NEW YORK (TheStreet) -- To make a hash of the baseball movie Field of Dreams: "if you renovate it, they will come." That's certainly true of Madison Square Garden (MSG), which invested almost $1 billion to remodel its New York City arena.
"The World's Most Famous Arena" re-opened on Oct. 25. The payoff has been increased attendance -- typically capacity crowds -- at National Basketball Association and National Hockey League games for the New York Knicks and Rangers. The company continues to see record revenue and profits and an increase in its share price. But something that may happen 10 years from now should be on investors' radar.
After MSG spent about $980 million on a three-year renovation project, the city of New York appears ready to push the iconic arena out of its current location.
MSG owns the arena, but not the land underneath it. That is owned by the city of New York. This year the company was given a 10-year lease limit on its current location, where it has hosted sporting and entertainment events since 1968.
The New York City Council voted 47-1 in favor of the 10-year lease. The given reason for the short term was the need to update Penn Station, the busiest passenger train station in the U.S., located directly below the Garden. The city says it needs the arena to move to allow renovations to the high-traffic rail line and to improve transit access.
The planning commission had recommended a 15-year lease extension. MSG wants to operate there in perpetuity. Instead, the Garden will have to go through the same lease-approval process or vacate the space in 10 years.