Simon family expands footprint near fieldhouse

For decades, Herb Simon’s primary investment downtown was his ownership of Pacers Sports & Entertainment and management of Gainbridge Fieldhouse, the city-owned basketball facility where the Indiana Pacers and Indiana Fever play.

But in the past few years, Simon and his family have expanded their investments and holdings in downtown’s Warehouse District.

Their latest project is the most significant yet—a planned hotel and 4,000-seat live-performance venue at the corner of Georgia and Pennsylvania streets, where a former CSX Corp. building now sits empty across the street from Gainbridge Fieldhouse. The Simons originally planned to build apartments along with the hotel at that site.

The July 18 announcement about the $300 million revamped project—which could open in late 2027—comes just six months after the Simons opened the $20 million Commission Row, a 30,000-square-foot dining and entertainment complex.

Commission Row is adjacent to Gainbridge Fieldhouse, where a $400 million, three-year renovation was completed a few months before February’s NBA All-Star Game. That project—to which the Simons contributed $65 million—includes the 1-1/2-acre Bicentennial Unity Plaza, which opened last August.

In April, the Simon family paid $10 million to acquire a nearby parking lot that is key to Mayor Joe Hogsett’s plans to build a soccer stadium and attract a Major League Soccer team to the city. Simon and his family have so far remained mum about their plans for the property and whether they plan to invest in the MLS effort.

Plans for the CSX site, however, are coming into focus. In 2022, Boxcar Development LLC—the investment group led by the Simon family—filed a preliminary plan to demolish the century-old CSX building and replace it with two high-rise buildings containing a hotel, apartments and retail space.

That proposal carried an estimated price tag of $250 million.

But in additional discussions with city and state leaders about what would best fit the site and help grow downtown, the investment group shifted its focus.

Details and costs for the entertainment portion of the project are being finalized. But Boxcar Development has reached an agreement in principle with international promoter Live Nation Entertainment LLC to operate the facility. Already, Los Angeles-based Live Nation—which did not return a call and an email requesting comment for this story—manages two downtown venues, the Murat Theatre at Old National Centre and Everwise Amphitheater, along with Ruoff Music Center in Noblesville.

Filling a gap

Experts say Boxcar’s planned 87,000-square-foot live-performance hall could bring something new to the downtown market—a year-round option for mid-tier acts that can’t fill the 18,000-seat Gainbridge Fieldhouse (let alone the 70,000-seat Lucas Oil Stadium).

“My initial thoughts were that Indianapolis already has so much” in terms of music venues, said Steve Sybesma, a longtime concert promoter who was a partner in the creation of Deer Creek Music Center, now Ruoff. “Then I got to thinking about it and, you know, it’s going to fit a niche. It’s a good-sized venue, and you can put a lot of stuff in there.”

He said while he views the Simons’ efforts as “more of a real estate play” than anything else, he expects the venue to drive significant traffic to Indianapolis, particularly in colder months.

Julie Goodman, CEO of the Indy Arts Council, also said the venue “will be a positive addition to downtown” but noted that understanding the deeper impact such a facility could have on the overall music scene could take time.

She said the Arts Council plans to complete a comprehensive venue assessment by the end of the year. It also has concluded a survey for a separate strategic planning process, taking responses from more than 2,500 residents across central Indiana.

Phil Bayt, an Ice Miller LLP attorney who represents the Simons on the project, said the family became open to the idea of incorporating an entertainment venue into its project after it learned Live Nation was considering a project of its own. The Simons decided then to scrap the apartment portion of the CSX-site project in favor of a focus on entertainment.

“Since we did not have anything finalized with respect to the apartments, we immediately touched base with the folks at Live Nation, with whom PS&E has been doing business for 40 years. So it was an easy and … very exciting conversation, and there was a lot of enthusiasm in the room,” Bayt said.

The CSX building, built in 1923, is also known as the Indiana Terminal warehouse building. The five-story, 231,400-square-foot structure, which is connected directly to a rail line that crosses over Pennsylvania Street, has been used over the years as offices, shops and storage.

Designed by notable Indianapolis architectural firm Rubush and Hunter, it has a reinforced concrete frame and brick exterior walls. While some of the design elements might translate to the new structure, the existing building is expected to be razed. Kansas City-based Populous Design is leading architectural work on the entertainment venue.

Entertainment district

The new concert space would complement Gainbridge Fieldhouse’s much larger space. The city’s Capital Improvement Board owns the fieldhouse, but it pays Pacers Sports & Entertainment to operate it. This year, that compensation amounted to $12.5 million.

Rick Fuson, an adviser to Herb Simon, declined to say how much profit the Simon family earns from Gainbridge operations. But PS&E is required to share some data with the city.

According to annual reports, Pacers Sports & Entertainment generated $66.2 million from non-Pacers and non-Fever events at the fieldhouse from July 2018 to June 2023.

During that same period, PS&E had $89.4 million in expenses for those events—a deficit of $23 millions, averaging about $4.6 million per year.

A final report for the most recent fiscal year, which ended June 30, was not immediately available.

The addition of Commission Row and the planned venue at the CSX site will help develop the southeast corner of the Mile Square as an entertainment destination. That will continue if the city develops a soccer stadium just east of Gainbridge on a site that includes the Indianapolis Downtown Heliport and the Simon-owned parking lot.

A soccer venue, which would also be owned by the CIB, would likely include 20,000 to 30,000 seats—filling the venue gap between the 18,000-seat Gainbridge and 70,000-seat Lucas Oil Stadium.

Nearby, separate development plans are still in the works for a smaller facility similar to The Vogue in Broad Ripple. That venue from promoter Forty5 would seat 500 to 3,000 people and was initially part of the redevelopment of the Jail II campus west of Elevator Hill. But the group is now considering an undisclosed site nearby for the project.

Goodman said she expects the Arts Council’s analyses will find other gaps in terms of venue sizes, as well as amenities, access and affordability. But she said the Simon additions help.

“Indianapolis is better for the Simon family’s leadership and investment—past, present and future,” she said in an email to IBJ. “They sit at a unique intersection of expertise and excellence in sports and arts, culture and entertainment. We see exciting synergistic opportunities from their current and prospective/potential future investments in both sectors.”

But Josh Baker, owner of the 400-seat venue Hi-Fi in Fountain Square and president of local music promotion firm MOKB Presents, said that while he’s eager to see a new use for the CSX property, he’s not sure the planned size of the entertainment space is what the city needs most.

“It’s great in that the corner and block needs something, and downtown has long needed entertainment venues,” he said. “But I think 4,000 [seats] is a bit big, because there’s no real underground or 500- to 1,000-capacity spaces downtown that are helping cultivate that music scene.”

MOKB Presents won’t be able to book acts into the venue because it will be controlled by Live Nation. But generally, MOKB focuses on working with artists for lower-capacity venues. Still, Baker said, Live Nation’s size—it manages more than 370 music venues around the world—allows it to book dozens of venues at a time, which doesn’t leave much room for smaller companies to compete.

“It creates a lot of challenges anytime there is someone of that nature trying to control the market with deep pockets and all the resources that they have,” Baker said of Live Nation. “We love a good fight, and we’re not afraid to go out there and do our thing. But at the same time, anyone trying to go against Live Nation is at a pretty serious disadvantage.”

Live Nation, which merged with Ticketmaster in a $2.5 billion deal in 2010, has long been criticized by regulators and ticket buyers as having a virtual monopoly on the entertainment industry in the United States. In May, the U.S. Department of Justice filed an antitrust lawsuit against Live Nation in a bid to break up the company and bring down costs for consumers. That suit is ongoing.

Fuson, who retired as CEO of Pacers Sports & Entertainment in June after 40 years with the company, said Live Nation has a key role in the Simons’ new venue efforts and they view Live Nation as a “great partner in the whole region.”

Live Nation works “with all kinds of different acts, and there’s no question about it—there’s no way they wouldn’t work with local acts, and therefore I believe [working with the company on this project is] a very positive thing,” he said. “We’ve had a longtime relationship with Live Nation and have been working on this project for years, and that’s where we’re headed.”•

Clarification: A sentence with information about the expenses Pacers Sports & Entertainment incurred staging non-Fever and non-Pacers event has been added to the story.