A proposal to lease the city-owned XL Center to the state for 10 years could bring $2.6 million in annual rent payments to Hartford, beginning in the third year of the agreement — and includes a provision for possible capital improvements.
Property Line reported last week that the annual rental payment for the first two years of the lease would be $3 million under the proposal.
A city council resolution provided to Property Line over the weekend states: “Thereafter, the rent will be set at $2.6 million per year payable to the extent that net revenues are at least $2.6 million.”
If net revenues top $2.6 million, the additional money will be placed in a reserved fund for capital improvements and operating expenses, the resolution states.
It also could mean a smaller payment for the city if net revenues fall below $2.6 million, the city told me.
The XL Center — formerly the Hartford Civic Center — was opened in 1975 and is now much in need of improvements and updates. Global Spectrum, which has been chosen as the venue’s new manager, has agreed to put in an initial, $2.75 million “out-of-pocket” investment for capital improvements.
The state hopes Global Spectrum will boost event bookings and traffic at the XL Center, improving its financial performance.
The city owns the Trumbull Street arena and the land lying underneath it. If the council approves the resolution, the title for the arena — but not the land — would temporarily be transferred to the Capital Region Development Authority. The lease agreement is needed so CRDA can finalize the Global Spectrum contract.
The title reverts back to the city at the end of the lease. There are options for two, five-year extensions of the proposed agreement.
Read more here about why the city and state reached an agreement on a lease, rather than a permanently transferring ownership of the XL to the state.
A public hearing on the proposal is expected to be held April 15.