The NBA’s Los Angeles Clippers have reached an agreement to buy the Forum from The Madison Square Garden Co. for $400 million, paving the way for team owner Steve Ballmer to move forward with plans to develop a new arena near the venerable Inglewood venue, it was announced Tuesday.
The purchase involves a newly formed entity, CAPSS LLC, and was driven by Ballmer, the Clippers chairman, and Clippers Vice Chairman Dennis Wong, the team announced.
“By reaching an agreement with MSG, CAPSS LLC will acquire the Inglewood venue, simultaneously resolving litigation surrounding plans for the new NBA arena,” according to a statement from the Clippers. “As part of the agreement, all of MSG’s current Forum employees will be extended employment offers by the new owner.”
News of the sale talks broke March 1. The cash deal is expected to close during the second quarter, according to the Clippers.
Ballmer plans to develop a privately financed 18,000-seat arena, team headquarters complex and community center about a half-mile from the Forum. The project is undergoing an environmental review by the city of Inglewood, with public hearings scheduled for this summer, according to the Clippers.
“This is an unprecedented time, but we believe in our collective future,” Ballmer said in a release. “We are committed to our investment in the City of Inglewood, which will be good for the community, the Clippers, and our fans.”
The Forum, capacity 17,505, would continue to operate as a music venue, according to the team.
“We know traffic is something that many Inglewood residents worry about. While we have gone to great lengths to provide an unprecedented traffic-management plan for the new basketball arena, this acquisition provides a much greater ability to coordinate and avoid scheduling events at the same time at both venues,” said Chris Meany, a principal of Wilson Meany, the developer overseeing the new basketball arena project.
The news appears to settle a legal battle between MSG and both the city of Inglewood and Ballmer dating to 2018 and stemming from Ballmer’s intention to develop the new arena, estimated to cost $1 billion.
Ballmer bought the Clippers from Donald Sterling in 2014 for $2 billion. The team plays its home games at the AEG-owned Staples Center and signed a 10-year agreement to remain tenants in the downtown Los Angeles arena through the 2023-24 NBA season. The Clippers are the third tenant at Staples Center behind the NBA’s Lakers and the NHL’s Kings. AEG owns the Kings and has a 30 percent stake in the Lakers. The dynamic leaves the Clippers with fewer prime dates than the other two teams.
Ballmer has wanted to build a new arena in time for the 2024-25 season on a parcel of land near the Forum and across the street from $5 billion SoFi Stadium, which Los Angeles Rams owner Stan Kroenke is due to open for his NFL team and the Los Angeles Chargers this summer. The Clippers now practice in Playa Vista.
The new Clippers arena is being designed by AECOM and will be built by the joint venture of AECOM Hunt and Turner Construction.
Worldwide, the Forum was No. 7 on VenuesNow’s 2019 Year-End Top Stops in the 15,001-30,000 Capacity category, ranked by tickets sold. The “Fabulous Forum,” as it’s known, opened in 1967 and was home to the “Showtime” Lakers before the team moved to Staples Center when it opened in 1999.
Some industry experts have questioned how a third LA arena would compete against the Forum and Staples Center. MSG has close ties to Live Nation, the world’s top concert promoter. AEG owns and operates Staples Center, and its AEG Presents is the second-biggest promoter. All things being equal, Live Nation and AEG historically book their tours in the buildings where they hold a financial stake and have the strongest relationships.
MSG, which also owns Radio City Music Hall and the Beacon Theatre in New York City and the Chicago Theatre, acquired the Forum in 2012 from the Faithful Central Bible Church in a $23.5 million deal. The building reopened with a series of six Eagles concerts that began in January 2014 after a $100 million renovation that included state-of the-art audio and premium spaces, including the Forum Club.
Irving Azoff, now chairman and CEO of The Azoff Co. (and co-founder of Oak View Group, parent company of Pollstar and VenuesNow) formed a joint venture in 2013 with The Madison Square Garden Co. to run the newly formed Azoff MSG Entertainment. The agreement ran until October 2018, when The Azoff Co. bought out MSG’s interest. The Azoff Co. has continued to advise MSG, including on the Forum and the development of MSG Spheres in Las Vegas and London.
SoFi Stadium is part of the LA Stadium & Entertainment District at Hollywood Park, a mixed-use development on the site of a former racetrack slated to also include a performance arts venue, office space, residential units, a luxury hotel, public parks, a lake and mass-transit access.
This article originally appeared on VenuesNow.