KeyArena keeps sponsor for 2 years

The city of Seattle has regained $615,000 of $2.3 million lost in naming-rights revenue when KeyCorp agreed to renegotiate its deal and continue as the title sponsor of KeyArena.

"We have found Key to be an outstanding corporate citizen and we're delighted to continue our partnership," Seattle Center Director Robert Nellams said in a statement.

When the city accepted a $45 million buyout that allowed the Sonics to move to Oklahoma City, it terminated a 15-year deal signed in 1995 with KeyCorp that generated $1.1 million in revenue in 2007.

City officials approached the Cleveland-based bank in September and the two sides settled on a two-year deal in which KeyCorp pays the city $300,000 next year and $315,000 in 2010. The agreement is subject to approval by the City Council, which will vote in December.

The city was forced to offer a substantial discount to KeyCorp after losing the Sonics and minor-league hockey's Seattle Thunderbirds. The Storm is the primary tenant of the arena at Seattle Center.

"My Century 21 Committee has provided a bold and exciting vision to enhance and update Seattle Center as it nears its 50th anniversary," Mayor Greg Nickels said. "We're now working to turn this vision into a reality, and KeyArena plays an important role. This agreement reflects the confidence that we share in the future of KeyArena."

Still, KeyCorp is taking a wait-and-see approach before it begins negotiating a sponsorship agreement beyond 2010.

"There's a lot of unknowns about KeyArena at this time," Seattle Center spokeswoman Deborah Daoust said. "Will we have another NBA franchise? Will the city be successful in getting the funding for major renovations? Both sides are keeping their options open."

Percy Allen: 206-464-2278 or pallen@seattletimes.com