2022, with the city receiving a promissory note payable over 20 years without interest, according to a Mursfreesboro media release. City leaders in Murfreesboro didn’t respond to inquiries from El Paso Matters, and it’s unclear where the plans stand now. However, the SEC documents include a May 21, 2023, “stand still” letter issued by Murfreesboro that shows the company had not met its deadline to obtain a permit to begin construction as required by the contract it signed with the city. Under the contract, the company would have to transfer the land back to the city if the permit was not obtained by deadline. The letter points to a discussed agreement that allows the company to “reformulate its financing” without having to transfer the land back to the city for not meeting its land disturbance permit application deadline. “The current national economic conditions, and the resulting implications on banks lending have impacted Notes Live’s planned financing,” the letter states. “To address this situation, Notes Live is altering the Project’s financing structure, which understandably requires additional time. Notes Live anticipates using proceeds from an equity offering in their holding company to finance the construction in Murfreesboro.” The letter also states the company would make a good-faith effort to initiate the project as soon as feasible. The stand still arrangement expires this December. The Murfreesboro city manager, who sent the letter to the company, could not be reached for comment. El Paso city Rep. Brian Kennedy, who previously served as CEO of the El Paso Sports Commission that operated the El Paso County Coliseum, said the city’s future agreements with Venu will have clawback provisions to protect the city if the company can’t fulfill its promises. “If you have enough protections in the beginning of a deal, no matter what happens with the deal, you can’t get damaged because you’ve protected the entity,” Kennedy said, adding the city’s general fund will not be impacted by the arrangement with the developer. Where do Venu’s other planned amphitheaters stand? In Colorado Springs, the 8,000-seat Ford Amphitheater is the first venue scheduled to open in August. Meanwhile, the company has entered public/private partnerships for similar amphitheaters in Oklahoma, Tennessee, and McKinney, Texas. In McKinney, the developer entered a public/private partnership with the city in March to build a $220 million 20,000 capacity amphitheater – the largest planned to date. The city agreed to contribute at least $26 million in public funding as part of the performance-based incentive package. “It’s between $85 and $100 million that the city will incentivize (over 20 years), but again, it’s always important to identify that 75% of that is performance-based,” McKinney Mayor George Fuller told El Paso Matters. “They have to produce and deliver X number of shows with X amount of capacity at each of those shows and guarantee us patrons equal to X each year, otherwise those incentives are null and void.” Fuller said he is not concerned the company will be able to raise the money needed to fund the amphitheater. “As far as the (fundraising) model, I think it’s brilliant,” Fuller said. “There’s people that have bought boxes in venues like sports arenas – it’s not an unheard of thing, but it’s never been done in an amphitheater setting.” A rendition of a proposed amphitheater in McKinney, Texas, by Venu, formerly named Notes Live. A rendition of a proposed amphitheater in Broken Arrow, Oklahoma, by Venu, formerly named Notes Live. In Broken Arrow, Oklahoma, Venu has a $70 million, 12,500-capacity amphitheater planned. The city will complete about $17 million in infrastructure improvements as part of the economic development agreement that is performance-based. “We have entered into a public/private partnership with them as well and there were incentives – as a matter of fact – we have already started on the public infrastructure improvements in the area,” said Broken Arrow spokesman Aaron McColloch. “We’ve got several different things going on.” McColloch said they are currently working on a new roadway, among the public infrastructure improvements. He said the developer hasn’t broken ground, but they are working together on scheduling for some time this summer. “We’re supposed to have a ceremony, we’re still trying to nail down the day, but it looks like it’s going to be toward the later half of August,” McColloch said. “I know that they were always going to be just a little bit behind us. We were going to start our infrastructure improvements first and then they were going to start with the development of the amphitheater after us.” The city’s economic development agreement with Venu has been amended four times since it was first signed in August 2022, documents show. McColloh said those amendment extensions were initiated by the city to address water suppression to comply with the city’s fire code. “It was more or less run-of-the-mill type things,” he said. Venu also aimed to open an amphitheater in Oklahoma City, but the City Council in April rejected the proposal for the 12,000-seat amphitheater development following public backlash and concerns about noise and traffic. The company still has the venue listed on its website as “open for investment.” Aging venues prompt asks for renovations, new facilities The most recent major venue to open in El Paso is the Downtown ballpark, which broke ground in 2013 and opened its doors with Triple-A baseball a year later. But the ballpark has hosted only a handful of events outside of baseball and soccer, including the Way Out West country music festival that this year will be held around the Judson F. Williams Convention Center Plaza and several Downtown blocks. A series of boxing matches, dubbed Bouts at the Ballpark,are scheduled to be held at the ballpark later this month. Prior to that, local governments and private investors had for decades put forth several plans for new venues in the city – with none coming to fruition. The city’s planned $180 million multipurpose center remains unbuilt and at a standstill since voters approved it in the 2012 bond election. The arena, as it’s known, was last proposed to be an 8,000-seat indoor-outdoor amphitheater at the Union Depot in Downtown El Paso before talks stalled just weeks before the Venu proposal was announced. Existing city-run venues include the Convention Center that is used primarily for conventions and meetings; the 2,500-seat Abraham Chavez Theatre; and the 2,050-seat Plaza Theatre – all in Downtown. The El Paso County Coliseum originally opened in 1942 as a rodeo and livestock venue, but also hosts concerts and other large events, June 20, 2024. (Corrie Boudreaux/El Paso Matters) County leaders, meanwhile, have also debated whether to include improvements to the 5,250-seat El Paso County Coliseum on a proposed November bond issue as plans to expand the Bridge of the Americas nearby initially called for it to be torn down. The coliseum was removed from the General Services Administration’s final options for modernization of the port of entry, El Paso County Commissioner David Stout said in a news release last week. Stout said improvements to the coliseum were removed from a list of projects being considered for the bond, but added he wants it back on the table for funding. UTEP’s Sun Bowl Stadium first opened in 1963. (Corrie Boudreaux/El Paso Matters) UTEP President Heather Wilson in May unveiled a proposal asking the county of El Paso to include up to $99 million in upgrades to Sun Bowl Stadium in its planned November bond issue. The proposed structural fixes, electrical system upgrades, enhanced 18-wheeler access and other renovations would help attract and better accommodate concerts and other entertainment at the stadium. The stadium, which seats about 46,000 people, is home to UTEP football and the annual Tony the Tiger Sun Bowl postseason college football game. It has hosted concerts such as the Mexican pop group RBD and 80s rock bands Def Leppard and Mötley Crüe. Welch said the industry is leaning less and less toward stadium tours because they are expensive to mount. The Don Haskins Center on UTEP’s campus hosts the university’s basketball teams as well as concerts, graduations and other large events, June 20, 2024. (Corrie Boudreaux/El Paso Matters) UTEP also owns and runs the Don Haskins Center with a 12,000-seat capacity that hosts the university’s men’s and women’s basketball games and with concerts of various genres. “If I were to put money into something, I’d put it into Haskins and Pan Am (Center in Las Cruces) to at least keep catching the viable 8,000 to 12,000 seat concerts – and there’s great ones,” Welch said. She added that she believed those facilities could use some upgrades but aren’t falling apart. Having a variety of local entertainment venues is a quality of life issue, Welch said, adding each of the different types of venues are constructed to have specific types of events. “You can’t put a tractor pull in a theater, you really shouldn’t put opera into a stadium,” she said. “So I think having the broadest genre of venues affords us to pull in the broadest genre of different types of entertainment events.” [END] --- [1] Url: https://elpasomatters.org/2024/06/23/northeast-el-paso-amphitheater-venu-notes-live-investors-cohen/ Published and (C) by El Paso Matters.org Content appears here under this condition or license: Creative Commons CC BY-ND 4.0 International. via Magical.Fish Gopher News Feeds: gopher://magical.fish/1/feeds/news/elpasomatters/