The Pelicans’ Smoothie King Center lease expires in 2024. Here’s what they have planned.

The Smoothie King Center turned 23 years old in October. There are no signs that the Pelicans will vacate it for a new arena any time soon.

The Pelicans’ lease at the Smoothie King Center expires on June 30, 2024. With roughly 18 months remaining on the deal, every indication from team and state representatives is that the Pelicans will exercise their option on an extension to remain at their downtown arena for most, if not all, of the 2020s.

“Their intention is to extend the lease,” said Doug Thornton, the vice president of stadiums for ASM Global, which oversees lease negotiations with the Pelicans for the state’s Louisiana Stadium and Exposition District (LSED). “We’re going to determine what capital improvements need to be made. We’re always putting money into the arena. The question is how much?”

In February, Pelicans president Dennis Lauscha said the Pelicans can extend their lease at Smoothie King Center for up to five years, which would give the team time to figure out a “long-term plan.”

The New Orleans Saints and the state are already sharing the cost of a $450 million renovation of the Caesar’s Superdome, which is expected to be completed in 2025. Gayle Benson, the owner of the Saints and Pelicans, said at the NFL annual meeting in March that she wants the renovation of the Saints’ stadium to be finished before she shifts her attention toward the Pelicans’ arena situation.

The Smoothie King Center opened its doors in 1999 at a price tag of $114 million, which is $204 million in today’s dollars.

Thornton estimated building a new arena for the Pelicans would cost $800 million.

A handful of deep-pocketed NBA owners have financed new arenas themselves over the past few years. The Golden State Warriors paid $1.4 billion to build Chase Center, which opened in 2019. Steve Ballmer, the former Microsoft CEO who owns the Los Angeles Clippers, has shelled out $2 billion of his own money to build the Intuit Dome, which is set to open in Inglewood in 2024.

The Bensons bought the Hornets, whom they rebranded the Pelicans, for $378 million in 2012. The team is now valued at $1.6 billion, according to Forbes. 

Forbes estimates Benson is worth $4.7 billion. However, most of her net worth is tied up in assets. Compared to the rest of the NBA’s majority owners, Benson is relatively cash-poor.

“At some point, you may want to look to build a new arena,” Thornton said. “I don’t think that’s imminent, though. I don’t think that’s between the next three to five years. They (Pelicans officials) have every indication of extending their lease. They have talked about extending their option for five years, which they have under the lease agreement. During that time, we will maintain an upgrade to the extent we can.”

NBA commissioner Adam Silver has already made a trip to New Orleans this season. Those who interacted with him came away with the belief that he was pleased with the direction the Pelicans are headed, on and off the court.

In 2013, shortly before he took over for David Stern, Silver said the Bradley Center, the then-home of the Milwaukee Bucks, was unfit for the NBA.

Five years later, the Bucks moved into Fiserv Forum, a new arena that cost $524 million. Taxpayers were on the hook for $250 million of that project. The remaining $274 million was privately financed. 

Smoothie King Center was built entirely with state funds.

In October, the Pelicans played a preseason game at Legacy Arena in Birmingham, Ala. Multiple Pelicans players remarked that Legacy Arena seemed nicer than their home arena in New Orleans.

The Birmingham Squadron, the Pelicans’ G League affiliate, has called Legacy Arena home for the past two years. The Pelicans relocated their G League affiliate from Erie, Pa., to Birmingham in 2021 on the heels of a $125 million renovation of Legacy Arena, which was financed by a bond sale.