VOL. 132 | NO. 188 | Thursday, September 21, 2017
Graceland Changes Venue Plans After Grizzlies Raise Concerns
By Patrick Lantrip
Elvis Presley Enterprises has announced it will significantly alter the plans for its new entertainment venue in Whitehaven after the Memphis Grizzlies raised concerns surrounding a noncompete agreement with the city involving FedExForum.
Attorney James McLaren with the law firm Adams and Reese LLP announced the amended plans on behalf of EPE at the Economic Development Growth Engine for Memphis and Shelby County’s Wednesday, Sept. 20, meeting.
“The Memphis Grizzlies in their use agreement for the FedExForum have a noncompete and nonparticipation agreement, which I believe is not violated by this proposal and your counsel has taken the same position,” McLaren said. “However the Grizzlies raised an objection and in order to be good corporate citizens of Memphis my client has agreed to alter the proposal.”
McLaren said that the original proposal called for about $40 million to $50 million of additional development, including a 6,000- to 7,000-seat theater, and in its place they are proposing a 50,000- to 75,000-square-foot multiuse facility that will carry roughly the same price tag.
The new plans now call for no permanent seating, only hosting concerts and theatrical shows produced by EPE, and the removal of a $1 surcharge on certain events.
Graceland Holdings LLC managing partner Joel Weinshanker, in Memphis earlier this month to meet with Shelby County Commissioners, told them Sept. 6 that the venue was not an attempt to compete with FedExForum for concert business.
“The event center is not looking to usurp any other venues in the city and county,” Weinshanker said at the time. “A lot of what we are going to do is create new opportunities.”
He also said the Whitehaven venue might compete in some limited way with the 10,000 seat Landers Center in Southaven, 10 miles south of Graceland, that has drawn quite a number of concerts drawing smaller crowds in recent years.
The altered plan for the venue also changes a plan to generate money for overall development in the city.
“In negotiations with the city on that project, Graceland had agreed to donate $1 per ticket sold other than on community events to EDGE for a period of five years after the expiration of the TIF,” McLaren said.
Now, McLaren says that is no longer economically feasible.
“It is a different project, instead of having 60 to 75 or more events a year where you have musical shows (and) concerts, this facility will be focused more on what Graceland does where they are the producer and you’re just not going to have the same revenue,” he said.
To offset some of the revenue discrepancies, EPE is seeking to increase the TIF percentage to from 50 to 65 percent.
The per seat surcharge on non-community events in the venue was to go to a fund controlled by EDGE for use in development projects citywide at the discretion of EDGE. The surcharge would have generated an estimated $300,000.