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Portlanders just bought themselves a basketball arena.

On Wednesday, the City Council unanimously agreed to purchase the Moda Center from Rip City Management LLC (sister company of the Portland Trail Blazers) for a nominal $1 price. At the same time, commissioners approved a five-year lease agreement with team management that can be extended an additional five years.

Both parties portrayed the lease as a 鈥渂ridge鈥� agreement that is needed to advance small-scale improvements to the Moda Center while the city and pro basketball franchise plan and obtain funding for a large-scale renovation of the nearly 29-year-old NBA arena.

The short-term agreement keeps the Trail Blazers in the Moda Center at least through 2030 while the parties seek to ensure the arena鈥檚 long-term health.

鈥淢oda Center is a unique community asset, and a new significant investment will improve and extend its useful life,鈥� said Dewayne Hankins, president of business operations for the Trail Blazers and Rip City Management.

The complex set of agreements caps 18 months of discussions between the city and Rip City Management, the Blazers鈥� operating company. It involved sports business consultants and outside legal counsel to advise the city.

Eventually, the city expects to oversee a major renovation of the Moda Center, which is the oldest NBA arena that has not received significant upgrades.

Building a new arena is unlikely, said Karl Lisle, external partnerships and programs manager for the city of Portland, citing conversations with Rip City Management and sports business consultants.

鈥淕iven the condition of the building, location of the building, it鈥檚 a pretty good asset and it would lend itself well to a renovation,鈥� he told commissioners. 鈥淭here isn鈥檛 a compelling reason 鈥� unless you don鈥檛 want to be in the Rose Quarter anymore, right? 鈥� to really look seriously at replacement.鈥�

Lisle pointed to precedent for the city owning a sports arena.

鈥淧ublic ownership of similar facilities is common and an important step to allowing public investment into the building,鈥� Lisle said. 鈥淔or local context, the city also owns Providence Park stadium and the Veterans Memorial Coliseum, and both are operated by private enterprises on the city鈥檚 behalf through operating agreements similar to the arena operating lease being proposed (Wednesday).鈥�

The Blazers are owned by Jody Allen, the sister of the late Microsoft co-founder Paul Allen. She has not indicated if or when she will sell the team, and has reportedly rebuffed inquiries from billionaire Nike co-founder Phil Knight. But the specter of new ownership hung behind the agreements approved Wednesday.

Commissioner Rene Gonzalez said the agreements are 鈥渟teps in good faith by both the Blazers and the city of Portland.鈥�

鈥淗owever,鈥� he added, 鈥渢he city of Portland also needs to prepare for the prospects of new Blazers ownership in the coming years. Retention of the Blazers is very much a cornerstone of our city鈥檚 future. 鈥� We cannot take our eye off the ball on the long-term play.鈥�

The agreements set out several provisions aimed at protecting the city鈥檚 interests while freeing up funds to improve the building. Among them:

• Now that the city owns the building, Rip City Management will no longer pay property tax on it. That will save the Trail Blazers ownership an estimated $1.2 million annually that could be used to pay for facility upgrades.
• The city agreed to purchase an underlying parcel for $7.13 million. Money for the purchase will come from the city鈥檚 Spectator Venues and Visitor Activities Fund.
• The agreements lay out a $61.5 million capital expenditure plan over five years. If the Moda Center ceases to be the Blazers鈥� home, the city government will be repaid by Rip City Management for public investments in the arena.

Business and civic groups lined up behind the lease agreement. Jon Isaacs, lobbyist for the Portland Metro Chamber, said the Moda Center 鈥渋s in dire need of major renovation to keep our city and our franchise competitive.鈥�

The Albina Vision Trust, a nonprofit that seeks to remake the historically Black neighborhood around the Moda Center, also voiced support. Winta Yohannes, the group鈥檚 executive director, said the Blazers are 鈥渋ntimately rooted in the social and economic fabric of North and Northeast Portland.鈥�

鈥淥ur city must not shy away from making significant public investments in our most significant public spaces,鈥� Yohannes said.