That is because the team announced on Monday that they have pulled out of a $140 million project that was set to upgrade Quicken Loans Arena. The facility, which is one of the oldest in the league, was set to undergo a transformation that would have helped bring the All-Star Game to Cleveland in either 2020 or 2021. Via Cavs.com:
The Cleveland Cavaliers announced today the cancellation of their participation in The Q Transformation Project of the publicly-owned Quicken Loans Arena, which would have:
- Significantly upgraded one of the oldest arenas in the NBA
- Make it more competitive for the long term with other nearby midwestern cities and national venues to maintain and attract additional events
- Created over 2,500 project-related construction jobs
- Grown The Q's permanent job base to 3,200
- Increased tax revenue to the City's General Fund and neighborhoods
- Extended the Cavaliers lease for The Q to 2034
- Help maintain state and local taxes such as the $44 million in 2016 and potential growing tax revenue source to Cleveland through 2034
- Rehabbed 40 gym courts and floors in the city of Cleveland's rec centers and all Cleveland Metropolitan School Districts high schools
- Brought an NBA All-Star Game to Cleveland in 2020 or 2021 along with its $100 million+ economic impact
The $140M for the project was set to be split between the Cavaliers ($70M) and the public ($70M), but a referendum has been placed on the ballot which would delay the project, and because of rising costs with the delay, the Cavs decided to back out.
Construction on the $140 million publicly-owned facility project was to have started this past June, but had been delayed due to a prospective referendum being placed on the ballot by the Washington, DC-based Metro Industrial Areas Foundation represented locally by a group calling themselves the "Greater Cleveland Congregations" (GCC), Service Employees International Union District 1199 and the Cuyahoga County Progressive Caucus.
The prospective referendum will cause the groundbreaking of The Q Transformation to miss the current construction cycle, which pushes the overall price tag of the project higher due to rising construction costs. In addition, a time sensitive financing package that included historically low interest rates would be negatively impacted by further delay due to a prospective referendum exposing the project to an expected higher interest rate environment.
There is likely much truth to the rising costs due to the delay on construction, but there is also the "conspiracy theory" that this is another sign LeBron James is leaving town next summer, and with LeBron taking the Cavs' title chances with him, Dan Gilbert does not want to pay to upgrade an arena that will be half-empty on many nights. Obviously for now the only explanation that we have comes from the Cavs.