Wizards, Capitals to stay in D.C. until at least 2050 after Virginia deal falls through

ALEXANDRIA,VA - DECEMBER 13 :   Washington Wizards and Capitals owner Ted Leonsis, left, seated next to Virginia Governor Glenn Youngkin at an event to announce the building of a new sports arena for Hockey and Basketball at the Potomac Yard area of Alexandria, VA on December 13, 2023. (Photo by John McDonnell/The Washington Post via Getty Images)
Ted Leonsis and Glenn Youngkin's deal to bring the Wizards and Capitals to Virginia is kaput. (Photo by John McDonnell/The Washington Post via Getty Images) (The Washington Post via Getty Images)

The Washington Wizards and Washington Capitals are no longer moving from D.C. to Virginia, three months after owner Ted Leonsis and Virginia Gov. Glenn Youngkin announced plans to build the teams' next arena in the Potomac Yard neighborhood.

Per the Washington Post, the city of Alexandria, which includes Potomac Yard, said Wednesday it has stopped negotiations around the proposal and will not move forward with the project.

Only a few hours after the break-up was reported, D.C. mayor Muriel Bowser announced the city had signed a deal with Monumental Sports, the Wizards and Capitals' parent company, to remain in the city through 2050. The Associated Press reports the deal will see Monumental receive $515 million in public funds to renovate Capital One Arena.

Youngkin and Leonsis had only announced a handshake agreement in December to build the arena as part of a $2.2 billion mixed-use development. The deal had initial approval from the Virginia House of Delegates, but the proposal reportedly never passed in the Senate and wasn't included in the state's budget.

From the Post:

In the statement, the city said the proposal was “worthy of community discussion and Council consideration,” but that it was “disappointed in what occurred between the Governor and General Assembly.”

It appears to be the end of what has been a particularly contentious battle over the future home of the Wizards and Capitals, and wasn't without foreshadowing. Leonsis was reported to be in talks with Maryland Gov. Wes Moore about a possible arena just last week, which isn't something you do when the Virginia plan is going as hoped.

Before that, Leonsis had asked D.C. for $600 million in public money last year to renovate Capital One Arena, reportedly with plans to move seats, add a new food court and a new entrance at Seventh and F streets. Months of negotiation between Leonsis and Bowser went nowhere.

Reportedly at issue was a cap on D.C.'s ability to borrow money, until a refinancing of the city's debt freed up more funds in December. Bowser's office reportedly approached Leonsis with a $500 million offer, but no agreement emerged. One day later, Leonsis was in Alexandria, announcing the Potomac Yard deal.

That deal received a mixed-to-negative reaction from local residents and the team's fanbase, and it appears the Virginia legislature didn't love it either.

Increasing the pressure on all involved was the presence of the Washington Commanders, who are looking for a new stadium after three decades at FedEx Field. The U.S. House of Representatives recently passed a bill allowing the District to redevelop the site of RFK Stadium, a potential landing spot for the NFL team.