New proposed arena relies on Lincoln’s vote

A new basketball arena is on the horizon for Lincoln but could disappear as easily as a mirage without the approval of Lincolnites on May 11.

The city of Lincoln and the University of Nebraska-Lincoln have began planning together, and a tentative design for the 450,000-square-foot arena is in place.

Plans include a new Amtrak station, parking garages, roadways and a private hotel.

The $400 million plan would receive $30 million from the city, and three new taxes are proposed to help support costs. The taxes are geared towards tourists, including a 4-percent car rental tax, a 2-percent bar and restaurant tax and a 4-percent hotel tax.

The 16,000-seat arena is meant to bring people into Lincoln, which is something the city needs, City Council Chair Doug Emery said.

"I believe Lincoln will be less than Grand Island in 50 years if we don't (approve the arena)," Emery said. "What is here that would draw people to our city? Nothing. We want to draw students, we want to draw people here, but you have to have something that will draw."

Troy Terwilliger, the director of sales for the downtown Lincoln Holiday Inn, said he thinks the arena will be a great investment for the city and university.

But not the proposed hotel.

The new hotel would have around 200 new rooms, or 73,000 rooms available a year. In order for the hotel to be successful, it would have to book between 50 and 55 percent of rooms. That's about 36,000 to 40,000 rooms a year.

Terwilliger said the STAR report, a performance and informational comparative hotel report, indicates no need for a new hotel – even with the possibility of a new arena.

"There is no way the arena will supply that high of a demand," Terwilliger said. "If you want to build that arena, we're fully supportive, but if you're building a new hotel to go with it, you're basically not concerned about the downtown hotels. That arena is going to be good on a lot of fronts but not the new hotel."

Concern that the new hotel would have to take business from other downtown hotels to stay afloat is Terwilliger's main issue with the proposal.

"We would be much more willing to have that tax go up if we saw an increase in business, but with the new hotel, that just won't be the case," Terwilliger said. "We'd be less competitive and have a higher tax. It'd be a huge double whammy. … It could get ugly."

The proposed location of the arena is just west of the Haymarket district. It was chosen so that it would be contiguous with the university. A downtown location would allow students and non-students alike easy access, Emery said.

Some people in Lincoln have voiced concerns about paying extra taxes for an arena that is mainly for UNL's benefit, Emery said.

"I think you have to understand that there is some underlying dislike for the University of Nebraska in the city of Lincoln," Emery said. "I've lived here for 56 years of my 58 years, and frankly, it has only surfaced for me since I got into politics."