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Consultants' report finds that fixing Mellon Arena would cost as much as building a new one

Wednesday, June 13, 2001

By Tom Barnes, Post-Gazette Staff Writer

A study commissioned by the Penguins has concluded that it would cost as much or more to renovate 40-year-old Mellon Arena as it would to build a new arena.

And renovating the building would leave the Penguins with no place to play home games for two years.

The cost of a new arena is estimated at $200 million to $220 million. The most expensive option for renovating Mellon Arena is in the same range.

	Lemieux buys hospital property Penguins owner Mario Lemieux yesterday completed an $8 million purchase of the former St. Francis Central Hospital property on Centre Avenue, across the street from Mellon Arena. The land and building were bought by Lemieux Development LP, an affiliate of Lemieux Group LP, which owns the Penguins. Team spokesman Tom McMillan confirmed the hospital purchase but refused to say what the land and building might be used for. The purchase price is coming from private loans, not public funds. When the pending sale was first disclosed in November, team officials said the hospital property might become the site of a new hockey arena, or might be used for ancillary development in case Mellon Arena was renovated. In a new study, however, the team has ruled out renovation of Mellon Arena, saying a full-scale rehab could cost as much as building a new arena. Tom Barnes

Those are the major conclusions of the yearlong, $100,000 study, which clearly points the team toward seeking a new arena -- one that would likely open in the fall of 2005.

A summary of the report was obtained by the Pittsburgh Post-Gazette this week. It was done by two private consulting firms, HOK Architects of Kansas City and Turner Construction Inc. of Pittsburgh.

Penguins owner Mario Lemieux couldn't be reached for comment. But John Brabender, an outside consultant for the team, confirmed the gist of the summary.

The current arena "was designed during the Eisenhower administration" in the late 1950s, Brabender said. It opened in 1961 and is now the oldest rink in the National Hockey League.

Brabender said the unique domed roof -- the only one of its kind in the NHL -- makes it difficult to renovate. The building can't be expanded laterally because the domed roof wouldn't fit correctly, he said.

The only way to add seats and, more importantly, revenue-generating luxury boxes, is to "dig down into the ground," which is very expensive, or raise the roof, he said.

"The roof is the single biggest impediment" to renovating the current structure, he said. Another major factor is the age of the building, which has saddled the structure with narrow concourses and a lack of facilities for the handicapped.

He said the arena was originally intended as a 10,000-seat venue for the Civic Light Opera -- not as a modern hockey rink with luxury boxes, club seats, wide concourses and capacity for 18,000 or more fans.

Because the Penguins have ruled out renovating Mellon Arena, they believe the only remaining choice is to build a new one. However, that issue almost certainly will be the subject of robust public discussion in coming months.

It isn't known when the Penguins will formally ask the city and county to build a new arena. However, the team has scheduled a news conference on "financial matters" at 2 p.m. today at the Igloo Club in the arena.

Brabender noted that the Pirates and Steelers will have played in three different stadiums each since the arena opened in 1961 -- the Pirates at Forbes Field, Three Rivers Stadium and now PNC Park, and the Steelers at Pitt Stadium, Three Rivers and soon their new stadium.

In the study, the Penguins looked at three basic options.

One was a limited or minor renovation of Mellon Arena -- widening concourses and making it handicapped accessible -- but even those modest improvements could cost as much as $100 million.

A second was a total renovation -- meaning raising the famous silver-domed roof to allow space for more luxury boxes -- that would cost $200 million or more.

The third was to build a new arena, at a cost estimated at $200 million to $220 million. Details of where a new arena would go, or how it would be financed, weren't included in the study.

Negative aspects of the current arena, which are pointed out in the executive summary of the study, are:

Problems meeting new rules under the federal Americans with Disabilities Act, such as better elevators and ramps for the handicapped.

"The dome design creates distorted acoustics for stage or concert events."

"The sight lines of the upper seating were not designed to current standards and offer restricted views of the ice."

"Premium seats/suites are not competitive to the current market in other facilities."

This last point, Brabender said, means that the luxury suites at the arena aren't as fancy and don't offer all the features that suites at PNC Park and the Steelers stadium offer.

While arguing that a rehab of Mellon Arena didn't make sense economically, the Penguins' study didn't address two issues that would be crucial concerning a new arena -- financing and location.

The state's capital budget already includes $60 million approved by the Legislature for a new arena, but Gov. Tom Ridge would have to approve release of that money. The state provided $75 million for each of the two new stadiums.

Ridge has indicated he wants considerably more private money put toward a new arena than for the stadiums because an arena can be used for many more events year-round. The two stadiums are basically limited to 81 baseball games and about 16 football games a year.

Currently, Mellon Arena hosts events on about 150 days a year. Only 40 to 50 of those are Penguins games, depending on whether the team makes the playoffs. Concerts, religious meetings, circuses, skating, wrestling and other events make up the rest.

The Pirates provided $47.7 million of the total $260 million cost of PNC Park, with the rest from public sources, according to the Sports & Exhibition Authority. The Steelers provided $123 million of the $281 million cost of the new stadium.

Mayor Tom Murphy and Allegheny County Chief Executive Jim Roddey have been reluctant to address public funding for a new arena, at least in part because of the potential for public criticism.

As for where a new arena would go, several sites have been mentioned, including the North Shore and the Strip District, just east of the new David L. Lawrence Convention Center.

Murphy has said a new arena might be situated somewhere around the present arena. It couldn't be on the exact site, however, because the Penguins wouldn't have any place to play during the two years of construction.

The Penguins' announcement that they've closed a deal to buy the former St. Francis Hospital on Centre Avenue, directly across from the existing arena, means the team has a prime location on which to put a new arena.

Privately, Penguins officials think there is plenty of time to consider financing and siting for a new arena. They don't expect the facility to be operational until the hockey season that would start in October 2005.