Billionaire Mikhail Prokhorov to Shutter Long Island’s Nassau Coliseum

(Bloomberg) -- The Nassau Coliseum, the Long Island arena that hosted professional hockey games and rock concerts, is turning off the lights.

Billionaire Mikhail Prokhorov’s Onexim Sports and Entertainment, which operates the arena under a lease from Nassau County, is planning to shutter the venue indefinitely while it seeks investors to take over operations and pick up the remaining debt on the building, according to people familiar with the matter.

Onexim has told potential investors that it would turn over the lease in return for assuming roughly $100 million in loans on the property, said one of the people, who asked not to be named because the discussions were private. The firm, which is laying off arena employees, could also surrender the lease to its lenders, the person said.

The arena has been dark since the pandemic hit New York and shut down much of the U.S. economy. The coronavirus also slowed progress on a redevelopment project known as the Nassau Hub, which calls for the construction of offices, housing and retail space on roughly 70 acres of parking lots surrounding the arena the Coliseum.

“The unforeseeable and unprecedented Covid-19 crisis has had a devastating effect on the operations of the Coliseum and its finances,” Onexim said in a statement. “While we still believe in the enormous long term economic value of the Coliseum and the development of the surrounding land, we recognize that such value will be best realized by other parties.”

The Uniondale, New York arena, known formally as the Nassau Veterans Memorial Coliseum when it opened in 1972, has long played a central role in life on Long Island.

It was home to the Islanders for more than forty years, including the franchise’s four consecutive Stanley Cup title runs in the 1980s. The singer-songwriter Billy Joel performed there so frequently that the Coliseum’s operators printed his name on a banner and hung it from the rafters.

The arena closed in 2015 for a $180 million renovation and the Islanders moved to the Barclays Center in Brooklyn, sharing the venue with the National Basketball Association franchise owned by Prokhorov at the time. The Coliseum reopened in 2017 and has hosted roughly 200 events a year, including concerts, minor-league basketball and professional lacrosse.

Prokhorov is worth $11.5 billion, according to the Bloomberg Billionaires Index.

In February, Governor Andrew Cuomo announced that the Coliseum would host all of the Islanders home games during the 2020-2021 season. But the Covid-19 pandemic upset those plans, casting doubt on when sports leagues would resume and whether they would allow fans to attend games.

The Islanders are building a new arena at Belmont Park, which would create a competitor for the Coliseum’s events business if it reopens.

Potential investors in the Coliseum may be more focused on the opportunity to build on the surrounding area.

Scott Rechler, chief executive officer of RXR Realty, which partnered with Onexim on the redevelopment plan, said he was “confident that the people who step into their shoes will want to maximize the value of the property by having the most dynamic development possible on the site.”

The coronavirus, Rechler added, has led his firm to consider the best ways to utilize the land for a post-pandemic future.

Nassau County Executive Laura Curran also expressed optimism that the project would move forward despite Onexim’s looming exit.

The county “is encouraged that Onexim is speaking to their lenders and other potential investors and we remain focused on development plans,” Curran said in a statement. “Transforming the Hub site, important before the pandemic, is now even more critical to Nassau’s economic comeback.”

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