Grammys to Return to Los Angeles' Staples Center After 2018 New York Show: Exclusive

In January 2014, during the run-up to Super Bowl XLVIII in New Jersey, the real action was taking place across the river in Manhattan, where the city had transformed into a weeklong pregame party. Jay Z, Drake, Kendrick Lamar and the Foo Fighters were ­headlining nearby concerts, and Times Square had been renamed "Super Bowl Boulevard."

Amid the fanfare, Alicia Glen -- a former Goldman Sachs executive who had just become a deputy mayor with the then-new administration of Mayor Bill de Blasio -- attended NFL commissioner Roger Goodell's annual pregame Super Bowl party at the Museum of Natural History. There, she was approached by Jonathan Tisch, co-owner of the New York Giants and co-chairman of the board of Loews Corp.

"You see how great these events are for the city?" Tisch asked. "Why don't we team up to bring the Grammys back to New York?"

Three years later, according to multiple sources close to the ­negotiations, the Grammys are indeed set to return to New York's Madison Square Garden -- for just the second time in 17 years -- for the show's 60th anniversary in 2018. The deal is all but done, city sources say, and a formal announcement will be made after this year's ceremony. But sources close to the situation tell Billboard that after that New York sojourn, the Grammys will return to the Staples Center in 2019, as part of a multi-year extension of its most recent agreement. 

After all, the Grammys have developed a cozy relationship with their Los Angeles base, particularly the awards-show-friendly Staples Center. While the ceremony ­essentially traded off between L.A. and New York for its first three decades, that ended in the late 1990s after a very public spat between then-New York Mayor Rudolph Giuliani and then-Recording Academy chief Michael Greene, which spiraled into threats and insults after Greene refused to allow Hizzoner to read the list of nominees at a news ­conference promoting the awards show. "If they want to go back to L.A., they can," said Giuliani in 1998. "We could replace the Grammys in about a day."

But by 2014, New York wanted them back. The Grammys bring an estimated $82 million bump to its host city's economy, according to a report from the Los Angeles Tourism and Convention Board; the mayor's office says the total could be as much as $200 million in ancillary ­spending. That summer, Tisch ­introduced Glen to Recording Academy CEO Neil Portnow. The Grammys' agreement with Staples was up for renewal in 2017, and native New Yorker Portnow was interested.

But discussions lay dormant as de Blasio became ensnared in a series of investigations into his fund-raising, which left City Hall reluctant to ask would-be donors for contributions. The calculus changed at the start of 2016, when Julie Menin, a longtime civic activist who worked to revitalize Lower Manhattan in the years after 9/11, was named to head the Mayor's Office of Media and Entertainment; just as she was appointed, her ­department's purview grew from film and TV to include a number of other creative industries, especially music.

In February, Menin flew to L.A. to meet with The Recording Academy. According to sources familiar with the negotiation, the academy balked, mostly because a show in New York would require an additional $6.5 million in costs due to increased production, labor and venue expenses.

City Hall declined to offer up funds, so Menin set about raising the money from private ­interests, enlisting Related Companies, a major real estate developer in the city, to invest, along with Spotify, ­consulting company Accenture and the Partnership for New York City; she also negotiated with labor unions for concessions on costs. Not every union was ­willing, however, so final costs ended up rising to $8 million, ­according to a source -- a figure Menin promptly matched by a new round of solicitation.

"She came to us looking for some help, and we did our best to ­accommodate," says James Claffey, president of Local 1, the stagehands union for MSG. Claffey offered flexibility on call times and meal times that the Grammys sought. "Honestly, I did not think Julie would pull it off," he adds. "She was remarkable."

The toughest knot of all, however, was the venue and its executive chairman James Dolan. The Grammys require the arena to remain dark for nearly two weeks as the set is built and taken down.

"It's a pain in the ass for them," one person involved in the ­negotiation tells Billboard. "It's a money loser." Another source says Dolan declined to meet with de Blasio or New York Governor Andrew Cuomo, since the ­latter two have a long-running feud and Dolan did not want to get involved. But Irving Azoff, Dolan's business partner in Azoff-MSG Entertainment, had been in touch with New York Attorney General Eric Schneiderman -- a neutral party in the feud -- who reassured Dolan and Portnow that the city and state would adhere to whatever was agreed to, says a source. MSG also requested that the Grammys be presented "in the round," which would allow it to sell more luxury suites and help make up the ­financial shortfall for the remaining 11 dark days. Why was the venue so ­cooperative? Not ­coincidentally, Azoff-MSGE also runs the Staples Center's fiercest competitor: The Forum. (Representatives for The Recording Academy, Azoff, MSG, Staples Center owner AEG and City Hall declined requests for comment.)

All seemed positive until the eve of a get-to-know-each-other dinner with the stakeholders -- representatives from MSG, Tisch, Claffey, Menin, Portnow, the CEO of the corporate sponsors on the host committee and reps for the academy -- when The New York Times reported the Grammys would be returning to New York. "It put a bit of a strain on the dinner," says one attendee.

While reps for the academy and the city declined to comment beyond statements like Menin's to Billboard -- "We're having ­productive ­conversations" -- and sources close to the academy insist the deal is not final, the Grammys are ­conspicuously doubling down on their presence in New York. In December, the academy purchased a $13.5 million Manhattan townhouse to serve as a new local headquarters; on Feb. 7, it announced the ­opening of the first East Coast Grammy Museum at the Prudential Center in nearby Newark, N.J.; and on Jan. 30, Menin was a featured speaker at a Grammy reception for New York nominees at the Standard Hotel.

Even if, as multiple sources confirm, the Grammys are held in New York next year, a longer-term ­arrangement may take more fund-raising and finagling in light of the Academy's deal to return to Staples in 2019. Still, says one source, "More than just a one-off is everyone's hope."